The Ledger (ex Candlesticks thread)

[SOCRATES]

As to some sort of ledger which hold the secrets to the markets, i have my doubts about that. If there were such a thing and revealed the secrets, then i would not be expecting you to frequent these boards.

With such information there must be some responsability attached to it. I dont mean to share it but atleast to keep its mere existence a secret, rather than dangle the knowledge of its supposed contents to create a longing within the minds of traders.

Everyones experience and interpretation is unique to themselves, regardless of Gann, Elliot,Wykoff and anyone else. Why else do they all have a different approach? (I dont know but assume so because i know there are many different aproaches.)

Please rest assured that i am not doubting your ability or success as a trader, you say a lot of things that obviously a very experienced and knowledgable trader would say, but i am under the impression that most who frequent some boards are looking for a little piece that may be missing to complete the jigsaw, (hey guys dont take offence, just an observation.)

Just my two pence worth, and no offence attended.


Thank you

Think deeply. Think as deep as you can, and when you have done that, come back to me again.

There is plenty of time, no rush.

I am taking a few days off, I have important matters to attend to.

 

[Citizen2007]

Think deeply. Think as deep as you can, and when you have done that, come back to me again.

There is plenty of time, no rush.

I am taking a few days off, I have important matters to attend to.

Sorry Socrates. There is nothing to think about. Why would i want to waste my time thinking about what you may or may not know ?


I know people who started thinking and they are still doing it years down the line. I am sure you know many too.

Your perspective is your own.

It works for you to the extent that you allow it to or want it to. What good is it if it does not deliver the results.


Reading some of your articles, I understand what message you are trying to convey, but that is just ONE way of looking at it. It is not the only way. People can arrive at the same destination via differnet journeys. As a trading coach i am sure you are fully aware of this.

I gather fron some of the readings that you are a strong advocate of intuition, and maybe that is the message that you are trying to convey in your posts. Viewing trading from a psychological/intuitive approach - totally .


Please correct me if i have misunderstood.

Thank you

 

[Citizen2007]

There is a very fine line dividing sense from nonsense.
The great majority are unaware of its existence, or, choose to ignore it. Consequently they succeed in misdirecting themselves to choose the wrong side of this line, for reasons best known to themselves. This is a source of amazement to those very few able to correctly logically deduce and reason, viewing nearly everything you will encounter here as nonsense, pure nonsense, that the majority ultimately embrace.


I like your signature.

But how do you or i know what side of the line we are on. There is logic on both sides and advoctes for both sides.

Who is the judge ?

The prizetaker ?

or the thinker?

 

[peto]

Yes, I will explain again with pleasure.

For spreadbetting, with the games played by the spreadbetter companies aganst the public betting their pennies, crystal balls are needed, because you need to have extra pairs of eyes all the time.

For real trading, and for writing naked and for other operations, titanium balls are needed, as the requirements are very different.

I hope and expect this clarifies...

You cannot complain that I do not tell you everything...

With all respect Socrates, this clarifies nothing. The question concerned the apparent contradiction between your assertions last year:

Therefore I always use a ridiculously tight stop. I expect any pozzie to get at the money immediately, and in the money very quickly.
http://www.trade2win.com/boards/showpost.php?p=247253&postcount=17

and

The concept of "breathing room" is a blanket excuse used by inefficient traders to justify their uncertainty or to assuage their insecurity, or often both. Curiously there are some market personalities ( I will not mention names so as not to inflame, but those of you up to date with events will clock this) who advocate the use of stops in this way. One particular such person insists that a stop should always be placed below the last low when going long and above the last high when going short.

This point of view only encourages ineficcient traders to be more inefficient than they would otherwise be, because it leaves an opportunity available for a large bite to be taken out of the value of the position if an unexpectedly severe countermove develops suddenly.

This would not occur if the stop in the first place was really tight. This idea of "breathing room" is fiercely defended by entities who argue it is valid because it protects the position against a temporary reversal, or against sudden volatility, or against during the progression of the move a retracement to a level along a supply demand line, or a support or resistance level, or a Bolly or any other mechanical marker.

The argument is that this practice is not professional at all, and in consequence is not proficient either, or even advisable, but there you are.

It is not professional because it is amateurish, simply put. A professional posture is to commit with flawless timing at the right price. Then the stop however tight does not get hit.
This is because the expected progression is manifest immediately in line with the expectation, which is different to hope. This applies to absolutely every timeframe, so there are no excuses.

This further reinforces the reason why really expert traders always use tight stops, whether logged or held in the head, as I have said before, the information shock delivered when a position turns out to be wrong, for whatever reason, meaning, for example that the posture taken at the time was indeed correct, but suddenly an unexpected development arises making the original posture taken totally incorrect, then the tight stop is there to cut the loss quickly.

http://www.trade2win.com/boards/showpost.php?p=234613&postcount=78

and your latest stance:

How many times do I have to explain here that none of this is vending and that in fact, it is anti vending as none of us are interested in recruiting at all, because not everybody has the deep pockets and the titanium testicles required ?.

A view which you seemed to demonstrate with your posted trades, many of which moved drastically out of the money at one point.

Have you changed your views recently?

 

[the blades]

Yes, I will explain again with pleasure.

For spreadbetting, with the games played by the spreadbetter companies aganst the public betting their pennies, crystal balls are needed, because you need to have extra pairs of eyes all the time.

Many thanks for the clarification, and further inflation of my ego. As we're told that "95%" of traders fail, overlay on this "the games played by spreadbetters", and I can only conclude that I am a genius to still be in the game

My stakes are now upped from 20p, to 25p per point - and all down to you

UTB

 

[The General]

Soc,

Why do you state 'You have to learn to push your own envelope. You do this by applying deep and incisive thought instead of allowing the thinking to be done for you' when apparently that is exactly NOT what you have done.

Apparently You have NOT learned to push your own envelope and HAVE had the thinking done for you in the form of supposed market masters' writings....

If this is not a contradiction, please tell me what is. Also, presumably as you clearly rate yourself above all else here seemingly, was it not an insult to your intellect to NOT have been able to work out the secrets of the market universe yourself ?

Eagerly awaiting a lesson in English. If you like, I can print and bind this reply in a leather-bound journal measuring approximately 5 by 8 if that means you will take more notice....

 

[Hoggums]

"It is not professional because it is amateurish, simply put. A professional posture is to commit with flawless timing at the right price. Then the stop however tight does not get hit.
This is because the expected progression is manifest immediately in line with the expectation, which is different to hope. This applies to absolutely every timeframe, so there are no excuses."

Socrates obviously lives in this hypotheical world where there are no uncertainties and price action is governed by black and white principles. Such rhetoric is theoretically ideal but cannot be translated into any practical strategy.

Such advise and attitude will lead to a string of mounting small losses as the market moves against your "expectations".

Do you think Warren Buffet ever ran tight stops? If you are convinced an instrument is going to move in a direction imminently take your position. And if it moves against you, provided the same conviction still exists it makes no sense to close. Only if your conviction is waivering because of this move, should you close.

There are no certainties in trading, every situation requires it's own evaluation and such advise coming from someone who professes to know so much, frankly, you should know better.

 

[A Dashing Blade]

TBH I think Socrates has a very valid point here.

However I'd clarify/enhance his stance by pointing out that the concept of "tight" is, of course, relative to the time frame within which you trade.

 

[The General]

All well and good but Soc is preaching one thing and utilising another (please refer my previous post 2 or 3 above).

This could all b e sttled, Soc, quite easily without you divulging any secrets, just post something which shows that you do, indeed, understand the mechanics of the market and furthermore that of the market masters.

You claim that you want to elude to us trainees how the market works, but so far you (seemingly) have only eluded to the fact that (apparently) your alleged success is as a result of being the proud occupant of a masters' writings, which is in distinct contradiction to your statement that we should all do our own work and not wait for it to be done by someone else.

It must be strange what goes on between your ears, because the above is a clear contradiction of what you previously stated.

For the last time, to be taken seriously, put simply, stop waffling and show us all what can be done within these markets we love so much, as I'm afraid without it you will be classified the same as Kermit and Miss Piggy.

Now surely, showing the RESULTS of what you have learned (as distinctly opposed to what you have discovered yourself) does not contravene your solemn oath of silence....

 

[Hoggums]

TBH I think Socrates has a very valid point here.

However I'd clarify/enhance his stance by pointing out that the concept of "tight" is, of course, relative to the time frame within which you trade.

Socrates statement implies that you can set your stop to 1 pip below your opening because you expect to profit immediately from your trade.

I've no doubt that tight stops are a good mechanism for a lot of people particularly if you are a scalper, by definition you are looking to profit immediately from a quick trade. A tight stop removes the emotional thought over whether to close or not when the trade turns bad.

The problem I have is I don't scalp - so it's not always for me, - but this doesn't make me "amateurish" as socrates suggests. It is not always a valid case to run tight stops with longer term trading. Longer term - by running tight stops, you are in fact demonstrating that you either have no confidence in your analysis & conviction or you are over leveraging yourself because you can't handle the loss. How many times have you read a post on here where someone has got closed out on a trade only to find out that they would have profitted (further) had they not got "scared". Yes your stops should always be tighter than your expected/anticipated "take profit" level but sometimes it can take hours/days or weeks for the expected breakout/resumption of the trend to appear. You enter at the time you think is best to profit, but it's not always right. I reassess the trade constantly but some sideways movement or volatility shouldn't close the trade out provided my original analysis still holds true. Therefore my stop is not so tight as to close me out before my analysis has been proven right or wrong - wether it's a tight 5 pips or 500 pips.

It's all a question of risk (in terms of pips) vs likelyhood that the trade will be profitable. The larger the stoploss the greater the chance the trade will turn profitable. But the larger the stoploss the smaller the trade size should be - and therefore the smaller your anticpated profit. I'm not "hoping" my losing trade will turn profitable - I only keep open trades where I believe it is more likely to turn profitable than to remain or go further negative. As a trader you have to find the level you are comfortable with. For soc it's a few pips seemingly regardless of all other considerations. I'm just trying to put the other point across.

 

[Splitlink]

A close stop also gives one the opportunity to enter the trade, again. at a lower level (if one is buying). What you suggest is that one should give the trade some breathing space. However, one can, still, have confidence that the planned trade is correct and be out of it until a better entry level occurs. Breathing space that gives me too much time before any action occurs is not acceptable to me, either. I'd sooner be doing something else.

What is wrong with entering a trade a few times if one can, really, control very tight stops? Getting stopped out of a far away stop after waiting for a relatively long time can be more frustrating.

Split

 

[A Dashing Blade]

Socrates statement implies that you can set your stop to 1 pip below your opening because you expect to profit immediately from your trade.

Depends on your timeframe, for scalping sure, but for those who hold (say) equities on a (say) 3 month timeframe (implying that your chart granularity is probably daily rather than 5 minutes) the definition of "tight" changes . . .

 

[The General]

Gamma Jammer and Hoggums,

Why aren't you asking the obvious questions of Soc ?....

Well, as no one else is prepared to, I will...

Soc, I will pay for you to fly here (Sydney) from anywhere in the worl and put you up in a hotel for a week, just for the opportunity to look you in the eyes.....that's all I need....from that I will be able to tell if you're spinning....

I earn a shedload of money so it's no problem for me. Just say the word...All paid for...

This is a GENUINE proposal. Let's see what the answer is......

 

[chump]

Isaac Newton said ,
"What Des-Cartes did was a good step. You have added much several ways, and especially in taking the colours of thin plates into philosophical consideration. If I have seen a little further it is by standing on the shoulders of Giants."

To take what others have done and then to think further on how to apply and develop same is one very real way of utilising the work of others and of also doing your own work. In plain English we call it not 'reinventing the wheel' and I always thought that this is what Socrates has been alluding to ..I'll stand corrected ,no problem , if I have misunderstood in that respect.

Edit....is the ticket to OZ etc generally applicable ,if so I'll get my application in ,but could we make it Brisbane and I'll spring for your ticket from Sydney.

 

[Splitlink]

Gamma Jammer and Hoggums,

Why aren't you asking the obvious questions of Soc ?....

Well, as no one else is prepared to, I will...

Soc, I will pay for you to fly here (Sydney) from anywhere in the worl and put you up in a hotel for a week, just for the opportunity to look you in the eyes.....that's all I need....from that I will be able to tell if you're spinning....

I earn a shedload of money so it's no problem for me. Just say the word...All paid for...

This is a GENUINE proposal. Let's see what the answer is......

You are willing to pay very high price just to satisfy your curiosity. Of equal importance, though, is whether it is worth his time to satisfy it, as it does entail looking into your eyes, as well.

Split

 

[Charlton]

A close stop also gives one the opportunity to enter the trade, again. at a lower level (if one is buying). What you suggest is that one should give the trade some breathing space. However, one can, still, have confidence that the planned trade is correct and be out of it until a better entry level occurs. Breathing space that gives me too much time before any action occurs is not acceptable to me, either. I'd sooner be doing something else.

What is wrong with entering a trade a few times if one can, really, control very tight stops? Getting stopped out of a far away stop after waiting for a relatively long time can be more frustrating.

Split

This is a very good point. For example, the bundled return trip minimum cost for my broker is $2. This charge is insignificant compared to even a relatively small price move in the wrong direction on a relatively small order. Furthermore, as you point out, there is also the opportunity cost to consider of using the cash elsewhere in a more productive trade, if the original one did not go to plan.

Thus from an economic viewpoint tight stops are good and give rise to better risk/reward ratios.

The only downside is the hassle of having to enter the trade again.

Charlton

 

[timsk]

I earn a shedload of money so it's no problem for me. Just say the word...All paid for...
This is a GENUINE proposal. Let's see what the answer is......

Yo General,
Would you like to look me in the eyes by any chance - I've always fancied a trip to Sydney. :cheesy:
Tim.

 

[The General]

Splitlink and others,

3 grand Aussie is nothing. That's what it would cost me...

You raised a point whether or not it was worth his while...well, there are two points to be made to that:

1. He should apparently be very rich by now (but if not I'll pay (seriously)), and,
2. If it's not worth his while, why post on our boards ? Because (and no offence) if I was in his supposed league, I wouldn't (obviously I am not hence...).

''fair Play I say.....Money and therefore flight tickets are in the bank eagerly awaiting Soc's reply (you and I know that may take some time)...

'Nuff said I guess.....

 

[Hoggums]

This is a very good point. For example, the bundled return trip minimum cost for my broker is $2. This charge is insignificant compared to even a relatively small price move in the wrong direction on a relatively small order. Furthermore, as you point out, there is also the opportunity cost to consider of using the cash elsewhere in a more productive trade, if the original one did not go to plan.

Thus from an economic viewpoint tight stops are good and give rise to better risk/reward ratios.

The only downside is the hassle of having to enter the trade again.

Charlton

Totally agree - this is a technique I do employ myself when I suspect a pullback is due. It does have it's own drawbacks too, sometimes the tight stop is hit but the market never gives you a point to re-enter and you end up worse off because you miss the next rally.

 

[The General]

Hats Off To Ya

Fair play then mate,

I totally understand, I was trying to make a point...I'm a very good judge of character and I'd happily pay 3k Aussie to put the guy up for a week juste to look him in the eye for 10o minutes...that's all I would need....