Best Thread How To Make Money Trading The Markets.

[spreader_legger]

Hey there Mr. Charts.

I have just read somewhere that someone at Bloomberg wanted to interview you, so you must be good.
Nevertheless, I just wanted to run by some things with you regarding your methodology.

At first glance, it appears to be very sensible and intuitive, however after several months of forward testing I am flummoxed .... perhaps I'm doing something wrong?

In any event, in my results, I had something like 1 outlier month, whilst the others were all slightly positive or negative .... needless to say that the commissions would have probably set the whole thing negative

In any event, this is what I did.


Every afternoon, I had a look at the ADVFN charts to see which ones trended the most over the course of the early afternoon & opted for the smoothest curviture

I then jumped into a continuation rally/shank (please delete as appropriate) to see what the results would have been. If I find my results, I could post them to you if you'd like .... be warned though .... there are literally hundreds of trades!!

Perhaps I am doing something wrong here & you could set me straight?

Many thanks.

 

[tradespreads]

Hey there Mr. Charts.

I have just read somewhere that someone at Bloomberg wanted to interview you, so you must be good.
Nevertheless, I just wanted to run by some things with you regarding your methodology.

BB are a bunch of lightweights.

I then jumped into a continuation rally/shank (please delete as appropriate) to see what the results would have been. If I find my results, I could post them to you if you'd like .... be warned though .... there are literally hundreds of trades!!

Perhaps I am doing something wrong here & you could set me straight?

Many thanks.

You shouldn't be trading that much unless you've actually bought a seat somewhere.

 

[spreader_legger]

BB are a bunch of lightweights.




You shouldn't be trading that much unless you've actually bought a seat somewhere.

Hundreds over 5 months of testing ... on average only about 3/4 trades a day. I mentioned the number simply to stress that we are dealing with a statistically significant number, and not simply something that has been cherry picked

 

[bm200906]

Hey there Mr. Charts.
Every afternoon, I had a look at the ADVFN charts to see which ones trended the most over the course of the early afternoon & opted for the smoothest curviture

I then jumped into a continuation rally/shank (please delete as appropriate) to see what the results would have been.
Many thanks.

I'm not clear on what you do......do you find some good trending stocks early afternoon and then jump into these for the rest of the day to see what the results would be at the end of the trading day (i.e. 9pm UK time)? This is NOT Mr Charts' approach.

And how do you decide how proportionately much to invest in each etc etc? (each will have a different risk level so splitting your investment evenly is too simplistic)

Each trade is very individual. An early trending stock may not continue to trend - it may completely reverse direction depending on markets conditions, news on that particular stock etc etc.

You should be watching for the trend to continue based on the price action and, ideally, get in and out and the best possible time - so you may only be investing for 30 seconds, or 10 minutes or 2 hours, depending on the individual stock and it's behaviour on a particular day.

If you're new to this game I would say you can only watch one stock at a time. Read the thread carefully - none of the examples involve investing in an early trending stock and looking at the result at the end of the trading day. This method is very active - you watch it carefully, get in (hopefully) at the right time, get out (hopefully) at the right time, take the profit and move on to the next.

(Also - pay careful attention to using the ATR when assessing risk & the number of shares to purchase. Each stock is different.)

 

[coopster]

I'm finding it difficult to find 3-4 trades per day that match this setup. Especially in the afternoon session. This to me is more often a first hour setup or at best, a last 1/2 hour setup. And then, maybe one per day, if at all.

Every afternoon, I had a look at the ADVFN charts to see which ones trended the most over the course of the early afternoon & opted for the smoothest curviture

This setup is also not really about the smoothest curvature. It often follows breakouts to new highs/lows after the stock has been trading sideways for some time. They are more momentum plays that continue after a quick trend forms, then retraces/pauses and then the momentum is enough to carry the price further.

In my opinion, this is a very level 2 / Time & Sales based setup which would be difficult to back test. Did you use level 2 in your forward testing? The results you have collected, might be useful and well done for documenting them all, but there is no way to know if the trade was justified without the level 2 information which is only really possible to document through video capture if you ask me.

Just observations, not criticism. Your commitment deserves credit! Even if it's just from a beginner like me.

 

[spreader_legger]

Cool. Thanks for the very succinct reply

I understand that you have adapted the basic premise of buying into a strong trend, after several consecutive green candles, or selling after several red candles.

You mentioned ATR, Price action, news events etc etc. I have however failed to find anything regarding these as a central tenet of Mr. Charts methodology, perhaps he expects traders to apply these at their own discretion. As things stand, these have not been explained very clearly here IMHO.

The premise of this thread I thought was .... look how simple trading can be. However without oulining these issues very clearly, I find the whole thing to be extremely misleading

As for exit criteria .... I just followed Mr Charts rules and trailed behind the candles.

Please note I did not set proportions of capital to these individual trades, as I would never dream of jumping into unproven methods.

Your approach is very sensible & no doubt you are successful at it. At no stage, however, have I understood this to be what Mr. Charts was outlining in this thread

I'm not clear on what you do......do you find some good trending stocks early afternoon and then jump into these for the rest of the day to see what the results would be at the end of the trading day (i.e. 9pm UK time)? This is NOT Mr Charts' approach.

And how do you decide how proportionately much to invest in each etc etc? (each will have a different risk level so splitting your investment evenly is too simplistic)

Each trade is very individual. An early trending stock may not continue to trend - it may completely reverse direction depending on markets conditions, news on that particular stock etc etc.

You should be watching for the trend to continue based on the price action and, ideally, get in and out and the best possible time - so you may only be investing for 30 seconds, or 10 minutes or 2 hours, depending on the individual stock and it's behaviour on a particular day.

If you're new to this game I would say you can only watch one stock at a time. Read the thread carefully - none of the examples involve investing in an early trending stock and looking at the result at the end of the trading day. This method is very active - you watch it carefully, get in (hopefully) at the right time, get out (hopefully) at the right time, take the profit and move on to the next.

(Also - pay careful attention to using the ATR when assessing risk & the number of shares to purchase. Each stock is different.)

 

[spreader_legger]

No worries Coopster

I'm new to trading stocks ..... and yet again, looking for stocks breaking out of a range very sensible IMO

I just followed some of TIMSKs's and Mr charts ealier advice when trialing this sytem out ... and again, Range breakouts weren't mentioned. All that I read was an admission by TIMSK that he had a tendancy of buying the highs of the day, or selling the absolute lows.

Actually, come to think of it, he did mention ATR from recollection

Just out of interest, how do you scan stocks that are ranging and likely to break out?

P.S you guys seem really sensible, & I'm glad you have been able to apply a more complete approach to trading stocks

I'm finding it difficult to find 3-4 trades per day that match this setup. Especially in the afternoon session. This to me is more often a first hour setup or at best, a last 1/2 hour setup. And then, maybe one per day, if at all.



This setup is also not really about the smoothest curvature. It often follows breakouts to new highs/lows after the stock has been trading sideways for some time. They are more momentum plays that continue after a quick trend forms, then retraces/pauses and then the momentum is enough to carry the price further.

In my opinion, this is a very level 2 / Time & Sales based setup which would be difficult to back test. Did you use level 2 in your forward testing? The results you have collected, might be useful and well done for documenting them all, but there is no way to know if the trade was justified without the level 2 information which is only really possible to document through video capture if you ask me.

Just observations, not criticism. Your commitment deserves credit! Even if it's just from a beginner like me.

 

[SanMiguel]

The premise of this thread I thought was .... look how simple trading can be. However without oulining these issues very clearly, I find the whole thing to be extremely misleading

Finally someone has seen the light.
The thread is littered with quotes of "go to my blog", "read back and you will see I have mentioned it many times", "don't be lazy" but the exact information is not there...only the setups and charts after the fact. You are not the first nor the last to wonder how the setups are scanned for only to get the response "I found it before the open".

The fact that Mr Charts has a website where you pay for services sets up a very strange dynamic and reason for this thread.

 

[DionysusToast]

Here's a suggestion for finding stocks to trade:

esignal scanner (can be used stand alone without eSignal)
www.madscan.com
www.marketguage.com (their hotscans product)

There are others I am sure - this should get you going though....

 

[gktk]

or www.trade-ideas.com almost limitless possibilities with a great support community ...and at $38 pm quite good value

 

[coopster]

Just out of interest, how do you scan stocks that are ranging and likely to break out?

I use the trade-ideas scanner also. I set it to look for new 1 day highs/lows and new 2 day highs/lows regardless of the pattern it forms leading up to it. I must admit, my scanning needs refining as i've mentioned before on this thread. I often get too many random hits which distract me from the useful ones.

I think what is not understood about this thread is that Mr Charts is not searching for this pattern. He is searching (i think) for stocks with interesting news or large moves earlier in the day/on a pevious day/premarket etc or the stock is one of a core list of favourite stocks and he trades this pattern when it happens to appear.

There is no real way to search accurately for this setup in my opinion. Refining the number of potentially interesting stocks using loose scans and news is as good as it can get.

Maybe the title is potentially misleading. I find it very difficult to make money trading with this or any other setup. The information in this thread did help me to know what others look for and where my weaknesses might be. That's all any free internet forum should do.

Sorry for butting in again Mr C. !

 

[spreader_legger]

Thanks for all your replies guys & for your suggetions

I guess the operative word here would be "you think". A system or methodology should be clear not ambiguous.

For instance what criteria does Mr C use to determine interesting news? Does he take wider issues into account? etc. He does not offer any suggestion as to his approach. Instead he remains extremely vague. Now I am not suggesting that this is purposeful & that his approach doesn't work, however, simply cherry picking winning trades and posting them on T2W quite frankly does not cut the mustard for me

If he had something worhtwhile to offer, then I would be very willing to purchase his services. As things stand, it seems that he is riding on the coat tail of the touted best thread as voted by readers hmmm :whistling

Incidentally, I would be very interested how this voting system works. Do some people, for instance, get more votes than others

I use the trade-ideas scanner also. I set it to look for new 1 day highs/lows and new 2 day highs/lows regardless of the pattern it forms leading up to it. I must admit, my scanning needs refining as i've mentioned before on this thread. I often get too many random hits which distract me from the useful ones.

I think what is not understood about this thread is that Mr Charts is not searching for this pattern. He is searching (i think) for stocks with interesting news or large moves earlier in the day/on a pevious day/premarket etc or the stock is one of a core list of favourite stocks and he trades this pattern when it happens to appear.

There is no real way to search accurately for this setup in my opinion. Refining the number of potentially interesting stocks using loose scans and news is as good as it can get.

Maybe the title is potentially misleading. I find it very difficult to make money trading with this or any other setup. The information in this thread did help me to know what others look for and where my weaknesses might be. That's all any free internet forum should do.

Sorry for butting in again Mr C. !

 

[Mr. Charts]

Many thanks to bm200906, coopster, toastie and gktk for your positive imput

I'll talk a little about other general market factors when time permits.

Richard

 

[spreader_legger]

Great !

I'm glad to hear it Timsk

I guess I have grown a little bit scepticle in my old age following the whole Jacko debacle on Forex Factory, where he was able to defraud a whole community following his stellar - yet manipulated results on another trading forum.

Just a little word of warning to everyone, especially the newbies out there .... caveat emptor. These forums are uunregulated, & for all you know Mr Charts could just as easily be Sharky's mother!

P.S I am eagerly awaiting Mr. Chart's response, which I am sure will be very carefully crafted

keep up the good work guys, you really take away from the real serious teachers out there who are willing to help newbies out

spreader_legger,
Voting is simple: one member - one vote and you may vote for whoever you want. Click on 'T2W Members' Choice Awards' in the Notices panel at the top of the page to register your vote.
Tim.

 

[amit1986]

Great job on ITMN

 

[Mr. Charts]

Thanks, Amit
Considering whether to post the chart on this site or whether it might upset too many people
Richard

 

[DionysusToast]

Thanks, Amit
Considering whether to post the chart on this site or whether it might upset too many people
Richard

It went up $5.50 - how much of that did you get ?

Is it enough to buy me lunch (inlcuding flights) ?

 

[Mr. Charts]

It went up $5.50 - how much of that did you get ?

Is it enough to buy me lunch (inlcuding flights) ?

Only $2.97, I'm afraid.
Flights, lunch at Gordon Ramsey's at Claridges but not enough for all the women you'd want. Sorry, Toastie.
Happy Holidays to you and your wife and little ones
Richard

 

[Mr. Charts]

It'll upset more if you dont . . .
"That pain in the @rse Mr.C' does the biggest trade in ages and now he won't post a chart, grrrrrr"

I'm always inclined to follow the Duke of Wellington's advice
Richard

 

[spreader_legger]

Nice side step guys! don't worry, I'm not really all that upset. I thought I would do the honourable thing and take the side of new would be traders .... maybe that was to Christian of me?

P.S If you would like, I could post a winning trade next time I log in aswell?