Best Thread How To Make Money Trading The Markets.

[Sir Pond Life Dreg]

 

[DionysusToast]

$100k a day at best so $10k a day on average may cut the mustard in Thailand but not in the western world.

Your vendor business may be going well but these kinds of posts could really put people off buying your products. How's that for some education? Or cant you hear me up on your high horse?

But anyway, you have gone massively off topic above so I'll leave it there.

Actually, I am on topic. This is a trading thread. I am discussing the parallels between Mr Cs methods and some people that make a lot of money day trading a similar style. Something you are having difficulty with. Y

ou come to an astounding conclusion. That somehow somebody that makes $100k on a good day is averaging $10k. You follow that up with a comment about me being a vendor - something that puts you squarely in the T2W "disgruntled trader" demographic.

Fact is - the traders I speak of are 100% real, regardless of your very feeble efforts in trying to 'call me out'.

 

[DionysusToast]

Anyone with an average IQ would've picked up what i was trying to say on the other thread : certainly writing trading books isn't indicative of one's profitability .

Re this thread : I tell you what go to any reputable hedge fund and show them a 5 years unverified trading record "paper trades" and tell us what's their reaction .

BTW Tim didn't back me up here , he was communicating and replying .

What has 5 years of paper trading got to do with anything?

 

[tar]

What has 5 years of paper trading got to do with anything?

You aren't following !

 

[DionysusToast]

You aren't following !

Clearly - we aren't even on the same page.

Just because hedge funds loan money to traders on a profit share/interest charge business does not mean it's open to people that they don't know.

It's a niche area - from what I have seen, it's more about who you know that what you know. Just like any other business. From what I have seen, there are some wild punts going on too. Still to be fair, the trader I mentioned was trading many millions and the punt they took on the other guy was only $100k.

Still, I have to wonder if any of the contributors to the fund knew some guy got $100k of their money based on the fact he worked with a great trader and had had a few nights on the town with him.

 

[Mr. Charts]

Thanks to everyone who has made a positive contribution

I sometimes keep stocks on my watch list if they've proved good the previous day, even if they haven't gapped or produced any news stories.
IMHO that is worth doing.
The stock I posted about yesterday, ALKS, remained on my alert list and came good using this same method to produce a 38c gain. I exited very close to the high of the day, which is always very nice. Looking at the chart there is no apparent reason why I should have exited, but I could see there was an increasing probability that the move might end very shortly so I played safe and exited as shown.
Sometimes I'm proved wrong with this price action approach, sometimes right, but as long as I'm profitable I don't mind leaving money on the table. After all, I can always enter again if the evidence in front of my eyes changes.
I don't usually enter or exit a trade at a specific pre-determined price point, it often depends on how price is actually moving. Why enter a trade just because someone trades some shares at a specific price ? That doesn't make sense to me. However, sometimes if the move is steady and unremitting I might enter anyway.
I'll post my results on my blog in a few minutes.

As rob0003 hinted, if you go only for high probability trades and cut losers early you can reach a state of being profitable day after day very consistently. However, I've been trading for a long time and anyone who hasn't or who trades other instruments (especially FX) is extremely likely to have some losing days.
If I routinely traded FX I'd have plenty of losing days - which is why I rarely trade FX.
The downside to consistency is that there are some days when you think you should have made more profits if you'd been more adventurous. However, I'm cautious by nature and very self-controlled in my trading and I'm satisfied with consistency and fewer trades. We are all different and need to find methods of trading we're comfortable with.
Hope the above provides some people with some food for thought.

 

[DionysusToast]

I have a question Mr C.....

I haven't day traded stocks for a while and recently a punter had some issues with his eSignal feed and I ended up having to compare the Level 2 info with the same stocks on the DOM.

It looked different to me. I'm not sure how to describe the difference other than it felt very different. One thing that stood out was that the stocks I looked at (mostly mid-priced NASDAQ stocks with 500k+ volume) had none of the old MM Ids anywhere on L2. Used to be that UBSS would be all over most actively traded stocks and frightening people out of the way whenever they jumped in. On the stocks I looked at, there was no sign.

Has the game changed somewhat in the past 3 years in terms of transparent MM gameplay or was I just looking at some odd stocks?

 

[D70]

I have a question Mr C.....

I haven't day traded stocks for a while and recently a punter had some issues with his eSignal feed and I ended up having to compare the Level 2 info with the same stocks on the DOM.

It looked different to me. I'm not sure how to describe the difference other than it felt very different. One thing that stood out was that the stocks I looked at (mostly mid-priced NASDAQ stocks with 500k+ volume) had none of the old MM Ids anywhere on L2. Used to be that UBSS would be all over most actively traded stocks and frightening people out of the way whenever they jumped in. On the stocks I looked at, there was no sign.

Has the game changed somewhat in the past 3 years in terms of transparent MM gameplay or was I just looking at some odd stocks?

MrC doesnt sub to L2. I believe he is only aware of t&s, altho that's a **** show of single lots these days so I'm not sure what use that is either.

No MM worth their salt puts their signature behind a trade anymore. Almost every trade made by MM is executed thru the various ECNs and a growing % are done in dark pools "off grid". So anyone that says they trade the "old style" by front running MM orders is lying.

 

[Purple Brain]

When DLPs first got wide news coverage I could see why major players would want to have (some) transactions shielded from public view or more importantly shielded from direct competitors for their order flow and liquidity. Although any one individual retail trader is not going to impact them from open knowledge of their transactions, as an aggregate entity, retail traders presumably provide liquidity the larger players could utilise so to cut them out of the loop seems self-defeating. Unless of course they’re still watching the L2 for what retail in aggregate is doing, which is watching L2 to see what large players are choosing to show them what they’re doing. I also wonder if the DLPs themselves have the equivalent of L2 to which only the MMs have access?

 

[DionysusToast]

I don't think there has ever been a time you could just blindly front run a market maker on L2. The whole point of it was the MMs would display size one side to make it look weak/strong and then trade the opposite direction thru the ECNs. This is going back 3-4 years now and from what I can see they have disappeared.

As for Mr C not subscribing to L2.... he was the person that introduced me to it!

The only real front running going on was in the pits wher

 

[Mr. Charts]

DT,
Have to go off for the day shortly but I'll email when I've got time about how I've adapted to the changes in L2 over the last couple of years.
Richard

 

[D70]

DT,
Have to go off for the day shortly but I'll email when I've got time about how I've adapted to the changes in L2 over the last couple of years.
Richard

LOL.

"Email"

That's helpful. Got to keep up the smoke and mirrors I suppose.

 

[wallstreetwarrior87]

Remember the 1 thing that doesn't lie in any transparent market environment is price, the more you can see of it the more you can gain from it.

Games are really secondary, they have a purpose to fool those that can be fooled.

Anyone looking at DOM/orderbook/level 2/T&S etc are wasting their time unless they know what they are looking for and why?

If one believes that someone may leave a footprint in the market, then that means that they must trade with a purpose, so unless you know the purpose it will be a total waste of time looking at any auction proceedings. It will only result in even more confusion.

If you have a grasp on the purpose; well, then it is a completely different ball game.

 

[DionysusToast]

Remember the 1 thing that doesn't lie in any transparent market environment is price, the more you can see of it the more you can gain from it.

Games are really secondary, they have a purpose to fool those that can be fooled.

Anyone looking at DOM/orderbook/level 2/T&S etc are wasting their time unless they know what they are looking for and why?

If one believes that someone may leave a footprint in the market, then that means that they must trade with a purpose, so unless you know the purpose it will be a total waste of time looking at any auction proceedings. It will only result in even more confusion.

If you have a grasp on the purpose; well, then it is a completely different ball game.

Agreed

The purpose itself is fairly simple - they have a position to enter/exit and they want to do so at a good price.

So they need muppets to do the opposite.

However you slice it, it's still a punt you are taking. Even if you understand the gameplay, it's like poker - you never know what hand they are playing, you are just looking for a tell.

In one form or another, you are looking for something to lean on. That is usually something very close to the market and so whilst a pain in the butt to learn, it does reduce risk.

 

[Mr. Charts]

Among other things pre-market I like to have a quick read of the news stories.
Anyone would have to be blind not to have noticed the AAPL news.
Personally I never consider trading the news in the sense that if the news is bad that doesn't mean I'm going to short it or vice versa. I'm looking to see if any of my set ups occur and if they are triggered by price action (NOT a specific price).
These are my two trades today in AAPL. Obviously this was a fast moving stock with a large intra-candle range; not a stock for beginners to take a risk on.
However, you can minimise risk by drastically reducing position size to maintain your personal risk criteria. This is described earlier in this thread.
I find that keeping tight stops and concentrating on minimising any potential loss means that the winners almost take care of themselves.
Consistency for me comes with that approach, but sometimes opportunities like AAPL present themselves and need to be taken advantage of.
The first trade produced 363c per share and the second 492c per share.
My point is that by concentrating on consistent methodology quite substantial gains can be made as well as the day to day earnings traders need to live on.
There is nothing special about these charts or the choice of stock.
Just common sense, method and application.
No rocket science or complex technical analysis needed.
As I always say, try paper trading strongly trending stocks using tight stops at least 100 times before you try it for real. Analyse your results. Make sure you are ONLY choosing strong trenders. Then make your own mind up for yourself.

 

[Purple Brain]

Nice work Mr. Charts. Here I am messing around with aroon and multiple moving averages and whatever else takes my fancy, and you’re making quick and useful profits using what appears to be little more than an moving average and a breach of a prior higher high/lower low. I appreciate there’s a whole lot more going on in the selection and trade preparation than those charts show, but even so, it’s clean, simple and unembellished. A pleasure to get a glimpse of your style.

 

[mik1973]

Pity he can't prove it

 

[mik1973]

Bravo Mr. Charts. Well said.

Really Rob0003?

I mean REALLY ??

 

[D70]

Nice work Mr. Charts. Here I am messing around with aroon and multiple moving averages and whatever else takes my fancy, and you’re making quick and useful profits using what appears to be little more than an moving average and a breach of a prior higher high/lower low. I appreciate there’s a whole lot more going on in the selection and trade preparation than those charts show, but even so, it’s clean, simple and unembellished. A pleasure to get a glimpse of your style.

He might email you his "secret sauce", otherwise known as his bank details.

 

[be-positive]

He might email you his "secret sauce", otherwise known as his bank details.

:cheesy: D70 was the sauce not to your liking