is it ok to have a not very technical, but 'intuitive' trading strategy.

[Attila the trader]

HI,
I'm not taking about trading by feel, without any consideration of facts and figures, but to what extent can a good strategy be flexible , do you always have to have rigid entries and exits , determined by indicators, specific candlestick patters etc. along with fixed take profit levels and stops and position sizes , and you have back tested it thoroughly to find out its mathematical edge . or can you be more flexible . I'm using the latter method and it had done well so far , with a net profitability of 33% since sep, but then again I'm very new and it could just be luck, is the former method more reliable in the long run. as you clearly know its risk and , how large potential loses can be etc.

 

[tomorton]

It never works for me, I must have rigid set-up rules that define which forex pairs or indices I'm going to take positions on. After that the entry patterns aren't very critical to outcomes. And I know for sure that if I take a position on a market that does not meet my set-up criteria, I will lose.

 

[Farm Yard Forex]

If it works for you then who cares if it is "ok" for other people? Personally I would want more rigidity in rules that I can tweak if needed but you do you!

 

[dusktrader]

Personally I have tried both styles of trading - discretionary and rigid-rules-based. I truly believe some people are gifted and can intuitively detect underlying patterns in price action. These people who have honed this skill may be a great fit for the intuitive/discretionary style. I am not that person though -- every time I try to get "intuitive" I am getting burned!!

So right now I'm focused on systems trading where the rules are very rigid. In fact, I want them 100% objective so that I can first learn how to trade them manually and prove to myself that they are worthy. Then I will spend the time to automate those few strategies. My goal is that in the end - the robot would be a better trader than me, because it will execute perfectly whereas this human would most-likely mess it up.

 

[HeavLeighGill]

Sometimes an overly technical strategy can backfire and throw you off...analysis paralysis for example where you get paralyzed because there's so much information available. If it works, it doesn't matter how simple it is but of course you do have to base your strategy off something.

 

[Attila the trader]

The problem with intuitive trading is that most of the time I don’t realise whether it’s my intuition or I am forcing myself to believe a certain way. Therefore, I rely on technicals but that doesn’t mean using way too many indicators on my charts. I try to keep my strategy simple.

but how you interpret indicators is subjective same for price action , so your bias would affect the decisions unless its automated.

 

[Attila the trader]

Personally I have tried both styles of trading - discretionary and rigid-rules-based. I truly believe some people are gifted and can intuitively detect underlying patterns in price action. These people who have honed this skill may be a great fit for the intuitive/discretionary style. I am not that person though -- every time I try to get "intuitive" I am getting burned!!

So right now I'm focused on systems trading where the rules are very rigid. In fact, I want them 100% objective so that I can first learn how to trade them manually and prove to myself that they are worthy. Then I will spend the time to automate those few strategies. My goal is that in the end - the robot would be a better trader than me, because it will execute perfectly whereas this human would most-likely mess it up.

i don't think you can have a 100% objective strategy when trading manually , because you will interpret the charts/indicators subjectively and humans would not make the most rational decisions , especially consistently . "My goal is that in the end - the robot would be a better trader than me" I agree with that I would would also like to get there eventually.

 

[No_Fear]

HI,
I'm not taking about trading by feel, without any consideration of facts and figures, but to what extent can a good strategy be flexible , do you always have to have rigid entries and exits , determined by indicators, specific candlestick patters etc. along with fixed take profit levels and stops and position sizes , and you have back tested it thoroughly to find out its mathematical edge . or can you be more flexible . I'm using the latter method and it had done well so far , with a net profitability of 33% since sep, but then again I'm very new and it could just be luck, is the former method more reliable in the long run. as you clearly know its risk and , how large potential loses can be etc.

I like to use mechanical methods. Discretionary only once in a blue moon. You have to be very experienced to use discretionary and if a mechanical system with a good or excellent edge has already tell you the amount to bet and your stop loss and take profit, why do you still want to trade discretionary? Normally it is to satisfy the itch for trading which often leads to disastrous results. 100% profitable discretionary traders exist but are few and far in between.

 

[Henow1969]

We should continue the use of the strategy which works well fr you and do not try to copy others.

 

[dusktrader]

I think "random" might be the wrong word. True randomness wouldn't move in trends, for example. So based on the fact that we do have trends, I'd say this is more like crowd behavior. The crowd moves like waves in the ocean, so you can exploit these ebb- and flows. I also believe these flows create an infinite amount of opportunity for anyone that learns how to find patterns.

 

[LuckyMac]

Douglas takes about this 'intuitive' style where you can feel what the market will do next. I cant imagine getting to that stage unless you're 10-15 years consistently profitable. Anyone below that needs structure and probabilities.

 

[Attila the trader]

Douglas takes about this 'intuitive' style where you can feel what the market will do next. I cant imagine getting to that stage unless you're 10-15 years consistently profitable. Anyone below that needs structure and probabilities.

whos Douglas ?

 

[Trader333]

whos Douglas ?

Mark Douglas author of Trading in the Zone.

 

[pezza55]

Everyone's trading strategy is personal to them and if yours seems to be working then there's no need to change it. I have tried a bit more of a relaxed method and I found myself making silly mistakes. I like a good structure and low risk strategy but it is a personal preference.

 

[LuckyMac]

Mark Douglas author of Trading in the Zone.

Thanks for fielding that Q i was off on holidays. Should have put that reference in too

 

[sharabela]

HI,
I'm not taking about trading by feel, without any consideration of facts and figures, but to what extent can a good strategy be flexible , do you always have to have rigid entries and exits , determined by indicators, specific candlestick patters etc. along with fixed take profit levels and stops and position sizes , and you have back tested it thoroughly to find out its mathematical edge . or can you be more flexible . I'm using the latter method and it had done well so far , with a net profitability of 33% since sep, but then again I'm very new and it could just be luck, is the former method more reliable in the long run. as you clearly know its risk and , how large potential loses can be etc.

You have to have at least one solid strategy. It may be derived from fundamental or technical. I personally like trading on technical analysis. However, there are traders trading on only fundamental as well. Your strategy must be applied on demo first to be able to find out how consistent it is.

 

[TickCOM]

It depends of the time-frame traded.

If intraday, you cannot use "intuitive", since markets have become very efficient and difficult to trade technically.

If in investment timeframe, buy and hold, the game is different and not technical trading.

In anyway, one need at least one fundamental "edge". Where an edge can be a custom made indicator, a specialized trading platform giving you that edge through its features, a method not in the books where you have found an edge etc.

So if you dont have such edge, you would typically search for a trading platform which can give you that edge, or where you can develop an edge. Or search the web for comments by highly profitable traders hinting what they do. You can also simply be smart, for example collect free morning reports from a count of banks what they expect EUR/USD will do today, and get in at the morning and get out in the afternoon for the daily 80 pips . Play the retracement game 2 hours before close.

To say, the smart makes money, the rest dont.

 

[ElliotM]

Intuition is a good tool to be used in trading but it's not the main one. You can listen to your intuition and sometimes you'll win, sometimes not. Just don't let your intuition take the lead

 

[morehastelessspeed]

HI,
I'm not taking about trading by feel, without any consideration of facts and figures, but to what extent can a good strategy be flexible

I would say this question is really about the conviction needed to take on uncertainty. Anyway it's always going to be about having enough conviction to take the trades, while not having unfounded confidence in their outcome.

Some people may be be able to muster the necessary conviction by trading manually just off their visual perception of price on chart. At the other end of the spectrum, some other people might need to have thoroughly studied quantitative methods, mastered algoritmic programming, built their own stack, and tested back and forth exhaustively, before getting to feel they can size large enough for profitability to make a difference to their wealth. Trading involves a journey of self-discovery to find one's place somewhere in there.

So, to me, there's no right or wrong answer to this question. There's always going to be uncertainty about future performance, with risk of loss and profit like the two sides of a coin.

 

[AriaS]

The only goal is being profitable. If you are profitable then it is Okay.