I agree with you to an extent. I do however take a slightly different view because I believe position sizing is one aspect of risk mangement.
What you're refering to is nominal risk. Actual risk IMHO is defined by the probability of your stop being hit once you're in the trade. Macci MLT analysis, N minute, moving averages, elliot waves and many other indicators are designed to reduce the probability of loss. Some methods are more efficient at doing this compared to others, depending on your holding period obviously.
Finding value within stocks is intrinsically an act of controlling risk. Most people would define it as an act of finding opportunity. It really depends upon your definition and how you view the role of risk to be honest.
Naeem
BTW - Tradestation is now becoming a real pain. For the past 2 nights, radar screen has simply been refusing to update.
I've been using TS 8.3 for about 4 weeks now and it happens to me every so often too. You can try doing [CTRL]-[R], to force refresh, it may or may not work.
pedro01
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pedro01
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Friday 17th
Been well under the weather this week so not done much.
I thought I'd post the first part of Friday before the markets open.
OK – so yesterdays leader was that Buffet was buying stocks. Honeywell is above expectations for the quarter but to be below on the year. Google is doing better than expected.
Other things to watch for today :
Housing starts at 8:30 am
Bush at chamber of commerce at 8:40 am (that'll cause a crash !)
Consumer sentiment 10:00 am
Fed President economic outlook at 2pm with Q & A – that’ll be a touchy feelgood session I guess.
MACCIS all towards OB but 60 min -34, so a mixed bag at this point.
Perhaps we'll be looking at low volatility until consumer numbers & then a drop ? I presume most are expecting negative numbers from both housing & consumer sentiment but I am sure there will be an overreaction anyway. Same if the news is better than expected. Then again, the Oracle I am not.
So far - my Tradestation is flying with the extra 2GB of RAM - let's see how it holds out.
Been well under the weather this week so not done much.
I thought I'd post the first part of Friday before the markets open.
OK – so yesterdays leader was that Buffet was buying stocks. Honeywell is above expectations for the quarter but to be below on the year. Google is doing better than expected.
Other things to watch for today :
Housing starts at 8:30 am
Bush at chamber of commerce at 8:40 am (that'll cause a crash !)
Consumer sentiment 10:00 am
Fed President economic outlook at 2pm with Q & A – that’ll be a touchy feelgood session I guess.
MACCIS all towards OB but 60 min -34, so a mixed bag at this point.
Perhaps we'll be looking at low volatility until consumer numbers & then a drop ? I presume most are expecting negative numbers from both housing & consumer sentiment but I am sure there will be an overreaction anyway. Same if the news is better than expected. Then again, the Oracle I am not.
So far - my Tradestation is flying with the extra 2GB of RAM - let's see how it holds out.
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pedro IMHO I find 2pm's HAVE been pretty risky if market is overbought and esp. if anyone from the fed is talking unless you have a strong conformation.
I have had some rough afternoons over the years.
okay this is the way I have made good judgements lately... look at the futures market... what have you seen during the last 2 days??? well what I look at in a weak market is dow futures have gone up alot 700pts on globex since yesterday afterhours till the top a 2pm today that move is pretty overextended... tending to be a low probability entery.
I have had some rough afternoons over the years.
okay this is the way I have made good judgements lately... look at the futures market... what have you seen during the last 2 days??? well what I look at in a weak market is dow futures have gone up alot 700pts on globex since yesterday afterhours till the top a 2pm today that move is pretty overextended... tending to be a low probability entery.
pedro01
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OK - so most of Friday, the MACCi 60 was up but the MACCi 30 was OB or headed down for the whole day.
There wan't a trade in my book BUT it did give me chance to do a few things to practise the execution side.
First of all, I noticed that the stocks above the $INDU were in just a couple of sectors, so I created a sector radar with the sectors & the $INDU...
Energy was leading but energy stocks not really represented in my days list, I decided to add the energy leaders to my list.
I played with staging orders all the time, seeing stocks that were hitting the top of my radar screen, looking @ position sizing and staging them as join buys. That way, I could just select them on order manager & click 'go' when I was ready to go in. Same for the exits - I added those too.
I reckon you could easily deal with 5 trades this way.
At the end of the day, there really wasn't a clear buy, so I never got in. Dull but hardly taxing.
There wan't a trade in my book BUT it did give me chance to do a few things to practise the execution side.
First of all, I noticed that the stocks above the $INDU were in just a couple of sectors, so I created a sector radar with the sectors & the $INDU...
Energy was leading but energy stocks not really represented in my days list, I decided to add the energy leaders to my list.
I played with staging orders all the time, seeing stocks that were hitting the top of my radar screen, looking @ position sizing and staging them as join buys. That way, I could just select them on order manager & click 'go' when I was ready to go in. Same for the exits - I added those too.
I reckon you could easily deal with 5 trades this way.
At the end of the day, there really wasn't a clear buy, so I never got in. Dull but hardly taxing.
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pedro01
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Monday 20th - the day of the fcuk ups....
OK - so first wierd thing today is my MACCi 60 is still pointing up. Seems like it hardly ever moves - see top left hand chart.
After an hour or so I realised that I had my charts set up wrong & that what I thought was my 60 minute chart was really a daily one
That's better !
Now - shortly after, the 30 min moved against the 60 min.
At this point, the 10 min was turning out of OB & the 5,3,1 all OB. I decided to push the button.
Almost immediately - both trades went my way - RIMM down $1.11 and LVS down $.63. As the 60 & 30 were not in agreement, maybe I shouldn't have taken this but I wasn't expecting to be in for long....
And then Tradestation stopped updating... Radar screen, charts, prices - the lot just stopped. I restarted tradestation - still in profit when it restarted but still no updates on radar screen or charts. I then rebooted the PC...
Not great, eh ? When I rebooted, I was looking at a loss, the 10 min was down more than before but my shorts went the other way. I wasn't sure if it was a data issue - so I stayed in in case I just needed TS to catch up on price data. As soon as the 10 min turned against me, I took a hit & closed out.
So - a few problems
- I got in when the 30 was against me without having clear plan of when to get out if this was to be a scalp. Sure I could say that if TS hadn't crashed, I could have got out in profit - but on what signal ?
- I should have set my stop loss at entry + 2c as soon as I was in profit as it was a riskier trade. I didn't as I wanted to leave some wiggle room. That's the difference between a break even & a $175 loss.
Lessons learnt !
On the bright side, I am getting used to using staged orders in TS - I simply fill it up with my likely trades & quantities & can then press go when desired. I can also set up my 75% scale out trades and complete closes and just select the appropriate one as necessary - it makes dealing multiple stocks much easier. I am using 2 now but as I get used to this will up to 5 and see if that's still manageable. The only downside is I can't use ESL to automate the order staging - now that would be nice....
As you can see - for RIMM & LVS, I have my 75% scale out already entered & just need to highlight them & 'send selected orders' to place them.
OK - so first wierd thing today is my MACCi 60 is still pointing up. Seems like it hardly ever moves - see top left hand chart.
After an hour or so I realised that I had my charts set up wrong & that what I thought was my 60 minute chart was really a daily one
That's better !
Now - shortly after, the 30 min moved against the 60 min.
At this point, the 10 min was turning out of OB & the 5,3,1 all OB. I decided to push the button.
Almost immediately - both trades went my way - RIMM down $1.11 and LVS down $.63. As the 60 & 30 were not in agreement, maybe I shouldn't have taken this but I wasn't expecting to be in for long....
And then Tradestation stopped updating... Radar screen, charts, prices - the lot just stopped. I restarted tradestation - still in profit when it restarted but still no updates on radar screen or charts. I then rebooted the PC...
Not great, eh ? When I rebooted, I was looking at a loss, the 10 min was down more than before but my shorts went the other way. I wasn't sure if it was a data issue - so I stayed in in case I just needed TS to catch up on price data. As soon as the 10 min turned against me, I took a hit & closed out.
So - a few problems
- I got in when the 30 was against me without having clear plan of when to get out if this was to be a scalp. Sure I could say that if TS hadn't crashed, I could have got out in profit - but on what signal ?
- I should have set my stop loss at entry + 2c as soon as I was in profit as it was a riskier trade. I didn't as I wanted to leave some wiggle room. That's the difference between a break even & a $175 loss.
Lessons learnt !
On the bright side, I am getting used to using staged orders in TS - I simply fill it up with my likely trades & quantities & can then press go when desired. I can also set up my 75% scale out trades and complete closes and just select the appropriate one as necessary - it makes dealing multiple stocks much easier. I am using 2 now but as I get used to this will up to 5 and see if that's still manageable. The only downside is I can't use ESL to automate the order staging - now that would be nice....
As you can see - for RIMM & LVS, I have my 75% scale out already entered & just need to highlight them & 'send selected orders' to place them.
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Hello pedro.
I'm no expert by any means as I am just learning this stuff and going thru the live seminars.
On entry the 10 was going down, and yes the 30 was up, but you had the 60 on your side. So I would think that was ok to go short where you did. (Especially since the lower TF were also in your favour).
I was under impression, that normally exit (or take 1/2, 3/3 etc) once the 10min turned against you. And I agree that once in profit you should have moved stop to breakeven.
On a related note, when we talk about about the 10min turning, or 30min turning etc etc. Am I right in saying that this can only be determined once the candle is finished forming. So You can't make a judgement on say the 60min macci, until 1 hour after open. And only once a particular 10min candle has finished forming can you say that it has changed direction ?
Thanks.
I'm no expert by any means as I am just learning this stuff and going thru the live seminars.
On entry the 10 was going down, and yes the 30 was up, but you had the 60 on your side. So I would think that was ok to go short where you did. (Especially since the lower TF were also in your favour).
I was under impression, that normally exit (or take 1/2, 3/3 etc) once the 10min turned against you. And I agree that once in profit you should have moved stop to breakeven.
On a related note, when we talk about about the 10min turning, or 30min turning etc etc. Am I right in saying that this can only be determined once the candle is finished forming. So You can't make a judgement on say the 60min macci, until 1 hour after open. And only once a particular 10min candle has finished forming can you say that it has changed direction ?
Thanks.
pedro01
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I'm learning too - hence this thread.
I agree that it was a valid trade but not a perfect one & perhaps the "75% out on a turn of the 10 min" is not valid when the setup isn't perfect. My strategy for perfect entry & not so perfect entry is currently the same. Perhaps you just have to play with position size.
In terms of determining when to decide if the MACCi has turned - I'm not sure, it seems safest to me to wait until the bar has closed but generally you will see it level out a bit before it turns. I leave my more informed friends to answer this question. For me, lets say a classic hammer was forming & I'm 10 mins away from the close of the bar and the trading range is fairly tight around the bars open, I'd say in that case you could pretty much rely that the hammer would stay intact.
Hello Pedro.
Just out of interest, did the trades go into profit by 0.5ATR ? , as I think this can also be an exit point. I.E. Close 75% of your position when you have gained 0.5ATR.
Another question > Did you have a hard stop in place at all ? As not having one would make me nervous just in case the platform went down, loss of internet connection etc. However there is always the phone to close the position I suppose, so maybe not really an issue.
Just out of interest, did the trades go into profit by 0.5ATR ? , as I think this can also be an exit point. I.E. Close 75% of your position when you have gained 0.5ATR.
Another question > Did you have a hard stop in place at all ? As not having one would make me nervous just in case the platform went down, loss of internet connection etc. However there is always the phone to close the position I suppose, so maybe not really an issue.
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Thanks Naeem !
Yesterday I really didn't see any opportunities in the first 3 hours of trading, so I went to bed. No point putting up MACCi charts where there's nothing much to see. The lower time frames never managed to creep back up in unison - so I decided to live on to fight another day !
jitasb - there are no stops at the moment - even half an ATR would be an arbritary stop whereas the 10 min turning against me is a sign that the trade is no longer in my favour. Saying that, I do recognise the need for protective stops and as I progress with this I will figure something out. Whether that is an automated stop or a manual one, I am not sure.
Yesterday I really didn't see any opportunities in the first 3 hours of trading, so I went to bed. No point putting up MACCi charts where there's nothing much to see. The lower time frames never managed to creep back up in unison - so I decided to live on to fight another day !
jitasb - there are no stops at the moment - even half an ATR would be an arbritary stop whereas the 10 min turning against me is a sign that the trade is no longer in my favour. Saying that, I do recognise the need for protective stops and as I progress with this I will figure something out. Whether that is an automated stop or a manual one, I am not sure.
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Wed 22nd
Time for a quickie before the market opens. Plenty of doom & gloom today with a bunch of poor earnings reports out.
Chart wise - 60 & 30 looking down but 10 min already OS. With news so negative, I feel like it's a good short day but how do I short when 10 min is already -126 ?
Any thoughts ?
Time for a quickie before the market opens. Plenty of doom & gloom today with a bunch of poor earnings reports out.
Chart wise - 60 & 30 looking down but 10 min already OS. With news so negative, I feel like it's a good short day but how do I short when 10 min is already -126 ?
Any thoughts ?
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Wait for 10min cycle to turn up. Then come back down with 60min and 30min still showing down. Time the entry using the 1min and 5min and 3 min or whichever combination suits you.
Sounds good, but is it correct ? Maybe the more experienced members who have been doing it live for past year or so can offer some opinion.
Many Thanks
Sounds good, but is it correct ? Maybe the more experienced members who have been doing it live for past year or so can offer some opinion.
Many Thanks
pedro01
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That is my understanding. Thing is - we never got there yesterday. The 60 & 30 hit the deck before a short on the lower timeframes came up.
Anyway my radar screen crapped out again, so I really need to get to the bottom of that now.
Lovely, eh ?
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Hello pedro.
During the evening (UK GMT time), the 10min came up and then headed back down. I know that the 30, 60 were probably OS, but IMO a short based on the 10min direction was a fair trade. Then use 1,3,5 as entry timing. On a trend day, it seems to me that both the 60 and 30 can remain at the extremes and stay there even though the market can and does move a lot further.
P.S > Do you use all 1,3 and 5 for entry timing, or can any combination suffice ?
Thanks
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That's pretty much what I am seeing.
I think you are right - but in such a case - how long do you stay in the trade ?
I heard in 1 seminar that a scalp would be held for just 3 x 1 min bars - does this set up represent a scalp or a setup whereby you can scale out when the 10 min macci turns ?
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OK - here's a plan.
Get on a plane Sunday evening in Bangkok, take a 15 hour direct flight to LA, sleep 4 hours, wake up, go for a run in the fog, get lost and then find your way back to the hotel & start trading !!!
Yeah, right - great idea !
So - todays news was new home sales up 2.7% - more than expected. Other than that - not much.
30 up, 10 os, 5 os & turning up, 3 up, 1 coming out of OS
Tried to enter 3 trades, only got in 1.
Buy TGT 183 33.54 Stop Loss @ 33.56 as soon as it got in profit.
No fill on 2 other stocks. – WHR, NYX
10 min flattened so got out 75%:
Then I got into a dumbass trade where only the 5 & 1 min were with me. Basically - jet lag took over
Anyway - I opened a position in COST & WHR - WHR stopped out at entry, I let COST & TGT run until lunchtime LA when I rushed back to the hotel to get out 15 mins before market close...
Basically - made 125 cents. But really - I was way too jet lagged to trade !
Get on a plane Sunday evening in Bangkok, take a 15 hour direct flight to LA, sleep 4 hours, wake up, go for a run in the fog, get lost and then find your way back to the hotel & start trading !!!
Yeah, right - great idea !
So - todays news was new home sales up 2.7% - more than expected. Other than that - not much.
30 up, 10 os, 5 os & turning up, 3 up, 1 coming out of OS
Tried to enter 3 trades, only got in 1.
Buy TGT 183 33.54 Stop Loss @ 33.56 as soon as it got in profit.
No fill on 2 other stocks. – WHR, NYX
10 min flattened so got out 75%:
Then I got into a dumbass trade where only the 5 & 1 min were with me. Basically - jet lag took over
Anyway - I opened a position in COST & WHR - WHR stopped out at entry, I let COST & TGT run until lunchtime LA when I rushed back to the hotel to get out 15 mins before market close...
Basically - made 125 cents. But really - I was way too jet lagged to trade !
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Trading on 06 Nov 2008
Quick question to those who were following the market yesterday.
INDU pretty much trended down the whole day, so the higher tf macci's (30,60,10) seem to meander around in OS region. How do you guys play any entry setups ?
Is it a case of using the lower tf (1,3,5) and selling any pullbacks when these become OB ? as they didn't have much strength to bring up the 10,30,60.
Thanks in advance.
Quick question to those who were following the market yesterday.
INDU pretty much trended down the whole day, so the higher tf macci's (30,60,10) seem to meander around in OS region. How do you guys play any entry setups ?
Is it a case of using the lower tf (1,3,5) and selling any pullbacks when these become OB ? as they didn't have much strength to bring up the 10,30,60.
Thanks in advance.
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