my journal 3

[Yamato]

I was looming over my positions again, threatening of revising their LMT orders again, but I guess this is final. I can't really find anything to change anymore.

For JPY and GBP, there are two very easily triggered exits. And two much higher exits. The former to keep me from despair in case they resume their falling. The latter to keep me from feeling like an idiot in case their bounce is just as high as expected, seemingly huge if compared to the safety exit of the first contract.

For GBL, the exit is higher because the potential to the upside is great.

I don't think I will change them again.

...

I wrote myself a note, a memo, a reminder, to learn to go with the trend, on top of my usual top/bottom picking. If I can do this, I will be an excellent trader. I can't wait. I am done with just being a top/bottom picker.

New index.html with this change:
View attachment index.html

I sure hope I won't blow out my account next week. That JPY trade hopefully will get closed and on both GBP and JPY there will be at least a small bounce. Hopefully even a major reversal.

...

Wish me luck. In less than 3 hours, I'll turn on my systems, go to sleep, and hopefully tomorrow when I'll wake up, because I will check even though I said I wouldn't, hopefully I'll wake up and find all my trades executed. But definitely I will pray and have nightmares for my first 2 contracts on GBP and JPY to be closed. If they don't, it'll be very very bad news for my account.

What's worse, I won't be able to ask for a pardon, because I've been pardoned many times for my martingale trading, to no avail. Each time I went back and did the same. Year after year, for 15 years. At the start i wasn't even aware of what mistakes I was making. Now I know, and there is no excuse. I cannot effectively fight my scorpion's nature and i keep biting the frog who's carrying me across the river, and we both drown. We'll see if I'll ever learn. I'll keep writing about my adventures here.

...

One hour to go before I turn on the systems. Two hours to go before the future markets resume trading. 10 hours to go before I wake up and check how it went, if again, I got lucky and didn't blow out the account.

...

Ok, it's done. I started the systems. If I feel like it, tomorrow morning I'll check. If I don't, I will just go to work and check from there. I might be too scared to check tomorrow morning.

I could even check as late as Tuesday morning, when I'll have to start the systems again. It might be more profitable if I can manage to wait that long.

If I do wait that long, I also won't write anything on the journal, particularly so that D70 can read and reply to jazeonli's reply to his question. (That's why I kept editing this post, to leave jazeonli's reply as the last post here below).

 

[Yamato]

JFK Secret Societies Speech - Complete - YouTube

JFK trying to expose and stop the shadow government, who eventually killed him. He wouldn't name names, so we don't even know who is control today, and if it's the same guys who killed him.

 

[Yamato]

Watch The Impossible online - Watch Movies Online, Full Movies, Download

This documentary is better:

Tsunami: Caught On Camera (Full Documentary) - YouTube

The movie is like a bad copy of the documentary.

Wow, in the middle of the documentary, don't remember the minute unfortunately, there's a kid saying to his mom, in the middle of the tsunami, "I want to go home". It really made me laugh. You're in the middle of a tsunami in Thailand, thousands of miles from home, and you tell your mom "I want to go home". It made me laugh, although of course there's nothing to laugh about during a tsunami.

(I Want To) Come Home by Paul McCartney - YouTube

This made me realize that to children "home" is a synonym for "safe place". They say "I want to go home" whenever they feel unsafe, like Chance the Gardener tries to use his remote control to escape an unpleasant situation in the movie Being There:

Raphael - YouTube

I guess for children being away from home is much more scary than for adults, and that's why adults lose the habit of saying "I want to go home".

...

This is very promising:

Watch Seven Psychopaths online - Watch Movies Online, Full Movies, Download

...

Nope, it's a total piece of ****.

 

[jazeonli]

When testing a strategy. Which outputs do you deem important?

And are there any major things I need to look out for that are giveaway signs that the strategy isnt as good / as bad as it looks.

Watch for a few trades that make huge profit/loss and skew the results. An easy way would be to calculate two separate total profit/losses:
a) one which includes all trades
b) another one without top/bottom 5% of trades
If these two differ too much, look for outliers in your trades.

 

[Yamato]

Ok, I couldn't resist the curiosity (although mixed with fear), and D70 read jazeonli's message anyway, so I will create this new post, check the markets and write down the damage I have done with my trading.

Ok, let's get ready for this cold shower in the middle of winter: let's open the server and look at TWS.

...

Wow, it couldn't be worse. No trades got executed.

It could be worse only in the sense that the markets could have fallen lower.

My JPY exit didn't get triggered by 1 tick. That's how good it was my estimate.

...

I removed all JPY's and GBP's exits and I'll stick my head back in the sand, while I am at the office.

 

[Yamato]

I am at the office, checking things again from here. Not going too well, much worse than expected. Nothing is bouncing much, but they're not falling either. But that's not saying much, considering the fall they're coming from.

Now let's get back to work. If I work hard enough, hopefully I will be rewarded. By someone. That's what you hear as you grow up, but what pays is to be smart and cheat rather than to work hard. At least that is my experience. Nonetheless I think I work harder than the average, despite not being rewarded, so far.

...

15 minutes later and I feel like checking again. Let's keep track of this orderly:

GBL: higher than Friday
JPY: higher
GBP: higher

That would sound good, but how much higher? On average 15 ticks higher. After having lost hundreds of ticks, this is how much they're bouncing. Very very bad.

...

another 20 minutes, and I am checking again:

GBL: same as before
JPY: lower, at Friday's low (DAMN! ****ING ASSHOLES!)
GBP: higher

...

Ok, now only a miracle can save, because it's gone lower than Friday's close:



From here it can easily lose the usual 150 ticks. And that'd make me lose another 4000 dollars. Only a miracle can save me.

Now I really regret that JPY didn't trigger my exit by 1 tick.

...

Ok, 20 minutes later, time to check again:

GBL lower (than last time I checked)
GBP higher
JPY same

...

Ok, checking again:

GBL same
GBP higher
JPY lower

At this point JPY is really hurting my feelings. I am taking it personally, like GBP in the summer of 2008, when it blew out my account. It's like a personal injustice against me.

I also know that if I closed my position, JPY would suddenly bounce and keep rising for weeks. So it is really me vs JPY, to the death. JPY wants to wipe me out, despite many demanding a bounce.

...

Jesus, here I am checking again. I am like a junkie:

GBP: very satisfied, as it kept rising all day long so far (8 straight hours of rising)
GBL really sucks - no rise
JPY: the asshole touched 1.0734 and has been rising ever since (no big rise, but steady, six 5-minute candles in a row for a total of 15 ticks)

At this point, judging from the past, the way to get JPY to go my way is feign despair and pretend I am giving up hope. It's like those who pretend they're dead in order not to be killed. Once JPY will think I am wiped out, he will turn around. That's always the case. They turn around when I exit the position or when I am wiped out. So this time I will pretend I give up, but I'll still hold my positions open. I don't know exactly what instruments JPY has to monitor my mood, my account, and my positions. But there's a chance he's unable to monitor everything. So I'll feign despair and pretend I am exiting and giving up.

...

Ok, it worked!

Checking things again, before starting to work on a massive task that will keep me busy for hours, I am noticing something I like:

GBL massive 20-ticks rise (still not at break-even though)
GBP taking a break after rising for 8 hours: acceptable
JPY massive 40-ticks rise from today's low, to higher than Friday's low

hush hush, let's not show JPY that I am rejoicing.

...

Now capital is at about 19k, I suppose, because I am at the office. I should exit in just 1000 dollars more of profit, but I am getting confident now and I want to keep it open until tomorrow.

...

Ok, back. It's 13.41. In just 50 minutes I'll go home. Let me check one last time... I am feeling very confident.

GBL looking good
JPY looking so so but... more good than bad
GBP looking bad, definitely, definitely regretting not closing it earlier, with the LMT order I removed

Anyway, the account is higher than where I left it on Friday night, so I am hopeful and I am going to keep all positions open.

...

Ok, one more look, before leaving the office:

GBL awesome
JPY awesome
GBP recovering from sucking after being awesome

I think my capital is now at above 19k. Still keeping them open though. They're all waiting for me to close my positions to explode to the upside. I should even go to the restaurant and to a movie so I can't tamper for sure.

 

[Yamato]

Yeah, I went to a movie, Django, and as usual, I left in the middle of it, because it sucked. But it left me a good song, as most movies by Tarantino:

I Got A Name (Jim Croce) - YouTube

Django Unchained (soundtrack) - Wikipedia, the free encyclopedia
Jim Croce - Wikipedia, the free encyclopedia

...

Time to check the markets.

...

Great. Time to close all trades without looking back:



I have achieved the objective of getting back to 20k, and I closed all positions.

Now I'll re-enable all my best systems. And keep the **** away from them for a while. GBL saved my ass.

...

Wow, this song is great!

Jim Croce - I Got a Name (1973) - YouTube

Like the pine trees lining the winding road
I've got a name
I've got a name
Like the singing bird and the croaking toad
I've got a name
I've got a name
And I carry it with me like my daddy did
But I'm living the dream that he kept hid
Moving me down the highway
Rolling me down the highway
Moving ahead so life won't pass me by
Like the North wind whistling down the sky
I've got a song
I've got a song
Like the whip-poor-will and the babies crying
I've got a song
I've got a song
And I carry it with me and I sing it proud
If it gets me nowhere, I'll go there proud
Moving me down the highway
Rolling me down the highway
Moving ahead so life won't pass me by
And I'm gonna go there free
Like the fool I am and I'll always be
I've got a dream
I've got a dream
They can change their minds but they can't change me
I've got a dream
I've got a dream
I know I could share it if you want me to
If your going my way I'll go with you
Moving me down the highway
Rolling me down the highway
Moving ahead so life won't pass me by
Moving me down the highway
Rolling me down the highway
Moving ahead so life won't pass me by

 

[Liquid validity]

Travis, have you looked into IBfx or MBT fx.
You seem to trade a lot of currency futures.
IB and MB are just about the only FX I would touch, although not
strictly interbank ECN's they are close enough.

Main point is the greater flexibility with position sizing given your bankroll.
You can size down to mini or even microlot resolution.
In other words the whole contact limitation of futures is removed.
You can essentially adjust size in roughly 1% increments of
minimum futures contract size.
6E is 125000 eur -- $12.50/tick.
Thats like only being able to size fx in whole lots.
With fx you could trade say 165000 eur instead of the contract jump
to 250k.
Not sure if you still use fixed fractional sizing, but the above helps with that.

I know its not exchange traded, but like I said, IB and MB fx
are pretty much identical to the futures.
TBH I haven't had any problems with it.
Just a thought, obviously you may prefer futures, as they have volume etc.

 

[Yamato]

Great suggestion, not just for me but for all the others reading. How do I access it from TWS? Do I need any extra permissions? Any extra feed I should pay for?

 

[Liquid validity]

Great suggestion. How do I access it from TWS? Do I need any extra permissions? Any extra feed I should pay for?

I don't know TBH, I'm with MB but IB fx are just as good from what I've heard.
You should be able to add it to your account, I don't know how.
Email or phone them is best.

Extra feed depends on your trade duration really, holding for hours or more,
the standard IB feed should be ok.
I say that because I know they don't supply a raw tick feed.

http://ibkb.interactivebrokers.com/node/1460
http://individuals.interactivebroke...ing/pdfhighlights/PDF-Forex.php?ib_entity=llc
http://individuals.interactivebroke...o&showcategories=FX&ib_entity=llc#min

I did have a pretty detailed look at IB fx but decided the MB setup suited me better.

 

[Yamato]

Thanks for the detailed information and links.

I found something on IB TWS which is probably what you're referring to:



I had to add the button, because it wasn't there (probably I had removed it when I customized it).

There are some things that might keep me from exploring it further and using it. I can sense some discomfort in myself, but I can only name one issue: it's something I haven't used until now. I know futures have huge leverage and I'd like to reduce that, but I know my futures, I know them very well. I know how dangerous they are. With something new, I'd have an excuse to lose some more money. Also, I've used these 16 symbols for years, throughout my systems, so that would be nearly impossible to change for my systems. I mean all the drawdown, profit and performance are based on these 16 futures (years of work).

However, this is good for discretionary trading, so thanks for letting me know this option I have.

 

[Yamato]

I am back in business as an automated trader.

Two trades got placed and I am back in business, with my capital of 20k.

Naturally something didn't go as nicely as I would have hoped. In other words, by exiting at a capital of 20k, I didn't exit exactly at the top of the day.

Big deal.

Obviously!

But guess what: it is pissing me off, as expected.

I could have made 1000 dollars more... had I known the future!

This is so trivial that I worry about this, and yet I am pissed off because I didn't know the future and didn't bet accordingly!

What a ****ing counter-intuitive business trading is! Who would ever realize that you go in as a rational person and, when you are in the middle of it, you are blaming yourself for not predicting the future tick by tick! LOL, idiot me. And as I say this, I stupidly tell myself "if only I had kept it a little longer... if only...". Idiot! I am an idiot! I can't blame myself for not knowing the future. I should praise myself for closing at 20k as I had planned when I was viewing things from the sky, in the weekend, when the markets were closed.

Oh, well... such is the nature of non-calculated bets, compulsive bets, martingale trades. You stay in them just enough to risk blowing out your account, and then, when it goes your way, you were left so scared by the risk you took, that you cannot believe your eyes when you can get out not at break-even but with a loss of just 1000!

So you end up losing 1000 in return for risking 20 thousands.

It cannot work in the long run.

idea2develop

And yet, you all do it, one rational step at a time:

go in with 1 contract at 10, long.

it falls to 9, it's even more convenient and you go in with another contract.

By the time it reaches 8, you go with a 3rd contract.

If it reaches 6, you're down 50%.

When it returns to 8, you get out because you feel lucky to only lose 10%, having been down 50%.

Then, it turns out you were right, and the market goes to 11.

You would have made 40%. But you are out, because you saw death in the eye.

It never works. Never. Never.

But you never realize it, at least I never do. I never learn it. Appearances keep deceiving me.

The only thing telling me the truth is statistics. But appearances do not tell you that if you run away from a dog, you risk more than if you don't. Counter-intuitive nature of dealing with dogs.

Rely on statistics. Follow your... stats.

I Got A Name (Jim Croce) - YouTube

Your pride... your pride removes your safety net.

You're climbing, you slip, and instead of paying the price at that time, you say "don't hurt me now for this mistake, but kill me later in case I am wrong again".

This postponing of the pain is what causes you to blow out your account.

And the pain is only pain because you're proud, because with a small stoploss, the pain is more in your pride and ego than in the account.

Pride traders have problems with blowing out their accounts I suppose. I know I am a proud and touchy and take it personally.

Why am I pissed off now? Because I didn't exit at the exact top of today.

How much of the account did I miss because of this? 5%.

A lot. What could have I risked had i stayed? The entire account in the state of mind I was in.

It is therefore a good thing to miss a profit of 5% and keep your account.

But I am thinking of that 5% that I made a mistake on.

I suck.
I suck.
I suck.

It was good that I exited even if I lost money, because when I did it, there was no way for me to know where the market would have gone. And I executed a long term plan.

It was good. It was good.

I was wise. I am an idiot now for regretting that I did not know the future. I am an idiot.

It was a smart and wise move to exit the trade and miss... what turned out to be 1000 dollars.

It is a stupid activity to regret not knowing the future. It is stupid to blame myself for trying to be wise.

I am being stupid. I am being stupid. I am being stupid.

 

[Yamato]

Awake, again.

I woke up one hour early. Something's still wrong with me.

I must get rid of all this excitement and frenzy in me. It is largely due to trading I guess, because I've solved my other problems at work, and the neighbors aren't bothering me anymore now that I'm sleeping upstairs.

Today I've entered my first discretionary trade since recovering from my martingale compulsive binge. This is a safe trade, because it's in a market that's characterized by what I call "stoplosslessness", the GBL. I placed my LMT sell in the 144 neighborhood. GBL is not likely to get higher than 146, so I placed it there and I'll keep it there, if necessary for weeks.

Also, one minute after thinking I wouldn't do it, I've placed a BUY LMT in the neighborhood of 1.07 for JPY, the infamous JPY, which almost made me blow out my account. But this time there's also a stoploss. Neither LMT order, on GBL and JPY, will probably be triggered.

Other than this, not much going on. The systems made a short trade on NQ yesterday, and made 200. This morning they have an ongoing trade on NQ, long, making 100. Yesterday a long overnight on NG got traded, that's losing 100 (all rounded figures).

I was going to buy melatonin but I decided against it, because I have heard in one of my health documentaries that if you buy it, the... or I've read it somewhere on the web, that if you take those pills the body will stop producing it. I decided I must keep sleeping as a consequence of relaxation rather than pills.

I know why complete relaxation is still lacking: trading. I am not at peace with trading, because of last few weeks of martingale compulsive gambling.

I've solved so many problems otherwise: neighbors, roommate, other office problems. There's almost no problems left. I almost feel guilty for having such an easy life. Especially compared to my colleagues.

No money problems, no fatigue from the office, given that I leave at 14.30, no stress from people, given that I avoid people altogether.

I don't know what else to add/remove in my life. Relaxing would be such a novelty. I usually look for some engrossing activity when I encounter a situation such as this one. But whatever I do, I must not look for thrills in trading.

 

[Yamato]

Regarding how I said... or maybe didn't say but thought that I have plenty of money. This is very interesting.

I am uber-rich if I have to compare myself to my colleagues, because 1) I don't have a family to support, 2) I have a family that supports me, 3) I have a salary, 4) I have trading, 5) I don't have expenses (I don't go out much either). So, while these people are making sometimes 3 times as much as I make, I ride cabs, and they take the bus. It's amazing. You see, they live beyond their means.

However, here comes the problem. It's tricky. I cannot quit my job, because 1) trading income is not stable, 2) I don't even know if I will make money at all, 3) I haven't saved enough to quit trading (obviously, given that my capital is 20k).

So I am extremely rich, and as an employee, I don't even know what to do with my money, but as a trader and as a capitalist, how do they say... "independently wealthy", someone who doesn't have to work... I am extremely poor. So I am kind of screwed.

This extra money in fact doesn't even bring me any happiness, and if I saved it, I wouldn't be able to quit my job that much faster, because the bulk of my capital is still in trading (it is now, because at the beginning saving did make a difference).

I wish I could find ways to use the few extra dollars i can afford to throw away every day, and make them multiply. But, other than trading, there is really no way to increase your money that I know of.

So I should maybe spend my extra resources monitoring the markets as much as possible.

 

[Yamato]

Back at the office and here for another 5 hours.

Doing good. Roommate not here.

Doing good, but what I'd like to achieve is imperturbability via the absence of humans within the radius of 1 mile.

 

[Yamato]

the equivalent of the stoploss in real life

I was thinking that the stoploss is inherently good and so there must be examples of similar situations in real life.

What examples can I think of?

For example. I can think of taxi drivers who try to rip me off. Every day there is about a 10% chance I'll meet one of those, because I take 2 cabs, and these dishonest people are about 5%. (Correct my probability theory if I am wrong).

Stoploss with these guys is the following. He rips you off by 2 euros, and if you get into a fight you stand to lose more money and even health if it turns physical. So don't get into a fight and consider that 2 euros as your stoploss.

In the same way, don't get into a fight with the market.

You don't know if the cab driver or another thief will return your money to you (or not take it), and in the same way the market. But in these situations it's best to let go, statistically speaking.

Follow your stats, as I said yesterday.

I can't think of many other situations though, at the moment. But I believe the stoploss, or in other words, a statistical approach to life, is a convenient method to adopt.

 

[D70]

Hi Travis,

Trying to solve an issue on TS.
I am pretty sure I'm being an idiot but I cant find a the word or function to test if something is "between" such and such a price. There is above and below ie. greater than, less than but sometimes they are other reversed so i need the function "between".

Any ideas?

 

[Yamato]

Let me see if I can remember my easylanguage from the office. I would simply say:

if close > x and close < y

Here's a typical system, actually twice as complex as those I kept (this one I didn't keep):

Inputs: test(0), test2(0), test3(0);
vars: sample(0),pre_SR_bars(0),post_SR_bars(0),entry_aft er(0);
sample = xx;
pre_SR_bars = xxx;
post_SR_bars = xxxx;
entry_after = xxxx;

If marketposition = 0
and low<=lowest(low,sample)[1]
and lowestBar(low,sample)[1] < pre_SR_bars
and lowestBar(low,sample)[1] > post_SR_bars
and time >= entry_after and time <= 1500 Then buy This Bar;
If marketposition <> 0 and time >= 1600 Then Exitlong This Bar;

If marketposition = 0
and high>=Highest(high,sample)[1]
and highestBar(high,sample)[1] < pre_SR_bars
and highestBar(high,sample)[1] > post_SR_bars
and time >= entry_after and time <= 1500 Then sell This Bar;
If marketposition <> 0 and time >= 1600 Then Exitshort This Bar;

 

[pecas]

I would like to make some comments on IB fx:

1. you can just create a new page in TWS, or add to your list, the following symbols:

no need to even open the other software (FX trader)

2. pay attention to CHF, CAD, JPY because the pair is inverted. For example buying CAD futures is the same as selling USD.CAD.

3. you can buy/sell as low as 1 unit of each currency, but IB considers as "full lots" the following quantities:
GBP: 17K
EUR 20K
NZD 35K
all the other ones: 25K
I suggest to use these lots or multiples of them. If you don't, you risk to pay a lot more commissions, because in this case IB is free to satisfy your trade with multiple trades (example, you want to buy 5000, they sell you 1000+1000+1000+1000+1000 with 5x the commission)

4. the commission plan is not friendly. Basically you pay $0.50 for each "full lot", but with a minimum of $2.50. In the end, if you buy/sell 5 lots or more all is ok, but 5 lots is the same as one futures contract, so there goes the main advantage of FX (granularity)

5. beware of the second currency in the symbol: if you buy/sell USD.CAD, for example, your result will be in CAD. If you lose here, and maybe win with EUR.USD, your USD balance will grow but you will have a negative balance in CAD. They will charge you with interests for this negative balance, even if it is -100. You can always exchange all in your base currency, but this costs you a lot in commissions (exchanging 100 USD to cover -100 CAD will be subject to commission of minimum $2.50)

6. IB FX is definitely fair most of the time: not even the same thing as forex everywhere else; but, if you use stop losses during data releases, expect huge slippage, like 10 ticks, on a regular basis (no good system can overcome this). If you don't use stops at that time, no problem with that.

 

[Yamato]

Wow, just as I thought. With each new instrument one uses, one adds opportunities to lose money with unexpected features of it. I better stick with futures, because I know them like the back of my hand.

Thank you for the precious and detailed information on IB forex.

For others interested in the subject, besides pecas' post, Liquid Validity has written two posts on it (mine is between them):
http://www.trade2win.com/boards/trading-journals/140032-my-journal-3-a-post2067750.html
http://www.trade2win.com/boards/trading-journals/140032-my-journal-3-a-post2067764.html

Pecas, let me know some day, whenever , if you would like to do one trade together.