TraderNumber7
Well-known member
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This is NOT irrational trading IF you understand WHERE to position the entries.
I'm not going to get into a long thesis on this subject, but this can be a VERY profitable way to trade.
Why? Because this market is efficient. This is one of the most "mechanically driven" markets in the world and that helps a great deal with an approach such as this, but you really do have to do your homework on precisely WHERE you place your orders and it requires a mastery of Stops. The reasons why you Buy or Sell, are the exact same reasons why you locate your Stop in a specific location.
But, what happens if I Buy (for example) and price just keeps falling?
Inside every trend, is a smaller reversal trend. Let me repeat that. Inside every single so-called trend, resides an ACTIVE reversal trend. Now, personally, I don't call these things "Trends" - I don't believe in Trends, per se. I call them Trajectories because that is precisely what makes up a Trend. Inside of every Trend, you will find Trade-able Trajectories but NOT at all times and in all locations within the so-called Trend.
This is why you can net consistent profits in a 230 pip move DOWN over 24 hours, by placing ONLY Long entries at very precisely determined locations within the same 230 pip downward move. Trying to catch a falling knife? Yes! If you fail to understand WHERE and WHY to enter Long. Otherwise, it is a very Stealthy way to trade - again - IF done correctly, as by definition it will always lead the Trader to the Trend Reversal Point - automatically.
Definitely, not irrational, but VERY dangerous if you don't know how to do it.
Don't try this at home with real cash until you have mastered the art AND the mechanics behind WHY and HOW it works.
Good post as it expresses someone who is actually using their brain in unconventional ways. Never bad thing when it comes to trading.
I'm not going to get into a long thesis on this subject, but this can be a VERY profitable way to trade.
Why? Because this market is efficient. This is one of the most "mechanically driven" markets in the world and that helps a great deal with an approach such as this, but you really do have to do your homework on precisely WHERE you place your orders and it requires a mastery of Stops. The reasons why you Buy or Sell, are the exact same reasons why you locate your Stop in a specific location.
But, what happens if I Buy (for example) and price just keeps falling?
Inside every trend, is a smaller reversal trend. Let me repeat that. Inside every single so-called trend, resides an ACTIVE reversal trend. Now, personally, I don't call these things "Trends" - I don't believe in Trends, per se. I call them Trajectories because that is precisely what makes up a Trend. Inside of every Trend, you will find Trade-able Trajectories but NOT at all times and in all locations within the so-called Trend.
This is why you can net consistent profits in a 230 pip move DOWN over 24 hours, by placing ONLY Long entries at very precisely determined locations within the same 230 pip downward move. Trying to catch a falling knife? Yes! If you fail to understand WHERE and WHY to enter Long. Otherwise, it is a very Stealthy way to trade - again - IF done correctly, as by definition it will always lead the Trader to the Trend Reversal Point - automatically.
Definitely, not irrational, but VERY dangerous if you don't know how to do it.
Don't try this at home with real cash until you have mastered the art AND the mechanics behind WHY and HOW it works.
Good post as it expresses someone who is actually using their brain in unconventional ways. Never bad thing when it comes to trading.
I've heard of such an approach before - e.g. every time the Dow drops 200pts, open another long position. Getting in at the bottom of the downleg and out at the top of the short-term bounce is surely the ultimate gymnastics without a safety net.
This requires unlimited capital or unlimited nerves and me and most of us have neither.
This requires unlimited capital or unlimited nerves and me and most of us have neither.
Adamus
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why is this technique called 'non-linear'?
Non-linear in mathematics refers to a type of algebra where the initial equation cannot be elucidated from the output graph that it generates and typically market movement is considered either non-linear or random - so the name implies some kind of formula which can predict non-linear movement which is by definition not possible.
I guess it's just a cool sounding name - where does it come from?
Non-linear in mathematics refers to a type of algebra where the initial equation cannot be elucidated from the output graph that it generates and typically market movement is considered either non-linear or random - so the name implies some kind of formula which can predict non-linear movement which is by definition not possible.
I guess it's just a cool sounding name - where does it come from?
timsk
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A curious debut post volnmar - what threat are you referring to? Or did you mean thread? If the latter, what's wrong with it?
Tim.
wrong letter iam sorry "thread"... because non-linear trading is something completly different