Paper to real money

[littleangie01]

Hi

Seem to be caught in a never ending cycle of:
Backtesting systems, paper trade, move to real money - lose money - start over with a new system rinse repeat.

My current system has been consistently profitable for 10 weeks paper trading. So I've moved to real money and in 2 weeks I've just lost money. Placed stops - stuck to signal entry points and traded with the trend. No revenge trading which is a biggy for me and recorded every trade.

Very confused I don't know if it's me, my system, a losing streak in the system or what it is. Another pattern is that I'll start messing with the system adding extra filters ADX or stochastics.

Thing is if I carry on paper trading I'm never going to confront the emotional side of trading.

Thank you for reading.

 

[Pat494]

Do you want to give bare details of your system and platform ? Someone may help.

Good luck.

 

[littleangie01]

Do you want to give bare details of your system and platform ? Someone may help.

Good luck.

Meta 4
Bollinger bands

Very simple really

 

[tomorton]

Bollinger Bands are a lagging indicator masquerading as a predictive indicator (which doesn't exist by the way, there's no such thing). There is no need to use an indicator to tell you what is probably going to happen next - you already know this, you are trading with the trend, so the most probable thing that price will next do is continue.

Adding this or other indicators will tell you nothing more that you need and will potentially cloud your judgement at crucial decision points. At the least they will distract your attention.

A sound MA is all you need and that is only to confirm what you already see, that a trend is in place - maybe also to allow you to gauge the strength of one trend against another - BUT, that's all they do.

Predictably, my advice is ditch the indicators and stay away from day-trading.

 

[littleangie01]

Well if you think I shouldn't day trade then there is nothing more to say really.

 

[Dowser]

Well if you think I shouldn't day trade then there is nothing more to say really.

Trade what ever time frame suits you - but I agree that indicators are a waste of time

 

[littleangie01]

Trade what ever time frame suits you - but I agree that indicators are a waste of time

By that do you mean you only trade candlestick patterns or just hop in on the trend. Even if it is a simple trend following system surely there has to be some method behind it - entry points, stops recognising oversold, overbought and the like.

Admittedly my systems start out simple but then I add on extra indicators as I start to lose then it just gets silly.

Thanks

 

[Dowser]

By that do you mean you only trade candlestick patterns or just hop in on the trend. Even if it is a simple trend following system surely there has to be some method behind it - entry points, stops recognising oversold, overbought and the like.

Admittedly my systems start out simple but then I add on extra indicators as I start to lose then it just gets silly.

Thanks

One thing you could look at is where the price is in relation to the yesterday's median price. Is it above or below? Moving to it or away from it? and how far away from it is it? (in relation to an average daily price range) and so on....

 

[tomorton]

Well if you think I shouldn't day trade then there is nothing more to say really.

At the risk of ignoring your suggestion, I will say trading is more than day-trading. The last people to make money from Day 1 from day-trading were the tech buyers blindly buying on something new called the internet in 1998-2000. Since then, day-trading has just been a way for brokers to lure in new clients and make money from them. Only the best of the best can do it and you might well be joining their ranks one day, but almost certainly not if you start out trading by day-trading.

 

[Pat494]

To follow up other's advice you can use 10 moving average smoothed to get a handle where the prices are. Takes time to see what's going on. Try practicing on shorter time frames or you will probably get bored.

 

[littleangie01]

Thanks for responses - I'll take a look at median prices - not used that before at least it's a stop loss idea.

I use 10 day already - I think I've used every indicator out there and wrote my own so I can only conclude it's my mental state.

I do buy and sell shares and have had modest returns - but I do agree day trading is a lot different - mentally.

Thanks again for taking the time to reply

 

[-Catalin-]

Hi

Seem to be caught in a never ending cycle of:
Backtesting systems, paper trade, move to real money - lose money - start over with a new system rinse repeat.

My current system has been consistently profitable for 10 weeks paper trading. So I've moved to real money and in 2 weeks I've just lost money. Placed stops - stuck to signal entry points and traded with the trend. No revenge trading which is a biggy for me and recorded every trade.

Very confused I don't know if it's me, my system, a losing streak in the system or what it is. Another pattern is that I'll start messing with the system adding extra filters ADX or stochastics.

Thing is if I carry on paper trading I'm never going to confront the emotional side of trading.

Thank you for reading.

How did you backtest?

 

[littleangie01]

I don't have an automated system so it's just eyes and excel really. I've paper traded this system and it's worked well for 10 weeks or so best results I've had so far from any system. Not sure if 10 weeks is enough but it seems reasonable.

 

[-Catalin-]

I don't have an automated system so it's just eyes and excel really. I've paper traded this system and it's worked well for 10 weeks or so best results I've had so far from any system. Not sure if 10 weeks is enough but it seems reasonable.

what was the largest number of losers in a row that you experienced while testing?

Also, while testing, when you were looking at the chart did you work off the centre of the chart or the extreme right? I am asking this because even with a system sometimes a decision has to be made and if you look at what would have happened your mind becomes biased and you could convince yourself that you wouldnt have taken on a loser or definitely would have taken on a winner. For accuracy purposes you need to decide how you'd treat the 50/50 opportunities and be consistent.

How many losers in a row have you had since going live?

 

[littleangie01]

Real money 62% win rate 3 pip average
Real money 38% loss rate 10 pip average


Backtesting and paper trading were about the same - no more than 3 in a row.
Paper 4 in a row

Paper 70% win rate average gain on each trade 7 pips
Paper 30% losses average loss on each trade 7 pips.

Real money 62% win rate average gain on each trade 3 pips
Real money 38% loss rate 10 pip average loss on each trade 10 pips

The stops are around the same place on both paper and cash.
The problem could be not able to hang onto winners I've been better at letting them ride with this system on paper.

Cash - to be honest I got out of a few with a small gain before I lost more - I've not been recording potential profits had I stayed in so hard to say for sure how much getting out to quickly is contributing.

 

[-Catalin-]

my guess is you dont trust it yet. The limit is as important as anything else and fundamental for your strategy to have a positive expected return.

You won't be the first nor last that closes trades early for a fraction of the desired target just work on it .

 

[gerryg]

Hi

Seem to be caught in a never ending cycle of:
Backtesting systems, paper trade, move to real money - lose money - start over with a new system rinse repeat.

My current system has been consistently profitable for 10 weeks paper trading. So I've moved to real money and in 2 weeks I've just lost money. Placed stops - stuck to signal entry points and traded with the trend. No revenge trading which is a biggy for me and recorded every trade.

Very confused I don't know if it's me, my system, a losing streak in the system or what it is. Another pattern is that I'll start messing with the system adding extra filters ADX or stochastics.

Thing is if I carry on paper trading I'm never going to confront the emotional side of trading.

Thank you for reading.

If you have no clear understanding of what moves big money or what drives smart money flows, then indicators are useless. They simply show past. What your system need to aim on is prediction or at least understanding what has been done by banks or hedge funds using data available to public. Trading is about information advantage or right interpretation of the events happened that may affect market sentiments. If you are not math genie that can mathematically calculate market edge then find instruments where decisions are made by humans and learn how to predict them.

 

[Pedro30]

If you have no clear understanding of what moves big money or what drives smart money flows, then indicators are useless. They simply show past.

So what? Do you know prices? They also show the past, nevertheless everyone is looking at them...

 

[tomorton]

So what? Do you know prices? They also show the past, nevertheless everyone is looking at them...

Yes. Everything a private retail trader needs is in the charts. There's no point being a genius who knows everything about how the market works - if price isn't going up, your long is worthless.

 

[piphoe]

if price isn't going up, your long is worthless.

that's priceless tom! that about sums it all up lol