successful traders

[cj12]

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[Anonymous]

I think allowing 1 : 2 risk:reward on entry is more appropriate. After entry, if the trade is favourable the stop can be moved to breakeven and the target moved higher to allow more upside potential, similar to trailing. Considering the bid-ask spread and the commission, a 1:1 ratio doesn't seem favourable.

 

[cj12]

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[charliechan]

very much depends on what market you trade and the characteristics of that market at the time you are trading. sorry - but i think its too vague a question to get any meaningful response.

i have never traded ym so i couldnt comment. i hear it can be quite choppy though - which is why you have more success with 1-1 given your risk tolerance.

number of trades a day is also very individual, and a function of experience. a new trader could get tiered trading all day(8 hrs) every day. breaks are vital. for an experienced 'hardened' trader it may not be a problem. age could also determine this. scalpers frequently do 100's of trades a day. so strategy is also dependant.

as for my self - and i dont like to give too much away (especially to unknowns), i usually have a target in mind based on what i know about how markets work. when (if!) that level is reached i wait to see what happens next. no prizes for guessing what i do under what circumstances

i am perhaps more of an intuitive & discretionary trader than an autopilot. i think as a trader matures, he becomes more intuitive in his actions and less mechanical as market feel develops. only screen time though will allow this.

i think the most important thing for you to do is do what works for you as long as you are making money. your perceptions are so much stronger and positive when you are in this position than when you are a consistent loser. you see ways in which you can improve your trading which you would never have seen when you were a loser.

disregard everything that you read in books and web sites and keep to what works for you. i am starting to believe inf fact that some (NOT ALL) of the numbskulls on this site could actually harm development and clear thought.

 

[Anonymous]

A 1:3 is possible but less often achieved.

A 1:1 would be good if a trader can be right, say, 99.9% of the time, which is very unlikely.

If target at 1:2 and within 1 or 2 minutes of entry, target is achieved, well and fine. If let's say the target is at 20 pips, and immediately after entry the price:

1)shoots favourably to 10 pips profit, and the stop is moved to breakeven, the position is protected, thus and trader makes fewer losing trades even if he doesn't make a profit from that trade.

2)shoots to 15 pips profit, if the stop is moved to 10 pips profit, the trader has already secured 10 pips profit. Whether or not to move the target higher would be up to him.

On the other hand with a 1:1, assuming a trader can be 99.9% correct in his trades, well and fine, but what if he cannot? If the trader hits the period of the losing streak, his 1:1 profits will be eroded. Let's say 10 losses in a row?

Contrast a 1:2 or a 1:1.5, the 1:2 gains can more or less compensate for the losses if and when the trader does hit the period of the losing streak.

 

[cj12]

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[senyorqueso]

sun,

Can't say i qualify as a successful trader yet, so feel free to ignore the rest of this post!

I'm coming to the conclusion that small profit targets are the way to go, maybe 3/5/10 YM points per trade with a stop far enough away to keep out of the noise but not too far away that it will cancel out too many winning trades if hit. So maybe a 10-15 point stop but get out early if it doesn't feel right or you get an exit signal. It means you'll miss out on some big moves, but what does that matter if you can make consistent profits anyway? It also means you can repeat the same trade a few times within a short time instead of just staying in and watching your profit come and go again and again.

From a risk-reward point of view this seems terrible, but smaller targets have a higher probability of being reached in a shorter time. From what little testing I've done of this sort of trade I can get a pretty high success rate, but I need to be more disciplined in getting out of the losers early.

Had a good session tonight, which was the first time I've tried this for real - 6 wins and 1 loss, resulting in 23 points profit (minus commisions). I'd be quite happy if I could do the same every day.The annoying thing was there there were plenty of signs to get out of the loser early for a smaller loss, but I found myself just hanging on and hoping until the stop was hit.

If I can start to get consistent results, I'll up the number of contracts, and maybe try to get more out of a portion of the position. Still - one step at a time!

 

[cj12]

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[eddyjo]

Senyorqueso, Am I right in thinking that you are a 'cheese lover'?

 

[senyorqueso]

I certainly am.