Did you suffer before doing well or vice versa?

Hi guys .
I have been trading for around 8 mths now full time . I was not on a good footing when I started financially - at all , due to leaving a former job which left me in that state so it was sink or swim and I decided to try swimming and trading as I'd always had an interest in it .
So this was started in the Bull market and I did very well , my account doubled within 4 mths or so .
I was well aware that things should come down and continued doing pretty well [ not as but pretty ] into this year ajusting to a more concervative approach and percentages in my trades.
Until I started making some really stupid moves, some panic selling and buying and with the maket so turbulent my reading seems to be off non stop. Accounts down 30% on principle and I am starting to wonder .
But- I also have huge faith in just what can be achieved on the stock market and have seen it many times over and done it myself but ofcause right now in my present state I am also wondering.
On one hand I have done very well and in not only the good times especially for a beginner but on the other , sh't seems to be hitting the fan right now and it has costed me more than I can afford .
So I wonder , how many go through this or have gone through it yet persisted and came good whatever - got worse , is it a common situation in your first 12 mths bla bla , have you persisted and turned the corner the wjhole bit youknow .
I'd really like to hear how it has been or was at the beginning or at times and what has eventuated for people here that do trade full time and depend on that income as their only income.
Personally I think it's a great job and you can be rewarded big time , I feel I should soldier on but if my account gets much lower I've lost too much which is really going to stuff things up but - good trades pick it up again just as quick so it's confusing .
Any thoughts or stories appreciated.
Cheers
Blaster
PS I realize people probably won't wanna discuss their hard times but - even if one reply it would be appreciated so if there is anything you'd like to say - or advice too actually of course , I could certainly use it right now . cheers

How about putting things in paragraphs and then someone might actually read it.

Something to remember blaster - if you start with a nominal $100 and lose 30% you're down to $70.

To get back up to $100 again you have to make $30 which is 43% of $70.

i.e. when you lose it you have to work twice as hard to get it back (have to make 43% profit to get back the 30% loss). That is why capital preservation and money management needs to be the highest priority.

Yep its not an easy market to work in at the moment - just look at LGL today for example! :eek:.

It's time that you review your trading performance. As you are running a business then you will have kept detailed records of all your trades. Look at them. Did you follow your plans? Rate your performance on every trade, be honest. If you have more crosses than ticks then it is obvious you will need to change what you are doing. The review will identify if you need to improve your entries or exits. How did you manage the risks, properly according to your plan or not?

If you don't have any plans or don't have a process to review all aspects of your business, then is it really a business? Hobbies are for fun, businesses must be profitable to survive.

Imagine if you had to show all details of your business to a business analyst (like dhukka). What would be their response to you? If this worries you then you know that things have to change. Find them and fix them.

Having a bad day?

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Lots of problems in there Blaster.

1. Are you an investor or a trader? I will assume trader.
2. Starting off without enough capital as a trader will kill you.
3. As Peter mentioned, have you foolowed your plan? Did you have a plan? If not, why not?
4. Im a firm believer that you should not put $$ in you cannot afford to lose, especially when starting out.
5. Would you expect to excell in a normal new job after a few months?
6. Low capital means lower % returns.

A lot of things for you to consider, and im sure 'traders' could add a lot more

How about putting things in paragraphs and then someone might actually read it.

What so out of all this - all your worried about are pretty paragraghs, you must be doing well then that's forsure. Buy a painting !
Have a good one

Blaster you are not likely to get much more than the usual reply to these problems as you have given no details. Until you can list some problems this thread will be filled with the usual problem reply. They are all valid but you probably have heard them before.

You have 8 months of experience/results. You tell us what is the biggest problem for you at the moment is. Someone will be able to point you in the right direction.

What type of trading have you been doing to start off with?

Everyone who has traded has gone through draw-downs most have gone through a couple of blow-up. Ain't nothin new there.

Until I started making some really stupid moves, some panic selling and buying and with the maket so turbulent
Looks like you have answered your own questions.
1. Take a deep breath.
2. Think: TODAY is the FIRST DAY of the REST OF YOUR LIFE.
3. Examine your current financial position.
4. Assess your own capability.
5. Act according to your own judgement.

Best of luck. And remember you make your own luck.

My tip as a trader. Stop trading. This is a very crap market for traders. Find something else to do that makes money for a while. Nearly impossible to make money in a market like this, but very very very easy to lose it. Come back when things are better. Dont trade till you have nothing. Its not worth it. I think every trader would say these are difficult times.

It's time that you review your trading performance. As you are running a business then you will have kept detailed records of all your trades. Look at them. Did you follow your plans? Rate your performance on every trade, be honest. If you have more crosses than ticks then it is obvious you will need to change what you are doing. The review will identify if you need to improve your entries or exits. How did you manage the risks, properly according to your plan or not?

If you don't have any plans or don't have a process to review all aspects of your business, then is it really a business? Hobbies are for fun, businesses must be profitable to survive.

Imagine if you had to show all details of your business to a business analyst (like dhukka). What would be their response to you? If this worries you then you know that things have to change. Find them and fix them.

Thanks very much Pete I really appreciate this .I know I have allot to learn .
In a fashion I have sort off - in my way , done what you are saying here a few times of late . But some I have just read and predicted totally wrong pure and simple . They've done opposite even when that looked impossible , a no brainer ! I realize that's happening allot this year but . Others are things I know I have done wrong and need to correct and am working on , learning curbs .

Must admit , one thing has come out of all my analisis is the old ordering or selling finger [ on that key board ] seems to be my worst enemy at the moment.
It certainly isn't a hobby , I can't afford one right now and my plan has been good but it seems you have to be disciplined and beyond when things get turbulent in this business especially green .
So I decided the safest bet was lower my percentages and only deal in the mega concervative stock that I know fairly well and have followed.
Next minute one of the no brainers pop up , I've deviated and done a dollar . Meanwhile the very stock I've had in mind and ordered but cancelled - comes in and even well under what I was willing to pay for it if only I'd waited which I spose happens to everyone but I do seem to be doing extra well in that area lately .

Cheers
Blaster

So in other words you have answered your own question.

You know what you are doing wrong, so you either need to fix it, or find another income source in these volatile times...

(My 1000th post. :D )

My tip as a trader. Stop trading. This is a very crap market for traders. Find something else to do that makes money for a while. Nearly impossible to make money in a market like this, but very very very easy to lose it. Come back when things are better. Dont trade till you have nothing. Its not worth it. I think every trader would say these are difficult times.
Your kidding?

All for capital preservation and not losing money when your cold but just because she's not going straight up doesnt mean its not a market to be traded. I consider this volatility the best of times.

Yeh, as mentioned above, I think you need to give details of your trades.

What analysis are you basing your trading upon? What kind of trader are you? What is your base capital? My beleif is that to live on it, you need a VERY high base to start with. If you dont have one, go back to working at least part-time, that way you can supplement your trading profits. With my run lately, I am looking to do this myself.

Definately keep a trading log, sounds like your own psychology is a big issue! Work out what kind of trader you are (as far as psychology) and base your style and instrument you trade around that.

Full-time trading is NOT the flashy, fast paced lifestyle that its made out to be, as far as my experience doing it. Infact, I find I have to be a lot more conservative with my outlays, but at least I have freedom.

You need to really expand your post to include details, if you want feedback.

I personally, started out last financial year a LOT more seriously (though have dabbled since the age of 12), and had a pretty good year for the period I was trading. First part of this financial year I had a fantastic run, some of my trades were "gold" ;) and my profits ran and ran until the trend turned. I was slow to pick the momentum shift and lost a lot of my initial profits (bad mistake from my experience so far). I found I really need trailing stops so when you make profits initially, you at least get to bank some of your profits and dont end up breaking even or slightly negative on the trade (which has happened to me on NUMEROUS occassions these past few weeks). I generally dont have a big problem with entry, its the exit that does me!

Hope at least some of this helps. Would be helpful if you could answer the questions.

Cheers

Blaster you are not likely to get much more than the usual reply to these problems as you have given no details. Until you can list some problems this thread will be filled with the usual problem reply. They are all valid but you probably have heard them before.

You have 8 months of experience/results. You tell us what is the biggest problem for you at the moment is. Someone will be able to point you in the right direction.

What type of trading have you been doing to start off with?

Everyone who has traded has gone through draw-downs most have gone through a couple of blow-up. Ain't nothin new there.

Thanks Trembling .

I know allot of you guys must have really been there - how do you know though to be or not to be - wait until the cuboard is totally bare or ?
I will get back and lay a few details out .

Speaking to one guy he'd gone from 50 grand down to two in his first year .
He says he thought well , I only had two grand left so what's it matter now and he kept trading , reckons even at that he felt he could still be a good trader. He climbed back to 4 and then 10 and eventually back to where he was and on. He reckons he finds it so easy now he feels guilty but it took him four years to get to where he is and his very comfortable - his words.
Cheers

What so out of all this - all your worried about are pretty paragraghs, you must be doing well then that's forsure. Buy a painting !
Have a good one

Paragraphs aren't pretty, they're just normal a normal part of writing. I guarantee if you had written it out in paragraphs more people would read it and probably reply. Unfortunately that wouldn't necessarily mean any better quality responses. Often, sloppiness in one aspect of a person's life is indicative of their approach to other aspects.

BTW: A dictionary wouldn't go astray either.

Paragraphs aren't pretty, they're just normal a normal part of writing. I guarantee if you had written it out in paragraphs more people would read it and probably reply. Unfortunately that wouldn't necessarily mean any better quality responses. Often, sloppiness in one aspect of a person's life is indicative of their approach to other aspects.

BTW: A dictionary wouldn't go astray either.

dhukka did you use to be a school teacher coz ya sound like one.

CATAPILLAR

When I first started trading, I followed techniques that I gathered from many books. These included 'new' guys like Guppy, Tate as well as older ones such as Gann and Larry Williams to name but a few. The system worked - for a while, then I lost all my money. I gave up trading in disgust and simply invested in the market every time I saved up some cash. But time has way of making one forget and the last few years I have been studying trading instead of actually trading. By using software (VB4 and Tradestation) and daily data from Norgate I have been able to test all of those techniques which are mechanical in nature on many stocks and futures.

So I might as well tell you the secret I found.......
I found that making a living out of trading over decades is next to impossible using mechanical systems. Yes some systems make money but when you look at the drawdowns and put that info into a montecarlo simulator the risk of ruin can be very high!
So be careful, very careful!

Thanks Trembling .

I know allot of you guys must have really been there - how do you know though to be or not to be - wait until the cuboard is totally bare or ?
I will get back and lay a few details out .

Speaking to one guy he'd gone from 50 grand down to two in his first year .
He says he thought well , I only had two grand left so what's it matter now and he kept trading , reckons even at that he felt he could still be a good trader. He climbed back to 4 and then 10 and eventually back to where he was and on. He reckons he finds it so easy now he feels guilty but it took him four years to get to where he is and his very comfortable - his words.
Cheers

Blaster I only became reasonably consistent after 4 years up until then I had blow a number of $10K accounts, guru one second busted the next.

One of the factors that I believed played a significant part in becoming consistent.

Concentrated on a method and tested it manually to death. So I knew when it worked and when it wouldn't. There are lots of reasons for doing this least of all is proving the method.

I suspect the $50K guy has only traded a bull market, we are in a whole new ball game now......

Your kidding?

All for capital preservation and not losing money when your cold but just because she's not going straight up doesnt mean its not a market to be traded. I consider this volatility the best of times.

The futures have been great lately... but stocks have been porcupine esque when it comes to entries by the looks...

The futures have been great lately... but stocks have been porcupine esque when it comes to entries by the looks...

I know nothing about futures I mainly I spose you'd call it swing trade at 5-25% which has done me really well up until just recently . Sorry state of late though .
Do agree with trembling though there is so many opp's out there with things the way the are .
If I could read it I'd prefer it to any to tell you the truth but hell you can't even read BHP or RIO at the moment - I can't anyways. To me probably the most two predictable stocks on the market that I know off.
But there's no pattern right now anywhere - resistence mean nothing , charts , who buys out who . Things take off this time last wk yet good news from the states this wk at the same period but it dies - all very weird right now .
One company does something huge- nothing , another does nothing , jumps 40% she's a whole new animal lately isn't it - well to me anyway which I guess all the pro's have delt with many times eh.
Where as I do agree with trembling I also see other remarks here as she is certainly not behaving herself and without the experience and the old account looking pretty grim- beginning to wonder if I should be on that fence for awhile.
Cheers

(1) I dont think you know whether your trading plan or the way your trading has a positive expectancy.From what youve written

Meanwhile the very stock I've had in mind and ordered but cancelled - comes in and even well under what I was willing to pay for it if only I'd waited which I spose happens to everyone but I do seem to be doing extra well in that area lately .

I doubt you have one which you know will return consistent profit---hit and miss,in a bull market you can have more hits than misses.

(2) It appears you only trade long. If you dont have the capability of trading short and your trading stock only the next few years will see you out of the business of trading.

(3) More than likely your holding your losers and cutting your winners short.

of all my analysis is the old ordering or selling finger [ on that key board ] seems to be my worst enemy at the moment.

Id take the advice of not trading until you know you have a consistently profitable trading methodology.Its OK for TH to suggest you keep going if you had a clearly profitable method with a blueprint of results that was showing wether you were simply in drawdown or going broke.

Thats about all I can add from the little info presented.
A plans not worth the paper its written upon unless you KNOW WHY its profitable.
If you cant answer this your in the wrong business.---well possibly not for much longer.

Talking of BHP it is aging down in LSE tonight :banghead: No dead cat bounce either for this baby. Someone does not like BHP.....

How about putting things in paragraphs and then someone might actually read it.

Great post dhukka.

you feel like a big man now. :bigthumb: :rolleyes:

BTW: A dictionary wouldn't go astray either.

It looks like the dictionary has already gone astray. :)

My advice:
Take one trade at a time and try to detach yourself emotionally from the excitement/fear you encounter as you trade.
Before you trade, count to 10, walk around the room. Stop and think, do I really want to do this? Am I sure? Then write down your exit plan. If it goes up I get out at ..., if it goes down I get out at..., after x period of time I ..., etc. Then, if you are sure carry out the trade. Then stick to your exit plan.
You will be right some of the time and wrong at other times. Accept that rather than get upset when you are wrong.

Great post Dhukka
Blaster needs advice not a teacher, if you have nothing good to say please dont say anything

Great post Dhukka
Blaster needs advice not a teacher, if you have nothing good to say please dont say anything

Auh... don't be too tough on the old perennial on-heat magpie. It's about all he knows what to do. :rolleyes: ;)

In another thread my old mate dhukka... funny that... he tends to try to make people whom he clashes with... dhukka for cover :o... anyway, he had trouble winning the point so he nit-picked on a little spelling error of mine.

Needless to say, he made a spelling error in the very same post and again in the next when he got more excited (trying to) rubbishing me.

The moral of this story... keep your mind on the job at hand... playing the market. Critics will pesta ya like a pissed perrennial on-heat magpie trying to protect their position. :hide:

Aim to take high percentage (fundamental) positions so that if your timing is a bit out you get another bite of the cherry next time around. :bounce:

(2) It appears you only trade long. If you dont have the capability of trading short and your trading stock only the next few years will see you out of the business of trading.



Actually, one of the most successful traders I have read about, Gary Smith, basically only traded long for years and on mainly stocks (well mutual funds, but still a "stock" all the same).

Not sure his progress over the past several years, but his trading statements were damn impressive! Weird style of trading, but hey, it worked for him! Barely had a loosing month in over a decade I beleive, 15 years if I remember correctly (only skimmed much of the book).

Blaster: If you are serious you will do this.
Review your last ten or more trades. I have prepared a checklist to help you get organised.
If you don't have any written trading plans then I am wasting my time and so are you.

Planning: (5 points total)
Trade setup: the setup was perfect according to your plans. This includes any confimation filters that you might use. (1 pt)
Entry trigger: You identified the price trigger that would tell you when your trade starts. (1 pt)
Exits: You identified the correct price that would invalidate your setup (stop loss). (1 pt)
Exits: You decided on a trailing stop strategy or a price target to take profits. (1 pt)
Position size: You calculated the correct number of shares to buy in accordance with your money management strategy. (1 pt)

Trade Execution: (5 points total)
Entry: You started the trade at exactly the right time and as soon as price triggered your entry. (2 pts)
If you entered asap after you noticed that the trade had triggered but not immediately. (1 pt)
If you entered before the trigger or waited and entered late. (0 pt)

Exit: You exited the trade at the stop loss or the trailing stop or the profit target (breakeven is a trailing stop designed to lower the risk). (2 pts)
If you exited after hesitating, but close to your planned exits. (1pt)
If you ignored or even changed your exit strategy. (0 pt)

Documentation: You have detailed records of the trade including your thoughts about any aspects of the trade. (1pt)


A disciplined trader will score 10/10 almost every time. There will be an occasional 9/10 if either the entry or exit wasn't perfect.

Pete.

This is good stuff but.

Even scoring 10/10 you could still be unprofitable in fact you could go broke.
You need to know that in the long term you either.

(1) Have more winning trades than losing trades.
OR
(2) Your winning trades in aggregate are more than your losing trades in aggregate.
OR
(3) A combination of both.

Auh... don't be too tough on the old perennial on-heat magpie. It's about all he knows what to do. :rolleyes: ;)

In another thread my old mate dhukka... funny that... he tends to try to make people whom he clashes with... dhukka for cover :o... anyway, he had trouble winning the point so he nit-picked on a little spelling error of mine.

Needless to say, he made a spelling error in the very same post and again in the next when he got more excited (trying to) rubbishing me.

The moral of this story... keep your mind on the job at hand... playing the market. Critics will pesta ya like a pissed perrennial on-heat magpie trying to protect their position. :hide:

Aim to take high percentage (fundamental) positions so that if your timing is a bit out you get another bite of the cherry next time around. :bounce:

Noone has trouble winning points of you because you've been completely wrong with every call you've made on the markets year. Your record speaks for itself.

Great post Dhukka
Blaster needs advice not a teacher, if you have nothing good to say please dont say anything

Funny that, I don't get paid to teach but I do get paid to give advice. I suspect Blaster needs advice on a lot of things, the best piece of advice right now would be for him to stop trading for a while. What he doesn't need is meaningless cliches that he can find on the back of a cereal packet.

Its not about being right its about being profitable.
Being right 30% of the time can still bring massive profits.

Funny that, I don't get paid to teach but I do get paid to give advice. I suspect Blaster needs advice on a lot of things, the best piece of advice right now would be for him to stop trading for a while. What he doesn't need is meaningless cliches that he can find on the back of a cereal packet.

I have to agree with this.

Blaster appears to have a LOT to learn and should probably stop and read read read, until he starts risking his $$$.

I am yet to see one trading strategy from him.....

I think he would be better waiting for a bottom of profits, the SP to catch up with this and a turnaround in profits, before he starts investing. And I mean investing.

If you are going to trade, you should learn everything possible and establish your own trading style which prooves profitable (and better than indicies).

Funny that, I don't get paid to teach but I do get paid to give advice. I suspect Blaster needs advice on a lot of things, the best piece of advice right now would be for him to stop trading for a while. What he doesn't need is meaningless cliches that he can find on the back of a cereal packet.

You still here dhukka ! Reckon we'll have some fun in the future .
Actually I did a post this morning on exactly what I do and some of my lately wonderful trades , allot of work to but it seems to have gone West.
As I said though I basically do quick trades and shoot for 5 to even 30% sometimes which has gone very well until recently - now west like my post of late though .
I trained and studied my area for 3 yrs and follow my stratergies which I really like and have served me well but - also gone West to lately and suddenly my calls are all wrong.

I also joined an advisery when things started to look ugly on the market knowing I was a bit green to read it under those conditions and their advice actually wiped out a good size chunk of my account .
I also joined another mob and between there stock and their fee - another chunk and I parted company .
I also started actually reading some of the dozens of reports I get in daily when things began getting ugly and again their views costed me.
My calls turned sour of late have only actually taken 20% of it down .

I only deal with me and real people that actually trade now .
But you are right about the break , thinking about it myself - even some p/t work as someone else was saying here - sit back for a mth or two and regroop is my first step. Wifey says I've suddenly become flustered and it has me out of wack . I need it and she's right so that's step one.

Cheers

Actually I did a post this morning on exactly what I do and some of my lately wonderful trades

I trained and studied my area for 3 yrs and follow my stratergies which I really like and have served me well

even some p/t work as someone else was saying here - sit back for a mth or two and regroop is my first step.

Cheers

First two paragraphs, where did you post these? Do you use TA (which particular TA strategies?), FA (what do you look for in your FA?) etc?

Last paragraph was suggested by me. As I said, I beleive you need a LARGE base to trade for a living. I would say well over $100k, which is measly if your trying to live off it, unless you can make 50% p.a on average which is RARE (practically unheard of), no matter who tells you what!

Anyways, answer those above questions or point me out to where you posted them? I would be interested to know.

Good luck mate!

Peter2 - good post - easily implemented starting point for putting structure around each trade, and also an immediate guide to the beginner as to how emotion gets involved in the equation, and also provides a log to go back over and review.

What do you think blaster? - do you do this already and if not will you give it a go? Even if you take a break from the markets you could at least paper trade Pete's approach for a bit.

I suspect that what youve been doing so far is not trading or investing, but gambling, using the market as your roulette wheel. If only going long this is obviously more succesful in a strong bull market and less succesful in a flat or falling market. If you like gambling and only gamble what you can afford to lose there's nothing wrong with it - though its good to understand that this is the reality of what you are doing. On the other hand, if you want to become a trader or investor then there's plenty of good advice on this thread to get you further on the way.

unless you can make 50% p.a on average which is RARE (practically unheard of), no matter who tells you what!

Do you really believe that?

Do you really believe that?

I would say for anyone to make 50% pa compounding consistently over a period greater than 5 - 10 years would be very very rare indeed. The longer the timeframe moves out the rarer it would get.

In 10yrs that is turning 10k into nearly $600k.

I sure havn't figured that out yet... ;)

(1) I dont think you know whether your trading plan or the way your trading has a positive expectancy.From what youve written



I doubt you have one which you know will return consistent profit---hit and miss,in a bull market you can have more hits than misses.

(2) It appears you only trade long. If you dont have the capability of trading short and your trading stock only the next few years will see you out of the business of trading.

(3) More than likely your holding your losers and cutting your winners short.



Id take the advice of not trading until you know you have a consistently profitable trading methodology.Its OK for TH to suggest you keep going if you had a clearly profitable method with a blueprint of results that was showing wether you were simply in drawdown or going broke.

Thats about all I can add from the little info presented.
A plans not worth the paper its written upon unless you KNOW WHY its profitable.
If you cant answer this your in the wrong business.---well possibly not for much longer.

Thanks for that but ofcause I understand my stratergy crikey and why it works I chose the damn thing and studied it for years - how could you trade otherwise ?
I'd said it served me well consitently and had the account and a couple of very nice cars to prove it - until recently .
I seem to be disobeying my very beginning after somehow getting myself in a state after afew bad calls and adviseries plus new presures in life in life this year along with a crazy market I hadn't delt before.
Things along these lines I know have upset my apple cart hugely for a start and paticularly the damn advisers I'd joined account wise.

I spose the main thing I was actually asking in a way deep down but put it badly was do traders find that they start shooting blanks suddenly at times , maybe presure or getting slack and bitten , has it come back , what did they do , anything along those lines really .
I actually still have 100% confidents in my stratergies they've prooved themselves over and over and consitently . I actually did close to 90% straight calls for 5 mths at one point and not much below that since the day I started - until lately - I wish now ! Couldn't call a one horse bloody race this mth .
It's me that has strayed carelessly, it's left me for some reason i've lost focus and with the market of late that can't be done and i've payed.

Cheers

Blaster - in your trading strategy, what technique do you use to determine your exit point from a position?

Peter2 - good post - easily implemented starting point for putting structure around each trade, and also an immediate guide to the beginner as to how emotion gets involved in the equation, and also provides a log to go back over and review.

What do you think blaster? - do you do this already and if not will you give it a go? Even if you take a break from the markets you could at least paper trade Pete's approach for a bit.

I suspect that what youve been doing so far is not trading or investing, but gambling, using the market as your roulette wheel. If only going long this is obviously more succesful in a strong bull market and less succesful in a flat or falling market. If you like gambling and only gamble what you can afford to lose there's nothing wrong with it - though its good to understand that this is the reality of what you are doing. On the other hand, if you want to become a trader or investor then there's plenty of good advice on this thread to get you further on the way.

Yeah it was Pete thanks for that
No mate if I wanna gamble the last place on this planet I'd choose is the stock market.
All of the above is in every trade - ofcause - doesn't everyone , well unless they just wanna play but how could you possibly seriously expect to trade and last otherwise ?
But I have slipped back in caution and my D&D and strayed from what I do best and my exact format - this has definitely not been good .
L've also broken some golden rules with a few panic sells which costed me , then the damn advisers . I just seem to be running out of wack though as wifey puts it suddenly and carelessly too . Which I've read over and over of late is an absolute big no no in these times right now .
But one thing I really hear at the moment none stop - everywhere is patience ,patience and patience , which has also left me fo the moment and costed me .
Just a note here to mrc too.
I use a what is usually a very solid basically just a wave stratergy going on charting , buyers , habits and other goodies . I work these days on 5-10% but previously much higher .
Quick stuff usually a day to a wk - a wks a long trade to me .
Normally no stop losses but recently started using them , which ended in selling great stuff at a loss while I was away .
I also began a portfolio of keepers on the side but sold the lot as it gave me the sh'ts and I can use that money better .
Mind you suddenly I couldn't call a one horse race but above has played a big part in that I see now - gotta get a grip.

Cheers

~~
I use a what is usually a very solid basically just a wave stratergy going on charting , buyers , habits and other goodies . I work these days on 5-10% but previously much higher .
Quick stuff usually a day to a wk - a wks a long trade to me .
Cheers

Seems you may just need to recognise the conditions under which your method works. If you do not have the right condition, wait it out.

Blaster - in your trading strategy, what technique do you use to determine your exit point from a position?
Hi again cuttlefish.
Everything availble before I touch it in the first place but you know the most common is it's recent habbits by again using everything available . Another biggy right now - no one has recent habbits any more.

I also recently stated commiting to out if she drops 2% but this has costed me so I'm going back to my original I think ajnd trusting my judgement which only costed me rarely .
For me I find the whole stop loss thing a catch 22 and especially right now because they can do anything no matter what and how anything reads .
But also if you buy at the wrong time it easily drops before it rises
maybe 2 or 3 times even but if you've called right you check it in a few days or a week and here it is exactly where you said it would be eventually.
Like this week - I'm buying rio for 116 thursday it will be ready . Tuesday Wed it went up so I almost paid 122 but something else came up and I bought that . Here is RIO Thusday at 115 . I normally would have waited.
But anyway hey , can you even trust rio right now - what do you think ?
Cheers

Everything availble

Read nothing specific.

I also recently stated commiting to out if she drops 2%

Why? Thats NOT a 2% stop loss by the way.

For me I find the whole stop loss thing a catch 22

Clearly you do not know why a stop loss is placed how to place it and its affect on position sizing.

what do you think

It doesnt matter what anyone thinks.
You need to learn how to trade---your not trading,your guessing,and reacting,you are not in control of ANYTHING.

Maybe not what you want to hear but what you NEED to hear

Can someone point out some strategies (FA or TA ?) I mean do people name strategies?

To me,

FA, is simple you understand a business, work out company potential and work out the numbers. Plus you can set some stop losses to preserve your capital.


TA: A whole bunch of abstract concepts, enter here ( say a potential breakout..) exit there , put a trailing stop etc. etc. If someone can giveme some names of the strategies, I will greatly appreciate.


Sorry for going off topic.

Hi again cuttlefish.
Everything availble before I touch it in the first place but you know the most common is it's recent habbits by again using everything available . Another biggy right now - no one has recent habbits any more.

I also recently stated commiting to out if she drops 2% but this has costed me so I'm going back to my original I think ajnd trusting my judgement which only costed me rarely .
For me I find the whole stop loss thing a catch 22 and especially right now because they can do anything no matter what and how anything reads .
But also if you buy at the wrong time it easily drops before it rises
maybe 2 or 3 times even but if you've called right you check it in a few days or a week and here it is exactly where you said it would be eventually.
Like this week - I'm buying rio for 116 thursday it will be ready . Tuesday Wed it went up so I almost paid 122 but something else came up and I bought that . Here is RIO Thusday at 115 . I normally would have waited.
But anyway hey , can you even trust rio right now - what do you think ?
Cheers

blaster what you're describing as your trading strategy makes me form the view that what you are doing at the moment is basically gambling - which is fine - but accept that thats what it is. All gamblers that don't wreck their lives with it still need discipline and money management and to put bounds around their activities.

It is more likely when trading discretionarily based on no set criteria that you will have more emotional involvement in your trades - and typically your emotions give you the wrong signals - greed causing an entry at prices that are too high, or fear preventing you exiting when you should (at a planned stop or money management stop) and then instead exiting when you shouldn't (when there is capitulation and all seems lost).

By abandoning stops when things aren't going your way you are effectively abandoning the only trading plan you seemed to have. I would recommend taking some time out and paper trading according to the disciplines Peter2 has described whilst also reading some books on trading, investing and money management principles.

Do you really believe that?

Well perhaps not the practically unheard of part, but I know very few who have made over 50% p.a over 10+ years. Ive seen and heard of people doing it in bull-markets over a few years many many times, but not often deep into bear markets.....

If you could consistently gain 50% returns on average no matter what the market, why not start your own hedge fund and end up with billions of dollars in fees!

Ill try and give you a very simple example somewhere to start so to speak.

Ok seeing the overall market is in a downtrend we will look for downtrending stocks as that seems like more probalbility of success than going long on a stock.

so we have found a nice downtrending stock which code is xyz.When it makes a new low we are going to short sell it.Say the new low is $10.00 so we are going to sell short xyz at $10.00.

We look at the chart and the best place we can find to set a stop is a rally high in the downtrend which was $10.80 so we are going to set our stop at $10.81.

We dont want to loose any more than $400 on this trade so that means we will buy 500 shares.500 shares with a loss of 81c so a $405 loss.Close enough for this example.You can be stricter if you add in brokerage,slippage etc up too you.

Profit targets can be made or a trailing stop can be used as the stock drops.Either using a % or as new lower highs are made or whatever way you find to be the most profitable.

So after lots of practice testing going crazy etc you will hopefullly find a system that works for you.

well somewhere to start I suppose

good luck never ending though noone ever masters the markets completely

Read nothing specific.



Why? Thats NOT a 2% stop loss by the way.



Clearly you do not know why a stop loss is placed how to place it and its affect on position sizing.



It doesnt matter what anyone thinks.
You need to learn how to trade---your not trading,your guessing,and reacting,you are not in control of ANYTHING.

Maybe not what you want to hear but what you NEED to hear

Guessing - my God and after everything I've explained , this is a waste of everybody's time I'm afraid and a mistake i'm sorry . I appreciate the genuine replies but !
Everything available I would have thought summed up that one quite well without boring everyone to tears . What is everything available - charting history - habits , company info- announcements on and on but why would I bother throwing all that in .
Allot of people jump on you in forums , read and interpret anything and everything only in the way that they would really like to perceive it so as to have the op' to again pounce, pick and generally bignote themselves .
I don't know why it is but most forums seem to have a handful of genuine people balanced by the many that just live for picking the crap out of a ducks you know what and twisting every note along the way - maybe they don't heve a life I really don't know .

Happy easter

Thanks to all the genuine replies I know allot and myself appreciate it but I think we may as well finish up .
Might go mingle

Cheers.

Blaster,

None of your answers have been specific to any of the questions asked. Hence why you are not getting specific remedies.

Are you a discretionary or technical trader?

What is your main entry criteria?

What is your exit criteria?

Do you have defined RR on each trade?

What sort of stocks do you watch? ie - sector, top 20 etc


Saying things like "everything" does seem to imply that you dont have a plan in place and are just hoping.

As other have said, in a bull market it is easier to be correct more often then wrong, when going long. Thins change in this sort of volatility.

Now instead of complaining that you are not hearing what you want to hear, how about you actually answer all the questions SPECIFICALLY rather than generally and people may be able to help you further...

What so out of all this - all your worried about are pretty paragraghs, you must be doing well then that's forsure. Buy a painting !
Have a good one

As you do more research, you may form more respect for paragraphs, order, effort, and good advice.

Guessing - my God and after everything I've explained , this is a waste of everybody's time I'm afraid and a mistake i'm sorry . I appreciate the genuine replies but !
Everything available I would have thought summed up that one quite well without boring everyone to tears . What is everything available - charting history - habits , company info- announcements on and on but why would I bother throwing all that in .
Allot of people jump on you in forums , read and interpret anything and everything only in the way that they would really like to perceive it so as to have the op' to again pounce, pick and generally bignote themselves .
I don't know why it is but most forums seem to have a handful of genuine people balanced by the many that just live for picking the crap out of a ducks you know what and twisting every note along the way - maybe they don't heve a life I really don't know .

Happy easter


Advice is what we ask for when we already know the answer but wish we didn't.

Enjoy your trading---whats left of it.

A plans not worth the paper its written upon unless you KNOW WHY its profitable.

You have said this before tech and, for me at least, it is of utmost importance ... cheers.

Guessing - my God and after everything I've explained , this is a waste of everybody's time I'm afraid and a mistake i'm sorry . I appreciate the genuine replies but !
Everything available I would have thought summed up that one quite well without boring everyone to tears . What is everything available - charting history - habits , company info- announcements on and on but why would I bother throwing all that in .
Allot of people jump on you in forums , read and interpret anything and everything only in the way that they would really like to perceive it so as to have the op' to again pounce, pick and generally bignote themselves .
I don't know why it is but most forums seem to have a handful of genuine people balanced by the many that just live for picking the crap out of a ducks you know what and twisting every note along the way - maybe they don't heve a life I really don't know .

Happy easter

Blaster not so in this case, you are getting some very good replies based on market reality not warm loving and fuzzy but market reality.
There are a number of posters on this site that are very abrupt but their message is among the best.
You could go to a seminar and hear the same thing but put in a way that makes you feel good while they massage the money from your pocket.

Here you get it for free from people who trade and have done for some time.

Forget about or deal with your buttons being pushed, this is the market talking to you with out you losing a cent its a hell of a good deal.

Engage in the message not your emotions no different to when you front up to place a trade.

As suggested give more detail as to your method or point out you lack method and ask for help and you will get it.

Good post IFocus!

Its true Blaster, "everything" doesnt constitute a trading strategy.

Company announcements, historical charts, company info etc.

Specifics are required.

For example, company info or (FA): Do you look at sound management performance, low debt, good cash flows, high ROE with good growth forecasts, low risk and decent book value? Any specific intrinsic value equation you use? Historical growth of EPS and historically high ROE? Do you look for yeild and into the payout ratio? And this effect on capital growth? How about share buybacks?

TA, do you use EW, VSA? Do you buy after a strong trend, i.e. wait until the price has moved above the first upward pivot or just wait until a break out of trading range to try and gain the most out of the trend? Do you apply certain support/resistance levels, a trailing stop or a price target? Or do you wait until the trend looses momentum and then sell up? Do you use sentiment polls or look at monthly seasonality? Any other technical indicators you use, crossovers (Oscillators, MACD) etc? Oversold (RSI?). Do you look for a shift to close a gap? Or what about V-bottom reversals?

Is it simply stocks you buy? Any particular way you look at sector divergence? For example if NASDAQ outperforms the DOW over several days and you move your investments into technology stocks?

Do you look at industry fundamentals or economic outlooks? What about exchange rate effects?

So many different methods you can use to formulate your strategy.

"Everything" or historical charts, company announcements doesnt suffice.

You obviously need more research.

Cheers

Blaster doesn't need to post all his trading details. He has mentioned his main concern which is a disappointing trading performance. His results can only be due to the trading system or his handling of the system. Of course it may be due to both. Current market conditions may not be right for his system and he may be making poor trading decisions due to stress.

That is why I suggested he review his own performance in an objective way. If he is satified with his own trading performance (and I doubt that he will) then he needs to evaluate his system performance in the current conditions. Tech/a's point is very valid, it is very probable that his trading system is not suited in this highly volatile market. All systems go through periods of drawdown and if your system has been thoroughly researched you would know if this current drawdown is within expected parameters or not.

IMO it is generally the trader who saboutages his system rather that the system not being suited to the market. A disciplined trader will notice if the market conditions are not suited to his system fairly quickly. An undisciplined trader won't know what is going on, but will blame the market.

Hi to all. This is my first post on this site so feel free to tear it appart and question my comments.

I honestly think that the biggest problem people face when trading or investing in the markets is not having "or" following their own rules.

Human nature or mental bias on a stock is one of the biggest problems. Such as you can physically see that the trend has broken, and a lower low has begun. "Yet" The view that the stock has been outperforming and will therefore continue its uptrend soon clouds your better judgment.

When I started out, I "thought" I had put together a trading plan "yet" continually neglected to act on it when circumstances changed. I would ride the "bull" to the top, only to slip off the other side because my mental bias on the stock would not allow me to pull the trigger. Before I knew it I had gone from becoming risk averse, to risk seeking by averaging down trying to minimise my losses. "Pasminco" was my first crack at the market and I averaged it down until the the company failed and I did my money cold. :banghead:

The old adage "Plan the trade and trade the plan" can not be more accurate.

Regardless of what system, analysis or indicators you use (fundamental or technical), if your plan does not have a hard and fast exit strategy then your mental bias will take over again and you "will" fail.

You need to determine your:
1) % risk.
2) Exit strategy (before the entry is even made) ie: Stop loss (5%) or where to place the stop. I have found that the best place to set my initial stop is just under the preceding low on the chart, so if the low is taken out then the trigger is pulled as the downtrend is still in vogue.
3) I set an automatic stop, so my mental bias cannot supersede my plan.
4) Plant your entry and don't just guess it.
5) Don't bottom feed, wait until the uptrend is proven before making your entry. Again, people's mental bias of thinking that getting in at the bottom is maximising profits, only to see the stock fall lower shortly after entry. Why do people continually look for a falling stock for an entry, yet a rising stock is obvious.
6) Run a trailing stop or have a trigger that tells you when to exit.
7) If the trend changes on a stock, go find another one until the next reversal. Don't have a favorite and don't become emotionally attached to a stock. (There is no room for emotion in this game).
8) Ensure that you monitor the sector and or bellwether stocks of that sector to determine the bullish/bearish sentiment of that sector.
9) Don't try to be bullish in a bearish market, even if it means stopping trading until sentiment changes.
10) If you have to look hard at a trend to make a decision then don't bother, because the answer is not there. A simple trick to test your mental bias on a stock is to invert the chart. Look at it upside down and then ask yourself what you see?

The list goes on. You need to run a diary not only of your profits but more so your losses and why you made them. Once you have made your decision, do not second guess yourself as in most cases your initial decision was the correct one. Make notes on your mental wellbeing and what made you come to any one decision or conclusion.






Most of all......................."Abide by your rules" it's that simple! :2twocents

Most of all......................."Abide by your rules" it's that simple!

I really have to keep disagreeing vehemently with this often coined "true-ism".

While Sid has every best intention.

Having a plan no matter how complex (Or simple) you make it DOESNT GUARANTEE that it will turn you into a profitable trader.
How many follow a plan to the letter and still blow up.

They blow up because they have no idea BEFORE they trade their plan whether it has a chance in hell of being profitable.
No amount of Money management/stops/Entry and exit strategies will rescue a plan which is flawed in design.

First thing is to Design a PROFITABLE plan.

Test it and from that you'll get a blueprint which you can refer to during trading.
You'll be able to monitor historical draw down to see if your within know tolerances.String of losses,R/R,average win/loss,youll be able to see whether your over or under performing your blueprint.
You'll be able to compare performance in like conditions.

A high percentage of Businesses fail as the owners fail to test their market and see what they have as a business plan will have a chance of being profitable. Trading is a business.

.
Until I started making some really stupid moves, some panic selling and buying and with the maket so turbulent my reading seems to be off non stop. Accounts down 30% on principle and I am starting to wonder.

I assume by 30% down on principal you mean on the initial amount you started with, before doubling your money. If this is the case then a rough back of the napkin calculation says you have experienced a 65% peak to trough portfolio equity drawdown. Hmmm.

Get out and stay out, until you can put into perspective where you (WE) are within the market cycle and what kind of market we're currently in. IMO, the writing has been on a wall for a little while now already...noisy (volatile) and trending (down).

There are other threads which talk about being in the top 3%/5% of traders who are profitable. Quiet (not volatile), trending (UP) markets can make nearly all of us part of that 3%/5%...go figure.

Also, panic=emotion driven-decision making. Emotion in trading is OK (IMO). Many experts will tell you it's not, but for most people it's normal to need to work to silence the voices within. Emotion driven decision-making is a recipe for bigger drawdowns than necessary.

Step back, get perspective. Validate your plan or make a plan before you commit to executing it. Then, when the time is right, execute the plan, manage it, and spend the lion-share of your efforts on psychology.

As for details on plans and psychology, use the forum. There a literally dozens of experienced traders here who are only too willing to help others understand how they are succeeding.

ASX.G :2twocents

KNOW = know within the limits of reasonable due process.

The key hallmark of a profitable trading strategy is that you KNOW in advance what the strategy's performance parameters are.

You KNOW what the maximum expected drawdown is.

You KNOW how it performs in various market conditions.

You KNOW its expected run of losses.

In short, you KNOW in advance when the strategy will be declared not to be working any longer and what to do if this happens.


If these parameters are exceeded, you STOP trading the strategy and evaluate what is going wrong;
- is the strategy no longer valid
- are you trading the strategy incorrectly

Once you have worked out what is going wrong and fixed it then you start again.

All else is just gambling.

Most likely, your strategy is a bull market only excessive risk strategy which has now been slaughtered by the bear market. (AKA gambling and having a run of luck which has now run out).

KNOW = know within the limits of reasonable due process.

The key hallmark of a profitable trading strategy is that you KNOW in advance what the strategy's performance parameters are.

You KNOW what the maximum expected drawdown is.

You KNOW how it performs in various market conditions.

You KNOW its expected run of losses.

In short, you KNOW in advance when the strategy will be declared not to be working any longer and what to do if this happens.


See, I don't think anyone can ever KNOW (in your terms) a lot of these things - unless you believe that markets are inherently predictable by way of analysing historical data, in which case, every system once profitable will always remain profitable.

I think a lot of people here, especially the mechanical traders, would do well to look into the history of the word, "expectation".

Having said that, it doesn't take all these fancy terms to know if something is not working. Long only at the moment, will not work, and a 30% peak to trough drawdown on a very short term system, to me, is not working.

P.S. - what would you do with a trading strategy Michael, that has a theoretical statistical/ probability edge, but cannot be backtested adequately?

See, I don't think anyone can ever KNOW (in your terms) a lot of these things - unless you believe that markets are inherently predictable by way of analysing historical data, in which case, every system once profitable will always remain profitable.

I knew someone would mention this :)

I was going to put a bracketed caveat in my post about knowing what kind of market we are in, and where we are in the cycle. The reality/truth/fact! is that we can really only know where we've been. We can only make a true statement which says, 'up until now and based on my analysis, since the peak in Nov 07, we have been in a noisy and down trending market'.

Of course, the next days trading might be the beginning of a different kind of market. My opinion is that no-one can predict.

ASX.G

Hi Tech/A,

I agree that having a plan doesn't automatically guarantee your profits. But it will assist you in the most important thing, that is to protect your capital and minimise your risk. Not having a plan at all will surely lead you to your doom.

I also agree that the blue print as you say is ever evolving depending on circumstances influencing the market at the time.

How do you design or modify a profitable plan without using it?

Paper trading is IMO not beneficial or truly practical because the moment you put real money into the market your mental bias takes over. Paper trading has no emotion.


I disagree with you vehemently disagreeing about abiding by your rules :rolleyes:

What is the point of setting a plan or building rules, if continually neglect to act upon them? True improve or modify them as situations change.

I would appreciate your input into what you consider makes a good blue print.

Sid

I agree that having a plan doesn't automatically guarantee your profits. But it will assist you in the most important thing, that is to protect your capital and minimise your risk. Not having a plan at all will surely lead you to your doom.

Provided that components of the plan actually do minimise risk.
Provided that the person designing the plan actually understands how best to apply risk mitigation. So in essence I agree.

How do you design or modify a profitable plan without using it?

You can certainly forward test by using it as you say but ultimately many I have found that this method is/can be very costly not to mention some cases emotionally draining.
There are very good software around for testing ideas,Amibroker/Metastock/Tradesim to name a few.Plus some very talented people who can code for you if your not up to speed. For forward testing ideas without code but you need lots of patience and time STATOR.

What is the point of setting a plan or building rules, if continually neglect to act upon them?

The point is you don't know their profitable most don't know why they could be profitable or doomed to failure.
Very few very talented people can design and trade methods which cannot be tested purely because they understand the building blocks required for a successful trading methodology/plan.

True improve or modify them as situations change.

This again I have to disagree with strongly.This is the downfall of many a trader and their plan. Constant tinkering/twiddling with any methodology without first knowing ahead what this fiddling does to the performance of your plan,has many traders totally confusing and disappointing themselves.

If the KNEW that by altering their exit it would decrease strings of losses,increase drawdown but increase number of winning trades---then they could tell if when applied in the REAL world whether the change was working as tested.They have something to benchmark.

I would appreciate your input into what you consider makes a good blue print.

We all have different ideas on what makes a "good blueprint".
My definition.(In this market)

Positive expectancy.
Smoothness of equity curve.
Frequency of trades
High win rate
Short trade length
Reward to risk above 1.5:1

ASX

I was going to put a bracketed caveat in my post about knowing what kind of market we are in, and where we are in the cycle. The reality/truth/fact! is that we can really only know where we've been. We can only make a true statement which says, 'up until now and based on my analysis, since the peak in Nov 07, we have been in a noisy and down trending market'.

Of course, the next days trading might be the beginning of a different kind of market. My opinion is that no-one can predict.

But we can anticipate.Many here have for a long time indicated 4700 ish. Many here are no longer trading long term long methodologies. Although we did for years. Many are doing very little and many are trading to the choppiness seen in this market and will I anticipate be with us for quite a few years. As for the next day---anticipation is for a rally towards 6000 now for a while.So shorter term long positions would be favored.

Chops

See, I don't think anyone can ever KNOW (in your terms) a lot of these things - unless you believe that markets are inherently predictable by way of analysing historical data, in which case, every system once profitable will always remain profitable.

I agree in part to your points.While the market may not be finitely predictable the way a trading methodology is put together will determine how predictable its performance is/can be. It will vary in performance between the mean and the high and low of performance due to those unpredictable movements in the market. Any trading methodology can only be expected to remain profitable IF it is traded in conditions in which its been designed.
If those conditions change enough then it will cease to work.

Having said that, it doesn't take all these fancy terms to know if something is not working. Long only at the moment, will not work, and a 30% peak to trough draw-down on a very short term system, to me, is not working.

You could be right but there also could be exceptions to your qualifications of "Not working" they may still be in their Blueprint and quite happy with their results.

I think a lot of people here, especially the mechanical traders, would do well to look into the history of the word, "expectation".

True,and some/most traders would upon failure and study into that failure realise that they had Unrealistic expectations of their plan.

Chops

Just on mechanical trading.
Profitable mechanical trading systems don't come about on your first plug-in of conditions and variables. I'm sure all those who have walked the mechanical path will tell you that you soon learn what combination of Conditions and Variables DONT WORK..
You also learn what happens to a trading methodology when you play around with stops/trailing stops and position sizing. Important aspects of plans which are rarely considered by the masses.

Having a grounding in mechanical testing capability would in my view place you way way ahead of the crowd in developing a discretionary trading method (perhaps one that cannot be coded) which can have an EXPECTATION of profit well beyond a method designed by someone who hasn't.

Sid

Provided that components of the plan actually do minimise risk.
Provided that the person designing the plan actually understands how best to apply risk mitigation. So in essence I agree.


You can certainly forward test by using it as you say but ultimately many I have found that this method is/can be very costly not to mention some cases emotionally draining.
There are very good software around for testing ideas,Amibroker/Metastock/Tradesim to name a few.Plus some very talented people who can code for you if your not up to speed. For forward testing ideas without code but you need lots of patience and time STATOR.

Forgive me but haven't you gone from developing a trading plan to developing a software based trading system?

(IMO) The 2 are totally separate, a plan or set of rules by which you employ a strategy for risk management, entry and exit guidelines for minimum loss and maximum profit with minimal risk.

Building functions utilising charting software is much further advanced than having a set of rules to apply your basic trading principles.

The topic of system building and back testing is another story unto itself.

A couple of simple questions to ask yourself if you start have more loosing trades than winners.

Where did it go wrong? At the start or the end?

Was the entry strategy chosen by you correct?
If not, then what were the mistakes made? If you don't understand why your entry didn't work you will continue to make the same mistakes.


Do you continually find that your initial stop loss is being fired, only to see the SP rise shortly afterward? Do you fully understand the principles of stop losses? If no, you need to review your stop loss strategy. Research stop loss es and employ one that best suits your needs.

How often do you see your winning trade go South? If it a regular occurrence the you have "no exit strategy". You have been blinded by greed and suffer delusional incompetence, or is it because did not stick to your original plan?


It all leads to building a strong plan.

Hey Blaster,

Been in EXACTLY the same situation as you... was making a killing in the bull market and then all this down turn came about... sent me broke to be honest... The truth is, a bull market is a lot easier to make money in... where as now it is much harder. After I had lost all my cash, i closed my trading account and just forgot about trading for a while. I cleared all the emotional thoughts and slowly came around to that a trading plan needs to adjust to the different market conditions... to cut this story short, I have refined my plan and am making some good profits now... my advice would be to take a step back, clear the emotion and invest your money in more education (primarily books).... at the moment it sounds like you are taking semi-guesses as which way to trade... if this is not the case, then your plan is just not working and it probably need more education around it... good luck :)

ASX



But we can anticipate.Many here have for a long time indicated 4700 ish. Many here are no longer trading long term long methodologies. Although we did for years. Many are doing very little and many are trading to the choppiness seen in this market and will I anticipate be with us for quite a few years. As for the next day---anticipation is for a rally towards 6000 now for a while.So shorter term long positions would be favored.


Who says you need to be a mech analyst to anticipate?



Chops

I agree in part to your points.While the market may not be finitely predictable the way a trading methodology is put together will determine how predictable its performance is/can be. It will vary in performance between the mean and the high and low of performance due to those unpredictable movements in the market. Any trading methodology can only be expected to remain profitable IF it is traded in conditions in which its been designed.
If those conditions change enough then it will cease to work.

But you don't necessarily know what conditions are present. If you have a system designed long only, for a trending market, it may not work if the subset of conditions change within the larger market conditions. It's why I could never be a fully mechanical trader, because I just cannot agree with the underlying philosophy behind it.

Take Niz for example. No offence to him, but it wouldn't have exactly taken Einstein to work out a long only long term trend following system would be shellacked in this market, especially since December. So my point would be you need a manual override (in my systems anyway) to stop you from defying COMMON SENSE in trading.


True,and some/most traders would upon failure and study into that failure realise that they had Unrealistic expectations of their plan.

Got nothing to do with that. It's much simpler. Just involves another word that people think they eliminate by doing all this testing.



Chops

Having a grounding in mechanical testing capability would in my view place you way way ahead of the crowd in developing a discretionary trading method (perhaps one that cannot be coded) which can have an EXPECTATION of profit well beyond a method designed by someone who hasn't.

I don't disagree with that. My response would be to find out statistics on event criteria, or code something that induces a high frequency entry around said event criteria, to replicate an essentially "non-consistent" or inability to be consistent entry. At least that way you have some kind of "valid" belief (whoops, there's a clue) or at least justification for trading in that manner.

I don't believe there is much difference in trading based on a theoretical statistical advantage, as compared with a mechanical system. Because to me, trading based on a mechanical system, is essentially a more complicated way of establishing a statistical advantage.

Cheers.

Who says you need to be a mech analyst to anticipate?

no one ASX I thought was referring to traders in general.So am I

But you don't necessarily know what conditions are present. If you have a system designed long only, for a trending market, it may not work if the subset of conditions change within the larger market conditions. It's why I could never be a fully mechanical trader, because I just cannot agree with the underlying philosophy behind it.

This occurs from time to time.
Provided the system trades within the blueprint you can be pretty confident that market conditions haven't moved out of those used during design.When they do you can bet that conditions have changed to a significance which renders the system in new territory. Most systems exit or stop triggering trades in these times.

Take Niz for example. No offence to him, but it wouldn't have exactly taken Einstein to work out a long only long term trend following system would be shellacked in this market, especially since December. So my point would be you need a manual override (in my systems anyway) to stop you from defying COMMON SENSE in trading.

I have no argument with this,however Id remove commonsense as an indicator and replace it with sound analysis.---leading to a common sense decision perhaps. I have to say this as Ive been out of long term long trading since last July! We have kept T/T going as an evaluation process to see if it gets to a point of Failure V Blueprint---even if it does and the system stops it will show a very healthy return over the period traded.

Got nothing to do with that. It's much simpler. Just involves another word that people think they eliminate by doing all this testing.

Got everything to do with it.
If you are trading a flawed method/Plan you have an unrealistic expectation of it--to make a profit.
The thing is you don't know it!

I don't disagree with that. My response would be to find out statistics on event criteria, or code something that induces a high frequency entry around said event criteria, to replicate an essentially "non-consistent" or inability to be consistent entry. At least that way you have some kind of "valid" belief (whoops, there's a clue) or at least justification for trading in that manner.

I don't believe there is much difference in trading based on a theoretical statistical advantage, as compared with a mechanical system. Because to me, trading based on a mechanical system, is essentially a more complicated way of establishing a statistical advantage.

Cheers.

Ok the you need to know when all the statistical criteria is placed within a plan how it performs overtime.
A singular set of statistics while true in itself may not when combined with others deliver a single positive result.Logic says they should however practice proves to us often that it doesn't.

I'm not saying you cant trade any other way than Systematically/Mechanically.

What I am saying is that you need to know WHY your plan has a chance to profit.
No good writing out all these logical conditions into a trading plan ---following it religiously for 12 mths and losing $20,000 and WORSE not knowing why!

Or having a perfectly sound plan which suffers a NORMAL draw-down only to be completely ruined with constant tweaking because your scared to death your plan doesn't work.

Other than trading constantly until failure or Riches the only way I know to fast track this learning experience is to become proficient in systems testing,even if you have no intention of trading a system and end up trading in a Discretionary manner.

Wasn't expecting any more action on this one so thanks once again for replies here, there's some good stuff .

Granted - maybe I should word things better pretty it all up but - been published 8 times believe it or not , true story . But to me we're at the pup.
When you grow up in a family of 6 teachers and one genius , no not me my dad - you tend to have an incurable case of interllectual over load I'm afraid and the odd crossed t or dotted i just don't do it for you.

Or- Take our genuises in Cambera for instance they all write very nicely I'm sure. But we have me to thank for the the highest birth rate in thirty years and the baby bonus. Amongst all those brains - cough , no one could figure out what to do with the aging populatiion , or why we even had one so it is not everything , far from it.

I don't think I needed to clarify more at all it seemed clear enough to me but , then maybe not.You don't wanna put everyone to sleep do you.

The point was, yes my stratergies work very well or has for around close 12 mths now and are still for now anyway. The problem right now is me. Mind you she is one confusing time if your trying to trade that's for sure .
Writers block , or artists , which I use to be and have experienced first hand. Zilch for mths on end is my problem , traders block ! Which along with some help mentioned , is what's caused the sudden dwindling account.
Can't think , I'm doing stupid things all of a sudden .
I was wondering if traders find that they have turned corners at times making stupid moves for periods on end all of a sudden against their knowledge , better judgement - writers block. No matter how well they have done prior and does it return for them , how do they get it back ?

As an artist I know how to - by walking away . When it's ready and has something to say it returns and it's full steam ahead again . Dunno if that works for a trader though or if it's a natural accurence with and it's getting expensive

Cheers

But we have me to thank for the the highest birth rate in thirty years and the baby bonus. Amongst all those brains - cough , no one could figure out what to do with the aging populatiion , or why we even had one so it is not everything , far from it.



Since you've diverted from the topic, I can't resist asking exactly how you are responsible for the highest birth rate in 30 years (will desist from making snide comments about the obvious!), and also exactly how you were responsible for the baby bonus (probably the silliest bit of government policy ever), and lastly, I'm fascinated that you have figured out how to manage the ageing population. Please tell us.

Or- Take our genuises in Cambera for instance they all write very nicely I'm sure.

Im by no means a genius, but thanks for the wrap! ;)

Good luck with the kids! :jerry

In all seriousness, I still see no sound trading methodology explained, so its really hard to help. But all the best!

Got everything to do with it.
If you are trading a flawed method/Plan you have an unrealistic expectation of it--to make a profit.
The thing is you don't know it!

Ahhh... I'm talking of the etymology of the word expectation. Nothing more, nothing less. ;)



Ok the you need to know when all the statistical criteria is placed within a plan how it performs overtime.
A singular set of statistics while true in itself may not when combined with others deliver a single positive result.Logic says they should however practice proves to us often that it doesn't.

I'm not saying you cant trade any other way than Systematically/Mechanically.

What I am saying is that you need to know WHY your plan has a chance to profit.
No good writing out all these logical conditions into a trading plan ---following it religiously for 12 mths and losing $20,000 and WORSE not knowing why!

Or having a perfectly sound plan which suffers a NORMAL draw-down only to be completely ruined with constant tweaking because your scared to death your plan doesn't work.

Other than trading constantly until failure or Riches the only way I know to fast track this learning experience is to become proficient in systems testing,even if you have no intention of trading a system and end up trading in a Discretionary manner.

I don't disagree with this. Like I was saying above, mechanical testing and trading, for me, is a complex way of developing a statistical/ probable/ expectational bias for trading. But it by no means assures you of those results (hence my point about the origin of the word expectation). If a system requires exact entries, and your entries suck donkey balls, it's not going to work. You have to have a method that suits your own style. And yes, the combination of probabilities and your own style has to be the justification for the plan.

For me, currently, it is a matter of working towards finding various tradeable criteria. And in a high frequency manner, so it doesn't matter if they are traded in a discretionary manner or not.

But until then, it will remain simple. Continue to trade breakdowns in this market, and breakouts if we go flat to up. :rolleyes: And gaps throughout.

Cheers.

We have kept T/T going as an evaluation process to see if it gets to a point of Failure V Blueprint---even if it does and the system stops it will show a very healthy return over the period traded.

Just on this point. I think a very large part of the reason why it hasn't traded outside of the blueprint has been the discretionary entries. If you trade TT through various out-of-sample periods using data from the last 12 or so months, taking every trade, you would rather quickly find it outside of any blueprint I've seen mentioned. Drive TT through some of the rapid correction periods we've had, since and including the June 06 correction and you'll find many of the results catastrophic. Even with just 50% margin, not the 70% that the test case is claimed to have been driven at.

That might have been useful for someone thinking about starting a long only trendfollowing system to know. But in fairness the code is public and this gives us all an opportunity to test and discover for ourselves.

Ideas, as with products and services, are a definite case of buyer beware.

ASX.G

Since you've diverted from the topic, I can't resist asking exactly how you are responsible for the highest birth rate in 30 years (will desist from making snide comments about the obvious!), and also exactly how you were responsible for the baby bonus (probably the silliest bit of government policy ever), and lastly, I'm fascinated that you have figured out how to manage the ageing population. Please tell us.

Yeah I know - Jesus talk about get carried away , tried to delete the lot later but oh no, the damn thing wouldn't delete .
Forums can be so frustrating , just trying to prove a point.

So you really think the baby bonus was a stupid idea ? What else are you going to do when everything in such a young country is so anti family no-ones having kids any more ?
Cost you allot more looking after millions of oldies later than a baby bonus now , do the sums and hey it got us breeding again !

Remember when all of our great leaders were just so baffled at what to do with a self inflicted aging population back when Latham was running.
I just said to Latham look what the home grant did for housing , it's still going , bring out a baby bonus they'll start breeding like rabits and he did.

Costello tries to take the credit for it but that was originally Lathams policy that I suggested , Howard just matched it to win .
Does seem rediculous paying people to have kids but hey when they do everything they possibly can to wipe family out then complain about an aging population - stuff em.
Now thE topic's really gone West- sorry about that.

Cheers

See, I don't think anyone can ever KNOW (in your terms) a lot of these things - unless you believe that markets are inherently predictable by way of analysing historical data, in which case, every system once profitable will always remain profitable.

I cannot figure out how you went from my statement of
"you KNOW in advance when the strategy will be declared not to be working any longer"
to
"unless you believe that markets are inherently predictable by way of analysing historical data, in which case, every system once profitable will always remain profitable"

Such a belief system would be illogical, irrational and ultimately lead to blowing up. All backtesting does is show you what worked in the past and give you some idea of how it worked in the past. As such, it is an invaluable tool - if it has never worked in the past, then it is not likely to suddenly start working tomorrow. It is also able to provide you some indication of when you should say "enough - this system is not performing to expectation".

Having said that, it doesn't take all these fancy terms to know if something is not working. Long only at the moment, will not work, and a 30% peak to trough drawdown on a very short term system, to me, is not working.

These statements are entirely subjective;
- there is overwhelming compelling evidence that for long term trend following it is best to stay in the market at all times, waiting out the drawdown, rather than attempt to time the market. A blanket statement that "Long only at the moment will not work" takes only a short term view and also attempts to predict the market.

- 30% peak-to-trough drawdown would be no problem at all for some traders.


P.S. - what would you do with a trading strategy Michael, that has a theoretical statistical/ probability edge, but cannot be backtested adequately?
If I could not backtest/walk forward test a strategy to my satisfaction, I would not trade it.

However, I have not yet come across a strategy that cannot be backtested and walk-forward tested adequately - it may be very time consuming and labour intensive to examine some edges, but they can be tested if you really want to.

Would you like to offer an example of a strategy that could not be backtested adequately?

As happens with so many other threads, it appears this has turned into a mech vs non-mech traders.

Why does it matter??

Some people dont backtest, it does not mean they are not successful or that their system does not work.

I would argue that fundamental analysis cannot be backtested, or can only be done so through research, not a mechanical system.

I think people need to realise there is more than one way to invest in the market, and as a generalisation it seems funny how many mech traders think that their way is the one and only and that everyone should develop a mechanical system.

As happens with so many other threads, it appears this has turned into a mech vs non-mech traders.

Why does it matter??

Not at all-- you've missed the point this thread has become about validation of a trading method/plan.

Some people dont backtest, it does not mean they are not successful or that their system does not work.

Absolutely correct,what it does mean is they wont know that their plan is profitable until sometime down the track.They are trading ideas not a proven plan with all the hallmarks of a plan that can be profitable.

I would argue that fundamental analysis cannot be backtested, or can only be done so through research, not a mechanical system.

Well we have had a few try to prove this exact point,the last Ducati

http://www.aussiestockforums.com/forums/showthread.php?t=2829&highlight=Ducati

had a method---sound in theory---which he suggested would out perform T/T a mechanical system over 3 yrs. His method ceased to compete in 2 yrs.
So I would argue that Fundamental traders and investors are as blind as those trading technically without a proven methodology.
More than happy to see another exercise like the one duc set up 3 yrs ago.
The only genuine live methods I have seen turn consistent profit are those which have been validated.



I think people need to realise there is more than one way to invest in the market, and as a generalisation it seems funny how many mech traders think that their way is the one and only and that everyone should develop a mechanical system.

Missing the point again.
I dont care how people invest in the market or trade the market,those who dont know WHY their method COULD be profitable are just plain gambling.
Regardless of whether they have a trading plan of a few conditions or one with a checklist like a NASA launch.

As happens with so many other threads, it appears this has turned into a mech vs non-mech traders.

Why does it matter??

Some people dont backtest, it does not mean they are not successful or that their system does not work.

I would argue that fundamental analysis cannot be backtested, or can only be done so through research, not a mechanical system.

I think people need to realise there is more than one way to invest in the market, and as a generalisation it seems funny how many mech traders think that their way is the one and only and that everyone should develop a mechanical system.

Hi Prawn

Back testing and walk forward testing can be done for all trading methods IMHO.

Its just that mechanical can be coded where as discretionary is a manual process. I haven't done it but I suspect fundamental can be too.

I have heard the argument that you can not test discretionary methods because people cheat, or the brain only sees what it wants to see etc this is not testing.

Im by no means a genius, but thanks for the wrap! ;)

Good luck with the kids! :jerry

In all seriousness, I still see no sound trading methodology explained, so its really hard to help. But all the best!

Hey I really like that little cartoon by the way, mind if I borrow it?

Cheers

Would you like to offer an example of a strategy that could not be backtested adequately?

A truly scalping method. Taking a few points here and there on futures, with only the market depth to look at.

A truly scalping method. Taking a few points here and there on futures, with only the market depth to look at.

Yeah I would have to agree. I can make 10 or 20 trades without looking at a chart. Not sure how you could back test that. Not with conventional back testing anyway.

Just on trading plans I have seen successful traders (that is make a living solely from the markets for many years) on a trading plan that consisted of nothing more than this.

A maximum stop loss for the day.
A rough stop amount for each trade.
A loose time of days when they trade (not during lunch)
A couple of trading patterns that did not show up that often to explain their trade frequency.

So with years of trading and 10 to 200 trades per day their profitability could not be put down to either luck, market conditions or superior trading plan. It could only be skill. How do you test that?

How do you test that?

Like every other discretionary theory or hypothesis,by trading it.

There are people who already know what is likely to work and what is not.
Radge is one.
Jose Silva another.
Looks like TH
Myself and quite possibly a few more here.
Some may not know why they are profitable.

I would suggest that more than likely they have learnt from expensive trial and error.
OR
They have a grounding in Backtesting and know the structure required to gain positive expectancy.

The larger majority who trade in a discretionary manner however would be in a work in progress format and have no idea the final out come of prolonged trading using their "Plan"---which I hasten to add is likely to change each time there is a few losses.

Like every other discretionary theory or hypothesis,by trading it.


Yes and those that deviate from their trading "plan" are getting a HUGE signal.

You have no confidence in your plan because your plan doesn't work.

Its like getting a road map on how to get from point A to point B.
Why would someone who has a map (trading plan) turn left (so called emotional trade) when the map calls for a right turn(taking a small loss) or no turn(no trade)?
I can come up with only three reasons.
1. they are mad, stupid or deluded
2. they are looking for entertainment because they are bored.
3. they have no confidence in the map because they know that they have no results or that the results are from luck. ie their map is wrong.

Maybe there is others but I think the main reason people make bad trades is that they have no proof that what they do is the right thing but are unable to admit it. Therefore its easier to bring out some old gem or market cliche to explain away their poor results and keep the dream alive.

Not at all-- you've missed the point this thread has become about validation of a trading method/plan.



Absolutely correct,what it does mean is they wont know that their plan is profitable until sometime down the track.They are trading ideas not a proven plan with all the hallmarks of a plan that can be profitable.


How do you validate EW or Wycoff and its derivatives?

Your promotions of these methods seem to be at odds with your statements regarding backtesting and mechanical trading.

Are you tacitly admitting that a rule based discretionary trader can see a positive expectancy trade when he sees one, contrary to your dogmatic assertions of a few years ago?

Oops! Nope, you've come right out and explicitly stated it in post #85

Cheers :)

How do you validate EW or Wyckoff and its derivatives

Key point is that while you can back test what should make a horse a favorite..

That is only dealing with appearances...

The form is always ahead or behind the punter because of..
Everyone trying to manipulate this appearance for profit..
( even the Horse )
Eg a horse runs dead,,,It makes a negative appearance

Another runs hard ...

The public are always on the beaten favorite ( obvious )

Wyckoff distinguished between character and appearance
Appearance can be negative
While making a positive statement ( a down move could be accumulation )

appearance can be back tested made mechanical

eg just bet on the biggest. strongest, fastest based on past form

But that is just appearances

So the public are on the beaten favorites.

You can only judge character not back test for it

It goes down to go up this time
next time it goes up to go up ( An up move is accumulation )

what happens on the next bar is important until it changes to the third bar
being important

Wyckoff distinguished

between

mechanical methods ( pure appearance )
discretionary ( pure appearances of appearances )

And Judgemental... principles observed that proscribe

no discretion no mechanical
just the way of least resistance
through busy traffic..
false moves, manipulation ever changing cycles...

Demand and Supply and nothing else...

No appearances .. They are artifacts

Character

Yes singers use microphones
but people using microphones need not be singers

stocks breakout on buy signals
but all "buy signals" do not lead to breakouts

You can only back test appearance and see if that appearance
in any way correlates to some reality at some time in the past..

And then the "interests" will make sure you are on the beaten favourite
The interests are both everyone and someone..

Crowd behavior and "them" ....

Jockeys, Owners , Trainers & the public

Eemergent behavior

All interacting .... .... That is why there is bear and bull

Three Wyckoff Questions
What.........it goes down
How........... Price Volume Time
WHY....... Accumulation or distribution

Identify principles that proscribe

act..........NO DISCRETION

Character is of the present not the past
A singer is only one who can sing NOW

The fact they are reputed to have sung well in the past is only appearance as far as NOW is concerned

It is the subsequent action that matters

motorway

Maybe there is others but I think the main reason people make bad trades is that they have no proof that what they do is the right thing but are unable to admit it. Therefore its easier to bring out some old gem or market cliche to explain away their poor results and keep the dream alive.

I gather this is another point of insinuation.

Can I ask, why have so many hedge funds taken ENORMOUS hits lately?

With their "prooven" mechanical trading systems?

Volatility at the moment is out of the stratosphere, I also know 3 professional discretional traders who are loosing at the moment, due to volatility and out and out change to market dynamics (many momentum chart patterns are not working at the moment, including simple out of the ordinary big up moves accross all indicies followed by subsequent up-days, of which 70-80% of the time by research I have read (back-tested ;)) is evident.

Gil blake' research on mutual funds found that if a daily price change was greater than the average daily price change over the past 7 days I beleive, it had a 70-82% chance of following through the next trading day in the same direction (look up the research yourself if you want). This observation, where extreme price moves in the DOW, S&P, NASDAQ 100 and Russell 2000, are evident, also stands correct.

To the contrary lately.

I will challenge anyone right now with their positive expectancy in this market, to post your trading statements to the forum, for those who claim they are making good profits at this time with their methods. I gather some can, but I BET MANY will not do it!

Also, if you are making good profits, what are the methods you are using and what is your system based upon?

Wonder how many with their systems will see their maximum drawdown reached before they realise their system is invalid in this environment. Just as how many will change a winning trading style because quote:

"1. they are mad, stupid or deluded
2. they are looking for entertainment because they are bored.
3. they have no confidence in the map because they know that they have no results or that the results are from luck. ie their map is wrong".

It works both ways.

As far as what I beleive works at the moment and what I will mainly be trading, I agree with Chops. Quote "Mechanical testing and trading, for me, is a complex way of developing a statistical/ probable/expectational bias for trading.

But until then, it will remain simple. Continue to trade breakdowns in this market, and breakouts if we go flat to up. And gaps throughout".

Are you tacitly admitting that a rule based discretionary trader can see a positive expectancy trade when he sees one, contrary to your dogmatic assertions of a few years ago?

I'll elaborate a bit further on your observation.

Everyone who places a trade has an initial expectancy of profit.
Few know how to best setup a trade for the best chance of returning a positive expectancy.
Even fewer have any idea of how to guage or design a trading plan with positive expectancy.

The singular preparation of any trade to return a positive expectancy is a far cry to completing many many trades and returning a positive expectancy.

Also, if you are making good profits, what are the methods you are using and what is your system based upon?

There are places where you can see this in action.
You of course have to pay to be a member.
There you'll also learn how what Ive been ratting on about is so important.
You to can take the exact trades and gain the same return---which currently is 69% profit since 7/1/08
You can also learn how to follow the exact same methodology rules to mirror similar returns.

PM me if you wish for details.

Another angle on trading to contemplate.
When traders operating from charts dominate the trading scene then the buying and selling will follow the charts because a buy signal will be followed by a lot of buying that will increase the price and "prove" that the chart was right. The same will apply for sell signals.
However, in times like now, when other factors are dominating the scene, past history, charts, foolproof plans etc aren't worth the proverbial @$#@$%. The only help they may be is to help second guess the next days trading. Try and guess what the market manipulators are going to do next will be a more reliable plan to follow.

I'll elaborate a bit further on your observation.

Everyone who places a trade has an initial expectancy of profit.
Few know how to best setup a trade for the best chance of returning a positive expectancy.
Even fewer have any idea of how to guage or design a trading plan with positive expectancy.

The singular preparation of any trade to return a positive expectancy is a far cry to completing many many trades and returning a positive expectancy.

I think expecting is flawed.Time and again traders say they expect the price to do such and such.Ones expectancy doesn`t move the price in ones favour.
Que sera, sera.

Yes, in preparation of a trade it is advantageous to have a positive outlook.

I gather this is another point of insinuation.

Can I ask, why have so many hedge funds taken ENORMOUS hits lately?


Simple, because their trading plan is quiet evidently not profitable in changed market conditions. But that wasn't my point. If you can have a 65% draw down as the market changes, like the punter that started this thread, you trading plan is obviously wrong. And as the errors start popping up you know that your plan isn't worth the paper it isn't written on and then start deviating from that plan(so called emotional trades).

Why else would someone trade outside a plan they know is profitable?

hi ,i got caught in in the '97 into 98 "crash"trading futures,yes a big loss or losses stops you thinking straight.If you need the money it may force you to take marginal trades in desperation.First thing I would do is to stop trading.The hard lesson I learned was to always protect yourself,always look at downside risk and minimise your losses,and always expect the worst from a trade,look after that side of it and profits can look after themselves.i would check your method by paper trading the current market-to see if the system still works,or when it starts working again-but don't throw any more real money at it,until you can prove to yourself you can make money again.Take it or leave it.But thats what I've learnt through being knocked out pretty heavily.Mike

There are places where you can see this in action.
You of course have to pay to be a member.
There you'll also learn how what Ive been ratting on about is so important.
You to can take the exact trades and gain the same return---which currently is 69% profit since 7/1/08
You can also learn how to follow the exact same methodology rules to mirror similar returns.

PM me if you wish for details.

Yes, at the chartist.com.au?

Which I am going to sign up to, in order to learn EW by example. I already briefly talked to Nick about this, however, stating I wanted to use his analysis along with my own, to trade, so selectively choosing what I see as the highest probability and R:R trades. He stated this is genearlly where the best results are seen.

Cheers

Simple, because their trading plan is quiet evidently not profitable in changed market conditions. But that wasn't my point. If you can have a 65% draw down as the market changes, like the punter that started this thread, you trading plan is obviously wrong. And as the errors start popping up you know that your plan isn't worth the paper it isn't written on and then start deviating from that plan(so called emotional trades).

Why else would someone trade outside a plan they know is profitable?

I agree.

However, at what point (how much % drawdown), does the mech trader know his trading plan is not profitable and tweak it? Its the same for a discretionary trader. Wait for a larger % drawdown to ensure your plan is now invalid, you are now "sure" but you have lost a large % of your capital base. Change it following a smaller drawdown, you are not quiet as "sure" but you use your intuition and minimise potential drawdown on the current plan.

This is why I beleive its important to backtest, to gain a statistical/probable positive bias, but why I also beleive plans become unprofitable VERY QUICKLY (in this current environment), and as to why some are forward testing various methods.

Very few plans would currently be profitable, hence the current havoc in both the retail and instituational investment worlds.

Skillful traders recognise when the market conditions change because they are closely monitoring their results and the market. They have a range of strategies that work in different market conditions so it is very easy to switch to a system that is suited to the market. Prior research and backtesting of many systems means that they are not guessing which strategy will be better.

Stating that very few plans would currently be profitable is ignoring the fact:mad: that many plans that were unprofitable in the bull market are profitable in this bear market. :D

We retail traders must be flexible and be able to adapt in an ever changing business. Recognising the time to change is crucial to our survival. I will not wait for a signal like losing >25% of my capital in order to change.

This flexibility is our huge advantage over the funds that must invest according to their constitution (charter). Don't limit your imagination and accept that losing is OK because most people are losing. There are an unlimited number of opportunities each day for a trader who is prepared. ;)

:iagree:

A couple of charts of the XAO 1st starts late 2006 2nd current time.

1st is a guru maker the 2nd guru breaker. No drawn down in the account required to see some thing has changed.

I guess if its your 1st bear market then you could / will get sucked in, easily done but as a discretionary trader the 1st question I ask every day is what sort of market am I trading.

I agree somewhat Peter.

Hence as I stated above, downward breakdowns are more reliable than upward breakouts.

Skillful traders are so due to experience and their intuition, picking up nuance's which others may miss or take more time to observe, including changing market dynamics.

I am the first to admit (some here enjoy willy waving too much to admit), I am years away from this kind of experience and intution yet. It takes a LONG time to gain this, not just a few years in the market, at least thats my theory and observation from studying actual successful traders.

1st is a guru maker the 2nd guru breaker. No drawn down in the account required to see some thing has changed.



Yes, but how do you know the trend has changed immediately? Surely there would be some account drawdown required to find that out.

Point at which you realise, is what I am interested in, sorry I just see a lot of useless rhetoric in this thread and not many trading strategies or examples.

Yes, but how do you know the trend has changed immediately? Surely there would be some account drawdown required to find that out.
Not wanting to float my own boat here but many did notice changes occurring all through last year. I had been banging on about the lack of strength in the overall market all year and the strength in a couple of big caps masking the changing market. Many others did too way before they got cleaned up.

From my blog (http://tremblinghandtrader.typepad.com/trembling_hand_trader/2007/12/whats-going-on.html) on December 18th 07

Something happened yesterday that I am struggling to find an incident where it has been repeated in the last 4 years. Sure we have had plenty of nasty days in four year bull run thats not what I'm talking about. What happened yesterday is the first occurrence of a lower high followed by a lower low. The first in 4 years!
................... So that is a lower high, a very rare event in the last four years. Then bugger me we get the day from hell, if you are long that is, that takes out the last low. At the moment this could all be repaired in a week or to with a little bit of magic rally dust from Santa but its yet another sign that times are a changin'

Now don't go flaming me I'm just pointing out that quite a few traders have been adjusting there plans and expectations for sometime.

I look through a lot of charts per day for different reasons but doing so you see the market and sectors change and it stands out all most black and white.

If you are trading breakouts you often see the same patterns run through the market or the same sectors the same for pattern failures.

The short patterns turned up well before the end of last year warning a change was coming look at the basket cases now and look when their down trends started.

I also look at the number of up trends verses the number of down trends so I get to see the change there, it comes out clear as day.

TH posted time and again the market breath I think it was showing what was coming.

And lastly I use Nick Radge who posts regular updates on where he thinks the market could go with a number of different possibilities but clear instruction where each possibility is proved correct or incorrect. I don't use Nick so much for trading ideas but more for education on EW and market sentiment, its invaluable listening to a long time professional who isn't caught up in their own opinions but just trying to gauge the market.

Ah Trembling you beat me too it

OK now I am just banging on but the blog post before last the one mentioned above is even better.
entitled "It is all over (http://tremblinghandtrader.typepad.com/trembling_hand_trader/2007/12/it-is-all-over.html)"

This is it. This is what it looks like at the end. This is what happens at the end of a broad bull run lasting close to five years. This is what we have all feared, the end of the good times. The just throw a line or two into the market and watch it land a winner. Well it is over.

LOL. My blog post are more accurate than my trading.:o

But as IFocus has pointed out if you trawl through stacks of analysis after awhile changes stand out like dogs you know what.

Wyckoff distinguished between character and appearance
Appearance can be negative
While making a positive statement ( a down move could be accumulation )



It goes down to go up this time
next time it goes up to go up ( An up move is accumulation )


Wyckoff distinguished between mechanical methods ( pure appearance )
discretionary ( pure appearances of appearances )
And Judgemental... principles observed that proscribe

ever changing cycles...

Demand and Supply and nothing else...

No appearances .. They are artifacts

Character



Three Wyckoff Questions
What.........it goes down
How........... Price Volume Time
WHY....... Accumulation or distribution

Identify principles that proscribe

act..........NO DISCRETION

motorway


To MRC & Co,

I have quoted some of Motorway's post. MRC, I too am not yet at a point where I am happy with my 'experience and intuition' ... and I think these two words you have used are a big part of the key to successful trading. What I would say to you is that by studying Wyckoff's principles (start with Motorway's posts ... I would say you don't need any more than Motorway but he would disagree so I wont say that) I am accelerating my progress faster than I ever thought was possible (this is an honest observation I make of myself, not a throwaway line).

FWIW, and many will disagree so feel free to do so also, forget mechanical, forget the standard Tech. Analysis 'texts' (there are some valuable ideas, but you will get better ones from this forum), forget the common use of 'discipline'. Apply the discipline at the front end, at developing an understanding of the market, what moves price, WHY you can make money (thanks tech/a). Apply the understanding with skill in execution (MRC, I see you corresponding with TH on another thread, as well as improving my understanding of what moves price, TH's posts give me an inkling of what is required in execution skills). Money management ... thank goodness this is an anonymous forum so hopefully I wont get shot too quickly ... yeah, ummmm ... don't load the boat, don't bet the house ... but if you get an understanding of what moves price, and you can execute well, don't hold losers and don't get greedy on winners then thats pretty much it for mm (you see why I am fearful of getting shot) ...

Like I said, all the above FWIW, I got a lot out of writing it down. :)

Some people dont backtest, it does not mean they are not successful or that their system does not work.


There are 3 ways in which you can KNOW if a system has any probability of working.

1/ You backtest it.
2/ You paper trade it.
3/ You trade it.

Its only in part 3 where you are risking real money trading with a trading plan/style/system that may in fact have little probability of being profitable.

And paper trading introduces biases and takes a very long time.

That's why I and many others START with option 1 ie. backtesting.

How about putting things in paragraphs and then someone might actually read it.

Hi dhukka, I read it and understood it.

A truly scalping method. Taking a few points here and there on futures, with only the market depth to look at.

Not sure what you mean by "truly", but I'm actually in the middle of backtesting a scalping method myself.

Based on tick charts though, not the market depth.

The only problem Im having is that I bought 10 years tick data for 5 pairs, and the size of the data for each pairs is 9Gb! LOL.

Interesting thread guys.

Its not the analysis.
Everyone of these traders above do something that ENSURES they profit.
They know WHY they profit.
Thats all you have to do.

act..........NO DISCRETION

If there is no difference in interpretation.
If every trader interprets every chart exactly the same way with Wyckoff analysis (in this case) then no discretion---if not then---?

Dont get me wrong its excellent analysis use it myself.

Well I dont think it takes a genius to know the landscape was well and truly changing last year. High volatility is one very strong sign and then the crash cycle begun. I remember posts where I pointed this out myself, hence there was a period I was mainly in cash and another I was mainly in gold. So I have been adjusting and tinkering with my plan for some time also. Including far smaller position sizing, and tigher stops (too bad I cant say tighter trailing stops, which would mean I would still have trading profits for the year to date of around 30%). I will admit however, despite realising the landscape was changing, I was slow to act, a huge flaw and something which has been noted.

Still, many trading systems would be struggling, no doubt about it, its obvious and evident just from viewing the exodus of posts at ASF (this post and the gold thread seem to be the hub of activity lately, funny that) or the institutional investment world. The whipsaws alone are enough to disrupt a solid trading system! Many subtle trends have changed, for example the momentum I talked of earlier.

Timmy, thanks, I have studied the market myself for a few years (infact made my first trade 13 years ago), so know most of what you said. I havent learnt Wyckoff's principles (but am sure I will get to it) as of yet, however, I think I would need a book first. No doubt motorway understands it like the back of his hand, but I dont find it easy to read and comprehend his posts, very abstract (if thats the right use of terminology).

So to those who realised the subtle changes in the market without any drawdowns (I still find it hard to beleive, as there has to be a change in market movements (unless you got lucky and these changes in movements did not cause a loss to your equity base) and drawdown for you to realise your trading plan needs to be adjusted in the first place. If the part in brackets was correct, then your change must have been immediate, you must have known WHY to change and HOW to adjust your trading plan accordingly, without much recent data of this extraordinary trading environment to backtest with) and adjusted their trading sytem accordingly. HOW did you adjust your trading system? Examples are always the best use to everyone here. I have stated on numerous posts how I am forward testing new ideas and adjusting trailing stops, position sizing, trading downward breakouts etc. But mainly I still see rhetoric. Ifocus, I also look at sector trends when analysing a certain equity along with the broader market and US indicies, hence why I also espouse inter-market analysis myself.

Sorry, that post was a bit of a gramatical mess, but its just what came out.

HOW did you adjust your trading system?

You don't. If you are a chart trader with a system that includes playing on the short side your system/plan should/will give you short entries.

If you only play on the long side just the fact that more and more stocks started to trend down you shouldn't of been trading that many longs.

Then you also have all the position sizing and stop setting and max account exposure etc rules kicking in as volatility increased to protect you.

Including far smaller position sizing, and tigher stops (too bad I cant say tighter trailing stops, which would mean I would still have trading profits for the year to date of around 30%).

MCR reducing position size is critical I am trading at 1/4 of what I would during raging bull market conditions I am looking for survival now not riches.


My stops don't change but I do use profit targets when going short this is also some thing suggested By Nick. I look at market time frame to help determine this others use other methods.

Still, many trading systems would be struggling, no doubt about it, its obvious and evident just from viewing the exodus of posts at ASF (this post and the gold thread seem to be the hub of activity lately, funny that) or the institutional investment world. The whipsaws alone are enough to disrupt a solid trading system! Many subtle trends have changed, for example the momentum I talked of earlier.

A good system or method should keep you out of the market as much as it should keep you in the market. Most traders make returns determined by the market not by their skill. This particularly applies to myself I am just not that clever if I am to trade to probability then I trade when conditions favor probability.

Timmy, thanks, I have studied the market myself for a few years (infact made my first trade 13 years ago), so know most of what you said. I havent learnt Wyckoff's principles (but am sure I will get to it) as of yet, however, I think I would need a book first. No doubt motorway understands it like the back of his hand, but I dont find it easy to read and comprehend his posts, very abstract (if thats the right use of terminology)

Wyckoff is an invaluable education


So to those who realised the subtle changes in the market without any drawdowns (I still find it hard to beleive, as there has to be a change in market movements (unless you got lucky and these changes in movements did not cause a loss to your equity base) and drawdown for you to realise your trading plan needs to be adjusted in the first place.

Drawdown is a part of trading at least for me I cycle regularly into draw down I don't need a bear market to experience this.



If the part in brackets was correct, then your change must have been immediate, you must have known WHY to change and HOW to adjust your trading plan accordingly, without much recent data of this extraordinary trading environment to backtest with) and adjusted their trading sytem accordingly.

Its more important that I don't trade now rather than to have positions its part of the plan.

HOW did you adjust your trading system? Examples are always the best use to everyone here. I have stated on numerous posts how I am forward testing new ideas and adjusting trailing stops, position sizing, trading downward breakouts etc. But mainly I still see rhetoric. Ifocus, I also look at sector trends when analysing a certain equity along with the broader market and US indicies, hence why I also espouse inter-market analysis myself.

For me main adjustment is to use profit targets, determine market time frame 1 bar 2 bars 3 bars or trend.

Reduce position size.

Don't get sucked into the news momentum bit its works some times but get creamed when it doesn't.

If you use charts timing now become critical IMHO using sectors and indexs to anticipate expanding volatility out of consolidations.

Hope this helps

Ok thanks, similar to what I have been saying and implementing.

Cheers.

What an off-topic thread.

Back to you Blaster!

I'll elaborate a bit further on your observation.

Everyone who places a trade has an initial expectancy of profit.
Few know how to best setup a trade for the best chance of returning a positive expectancy.
Even fewer have any idea of how to guage or design a trading plan with positive expectancy.

The singular preparation of any trade to return a positive expectancy is a far cry to completing many many trades and returning a positive expectancy.

You're playing with semantics. Expectation and Expectancy are two different things... and as I recall, it was only two or three years ago that you vehemently denied that a positive expectancy setup could be found in a discretionary setup, contrary to your assertions above. Now your an "expert" on the topic?

Let me reword your statement above, sans the implicit, self-serving and gratuitous chest thumping:

Everyone who places a trade has an initial expectation of profit.
It is best to learn how to best setup a trade for the best chance of returning a positive expectancy.
Even better to learn how to gauge or design a trading plan with positive expectancy.

FFS Tech, please give people some credit. I agree there are many who ignore the above principles, that's their problem. But please, continuously setting up some little elite band of those in the know and then including yourself in it is nauseating.

This is not to take away from those you mentioned, they are obviously elite, but notice that they don't continuously claim to be so. Let me tell you something; there are quite a few more here than you think.

Here we go again.

Wayne I'm clearly up myself.
I agree infact many here will no doubt agree so I'm in good company---get over it!
Its the way I post the way Ive always posted and the way I will continue to post.

Was there anything of value you'd like to add or have I pretty well covered it.

MRC

I also find Motorways explainations difficult to follow although I have a basic knowledge,Particularly with the introduction of P&F which is not as commonly used as Bar analysis.


and as I recall, it was only two or three years ago that you vehemently denied that a positive expectancy setup could be found in a discretionary setup, contrary to your assertions above.


Recollection needs brushing up.
Positive expectancy in a singular trade of course can be found knowing that you have a positive expectancy in any plan and methodology by taking a trade with a percieved positive expectancy doesnt guarentee that plan will result in a P/E trading method.

Now your an "expert" on the topic.

Thanks.

Just made a minor adjustment to your wording to better describe your point.
That I'm up myself.
Subtle dont you think?

Every trader should have their own definition of the direction of the trend in the time frame that they are trading. When the trend changes you know what to do.

Events that should make you realise when the market is changing, for those who don't define the trend (investors). You should notice the number of stocks going up decreasing, number of stocks going down increasing, decrease in the number of new highs, decrease in 30d breakouts etc...

MRC & Co. Trading requires commonsense and a business like approach. I define the trend using the XAO and the 10,30d MA. When the trend is up I look for longs. When the XAO is below the 30d, but not yet defined as down I start a few shorts but I am still biased towards longs. As my longs get stopped out, (TS's above BE do not produce a drawdown) I notice more of the long trades starting well but being stopped out at BE (no drawdown). The profits from the shorts start to offset the losses from the longs (no drawdown). When the trend is down I predominantly look for shorts. There will always be a few stocks that continue up and I will be into a few of those. I have started making partial profits in all trades due to the current volatility and when I sell half at the predefined target my TS is moved to BE to minimise capital risk.

Currently my shorts in the financial sector are being stopped out but there are plenty of other sectors going down (eg resources).

This is not rhetoric and these types of actions have been mentioned in this thread by others. You say that you are looking after your trading business by testing ideas. Have you looked at alternate strategies for when the market trends down? Have you tested going short? Have you tested using cfds to short or hedge your long term trades? Have you looked at the US market? Have you considered EFTs?

I could go on... all of these topics have been discussed on ASF for months.

Do dept stores wait until they start losing money with their summer fashions before displaying their winter collections? Of course not, its commonsense.

ps: I have seen your cue to blaster and hope that we have helped him. My response is that you shouldn't suffer before doing something about it.

Here we go again.

Wayne I'm clearly up myself.
I agree infact many here will no doubt agree so I'm in good company---get over it!

Was there anything of value you'd like to add or have I pretty well covered it.

Well, now that we've cleared up the basic difference between expectation and expectancy, that about covers it.

Its the way I post the way Ive always posted and the way I will continue to post.
Let me ask you some questions. Why do you post differently over at RC? Why should the mods allow you to continuously edge your toe over the code of conduct line here? What if we allowed everyone to do it? This forum would turn very quickly into HC.

I know you can post with respect to the majority. Please do so.

This is not rhetoric and these types of actions have been mentioned in this thread by others. You say that you are looking after your trading business by testing ideas. Have you looked at alternate strategies for when the market trends down? Have you tested going short? Have you tested using cfds to short or hedge your long term trades? Have you looked at the US market? Have you considered EFTs?



I agree with what you said.

As far as this part, if you read my above posts, you would see I look at the US market on a daily basis, infact, moreso than analysing the XAO in itself. I have traded (you mean ETFs?). I have gone short. I dont use CFDs.

The strategies I am talking about are, whipsaws wiping out stops (larger % stops needed perhaps? Either initial or trailing in order to combat volatility, I realise this can be taken out of effect with price targets, if your initial directional call is right or by placing them near support, which in itself can be very shaky, unless its a strong support line). However, no real back-tested analysis or views on this. I posted others during this thread, short-term price momentum shifts now in-effective to some extent. Many breakouts/breakdowns being caused by sector movements (commodity falls, shifting assets) = divergence patterns can now be traded. As I have also stated, I am also looking a lot more into monthly seasonality and sentiment polls and ratios. So I have no doubt I am taking care of my trading business, whilst trying to understand the WHYs, so as to ensure it is consistently profitable, not erratic. I do not want large drawdowns, I simply cannot afford it while trading full-time.

All of the above I already have opinions formed upon.

I also do not beleive in diversification or hedging. For my own reasons, as stated in other threads. My version of that is tight stops and smaller parcels.

I would call most of this thread rhetoric, until the last replies, but each to his own unless you want to get into semantics. Not to mention, I am still well in the green, better than most I would think, but profits are definately being wiped out lately. Hence, my looking into the WHY.

Cheers

Hence as I stated above, downward breakdowns are more reliable than upward breakouts.

Skillful traders are so due to experience and their intuition, picking up nuance's which others may miss or take more time to observe, including changing market dynamics.

I am the first to admit (some here enjoy willy waving too much to admit), I am years away from this kind of experience and intution yet. It takes a LONG time to gain this, not just a few years in the market, at least thats my theory and observation from studying actual successful traders.

With regard to breakouts and breakdowns the only ones worthy taking are the ones that hold and continue their intended direction. All else is pissing dollars away in brokerage and relying on luck. But that is a hindsight realisation which shows how hard it really is.

Yes, years it does take. Dispensing with dogmatic thoughts is a start. If you want to speed up your time in the market it can be done without actually trading the market.

Everyone who places a trade has an initial expectancy of profit.
Few know how to best setup a trade for the best chance of returning a positive expectancy.
Even fewer have any idea of how to guage or design a trading plan with positive expectancy.


It seems natural that people would expect something from their trades - natural psychological thoughts. So above I think expectation would more accurately describe what you mean. But having expectations might be a bit flawed. Maybe, parameter is a better word, as in one parameter for the trade.

I agree that a lot don't have any idea about how to devise a plan, test a plan, or even know why a plan is the way it is. Telling beginners to get a plan is like telling a child to get a job without career counseling.(not in the above)

Not sure what you mean by "truly", but I'm actually in the middle of backtesting a scalping method myself.

Based on tick charts though, not the market depth.

If you read TH's posts, you would see why it can't be backtested, and why charts can't be used.


Why would someone who has a map (trading plan) turn left (so called emotional trade) when the map calls for a right turn(taking a small loss) or no turn(no trade)?
I can come up with only three reasons.
1. they are mad, stupid or deluded
2. they are looking for entertainment because they are bored.
3. they have no confidence in the map because they know that they have no results or that the results are from luck. ie their map is wrong.

Maybe there is others but I think the main reason people make bad trades is that they have no proof that what they do is the right thing but are unable to admit it.
I'd say there are other reasons. If your trading has unintended consequences, like not being able to sleep, regardless of position size and success. If the markets you need to trade are messing with your ordinary life. But this is probably got more to do with what I said with matching trading plans with your own personality. Not sure if can know this fully until you start doing it however...

I cannot figure out how you went from my statement of
"you KNOW in advance when the strategy will be declared not to be working any longer"
to
"unless you believe that markets are inherently predictable by way of analysing historical data, in which case, every system once profitable will always remain profitable"

Such a belief system would be illogical, irrational and ultimately lead to blowing up. All backtesting does is show you what worked in the past and give you some idea of how it worked in the past. As such, it is an invaluable tool - if it has never worked in the past, then it is not likely to suddenly start working tomorrow. It is also able to provide you some indication of when you should say "enough - this system is not performing to expectation".

But just because it's not performing to expectation, doesn't mean it isn't working. You simply just cannot know in avance when/ if a system will stop working, regardless of its performance. In my mind anyway.

Efficient market hypothesis may suggest that something not working in the past, may well have the possibility of working in the future...

Same thing I've been trying to get through to tech, find out the origin of the word "expectation", and a lot of this will make sense.


However, I have not yet come across a strategy that cannot be backtested and walk-forward tested adequately - it may be very time consuming and labour intensive to examine some edges, but they can be tested if you really want to.

Would you like to offer an example of a strategy that could not be backtested adequately?

I doubt you could backtest options strategies adequately as well. Especially, those with a writing bias. One couldn't deny that even a conservative strategy has a great chance of increasing income, but because of volatility, the effect on the premiums, I doubt you could ever really test that. You could only test the underlying strategies you would then trade options on, but that is no guarantee you can make money from the options trades based on it.

dogmatic
I think you've described mechanical traders rather accurately in one word. :)

Cheers.

But just because it's not performing to expectation, doesn't mean it isn't working. You simply just cannot know in avance when/ if a system will stop working, regardless of its performance. In my mind anyway.

Efficient market hypothesis may suggest that something not working in the past, may well have the possibility of working in the future...

I'm sorry, but I simply find these statements outrageous.

When does one accept that a strategy is not working? When you blow up? It's a bit late then.

I think you've described mechanical traders rather accurately in one word. :)

I prefer efficient but as the saying goes, if the shoe fits...

I think you've described mechanical traders rather accurately in one word. :)


Maybe you should read the book Market Wizards.
It describes mechanical traders in many words ;)

TH, then how would you know if a discretionary system has an edge? Simply thru practice?

TH, then how would you know if a discretionary system has an edge? Simply thru practice?

Not sure what comment of mine this question is related to but..

Well yes. The problem of course is the sample size and data you are trading. As a few have found out even 4 years of bull markets trading isn't sufficient to answer the question 'have you a trading edge'.

And I guess if you can afford to be patient you don't have to have an edge in all markets just recognize when you edge has disappeared is probably more important (capital preservation).

Maybe you should read the book Market Wizards.
It describes mechanical traders in many words ;)

I have read it.

Obviously not all mechanical traders are dogmatic, but certainly most appear to be on these boards.

I'm sorry, but I simply find these statements outrageous.

When does one accept that a strategy is not working? When you blow up? It's a bit late then.

Nice... we went from system to strategy in one sentence... nice obfuscation.

Nice... we went from system to strategy in one sentence... nice obfuscation.

And this contribution advances the discussion somehow?

When I design a system I have a defined endpoint at which I decide the system is no longer working as I thought it would - I define the maximum amount of my trading capital the system will be allowed to lose and that maximum is set at a point where recovery is not problematic.

At what point do you accept that a trading method is no longer working? 10% drawdown, 30% drawdown, 50% drawdown, 65% drawdown, 100% drawdown?

Going full circle back to the initial poster, they are at 65% peak-to-trough drawdown and have now just realized there is a problem. Recovery from such a major drawdown is difficult on many, many levels, especially if it comes as a surprise.

When I design a system I have a defined endpoint at which I decide the system is no longer working as I thought it would - I define the maximum amount of my trading capital the system will be allowed to lose and that maximum is set at a point where recovery is not problematic.

At what point do you accept that a trading method is no longer working? 10% drawdown, 30% drawdown, 50% drawdown, 65% drawdown, 100% drawdown?

Going full circle back to the initial poster, they are at 65% peak-to-trough drawdown and have now just realized there is a problem. Recovery from such a major drawdown is difficult on many, many levels, especially if it comes as a surprise.

Michael,

You have raised a good question regarding what level they would allow for a drawdown to represent normal operation or failure.

65% in my mind is ridiculous. What needs to happen before the mind clicks and says "What the...?"

What needs to happen before the mind clicks and says "What the...?"

Already been asked with no answer, amongst my dogmatic thoughts ;)

Already been asked with no answer, amongst my dogmatic thoughts ;)

But if one really knew, or could see, feel it, then that question wouldn't need to be asked. Not only from a tested perspective but from an expertise perspective.

At what point do you accept that a trading method is no longer working? 10% drawdown, 30% drawdown, 50% drawdown, 65% drawdown, 100% drawdown?
You have raised a good question regarding what level they would allow for a drawdown to represent normal operation or failure.


Why wait for any drawdown. IMO every trade should be looked at as information as to the success of your plan. People are wasting very valuable information and daily feedback if you wait for a drawdown to issue a message.

At the end of every day or before I start a new day I review how my trading went, good or bad, and have something to work on for the next session.

The punter that started this thread has now got to the end and has no answers to what went wrong.

But if one really knew, or could see, feel it, then that question wouldn't need to be asked. Not only from a tested perspective but from an expertise perspective.

Agreed, I dont get your angle. Maybe you should review my previous comments in their entirety.

Why wait for any drawdown. IMO every trade should be looked at as information as to the success of your plan. People are wasting very valuable information and daily feedback if you wait for a drawdown to issue a message.

At the end of every day or before I start a new day I review how my trading went, good or bad, and have something to work on for the next session.

The punter that started this thread has now got to the end and has no answers to what went wrong.

I agree TH, however, doesn't this refute your left-right turn hypothesis? :confused:

I agree TH, however, doesn't this refute your left-right turn hypothesis? :confused:

No. Reviews are about improving mechanics not about hoping for something better. My plan is to continually weed out mistakes as I'm a discretionary trader. And improve what is working.

That has nothing to do with so called emotional trades or trades that don't fit into my plan like, holding past stop losses, hanging on to daytrades over night, taking to large a position etc etc.

Agreed, I dont get your angle. Maybe you should review my previous comments in their entirety.

I have contributed to the discussion that seemed to be going nowhere. There is no angle just observation and comments. :(

TH,

Thanks for the comments from your perspective. :)

Why wait for any drawdown. IMO every trade should be looked at as information as to the success of your plan. People are wasting very valuable information and daily feedback if you wait for a drawdown to issue a message.

At the end of every day or before I start a new day I review how my trading went, good or bad, and have something to work on for the next session.

With 200-odd round trips a day you have a well-and-truly statistically significant sample of data on your trading methodology every day to work with, including intraday drawdown.

You would be wasting invaluable real-time information if you were NOT to examine this data frequently, but would you simply focus on one specific trade within your sample and modify your strategy? No, you look for consistent patterns in your intraday equity curve.

With other methodologies, it takes considerably more time to build up an equally statistically significant sample of trades you can use to feedback into improving your trading; long term trend following takes many years to complete 200 trades.

And this contribution advances the discussion somehow?

When I design a system I have a defined endpoint at which I decide the system is no longer working as I thought it would - I define the maximum amount of my trading capital the system will be allowed to lose and that maximum is set at a point where recovery is not problematic.

At what point do you accept that a trading method is no longer working? 10% drawdown, 30% drawdown, 50% drawdown, 65% drawdown, 100% drawdown?

It was just a niggle in regards to you thumbing your nose at the laws of possibility.

Just because you have a pre-defined end point, does not mean the system no longer works, just that you think it is no longer working.

From a practical stand point, you have to have your own limits. But from a theoretical stand point, no-one ever has enough capital to test if a system works or not. If it is even slightly possible, it could happen.

Why wait for any drawdown. IMO every trade should be looked at as information as to the success of your plan. People are wasting very valuable information and daily feedback if you wait for a drawdown to issue a message.

At the end of every day or before I start a new day I review how my trading went, good or bad, and have something to work on for the next session.


Pretty much.

It's one of my gripes with mechanical traders. The premise being that to operate a mechanical system, it is at the limits of optimal performance for whatever reason, for the person operating it - otherwise they wouldn't be using it.

But to me, that is just complacency, because in the face of a large drawdown or what have you, the operator is not looking for a better way, a better system, until by some pre-determined notion, it is decided not to be working. And that goes against every notion I hold.

If you aren't constantly looking for a better way, what is anyone actually doing?

No. Reviews are about improving mechanics not about hoping for something better. My plan is to continually weed out mistakes as I'm a discretionary trader. And improve what is working.

That has nothing to do with so called emotional trades or trades that don't fit into my plan like, holding past stop losses, hanging on to daytrades over night, taking to large a position etc etc.

Ok, I get you. Yes, I agree.

You would be wasting invaluable real-time information if you were NOT to examine this data frequently, but would you simply focus on one specific trade within your sample and modify your strategy? No, you look for consistent patterns in your intraday equity curve.


Yeah for sure, I agree. I think we are on the same point.

Somewhere in this thread (:confused:) I was talking about straying from the strategy. Tweaking mechanics and even subtle tactic changes to improve profitability is a world away from taking dumb trades.

Imagine how useless I would be as a system trader having to wait 200 days or more for some significant feed back. I bet I would start really messing up the system after about...... 2 days :o

in the face of a large drawdown or what have you, the operator is not looking for a better way, a better system, until by some pre-determined notion, it is decided not to be working. And that goes against every notion I hold.

If you aren't constantly looking for a better way, what is anyone actually doing?

This is not correct. When a given system reaches failure point it is retired. That is all. It is retired before it does excessive damage to trading capital.

Whilst a system is performing to expectation, research into improving the system is an ongoing process based on completed trades, but the system will not be modified or changed unless it can be proven that the change is likely to improve the system (limits on proof acknowledged but that's a whole area of discussion on its own).

As a specific example, my ASX long term trend following system started off with a rule that trades would be opened and closed at 11am or so as that is what many books suggested to be a good time ("amateurs at 10am, pros at 11am"). Observation of price action on opening/closing trade days lead me to question this trading truism and actually backtest around this - the system now closes positions on the OPEN and opens them on the CLOSE which is providing better results - the system has evolved as it has traded. There have been several changes to the system as a result of this ongoing process.

Developing and trading systems is an ongoing, fluid process. I currently trade 3; one is in full production mode, one is currently in trial mode (small position sizes) and one is 1/2 way through paper trading. They all utilize markedly different timeframes and exploit very different market edges. Also in development at present are 2 other systems for different trading instruments. The vast bulk of systems I work on don't make it past the initial backtesting stage, but the point is that systems development is an ongoing work in progress, not a process that stops when a system commences trading and resumes when the system fails.

Imagine how useless I would be as a system trader having to wait 200 days or more for some significant feed back. I bet I would start really messing up the system after about...... 2 days :o

Not all system traders trade longer term. The system I am designing at the minute will be taking between 50-80 trades per day.


The vast bulk of systems I work on don't make it past the initial backtesting stage, but the point is that systems development is an ongoing work in progress, not a process that stops when a system commences trading and resumes when the system fails.

I agree with this.

Not all system traders trade longer term. The system I am designing at the minute will be taking between 50-80 trades per day.



I agree with this.

Hey Nizar
So do you design systems then ?

From the sounds of the thread and forum in general well 1 . Most people don't think you can make a living trading .

Secondly , now this is only how I'm getting it but most people don't sound as though they have stuck to the one system or format for very long to this day without bouncing onto the next one or a variation.

And that makes me think that between all the people trading even in just this one site , we must have tried every system ever invented and still looking so what hope have we got anyway , maybe one is right after all .


Cheers

And that makes me think that between all the people trading even in just this one site , we must have tried every system ever invented and still looking so what hope have we got anyway


Your right none,
and that being the case why are you still trading?

Hey Nizar
So do you design systems then ?

From the sounds of the thread and forum in general well 1 . Most people don't think you can make a living trading .

Secondly , now this is only how I'm getting it but most people don't sound as though they have stuck to the one system or format for very long to this day without bouncing onto the next one or a variation.

And that makes me think that between all the people trading even in just this one site , we must have tried every system ever invented and still looking so what hope have we got anyway , maybe one is right after all .


Cheers

I had to read this post 3 times, and I still dont quite get your point.

But going by your conclusion, i recommend you stop trading, and save yourself some money and a hell of a lot of time and effort.

Hey Nizar
From the sounds of the thread and forum in general well 1 . Most people don't think you can make a living trading .

Secondly , now this is only how I'm getting it but most people don't sound as though they have stuck to the one system or format for very long to this day without bouncing onto the next one or a variation.


You clearly can. For some people that is by way of "mechanical" trading, dicretionary or arbitrage trading. The key is to find what works for the individual. Like in everything though, there will be people who wont be able to make anything work.

But you cannot remain static. Even the mech heads here have tacitly admitted here that to remain profitable, there has to be a discretionary element. What discretionary elements work, are probably up for discussion. One would think that an intuitive or intangible element, has to be present to a certain extent as well...

You clearly can. For some people that is by way of "mechanical" trading, dicretionary or arbitrage trading. The key is to find what works for the individual. Like in everything though, there will be people who wont be able to make anything work.

But you cannot remain static. Even the mech heads here have tacitly admitted here that to remain profitable, there has to be a discretionary element. What discretionary elements work, are probably up for discussion. One would think that an intuitive or intangible element, has to be present to a certain extent as well...


Chops what do you mean by mechanical trading ?
Repetition of a system they have that works or ?

Cheers


Nizar , not really my own personal conclusion at all but people do seem to read that way everywhere you go , it really surprises me actually.

Personally I feel there are many ways to trade very profitably and many versions of those ways and an abundance of opportunity even in the market we have right now .

Cheers

The key is to find what works for the individual. Like in everything though, there will be people who wont be able to make anything work.

Fully agree with this.


Even the mech heads here have tacitly admitted here that to remain profitable, there has to be a discretionary element.

Completely disagree with this - hopefully this is not what you took from my post on trading system development continuing after launch.

Each and every system that I have ever tried to add a discretionary component to has been actively harmed by the process.

"Sure thing" trades on a chart are usually anything but.

For new investors it depends where you come into the markets. I came in during the 1970's resource boom and made quite a fortune, and then lost it all during the 1987 crash period.
Doing well now that the resource boom has returned and now a more savvy investor who keeps a lot of cash to fall back on.

Fully agree with this.



Completely disagree with this - hopefully this is not what you took from my post on trading system development continuing after launch.

Each and every system that I have ever tried to add a discretionary component to has been actively harmed by the process.

"Sure thing" trades on a chart are usually anything but.


Hi Michael

Found that one myself too , the sure thing chart stuff . Although I am a big believer in charts , it has backfired plenty .

What would you say was one of the best indicators if any ?

Cheers

For new investors it depends where you come into the markets. I came in during the 1970's resource boom and made quite a fortune, and then lost it all during the 1987 crash period.
Doing well now that the resource boom has returned and now a more savvy investor who keeps a lot of cash to fall back on.


Must have hurt Noirua !

So did you restart years later with a whole new batch of cash or held and waited - a bloody long time ?

Cheers

What would you say was one of the best indicators if any ?

Price

(and Volume, although not many of my systems use volume information)

For new investors it depends where you come into the markets. I came in during the 1970's resource boom and made quite a fortune, and then lost it all during the 1987 crash period.
Doing well now that the resource boom has returned and now a more savvy investor who keeps a lot of cash to fall back on.

Nice one Noirua, good to see you doing okay.A good example of `the market giveth and the market taketh away`.

Completely disagree with this - hopefully this is not what you took from my post on trading system development continuing after launch.

Each and every system that I have ever tried to add a discretionary component to has been actively harmed by the process.


I'd say that everything you choose to alter, choose to investigate still has a discretionary element.

Even deciding what system to investigate, what strategy to compute, has a discretionary component.

After all, even turing machines still have to make a decision. ;)

I'm enjoying the argy bargy... :) Nice to be debating against someone with intelligence.

Must have hurt Noirua !

So did you restart years later with a whole new batch of cash or held and waited - a bloody long time ?

Cheers

I was bailed out by an investment in Endeavor Resources (St Barbara Mines) in the mid 1990's when they recovered from about 2 cents to nearly $3.00.
In 1987 they crashed from about 90 cents to around 20 cents in about 10 days.

How did I get it so wrong? In the 1973-76 Great Bear Market, gold shares doubled. Therefore it stood to reason that the same would happen again, it didn't.

Still, those who suffered in the dotcom crash have a similar story.
"It's different this time", no, "it's always the same".

I was bailed out by an investment in Endeavor Resources (St Barbara Mines) in the mid 1990's when they recovered from about 2 cents to nearly $3.00.
In 1987 they crashed from about 90 cents to around 20 cents in about 10 days.

How did I get it so wrong? In the 1973-76 Great Bear Market, gold shares doubled. Therefore it stood to reason that the same would happen again, it didn't.

Still, those who suffered in the dotcom crash have a similar story.
"It's different this time", no, "it's always the same".



Great story Noirua thanks for sharing.

I'm hoping AND does it for me wish I got that at 2 cents .
A portfolia I built through recommendations sunk like the preverbial, for now anyway but AND - god luvem has doubled which is helping things in that lot a bit .

The one that really hurt is I was going to dump the whole portfolio and instead just spend that whole batch on AND to begin with because it looked like such a good company.
But i did as they advised and spread it out , ouch.
Expecting those stocks will recover though they all still read well so the fat lady ain't sung yet.

Cheers

Blaster,

Based on a review of this thread and some other posts of yours in other threads, it seemed appropriate to offer this up at this point in time.


It is said that there are 4 stages of trading ability;

1. Unconscious incompetents,
- Traders who have no idea what they are doing and don't realize it. If they don't move on from this, they invariably blow up, but it will be someone else's fault. They often have had a run of luck to date which they have confused with skill. The vast bulk of traders. They don't have a written down trading plan, much less trade consistently. After all, they don't need a plan, since it's easy to make a killing on the markets for someone as naturally gifted as them.

2. Conscious incompetents,
- Traders who have woken up to themselves and realize that they didn't know what they were doing but merely got lucky. These traders now have some idea of what little they actually know and some idea of how to go about finding out what they need to know.

3. Conscious competents,
- Consistent traders with positive expectancy who understand why they have a positive expectancy and act accordingly.

4. Unconscious competents.
- The mythical final level where trading is intuitive and consistently profitable.


You are at stage 1, with the faintest glimmerings that there even exists a stage 2.

:iagree: I'm with Michael on that comment

:iagree: Blaster, it is up to you now.

Ah, the 4 levels of competence.................... "Goes with most things in life".



The hardest step is realising that you are still at stage 1.

I doubt it possible to ever truley be at stage 4 competence as a trader as the variables are too great. But stage 3 is a very achievable goal.

I doubt it possible to ever truley be at stage 4 competence as a trader as the variables are too great. But stage 3 is a very achievable goal.

Could you explain this a little more?

I doubt it possible to ever truley be at stage 4 competence as a trader as the variables are too great. But stage 3 is a very achievable goal.

I think you misunderstand what stage 4 is. Unconscious competency is not infallibility, it is getting to the stage where competency is achieved without having to "think". A useful parallel allegory is that of an accomplished sportsman... say, a footy player.

They are not "thinking" about their game so much as reacting unconsciously, because the techniques have been mostly committed to the neocerebellum area of the brain.

An options market maker of old (before 'puters) is definitely stage 4, otherwise they crash and burn.

It just means you know what your doing without having to think about it.

Blaster,

Based on a review of this thread and some other posts of yours in other threads, it seemed appropriate to offer this up at this point in time.


It is said that there are 4 stages of trading ability;

1. Unconscious incompetents,
- Traders who have no idea what they are doing and don't realize it. If they don't move on from this, they invariably blow up, but it will be someone else's fault. They often have had a run of luck to date which they have confused with skill. The vast bulk of traders. They don't have a written down trading plan, much less trade consistently. After all, they don't need a plan, since it's easy to make a killing on the markets for someone as naturally gifted as them.

2. Conscious incompetents,
- Traders who have woken up to themselves and realize that they didn't know what they were doing but merely got lucky. These traders now have some idea of what little they actually know and some idea of how to go about finding out what they need to know.

3. Conscious competents,
- Consistent traders with positive expectancy who understand why they have a positive expectancy and act accordingly.

4. Unconscious competents.
- The mythical final level where trading is intuitive and consistently profitable.


You are at stage 1, with the faintest glimmerings that there even exists a stage 2.

Just when I was starting to like it around here .
Granted - I am at the very very beginning paticulary around you guys . Ofcause , I don't claim any more than so what's wrong with that I've only been trading for under 12 mths .
But - that's why I use a system devised by a successfull trader of 20 yrs.

Your assumming also that I am guessing with AND - nope although I do really like the company regardless and there's nothin wrong with that.
AND was suggested to me by one of the biggest names in the country 12 mths ago .

I will say one thing though . Do you really think anyone trading could double in under 12 mths flying blind , come on ! Yes I know she's gone down right now but hey traders with 20 yrs have also gone down right now .

Have a nice day smart **** !

But - that's why I use a system devised by a successfull trader of 20 yrs.

Well that system sucks if your down 65%


I will say one thing though . Do you really think anyone trading could double in under 12 mths flying blind , come on !

YES.

You could also ask could someone who knows what they are doing have such a large drawdown??
And still have from your posts, with all due respect, not much of an idea what went on??

Just when I was starting to like it around here .
Granted - I am at the very very beginning paticulary around you guys . Ofcause , I don't claim any more than so what's wrong with that I've only been trading for under 12 mths .
But - that's why I use a system devised by a successfull trader of 20 yrs.

Your assumming also that I am guessing with AND - nope although I do really like the company regardless and there's nothin wrong with that.
AND was suggested to me by one of the biggest names in the country 12 mths ago .

I will say one thing though . Do you really think anyone trading could double in under 12 mths flying blind , come on ! Yes I know she's gone down right now but hey traders with 20 yrs have also gone down right now .

Have a nice day smart **** !




PS . I have followed the trades that I was meant to do instead of turning chicken sh't, deviating and listening to others and it actually works out that my account would be 30% up on end 07 right now even in this market. Instead of 30% down on the early 07 beginning .
Not bad for a trading blindly guessing fool and my first year !

Stage 4 of being unconsciously competent or acting and reacting upon instinct and not thinking is improbable (IMO).

I doubt anyone is that good.

But to attain consistent returns with minimal losses is very achievable. The market is ever evolving and subject to change from many external influences. To be a stage 4 trader. I doubt it possible.

Sure I believe you can easily achieve the consciously competent stage 3 level.

Just when I was starting to like it around here .
Granted - I am at the very very beginning paticulary around you guys . Ofcause , I don't claim any more than so what's wrong with that I've only been trading for under 12 mths .

Have a nice day smart **** !

Lolololol at the last line.http://www.clicksmilies.com/s1106/grinser/grinning-smiley-014.gif

Don`t worry mate ... most of us drift in and out of stage one and two.;)

Hi there Blaster,

I notice a couple of the lads are putting the boot in a little hard here, but don’t take it personally. There are some very good traders around here (and a lot of very average ones like me !!) ………… Read between the lines and you will pick up some valuable info from them.

I’m certainly not going to preach any great trading methods to you, cause I’m still working on that one myself.

If I could give you one piece of advice that would have saved me a small fortune, and will hopefully stop you doing what I did …………. 90% of being a successful trader is learning “money management” ………. Preserving capital through sound MM is priority number one ………. Everything else comes a distant second.

Unfortunately, even once you’ve learned and understand MM, often implementing and following it under the stress of a losing trade can put your “psych” under a lot of pressure …………… that is why Michael is advocating a proven/tested trading plan because this takes a lot of the psych out of the equation. Traders like T/H who can happily do 100 scalp trades a day and not end up a nervous wreck are a rare breed indeed. …………… Even though they may be giving you a bit of verbal grief, I would listen carefully to their comments ….. there’s usually a few diamonds in the rough. ;) Good luck with it. Barney.

Hi there Blaster,

I notice a couple of the lads are putting the boot in a little hard here, but don’t take it personally. There are some very good traders around here (and a lot of very average ones like me !!) ………… Read between the lines and you will pick up some valuable info from them.

I’m certainly not going to preach any great trading methods to you, cause I’m still working on that one myself.

If I could give you one piece of advice that would have saved me a small fortune, and will hopefully stop you doing what I did …………. 90% of being a successful trader is learning “money management” ………. Preserving capital through sound MM is priority number one ………. Everything else comes a distant second.

Unfortunately, even once you’ve learned and understand MM, often implementing and following it under the stress of a losing trade can put your “psych” under a lot of pressure …………… that is why Michael is advocating a proven/tested trading plan because this takes a lot of the psych out of the equation. Traders like T/H who can happily do 100 scalp trades a day and not end up a nervous wreck are a rare breed indeed. …………… Even though they may be giving you a bit of verbal grief, I would listen carefully to their comments ….. there’s usually a few diamonds in the rough. ;) Good luck with it. Barney.


Well thanks Barney .
Nice to know their not all 'smart>>>>s' around here - Mod' I've taken the liberty of putting the spaces in for you this time , sorry about that.

Their not boots mate their just silver tounged [ well I can't add the next bit ] they've been typing too much , unfortunately forums attract them.

Not a doubt in my mind their are some very good traders around here , one of the reasons I joined . As I said to His Highness Jesus I don't claim to be in even the same hemisfere and what , I'm not aware of beginners luck no matter what yourt using. Christ almighty I wish I could swear all this politeness is killing me .
Very predictable !

What I can't work out though is why they can't ad up with all that fancy talk and worlds of experience .
I've had 3 or 4 comments saying I'm 65 or 70% down not 30 , what the !.
Umm , that was 30 down from principal which was doubled equalling 130 - ouch , on my calc ' .

These people say they've read but was that with glasses on or ? Because even with my sorry little pea brain I have picked 1/2 a dozen contradictions at least and I haven't even read the whole thread , as silly as it it is .
They miss the one biggest key factor - I have wondered - strayed - deviated , that's in all my posts as pethetic as they are but they haven't got it yet preach all over the place - stick to stratergy.
Someone here even argued that changing a stratergy seems to muck with them which is pretty f'g obvious that that's exactly what I did .

Strangely enough all the basic people in this area like myself ,yourself , basic meaning of this world, got it day one and have told their story along with real advice .

Pretty damn predictable. Intellectual overload - some people really have gotta watch that stuff !

Such is life !
Cheers mate.

i could get real deep and meaningfull here, except im eating an ice cream and typing one handed.

so i'll be brief. if you have suffered financially during your financial life experience, recovered, and now have the readys to enter the market, you have more chance of doing well, than learning it as you go here, now, and with no adversity in your financial life experience...

What I can't work out though is why they can't ad up with all that fancy talk and worlds of experience .
I've had 3 or 4 comments saying I'm 65 or 70% down not 30 , what the !.
Umm , that was 30 down from principal which was doubled equalling 130 - ouch , on my calc ' .


Drawdown buddy Drawdown. 65 % from peak to trough. Thats bad no other way to look at blaster.;)

Drawdown buddy Drawdown. 65 % from peak to trough. Thats bad no other way to look at blaster.;)


Ooooh I knew that one would backfire , ouch . But I do know where it's coming from and yep - she ain't pretty .

Finally we can get back to the guts of the situation.

Cheers

;) :D

But - that's why I use a system devised by a successfull trader of 20 yrs.

Your assumming also that I am guessing with AND - nope although I do really like the company regardless and there's nothin wrong with that.
AND was suggested to me by one of the biggest names in the country 12 mths ago .

I will say one thing though . Do you really think anyone trading could double in under 12 mths flying blind , come on ! Yes I know she's gone down right now but hey traders with 20 yrs have also gone down right now .


PS . I have followed the trades that I was meant to do instead of turning chicken sh't, deviating and listening to others and it actually works out that my account would be 30% up on end 07 right now even in this market. Instead of 30% down on the early 07 beginning .
Not bad for a trading blindly guessing fool and my first year !

1. If the system is such a good one, why did you not follow it?
2. If the system is such a good one, why are you asking about other black box systems?
3. If the system is such a good one, why do you not name it when asked about your strategy?
4. Whose fault is it that you are in the position you are in now?

5. If AND goes pear-shaped, whose fault will that be?
6. Can anyone double their money in 12 months flying blind? You betcha it can be done, and more (look up the relevant thread on MTN). Stay blind, though, and the market will take it back even faster.
7. Traders with 20 years experience may (or may not be) down at present, but I'll guarantee you that if they are down, they are not down an amount that has caught them by surprise - it'll still be business as usual.

No one here is having a go at you. We don't need to. The market has done very well at doing that on its own. What happens from here is entirely up to you.