Put all the essays together in one spot if you are interested.
This web page has all the essays going back a few years that I have records of. Hope they help. Ignore the rest of the website, and don't go poking around it. I wouldn't want to be accused of advertizing. Trading Essays
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wow, all I can say is "Amen" to this entire thread!
It looked like 90% of my history, as far as trading goes.
It took me over 10 years - and unaccounted for amounts of $$ - before the pieces of that puzzle finally, almost automatically, fell into place.
Trading used to be like an obsession, stressful, nerve-wrecking for me.
Now it is entertaining, relaxing, my favorite "brain-sports".
Maybe we all have to go through the process and find out for ourselves that the ingenious is always surprisingly simple.
One of the most difficult phases for a trader to go through is draw down loss. This could last a month or more, and seems like an impossible situation. It could rip your heart out of your chest, and send you into depression. The biggest thought is that you must first recover before you are even going to make any more money.
The worse part about draw down is when it reaches your starting base principal.
One way you can think about it is to consider where you started, and how much is original investment and how much generated profits. If you have no profits, then you will have to put some techniques into place to ensure you do not draw down to nothing. Patience is the most important aspect when trading in the hole. Slowing it down, trading less, trading smaller, adopting a 1 and done policy, and becoming very particular about when to trade are all approaches that can help you come out the other side of draw down loss. But, the most important thing you need to do is examine and analyze your trading statistics. 99% of your trading answers are in your stats. By knowing what is happening you may also discover why it is happening from your in-depth analysis of your current trading. By knowing what is happening you may also discover what needs to stop in order to stop the draw down. Sometimes it is just a simple thing like maybe you need to take a week or two off and go hiking or fishing. In my case, I go outdoors for some plein air painting. There is no rush, and if you are drawing down, slow down and take some time to review your trading in more detail. Take time to relax. Examine the great trades you have had, and see if a similar opportunity could present itself, and make sure you will be able to recognize it. Take the very best trades you have done recently. Describe them in detail. Then wait until those circumstances present themselves again. While you are waiting, you won't be trading and you won't be drawing down.
If you very best trades were in your underwear, then maybe sitting at your computer all day in your underwear might help. Maybe that fantastic trade you did when you were standing on your head will come along again. Just make sure you know everything about your trading so that you can repeat only the very best.
The worse thing you can do is to try to plow through during draw down periods. This attitude means you are challenging yourself and more to the point, the market, to deliver what you know had been the nature of your trading. This attitude is self destructive, and confrontational. You ever try standing in front of a freight train and challenging it to stop before running you over? crazy right. So why challenge the market to do what it had always done before? The market moves in cycles, and maybe this cycle is not the one for you. There will be other cycles, and the market does shift character from quarter to quarter, season to season, even month to month. Maybe you are out of sync. But adopting a head strong insistence that things continue to work as they had before regardless of what is actually happening is kind of like the guy who keeps doing the same thing over and over and expecting different results each time. So, be humble and thankful that bad times are followed by good times, and that bad times happen now and then. Take practical steps to pace yourself until the good times return. Otherwise you will be humbled, and crushed, and driven to your knees should you fail to recognize your trading and fail to adopt a sound plan for capital preservation so you can outlast the draw down cycle. There is never an easy answer, and most answers we do not want to hear if they do not jive with what we want. Just remember that the market does not care what you want. It's sole purpose is to take your money. So, feed it pennies until your stats show you that you are turning things around.
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Yes, no matter what you use on your chart, or even if you use nothing, you have as much chance as the next guy to succeed at this.
To this day I still spend a lot of hours in and after market with the charts, and everything else that has to do with this business. Currently I am working on more automation of the strategies I use, and on adjusting myself to current market conditions; which have been ruthless lately.
So, I have been running the auto-traders I have in an effort to detach myself from the signals which allows me to concentrate on trade management.
One traders signal is another traders stop out. The simpler the view, the more information you have to make good trading decisions.
I have met a lot of traders over the years. When I was moderating for other companies I met all kinds of traders. Most were too anxious, too much in a hurry to lose money, and had the wildest expectations. I know now that these handicaps are not traders faults. They are implanted miss-information provided by the industry that needs to fill the ranks because of the massive attrition in this business. The brokers number one client needs inventory!
If you have not even been spinning your wheels by the 4th year, then chances are the 5th year will not be a profitable one. You have to spin your wheel before you can grip the road and take off.
For myself, the 4th year I spent starring at a blank chart, no indicators other that what were already there. The price bar structures, the time axis, the swing pivots, the history of prior opens, closes, and ranges, the current range, high and low, the time and sales window, and market depth and volume distribution. Lets see, that is 9 indicators? already.
I was amazed at what I began to see. There, starring at me, was a lot of information. I started to make the best trading decisions ever. I used trend lines (the greatest indicator of all time), I used price bars (range, renkos, point and figure), I used prior volume imbalances, and order flow discrepancies, and just started to trade what I saw. I did not lose money!! I did not make money either!!
The 4th year was the year when things came together. For some traders it takes 10 years to get to their 4th year, for others it takes 2 years, and for you lucky dogs out there... a few months.
So, if you are in your fifth year, re-read the above. The answer might be there for you, or most likely, it will be in your journal. WHAT!! you have not kept a journal and have no historical reference about your trading with detailed performance statistics that you can evaluate??? No wonder!
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Settings don't really matter (no magic in them).
Just get used to whatever you use.
Determine settings by RR and your account, and the number of trades you want according to how long you want to sit at your computer.
Observe for entry conditions. Basically a tap within 1 brick, then a reversal.
The strategy was used by my old trading partner (deceased).
Entry at market unless you want to limit in on an uptick 2x3 run. Stops tight or at outer BB green line.
Targets at opposite end or best RR.
The magic is what you do, not in what the indicators are doing.
You can use tick charts, time charts, range charts, renko, PnF, or anything you like. If you understand the concepts of the indicators and price structures, then you can perform the appropriate action. Nothing is perfect, and screen time with the same charts for 10,000 hours is crucial. My old partner used 5 tick stops with his method, and most of his trades were 5 to 1 or better. He just clicked when he had to click. The market did the rest.
Once you have statistically consistent profitable results in sim that are at least 70% or better, then you are good to go. Take 10 to 15% off the top for initial jitters. You will get over this phase and replace this % as your technique and self control improves.
We always tend to make things more complicated than they have to be, which makes very little difference to the market. This 'feel good' is in our heads. Keep it simple, strive to trade well, perform consistent actions and decisions, and time and results will take care of the rest. You cannot rush it. If you are desperate to make money, go do something else. Trade only because you want to and can afford to. Control loss, the market will provide the profits.
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Look for a candle with the tail/wick touching and with some outside the band, but the body inside. Also, watch that the expansion hump is not greater than the last expansion hump. Don't ask me why - that is part of understanding what Bollinger bands are, and what they measure.
Ideally (yea, in an ideal world) the bands are flat and sideways at both ends. RBS - range bound scalping.
Otherwise, the trend is the second bar closing on the band but lower than the last and both inner bands flared outward. Don't ask me why. That is part of understanding what Bollinger bands are and what they measure.
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