One more thing on hard stops placed 1 tick above a bar high etc- guess who stopped you out when your trade was "right, had you not been stopped"? Answer- the greater fool who bought the absolute high! Why let some dude in pajamas on his laptop trying to buy a breakout of a 1 min bar with a 1 contract order determine the fate of your trade? Most people look at price and forget what it is.
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Just adding something to the conversation about a time stop, while a 'hard' time stop possibly does not offer any benefit, for some strategies if the market has not moved how you anticipated within a certain time you might consider your assumption for that particular trade wrong, but I wouldn't consider a few minutes to be an appropriate time period. Tools that allow you to analyse your trade history can be beneficial for this, you might see some patterns.
Edit: Thinking about this more, I would say price action would take precedent over time, if you were expecting a break out and it is taking hours, the price action would still be the primary validator of the trade. If your trade history shows your losers taking a long time to play out perhaps studying those days price action would assist in recognizing patterns confirming/disproving your trade.
Last edited by amoeba; October 11th, 2015 at 11:03 PM.
Reason: Extra thoughts
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That is still a pretty short time-frame for trading. I know you mentioned that longer term day trading does not work for you, but ultimately you need to find a method that works for you AND makes money. More often that not it requires a change in perspective.
The following comes from one of the Market Wizards book (think New Market Wizards, but not 100% sure) - When you play roulette your best chance of making money would be to bet it all on black (or red if you prefer), make one bet and walk away.
If you try and play roulette, you will find that there are no magic combinations that allow you to have a positive edge. The house always has the edge. However, any individual bet like the above (all on black or red) has a 50% chance of success. While any additional plays still carry that 50% chance of success, the chances of you achieving two or more winners in a row are significantly less. This is why you should only play it once.
So how does this apply to trading? If you choose to play shorter term moves, you are exposing yourself more to noise and thus giving the house more of an edge (especially after slippage and commissions). If I make one trade a day with a 10 pt stop-loss I would bet good money that my win% would be much higher than trying to do 5 trades with a 2 pt stop-loss. Same daily risk, but over time the results will be vastly different. If I leave my trade open until a specified time, i.e. 30 minutes before the close (or whatever you are comfortable with), occasionally I will land big winners that can make the difference in performance between the 1 trade a day vs the 5 trade a day system even bigger.
I am not sure I agree with this - if your primary objective is to not damage your account, then it seems that you will just learn to cut profits short. Might sound funny, but after having a couple of losses it becomes very tempting to cut short profits in order to get back to break-even. Sometimes it works, other times you may just have cut short your best chance of a huge winner.
I will add that unless you have the ability to scale in to trades you are probably undercapitalized. Scaling it / out can be a very valuable tool that allows you to manage risk better vs trading one contract. Trading smaller when things aren't working is probably the best way to protect your account from serious damage.
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Thanks for your input - I'm actually not bad predicting the main direction for the day or even few days and I think I'll end up as a long trerm/position daytrader but yeah I'm under capitalized for that but I'm also not bad at predicting short term moves so I'll stick with what I feel more comfortable for the moment (short term)
Actually the house's edge is the zero on the american roulette or 1/37 and zero and double zero on the European version or 2/38 .. sorry just messing around I got your point.
No the primary objective is to trade your plan without deviating and damaging your account as a result of that, if you have an edge odds are You'll be ahead after 100 trades.
He half lost me on video 2 at 1:38ish when He (sorta) said He change his bias on a trade out of spiritual intuition and completely lost me at 1:55ish when He starts mixing neuroscience and religion too bad it took him almost 10 hrs to get to what would ultimately be the meat of the workshop, one thing has nothing to do with the other regardless of your personal beliefs.
Hey but that has nothing to do with your sincere good intentions, thanks I appreciated.
I do believe in intuition but when You say that it comes from spirituality instead of your subconscious your neurosciences credentials are compromised in my book.
When You say "is like You can't fool God" referring to spiritual intuition, to me that's adding religion in the mix.
If You believe in what He said that what He calls your spiritual intuition comes from somewhere in the universe instead of your mind then You're doomed as a trader, unless You reconcile that in your subconscious (where that info actually comes from). I'm not mystic I can't pretend that I am, that's one believe that I know I can't change.
I do trade like You to some degree I do have some rules but They're not set on stone, I only use volume and Barry's better volume which incorporate average trade size and bar length.
My inexperience trading live on intuition is probably the main reason I don't pull the trigger I miss the entry as I double/ triple check it while my first hunch was usually correct. Like I said before mental state is the main difference between sim and live trading. After My melt down I became a little suspicious on my ability to read the markets when in reality is just fear that clouds my mind.. I'll get over it eventually.
Your conscious/subconscious are spiritual mechanisms and the entire universe is a manifestation of your own perception. Everyone you encounter is just a series of connected thoughts you have and doesn't represent the person from their perspective. The same is true about the market. He's not saying that intuition comes from some far off galaxy or anything like that. I think you have a lot of issues with religion that are probably interfering with your ability to understand what Mark is saying.
He doesn't say to blindly trust your intuition, but to rigorously question it to the extent that you understand exactly what you're feeling. intuition is mainly a creative vehicle for discovering types of patterns you can build confidence in and use later in your trading. If you watched the rest of the video you'll see how to decipher genuine intuition as opposed to noise generated by your mind to sabotage your efforts.
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Last edited by Itchymoku; October 12th, 2015 at 11:37 PM.