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I sorta new to futures.io (formerly BMT), first forum Ive ever joined. Best trading move Ive made so far!!!!!!!! Ive read alot of different posting that key people have listed, and I tried tons(hundreds of different charts and indicators(which distort the move in my eyes) to come to this conculsion. Tell me if Im right, use a clean chart that (I) can read, then up is up, down is down and eliminate noise so you can trade with the trend. Lose a few points here and there on the reversals in direction and get paid on the longer directional moves? Is this correct?
Ive tried scalping, Ive tried counter trend trading, I tried quick scalps off res or support levels....But these are 60/40 r/r in my opinion (thats why these traders never get ahead?) , and If you wait on a big move only only then it runs away before you can catch it sometimes. But if you trade most of the day or half day or certain hrs you catch most of the move and make more overall. Thoughts?????
I use charts to quickly gauge what an instrument has done. I actually trade off the DOM and T&S, but I don't scalp for a few ticks. I only trade this way during the opening though. I also employ a statistical model and focus on global macro for my investment account.
Keep in mind that all automation does not rely on charts. A lot of option/basket/pair traders hardly use charts. Fundamental/news trading is another form that doesn't require charts. I traded stocks based on the quotes from the newspaper when I first started out.There's no point in excluding charts if they help one make money, but they are not instrumental to a wide array of trading methods. Try getting a job at an IB as a "chartist"....
Just because one can't do something oneself, doesn't mean that one should assume no one else is capable of doing it...
That being said, I actually use charts a quite a bit. I am somewhat embarrassed by it, but it makes me money...
Charts are not the only way to work, note that I included "written data". But you can program charts to show what you need to see a lot faster than you could for instance figure out weekly pivots or various projections off various IB's in various markets at various hours of operation for various pit sessions. The DOM is not going to give you that info, its best use is market profile if you have a histogram attached, such as found in Book Trader and rapid trade execution. The book itself can be deceiving, since many market moving volume entries come in at market. This is where cumulative delta shines. As far as computers, they are programmed in million different ways, and of course they do not need charts, since they do the math on the spot in milliseconds. Charts are merely a tool to present what you need to see.
And of course, any trade should come with a predetermined exit strategy, and frankly, you need some sort of charting for that, either volume flush, fibs, IB projections, etc...Just picking an exit based on the amount of ticks you book on trades is not a viable exit strategy since you invariably miss the big moves. And runners are what keep traders solvent.
I prefer the raw data over charts, but that's just me. The latter is just a way of visualizing the former.
I extract points of interest from the time series and use that in a statistical model. However, I also glance at charts for S/R.
I agree that "reading" the DOM is (often) a futile exercise. I use the DOM data in a different way.
I could live without charts, but they often save me a little time (and I'm a visual person), thus I will continue to use them. But, they are probably the least important element of my trading.
Interesting, I was under the impression that DOM trading was simply one of those strategy's that cant be explained unless one has 10,000 to be trained.
while i was trading the SPY I used to watch it and even tried to trade off it and I would have to say I didnt see anything relevant. Maybe I'm missing something. If anything the most it gives is an idea of speed of volume. but a tick chart can do that. Then again I had no idea what to look for but decided there was little info that could be read in the numbers them selves. maybe the spy wasnt a good place to try to learn.
Many have tried all sorts of set-ups or indicators to enter and failed. some try the same ones and succeed. Some scalpers trade many times a day and have automated systems shooting out orders and use a simple moving average.
Clearly this would mean that the set up is not the key to it all.
Further people that use set-ups alone tend to have a lower then 50% positive trade percentage.
So then we grow and we look at the next step while not abandoning our first setup theory.
We are told to add risk to reward and calculate % positive trades.
In essence we are looking for something that has a 1% or over edge.
entering at any given time should yield a 50 50 result. using probability we make a risk to reward ratio that would take those 50 % loss to win ratios and make profit out of it.
Now, if that is the edge (considering most fail at set-ups and indicators) that on its own should yield profits.
Blindly buying with good risk control in theory should work.
As a matter of fact, trend traders ,it is said. are more often wrong than right. From my reading an average of 30% of trend trades end up in the green. but with a 5 to 1 ratio they end up supposedly being profitable.
now if entering the market blind, yields a 50 % in the money ratio, then we are ahead here. just gotta work on those stops.
Also if you did not make money (besides fees), then that would mean that if you did the opposite of your years of research then you would of been profitable.
Tried it. did not work,
when some things not working we drop it. unless it is giving an edge.
if one is failing (besides fees) that means he or she is preforming under random entry. and if random entry is not 50-50 then we can simply pace trades randomly and expect profits in the long run.
Tried it and am retiring in within 5 years. lol i wish. But what im saying here is if you are failing, dont feel bad to do the exact opposite of your what you would normally do but let me know the out come !
