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COMMON SENSE


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COMMON SENSE

  #1131 (permalink)
BOSTON, MA
 
Experience: Advanced
Platform: Tradestation, TOS
Trading: commodities, TF
 
mfbreakout's Avatar
 
Posts: 7,244 since Oct 2010
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Trading

KC not working out today for me, CC and GC i am focused on today. Just took a long in ZS around 1037. No position in CL. Looking for shorts or long on pullbacks . Waiting for NG report which comes on Thursday bue due to holiday is coming out today.



My posts are not meant to give financial advice neither do they imply that my method is special. "THIS IS WHAT I COULD BE IF I HAD A TOTALLY CARE FREE STATE OF MIND DURING TRADING" Mark Douglas.
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  #1132 (permalink)
denver, colorado
 
Experience: Intermediate
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mfbreakout View Post
Thanks Surly. Anyone who shares, discuss ideas is a HERO in my book. Trend lines, channels, balance areas, weekly ranges, daily ranges- they all have VALUE. Without these tools we have nothing else to go by. What i do not believe in is exact areas of support/resistance. After watching macro traders managing billions who always talk about ranges i started thinking " Who the hell i am coming up with exact levels?" when these guys do not stress about exact levels.

I know of many traders who can see on a chart demand /supply zones- in fact almost any one can do it. Problem comes when they try to put stop loss right above it. They like to say this is my set up, i am giving it 30 ticks ( or something like that) stop loss it either works or doe not. Picking stop loss like that is random.

Bottom line everything becomes random if one gets stopped out. My solution to this problem is that i try to stay way away from randomness as far as stop loss goes. When my trade works, i look at my supply/demand zone and it looks like i have a crystal ball.

I agree completely. I've drawn this channel with lines but those lines need to be 100 ticks wide. I think that markets are very visual (ala Jim Dalton) and so yes, these lines represent supply and demand extremes but because this is such a long term chart you would need a 100-200 tick stop loss even at the very top and bottom if you want to trade these lines. Also, if you were trading on this type of chart, your hold time must be DAYS. A big part of the success or failure of a trading strategy is matching the size of your stops, targets, and hold time to the level you're doing your analysis on (this is a big part of your #4 guideline from that post in last day or so - the amount of money you have to risk to trade your strategy - NOTHING to do with psychology or your account size, everything to do with the MARKET).

Seek freedom and become captive of your desires. Seek discipline and find your liberty. - Frank Herbert
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  #1133 (permalink)
BOSTON, MA
 
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Trading



Surly View Post
I agree completely. I've drawn this channel with lines but those lines need to be 100 ticks wide. I think that markets are very visual (ala Jim Dalton) and so yes, these lines represent supply and demand extremes but because this is such a long term chart you would need a 100-200 tick stop loss even at the very top and bottom if you want to trade these lines. Also, if you were trading on this type of chart, your hold time must be DAYS. A big part of the success or failure of a trading strategy is matching the size of your stops, targets, and hold time to the level you're doing your analysis on (this is a big part of your #4 guideline from that post in last day or so - the amount of money you have to risk to trade your strategy - NOTHING to do with psychology or your account size, everything to do with the MARKET).

What you are talking about is HOLY GRAIL of trading. Everyone copy it, this is it as far this journal is concerned.



My posts are not meant to give financial advice neither do they imply that my method is special. "THIS IS WHAT I COULD BE IF I HAD A TOTALLY CARE FREE STATE OF MIND DURING TRADING" Mark Douglas.
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  #1134 (permalink)
madrid spain
 
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thank you again

i have finish my test of a fake combine (150k/9ktarget(maxdd4k5 maxdll 3k)sucesfully today , i pass the 450points in 8 days with the scaling rules (max2lot <1500Profit, max3 lot<2kProf max5lot<3000 max10lot<4500 max15lot<7000 )
thank you for your advices!
on monday i will start a real combine with them

results

performance


La lucha es de igual a igual contra uno mismo
The fight is fair against oneself
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  #1135 (permalink)
BOSTON, MA
 
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Trading

Hi Alejo,

" i have finish my test of a fake combine (150k/9ktarget(maxdd4k5 maxdll 3k)sucesfully today , i pass the 450points in 8 days with the scaling rules (max2lot <1500Profit, max3 lot<2kProf max5lot<3000 max10lot<4500 max15lot<7000 )
thank you for your advices!
on monday i will start a real combine with them"


There is no such thing as fake trade when you place the order. Execution platform does not care whether it's a SIM trade or LIVE trade. Yes, on SIM trade a trader may get filled at an advantegous price Vs live trading but that's chump change in big picture. Point i am trying to make that this SCREEN time has value if taken seriously.

If you can be as free during Live trading as during SIM trading- you got it. If you can not. It will not be due to your method. It will be due to psyshological reasons. Only way i know to take care of psychological schackles is to trade UNDER SIZE. Do not go by what combine says you can trade in terms of size based off $150K account. Go by what you can handle.


Good luck.



My posts are not meant to give financial advice neither do they imply that my method is special. "THIS IS WHAT I COULD BE IF I HAD A TOTALLY CARE FREE STATE OF MIND DURING TRADING" Mark Douglas.

Last edited by mfbreakout; November 14th, 2014 at 01:51 PM.
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  #1136 (permalink)
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Trading

reversion to the mean trades every where. Everything which was up and up over last couple of days and overextended got reversed and everything which was down and down like GC, 6A up and up. Pure technical trading. No need to forecast. When it comes we take it.



My posts are not meant to give financial advice neither do they imply that my method is special. "THIS IS WHAT I COULD BE IF I HAD A TOTALLY CARE FREE STATE OF MIND DURING TRADING" Mark Douglas.
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  #1137 (permalink)
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CL moved to the upside more than i anticipated. I am holding some shorts in anticipation of reversion to the mean. CL, GC,6A around upper end of weekly range.

1) taking some shorts in CL into next week. Hoping for 75 area. I hope CL does not bounce another 200 ticks to the upside before a pullback and if she does i will meet her on the other side. I have seen CL do things beyond my imagination , so i try to be mentally prepared. Within a bearish trend - rallies can be SUPER STRONG. That's hallmark of a bearish trend.

2) taking some shorts in GC into next week.

3) Taking some shorts in 6A into next week.

4) taking some shorts in KC into next week.

5) Long attempts in KC- loss. Flat.

6) Taking some longs in NG into next week.

7) No trades in TF.



My posts are not meant to give financial advice neither do they imply that my method is special. "THIS IS WHAT I COULD BE IF I HAD A TOTALLY CARE FREE STATE OF MIND DURING TRADING" Mark Douglas.
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  #1138 (permalink)
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ZS- My head is SPINNING while going over ZS trades over last 3 days.



My posts are not meant to give financial advice neither do they imply that my method is special. "THIS IS WHAT I COULD BE IF I HAD A TOTALLY CARE FREE STATE OF MIND DURING TRADING" Mark Douglas.
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  #1139 (permalink)
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I got couple of e-mails from what it looks like new traders. They were asking where to start to learn trading etc. I will copy my post from couple of days ago. Understand that there are traders who have been at traidng game for years but they will never get anywhere as long as they do not understand point #4 of this post. So my recommendation will be to focus on point #4.

" After spinning wheels for couple of years, traders come up with a set of things similar to following as a list of things they need to focus/master to become successful in trading.

To win the mental game you must have…

1) Faith in yourself.
2) Faith in your system.
3) An understanding of what trading size you can handle.
4) An understanding of the level of losses you can deal with mentally and emotionally.
5) A love and passion for trading.
6) The belief that it is possible to win in trading.
7) The belief that all your hard work will be worth it.
8) The belief that you are a trader, that is what you do.
9) The perseverance to have your butt kicked over and over but keep coming back.
10) The stubbornness to keep trying until you are successful.

Let's not worry about traders who have not yet realized the importance of things outlined in the above list. How about traders who have these things written down with 24K gold ink and framed all over their trading desk, office walls etc? In other words they got these things under control as much a human being can do.

I know of many traders who have everything mentioned in that list except ONE and they are still spinning the wheels and will continue to spin the wheels. In my experience item #4 is the missing link for traders who have everything else mentioned on that list. I will rewrite item #4 as following

4) An understanding of the level of risk one needs to undertake on every trade to avoid random nature of price movements and take something out of someone else's pocket.

The way item #4 is written in the list is a wrong way to approach the markets. Everyone has an understanding of the level of losses one can deal with mentally and emotionally. But how one feels about level of losses has NO MEANING and MARKET does not care. One trader can say based upon his account size, his personal financial situation and his technical analysis etc. that he can only handle 15 ticks stop loss vs. another trader who can handle 40 ticks stop loss and so on. When i have discussion like this with traders they almost come to tears, they curse me (not in my face but i know they do because i used to curse when other traders tried to guide me) and throw up their hands by saying " Well mfbreakout i do not have your trading account size and i have no way to get money from anywhere else".

I have never told anyone about my trading account and i am not in a position to tell anyone what's the proper trading account size one needs to trade full time for a living. A trader should be able to figure out that on his own. What i can tell is to FOCUS on "An understanding of the level of risk one needs to undertake on every trade to avoid random nature of price movements and take something out of someone else's pocket" and everything else will fall in place. Without item #4, items 1-10 can be a recipe for disaster because words like hard work, belief, stubbornness, perseverance, faith, love and passion etc. needs a foundation to build upon. We all know traders full of passion, love, faith etc for trading but going nowhere. One does not need to work on their passion, love, hard work etc. for trading. You either have it or you do not. Work on #4.

NOTE: The post is not about whether 15 ticks stop loss is better than 50 ticks or if one can make a living off a $5K vs $50K trading account.



My posts are not meant to give financial advice neither do they imply that my method is special. "THIS IS WHAT I COULD BE IF I HAD A TOTALLY CARE FREE STATE OF MIND DURING TRADING" Mark Douglas.
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  #1140 (permalink)
Valdosta, GA. U.S.A
 
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ZS


I like Trading this market....just wanted to post a chart of the Hourly that i have been keeping up with....
one of my favorites to trade now....
Adding Daily= Big picture so as to see the Divergence for Downside probability.

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