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COMMON SENSE


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Updated November 27th 2014 by mfbreakout
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COMMON SENSE

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  #631 (permalink)
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Picking the right horse is important for the jockey. Go where the action is.



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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  #632 (permalink)
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you are doing pretty simple


mfbreakout View Post
Hunting process. It's pretty simple. We buy strongest instruements on pullbacks and sell weakest into bounces.

why is so difficult to do it?

La lucha es de igual a igual contra uno mismo
The fight is fair against oneself
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  #633 (permalink)
madrid spain
 
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what the or for each instrument?



mfbreakout View Post
Picking the right horse is important for the jockey. Go where the action is.

cc
nk
pl
gc

it is incredible how i was fighting to find something i can believe it, an i did not find it, RR, W%, low risk, tigh stop, small time frames, strict method, etc
and now i see the light with your approach, it makes totally sense to me

La lucha es de igual a igual contra uno mismo
The fight is fair against oneself
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  #634 (permalink)
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i think it is completely true


mfbreakout View Post
Time for vacation. I will be away for next 10 days.

Trades since long off 88.40 area.

1) Out 89.30 area from longs. Afetr 140 ticks move up from bottom. I am ONLY interested in shorts.

2) Short 89.50, 89.70 before NY open. Cover 89.30.

3) Short 89.80, 90, 90.20, 90.50, 90.70. area. Cover around 90.14 and still holding shorts. A particular area is not important for me except general area. I have no way of knowing whether 90.20 is an area where CL will reverse or 90.70 ? Now that CL is at 89.85, it looks like that 90.70 area is the best area. It looks so obvious. ONLY thing obvious to me is that from 88.10 to 90 is around 200 ticks. Higher the monkey goes- i add bigger position size because the odds keep getting better as price moves up.

In the BBC trading video episode #2 it's pretty obvious that every trader is getting hosed for $200 here and then $300 there. They getting cut by the randomness and have no conviction or staying power. They are looking for PRECISION. They put so much pressure on themselves that it's beyond any discretionary trader capacity. ONLY computers/algos can pick points and churn money all day because they are dealing in nano second for ticks. At least i find it impossible to predict most of the time ( sometime i just get lucky due to randomness) that moment i take a trade it has move in my direction in the next 5, 15 minutes with little HEAT.

i feel identified myself with what you say. i was asking myself about this 1 year ago, scalp/bigger moves, and now i know i think i am identified with not go to scalp/i shut down the dom and cd
thank you for your enlightment

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The fight is fair against oneself
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alejo View Post
why is so difficult to do it?

I am not sure why it is difficult for others but i can share my experience. It was difficult for me because i was trading against my natural style. My natural style is to ignore noise and try to understand big picture. When i will look at monthly/weekly/daily chart to get a sense of big picture it will look so far out that it did not made sense for my scalping trading. For example, if Monthly chart is showing support at 90, weekly at 94 and daily around 98 while CL is trading at
103, i will be saying to myself who cares for 90,94 or 98? Who knows when will CL get there, it can be days and weeks before CL can get there. CL is trading at 103 and i need to figure out how to make 30 ticks based off what happening right now. I have simplified the example to make a point.

Another problem was i was ONLY trading CL for 4 years straight- day in and day out. I did not even look at any other instruement. There are lot of days when there is no opportunity within CL but i tried to create an opportunity in the name of order flow, channels, triangles - you name it. To make the matters worse i was looking at 1 minute , 5 minutes charts.

I was taking quotes like " Cut your losses Rule #1 of trading" without proper context and being stuck within my own narrow trading shell. I was trading 1/5 minutes charts and focused on 15 ticks stop loss to make 30 ticks. I realized for my way of trading ranges like these are totally random. I would rather be wrong and cut my losses when there is real change in a trend. If CL ATR is 200 ticks, then price needs to move another 200 ticks out of this range for me to believe that maybe something fundamentally have changed.

There are many other factors also but these were the key ones before i realized that something needs to fundamentally change to get in sync with my natural stayle of trading. For me change was to trade where opportunities are the most, avoid randomness and not to put so much pressure on myself that a trade going 30 ticks against me becomes an issue of life and death. I started realizing that a trade going 30 ticks against me ONLY means that my timing is off but the context of the set up have not changed and i started adding to my so called loosing positions. For some reasons after causing heart burn, anxiety etc. trades in most cases turned out to be what i thought they will be. Sometimes the trades just did not reversed from where i thought they will and HOLD time was much longer than i thought it will be required. I am OK ( not 100% comfortable though) with being off with timing and hold time as long as i am correct about the trend and context.



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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mfbreakout View Post
I am not sure why it is difficult for others but i can share my experience. It was difficult for me because i was trading against my natural style. My natural style is to ignore noise and try to understand big picture. When i will look at monthly/weekly/daily chart to get a sense of big picture it will look so far out that it did not made sense for my scalping trading. For example, if Monthly chart is showing support at 90, weekly at 94 and daily around 98 while CL is trading at
103, i will be saying to myself who cares for 90,94 or 98? Who knows when will CL get there, it can be days and weeks before CL can get there. CL is trading at 103 and i need to figure out how to make 30 ticks based off what happening right now. I have simplified the example to make a point.

Another problem was i was ONLY trading CL for 4 years straight- day in and day out. I did not even look at any other instruement. There are lot of days when there is no opportunity within CL but i tried to create an opportunity in the name of order flow, channels, triangles - you name it. To make the matters worse i was looking at 1 minute , 5 minutes charts.

I was taking quotes like " Cut your losses Rule #1 of trading" without proper context and being stuck within my own narrow trading shell. I was trading 1/5 minutes charts and focused on 15 ticks stop loss to make 30 ticks. I realized for my way of trading ranges like these are totally random. I would rather be wrong and cut my losses when there is real change in a trend. If CL ATR is 200 ticks, then price needs to move another 200 ticks out of this range for me to believe that maybe something fundamentally have changed.

There are many other factors also but these were the key ones before i realized that something needs to fundamentally change to get in sync with my natural stayle of trading. For me change was to trade where opportunities are the most, avoid randomness and not to put so much pressure on myself that a trade going 30 ticks against me becomes an issue of life and death. I started realizing that a trade going 30 ticks against me ONLY means that my timing is off but the context of the set up have not changed and i started adding to my so called loosing positions. For some reasons after causing heart burn, anxiety etc. trades in most cases turned out to be what i thought they will be. Sometimes the trades just did not reversed from where i thought they will and HOLD time was much longer than i thought it will be required. I am OK ( not 100% comfortable though) with being off with timing and hold time as long as i am correct about the trend and context.

I can totally relate to this. I have recently come to the same realization about trading against what I am good at. I was doing the same thing; trying to make something out of nothing. Looking at charts and indicators which I had no business looking at. It was driving me crazy because I could not make it work.

The ah-ha moment for me came when I realized I am not going to be a 30 to 50 tick per trade trader with multiple trades per day. For me its 10 to 20 ticks with one trade per day. This was hard to come to grips with because I really wanted to make the (perceived) big money. What I was not looking at was the bigger picture; being a consistent trader and doing what I am naturally good at. In the long run this will make me a hell of a lot more money and help me keep my sanity along the way.

Thanks for sharing!!

Robert

nosce te ipsum

You make your own opportunities in life.
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Silver Dragon View Post
I can totally relate to this. I have recently come to the same realization about trading against what I am good at. I was doing the same thing; trying to make something out of nothing. Looking at charts and indicators which I had no business looking at. It was driving me crazy because I could not make it work.

The ah-ha moment for me came when I realized I am not going to be a 30 to 50 tick per trade trader with multiple trades per day. For me its 10 to 20 ticks with one trade per day. This was hard to come to grips with because I really wanted to make the (perceived) big money. What I was not looking at was the bigger picture; being a consistent trader and doing what I am naturally good at. In the long run this will make me a hell of a lot more money and help me keep my sanity along the way.

Thanks for sharing!!

Robert

Hi Robert,

If you have decided to be a trader with a kind of discipline where you take 1 or 2 trades per day, then you do not have to settle for 10-20 ticks. 10-20 ticks is just noise. CL moves in most cases at least 100 ticks every day. To get majority of these 100 ticks, a trader has to hold the trade. Try and test this in SIM and see if it works for you.

Good trading.



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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Who is Michael Marcus?

Michael Marcus previously worked as a trader at Commodities Corporation, an investment management firm that was later acquired by Goldman Sachs. Reportedly, Michael Marcus was able to increase his account 2500-fold from $30,000 to $80 million over a span of 20 years.

On the secret to successful trading:

I think the secret is cutting down the number of trades you make. The best trades are the ones in which you have all three things going for you: fundamentals, technicals, and market tone. First, the fundamentals should suggest that there is an imbalance of supply and demand, which could result in a major move. Second, the chart must show that the market is moving in the direction that the fundamentals suggest. Third, when news comes out, the market should act in a way that reflects the right psychological tone. For example, a bull market should shrug off bearish news and respond vigorously to bullish news. If you can restrict your account activity to only those types of trades, you have to make money, in any market, under any circumstances.


NOTE: I am not aware of details of Michael performance, for example, if he added funds to his initial investment of $30,000.00 and other details. He may have been Michael Jordan of trading. All i know , i do not day dream and aspire to turn $30,000 into whatever. But i like his secret to successful trading.



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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It's been only a couple of times over last 5 weeks when i tried long in CL. Otherwise shorts and shorts.

Short 91. 10. Cover some 89.60 area.



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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mfbreakout View Post
It's been only a couple of times over last 5 weeks when i tried long in CL. Otherwise shorts and shorts.

Short 91. 10. Cover some 89.60 area.


Still holding shorts. Hold time? About an hour, so far.



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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