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Right, just like somebody can have a series of wins in a game of tossing coins (100, 1000, 10000 wins in a row. Hell, if you give a monkey a typewriter and let him punch on it for long enough, he'll come up with Hamlet), given enough time, he (or she) will lose it all again. But if, as you stated, no player beats the market, and you are a player, how do you beat the market? Unless of course you are not in it to beat the market.
By definition, “beat the market” means something like the same trader doing it over and over again, competing with all possible players, in all possible situations, taking advantage of the market inefficiencies that appear (until they disappear). It’s a “long term” idea.
But, as Keynes said, “in the long run we are all dead”. For practical “short term” situations (like a human life span):
1) you can be a “superior” trader (have better information, for instance);
2) market is slow to eliminate some inefficiencies;
3) you can become rich exploiting those inefficiencies during some years (maybe through your entire life).
In the end, it’s a terminology issue (and something a trader don’t need to know).
And I was planning to wake up at 6am (GMT-3) today... thank you insomnia!
2 trades today:
1) first one a bit risky (double-top + breakout bet)
2) in the second I was confident enough to to put 20 contracts a wait patiently.
Why target @.50?
1) After the breakout, the prices could test the lower of the day @.53
2) the "measured movement" of the first (down) leg of the day was even lower
3) $6k daily profit sounds good to me
(1) Setup conditions = true
(2) Open position + Stop gain/loss
(3) Wait
(4) Profit/loss
(5) End
This is a really nice approach. You've found an edge. So you put as many trades as you can. And you wait the Law of the Large Numbers and the Central Limit Theorem play their roles. Classical frequentist approach. It just works.
What I try to do:
(1) Price action Analysis (I do not use fixed rules/setups)
(2) Trade
(3) Price action analysis + reassessment
(4) Trade:
(4.1) reverse/invert and go to step (3)
(4.2) average up/down and go to step (3)
(4.3) stop (emotional or big loss or target) and go to (5)
(5) End
This is something I call the "Bayesian Approach" (I’m not saying I use the Bayes Theorem! I'm not sooo crazy It’s just the idea). Step 3 is the "secret": you gather further information from the price action ("look! a big bar against my position!"), and you "weight" this new evidence against everything you already know. The weighting process is the "intuitive" part ("Do I have to change my mind and get out? Reverse? Is it a bull/bear trap? Add to this losing position?"). Basically, you have to make decisions under stress (not suitable for everyone). When I lose, sometimes is BIG.
Ha, I actually know someone who trade like you. Just get in a position, doesn't matter which side and work it out later. Market doesn't move in a straight line very often. He blow up from time to time but mitigates by having a fixed account size of around 150k and sweep extras into the reserve account which is usually 5x what he uses. He blow up maybe once every 2-3 month, but in that time usually makes 3x or more. similar performance as you really, 5-10% a day.
not a style for everyone that's for sure and need balls of steel sometimes, which apparently you have lol
The step 2 is the first position I enter, usually in the first 5 min or 15 min bar. After some time the market must go up or down, right?. So I go for the "most probable" outcome/scenario. If you MUST enter now (imagine a gun pointed to your head), which one would you choose: go long or go short? I usually put 1 to 3 contracts at this point. Maybe I'll wait half an hour in a trading range, Idk.
It's the same idea used in Bayesian Analysis (the call it the "priori distribution"). For me it's easy to put this trade. It reinforces the idea that I'm in control. And I'm right most of the time. The market can do anything, but in average things cancel out and this initial trade doesn't make a huge difference in results. Maybe it's just a psychological "trick".
It’s just the idea). Step 3 is the "secret": you gather further information from the price action ("look! a big bar against my position!"), and you "weight" this new evidence against everything you already know. The weighting process is the "intuitive" part ("Do I have to change my mind and get out? Reverse? Is it a bull/bear trap? Add to this losing position?"). Basically, you have to make decisions under stress (not suitable for everyone). When I lose, sometimes is BIG.