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Perishabull

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Everything posted by Perishabull

  1. Perishabull

    PositiveDev's trading journey

    Yesterday's trades (4). 3 wins with 1 loss. I'm sure it's self explanatory however a red arrow indicates a sell and a green arrow indicates a buy. So the first arrow is red indicating an entry into a short trade, the next green arrow indicates the trade exit point. The next green arrow following that is an entry into a long, that was the trade that got stopped out.
  2. Perishabull

    Trading Volatility, Ballasted by Gold

    Don't take this the wrong way romans but I always felt that you were trying to make the trade on silver that you would have liked to have made back in August 2010, ie to get on board at that point. That rise in silver was a very unusual situation that was brought about by a range of factors working together and is unlikely to be repeated very often. I've seen others act in a similar way too and have noticed it occasionally in my own trading.
  3. If you have a defined price target and stop loss for each trade and you have analysed hundreds of trades showing that 48% of the trades you make succeed what is the probability of your next 100 trades succeeding? The answer is somewhere close to 48% provided your edge is quantified and doesn't change in character over the next 100 trades.
  4. The longest losing streak I've had in 2 and half years is I think 9 or 10 losses, and that was trading a strategy with 30% positive trades that simply didn't work - I came out break even so that shows if you have something that works you can certainly succeed with a low win rate. Apart from the fact that I was trading with a limited edge my risk reward ratio was 1 : 5. In my experience that is not a workable risk/reward for short term trading. It's often interesting to make analogies between trading as a business and trading a more traditional standard business where you might purchase from a wholesaler to sell on the retail market. So to use the above example I expected to buy stock at x and sell at 5x for a 400% gain on each sale. Is that unrealistic? Is there a business out there right now where you can purchase products and resell them at 5 times the price you bought? There are probably many opportunities like that out there but since anyone can trade these days finding great opportunities that aren't already being significantly exploited is a difficult task. In well established highly competitive markets (probably the most competitive markets in the world) is it realistic to enter the market and find a huge edge with no professional experience and expect to succeed? It's interesting to talk about money management, clearly it's important, the most interesting question for me is what edge has been developed and has it been quantified.
  5. What Nick Radge doesn't point out is that although Bill Eckhart had loss periods of 4 or 5 months he also had runs of positive gains, some of 6, 7 or 8 months. Also before a couple of those loss periods there were exceptional double digit gains, you would expect a drawdown after a period of unusually high gains. He talks about expectancy Expectancy = (Probability of Win * Average Win) – (Probability of Loss * Average Loss) This is a useful way to test a trading strategy although clearly you need a consistent strategy and many trades for it to be accurate
  6. If you intend on trading more than 165 trades per year (Is that what you meant?) then that suggests trading over short time frames where market movements (and trends) are limited, what rules do you use to exit a trade? In my experience it's best to define a money management policy after you've defined your expected performance. Start at a conservative level of 1% and increase dependent on performance.
  7. What's your risk/reward ratio when you enter a trade? What's your edge when you trade? Have you quantified it? There's something wrong with your strategy if you expect to see long chains of losses. Long streaks of 10 to 15 suggests your risk reward ratio is skewed at an unrealistic level where the risk is too small relative to the reward. Based on your strategy would you ever expect to see chains of 10 to 15 winners? If not then why? 5% per trade is way too high unless you have a proven track record over perhaps a year and you have high confidence in your strategy.
  8. Perishabull

    PositiveDev's trading journey

    18 trades this week Looking at the overall position in terms of numbers of trades the win/loss ratio is a fairly consistent. It fluctuates over time around the 1 : 1 mark, it's 0.95 : 1 right now. Consistency is the most important factor since trading futures is a scalable business, if you have consistency then you can develop the size over time. The question is what condition you set for an increase, I think it has to be based on consistency, capital available and expected draw down periods. The strategy that I'm using is one that I can only see being impacted if there were some sudden and dramatic changes in the make up of the participants in the futures markets and I can't see that happening unless there were some regulatory changes limiting market access.
  9. Perhaps the US Government are waiting until it gets really huge before they tax it and layer on a multiplicity of money laundering regulations.
  10. Perishabull

    PositiveDev's trading journey

    Interesting day today, in the Dow Jones Industrial Average the retail traders were bearish almost all day whereas the market itself actually closed higher although for the first half of regular trading hours it did paint a slightly bearish picture. Trade 31st October A difficult market to navigate today and unusual too - 7 trades and I ended the day only up by a small margin. I am now at the 3 month point with this strategy and here is where I stand. This is the sort of performance I am looking for. The Dow Jones Industrial Average has a low number of constituent components (30) with the main publically owned large cap businesses in the US. I think that and the large cap nature of the index combine to provide less long term volatility and perhaps that explains why my strategy and trading matches well with that market. I looked at the long term volatility of; the Dow Jones Industrial Average using VXD the S&P 500 using VIX the NASDAQ 100 using VXN the Russell 2000 index RVX Over the last 8 years The Dow Jones Industrial Average is typically less volatile than the S&P 500, at least using this measure. I was surprised to see that the NASDAQ 100 volatility in grey has typically been lower than the S&P 500 and Dow Jones Industrial Average. Most of the time the Russell 2000 appears to have been the least volatile from this perspective. I'll need to assess the possibility of using these same techniques on perhaps the NASDAQ 100 futures and/or the Russell 2000 futures. The S&P 500 is one to avoid, it seems overladen with ultracompetitives colliding with each other. Volumes of the different futures markets; There ought to be better opportunities in the lower volume markets relative to the high volume markets - less competition - and on that basis the Russell 2000 is more attractive than the NASDAQ 100.
  11. Perishabull

    SILVER

    IMG url location of image /IMG You need to enclose the IMG and /IMG in square brackets [ ]
  12. Perishabull

    PositiveDev's trading journey

    My focus is on the Dow 30 - it's E-Mini Dow Jones Industrial Average futures I'm trading.
  13. Perishabull

    Ray Dalio's Principles of Investment

    I've been looking into trying trancendental meditation. I've just been reading online about it, apparently Ray Dalio is into it. From the GQ guide to trancendental meditation; "But the name that jumped out most when I started looking at TM's fans was Ray Dalio, founder and chairman of Bridgewater, the world's largest hedge fund. Dalio is a superhero of the financial world. And what the 63-year-old has to say about TMwhich he started doing forty years ago, in collegeis not ambiguous: "I think meditation has been the single biggest reason for whatever success I've had." This from the thirty-third-richest man in America." Now THAT is interesting. http://www.gq.com/life/health/201309/gq-transcendental-meditation-guide
  14. Perishabull

    PositiveDev's trading journey

    24th July 2012 - 27th October 2013 " [AND ORDER FLOW EXAMPLE OVER LONGER TIMESCALE TO FOLLOW] "
  15. Perishabull

    PositiveDev's trading journey

    12th February 2012 to 23rd July 2012 " "
  16. Perishabull

    GOLD

    Interesting charts from Silver seek -http://www.silverseek.com/article/don’t-miss-out-these-important-charts-12615
  17. Perishabull

    GOLD

    Chart from 10th September;
  18. Perishabull

    SILVER

    Zeal LLC seem to think this looks like a positive point for silver; http://www.zealllc.com/2013/silverlp.htm "The bottom line is silver today looks to be on a powerful technical launchpad. Despite extreme fear and despair near its brutal late-June lows, silver bounced off the confluence of multiple major support zones and has been rallying on balance ever since. It remains out of favor and way too low relative to gold, which gives silver enormous potential to far outpace gold’s advance as the precious-metals uplegs accelerate. As always emerging out of hyper-bearish major lows, mainstream investors haven’t caught on. You won’t be hearing about silver’s new upleg on CNBC until its lion’s share is already past and the big easy gains have already been won. But for the brave contrarians willing to buy low when few others will, the bullish implications of today’s silver support convergence offer an exceptional opportunity to get in early and cheap."
  19. Perishabull

    SILVER

    That was indeed a good time to buy silver...;
  20. Perishabull

    PositiveDev's trading journey

    Since I've just moved passed the 3 year anniversary of this thread and I feel I'm now moving into a different phase I thought this would be a good moment to to take a look back over the last 3 years and pick out some of the interesting analytical posts from this thread, with some ideas that could be further developed. I'm going to do this in three stages since it's taken a couple of hours to work my way through half of the material I've posted over the last 3 years. 1st October 2010 to 12th February 2012 " "
  21. Perishabull

    PositiveDev's trading journey

    Well, that's quite an open question. I think there are 3 factors I changed, 2 of them consciously, that made an important difference. Firstly, my expectations of the potential achievable yield were set too high, certainly for someone like myself with no professional experience like working for a bank or a hedge fund. So I lowered my expectations of what returns I should expect on both an individual trade and a series of trades over time. Second, I decided to only use pure market based information and ignore anything that was a form of indicator, indicators appear to take market based information and distort it, creating inefficiencies that render them ineffective (at least for the sort of trading I do). Third is a subconscious effect and that is that since I'd been trading for 2 and a half years as a break even trader although my drive to continue was still there, my expectations of success were diminished, not in a negative way though. I simply gradually went from being certain of success in the future to being ambivalent. It seems as though that unconscious move has allowed me to think in a more clear and objective way more conducive to success. It's difficult to explain. It almost seems as if there is some sort of paradoxical effect at play. That my desire of success was getting in the way of my success. In fact James Dines in one of his books describes something similar I think, this reminds me as I write this, I'll need to go back and read it again. [i spent 30 mins writing this and then clicked add reply on my mobile and the post disappeared so I had to rewrite it all again. Not that I mind, it's been interesting thinking about it]
  22. Perishabull

    PositiveDev's trading journey

    A great day today, 3 trades, 3 wins E-Mini Dow futures The specific people I'm competing with in the futures market with this strategy are the retail traders active in the market. My strategy aims to find times in the market where they as a group have positioned themselves such that if the market moves against them and the professionals counteract the move I aim to take the side of the professionals when I spot these opportunities. It doesn't always work of course but today it has worked beautifully. I've just set up a Limited company at companies house that I intend to trade through. It's something I've thought about for a while and now is the time. The deeper I've become involved with trading the more serious it's getting and of course the next step after the initial phase is to step out and perhaps look at trading more contracts at some point in the future, in order to do that I need to trade with the safety net of a Limited company since if some highly unexpected market event happened that got me into serious difficulty I don't want my personal assets to be on the line. Trading is a serious business, especially when you are dealing with high value futures contracts. If I approach it in a more professional businesslike way that can only be beneficial. When he is older, I will be telling my son that you can achieve anything you want in life if you put a massive amount of belief and effort into it. In order to do this I need to prove I can do it myself otherwise the message is going to ring very hollow.
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