Best Thread How To Make Money Trading The Markets.

...so yes, tar, till anytime, but I like to exit before the final few minutes when things can get unstable and difficult to read.
HTH
Richard
 
I have been trying to day trade the Nasdaq market for about three years now, I feel about 90% there but have felt this way for a couple of years. I would be interested in hearing from other people who are in the same position as myself i.e. would be traders who feel so near and yet so far and have been trying for a couple of years.

I am in full time employment (Mon-Fri 9 till 5) but often manage to trade the first half hour and the last hour of the day. I occasionally trade the afternoon session. I day trade using standard TA, totally ignore fundamentals, anyone with a reasonable level of experience of TA would recognise the type of setups and trades.
I keep a trading log and my average win is 25c and my average loss is 10c but my win/loss ratio is only 0.5242, this gives me an overall expectation of 1.23 (based on 202 trades since May 2008). I use the e-signal trading simulator (which is excellent) and I have not actually committed money to the markets, I feel I need to improve my win/loss ratio before I do. I also feel stuck at this level.

As I mentioned I use e-signal (with the scanner), through experience I have learnt

• There is no holy grail, it’s a case of a number of small edges giving you a higher overall probability of success on a trade
• Keep losses small (every big loss starts as a small stop)
• The importance of the futures, try and get in rhythm with the market and trade accordingly
• The importance of whole numbers, a lot of my trades are based around trend/breakout behaviour at whole numbers
• Only trade stable and readable stocks (average true range is a good indicator of this)
• The cleaner and clearer the pattern the more likelihood of success
• Trading is a reflection of your personality, to be successful you need to devise a method you are comfortable with and suits your personality

I have read extensively about trading; books and bulletin boards. I find it frustrating but fascinating as well, I'm hooked on the challenge. I look at the markets (Nasdaq) every day and when I have not traded the markets (due to work commitments) and review the markets later on it all seems so straight forward. When I do trade the markets I find a number of trades failing. Sometimes it’s very difficult to see why a trade succeeded or failed because the setup and conditions were very similar prior to taking the trade.:confused:

If anyone identifies with my position I would be interested in exchanging experiences and it could be mutually beneficial if we shared our learning. I would be interested if someone has been trying for a while, say more than a year, and is still trying or who finally made it having tried for some time. It might be that we start another thread or the mods may consider it relevant, but this thread seemed a good place to find potential contributors.
 
The above is an interesting post.
Would you please start a new thread of your own so this one remains focused?
I'd be happy to contribute to such a thread, but I would like this one to be about this specific technique please.
Thanks,
Richard
 
Here's one from this afternoon.
Obviously it would have been more profitable to have entered earlier, but I picked it up on my scanner a minute before the short on the red X hairs.
Again I didn't wait for the chart exit signal as level 2 T&S told me there was a strong possibility of an imminent reversal.
I'll go into the amount of risk I was prepared to take on this trade when I have a little more time.
+65c
Richard
 

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Richard,

15.05 strikes me as a strange entry point. why were you confident it would make the whole number? You also only watched if for a minute, how where you confident that it would not simply reverse as can often happen at the high/low of the day? I'm sure if I had seen the chart I would have waited to see how it behaved at the whole number and entered if it had made it through or alternatively waited till there was a retracement and then a continuation on the trend before entering.
 
Hi Richard

I've followed this thread with interest - thanks for all your time and input

You say this method can be utilized without L2 but I'm finding it hard to see how you select your entries without reference to your L2 data (which I don't have). Looking at your STI chart you entered just before the previous day's low was coming up and, as Nearlythere observed, just prior to a round number. Not the most inviting setup, especially given the two prior fake-outs. So, is this a realistic trade without L2, or is it simply a quickening cascade of lower bars (or higher for longs) that is the main decision criteria?

The ATR on the chart is also very low at your entry - is that then a major factor in your decision to enter, or just a supporting factor?

Thanks

WR
 
waverider said:
Hi Richard

I've followed this thread with interest - thanks for all your time and input

You say this method can be utilized without L2 but I'm finding it hard to see how you select your entries without reference to your L2 data (which I don't have). Looking at your STI chart you entered just before the previous day's low was coming up and, as Nearlythere observed, just prior to a round number. Not the most inviting setup, especially given the two prior fake-outs. So, is this a realistic trade without L2, or is it simply a quickening cascade of lower bars (or higher for longs) that is the main decision criteria?

The ATR on the chart is also very low at your entry - is that then a major factor in your decision to enter, or just a supporting factor?

Thanks

WR
Click to expand...

waverider,
Sometimes level 2 is a great help, but not always.
"you entered just before the previous day's low was coming up " That is not correct, it was way below the previous day's low.
Level2 T&S is often very helpful as price approaches a whole number, but to automatically assume that price will stop at a whole number is not always correct in my experience.
"two prior fake-outs" - I see those moves differently; to me they are part of a series of lower highs indicating sellers coming in sooner each time.
"So, is this a realistic trade without L2, or is it simply a quickening cascade of lower bars (or higher for longs) that is the main decision criteria?" Yes it is a good trade without level 2 and the "cascade" was a main contributory factor.
The low ATR meant the risk was minimal and so I could take a larger position size.

I think many people want some degree of certainty in their trading, but there is no such thing, only high probability. There is also a temptation to think price is likely to reverse just as soon as they enter so they are reluctant to enter a strong trend till after a retracement. Personally I do prefer to enter after a retracement, but that won't stop me taking a trade if it's waterfalling provided it is readable and not so fast as to be unreadable. One of the advantages of direct access is the ability to exit instantly as soon as there is a sign of the waterfall stopping. You do need the ability to take instant decisions on the evidence in front of your eyes and then to execute that decision immediately.

I will return to discuss risk on this trade later in the week.

Thanks for your kind words and I hope the above helps,
Richard
 
Hi Richard/others,

Could you please shed some light on how they have this set up to identify trades on time?

Consider this - on any given day, one identifies about 10-20 stocks (via scanner) that are trade-able. To enhance probability of success, one needs to monitor trends on 1 min, 3 min and 5 min candles. For 10 stocks, that is 30 charts. Since there is not an algorithmic trigger logic, how do you detect a possible trade? (Perhaps, there is a trigger - I just do not get it yet. Or you actually have 30 charts up!)

Am I approaching this entirely the wrong way?

I ask because I set out to work on this method and have not had success locating trades in time. Ideally, I would assume scans are done intra-day as well.

Thanks for any advice in advance. As well as, thanks for sharing so much information on these forums. It has been very helpful for a novice like me.
 
What is this price being a whole number I am hearing about in this thread and one other thread? Looks to me as quite a bizarre indicator if people happen to be using it.
 
shopsmart said:
Hi Richard/others,

Could you please shed some light on how they have this set up to identify trades on time?

Consider this - on any given day, one identifies about 10-20 stocks (via scanner) that are trade-able. To enhance probability of success, one needs to monitor trends on 1 min, 3 min and 5 min candles. For 10 stocks, that is 30 charts. Since there is not an algorithmic trigger logic, how do you detect a possible trade? (Perhaps, there is a trigger - I just do not get it yet. Or you actually have 30 charts up!)

Am I approaching this entirely the wrong way?

I ask because I set out to work on this method and have not had success locating trades in time. Ideally, I would assume scans are done intra-day as well.

Thanks for any advice in advance. As well as, thanks for sharing so much information on these forums. It has been very helpful for a novice like me.
Click to expand...

Pick and choose basis of the 10..

You also don't need 3 charts on each stock all the time. But you do so when going in for the kill. That reduces the combination down from 30 substantially.
 
Cryoplasm,
Whole numbers often act as support and resistance levels. See attached an example from this afternoon, 54.00 acting as a clear resistance level.
BTW I don't use technical indicators, they are normally based on the price, if the price moves up/down so do they, I think you can just use the price itself (just my humble opinion).
I use price (direction), volume (strength) and ATR (as a measure of volatility).
 

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