How do you know you're on the right path? Am I?

May 28th, 2013, 07:52 AM

treydog999

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The chart is 1 set up, closed every bar for 50 bars. it ends up being like 50 different tests because if you close a trade at the 5th bar you can take another trade on the 6th bar for example. But if you hold the trade for the 6th bar that trade would never have been entered previously. This creates different sets of trades, so if you compare the list of trades taken say for the 5th bar and the 6th bar or 10th bar holding periods they would differ from each other. It has no stops or targets ,commissions or slippage, just time based exits. This just determines if the entry without any context provides at least some kind of inherent advantage using automated execution.

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Is this a setup based on one certain bar (OHLC) formation?

I do not understand your comments regarding closing the trades. In the first sentence above you say "closed every bar for 50 bars". Then in the subsequent sentences you talk about time based exits and closing of trades after x bars. I have difficulties grasping the method you tested here, in the first place.

But you are right, without context a simple method will have a hard time being profitable even mid-term.

If you want, we can talk a bit more in detail about your method, plan, etc. and I can try to help. Maybe we should do this via PM as this is more specific and not in the spirit of your general question regarding the right path? Your call, as this is your thread anyway.

May 28th, 2013, 08:49 AM

karoshiman

Is this a setup based on one certain bar (OHLC) formation?

I do not understand your comments regarding closing the trades. In the first sentence above you say "closed every bar for 50 bars". Then in the subsequent sentences you talk about time based exits and closing of trades after x bars. I have difficulties grasping the method you tested here, in the first place.

But you are right, without context a simple method will have a hard time being profitable even mid-term.

If you want, we can talk a bit more in detail about your method, plan, etc. and I can try to help. Maybe we should do this via PM as this is more specific and not in the spirit of your general question regarding the right path? Your call, as this is your thread anyway.

good idea, lets keep this thread on track. PM me for more details on testing process.

January 8th, 2014, 05:11 PM

Big Mike

I don't have time for a detailed answer but here is a quick one.

a) Do you accept that trading is not for everyone? I will tell you that I believe this to be an absolute fact. If you agree with me, then you should have an "ultimate stop loss" at what point you completely stop trading and acknowledge it is not right for you. This was discussed in detail in the "Time to give up thread".

b) As far as what separates most of the winners from losers, I can think of two excellent points:
1) Read this thread:

Ask any Trading Question

I'm creating this thread with the purpose of a 'catch all' for any trading related question that futures.io (formerly BMT) members want to ask, but don't want to create a new thread for -- or find an existing thread to reply to.

I've …

If you find that you are sharing a lot of similarities with members in that thread asking the same question over and over again, then you are almost certainly on the wrong path and need to break loose from that way of thinking. I am primarily talking about how everyone expects to be told what to do directly or specifically, or how they want to develop an "if, then, else" system.

2) Yes I have seen a huge number of traders fail. I would say more than anyone else on the forum. Most of them never set themselves up for success in the first place. I made a detailed post about this recently but not sure what thread, sorry. Point is, most of them had completely unrealistic expectations to begin with, and then they pursued a path that continued down that (wrong) road and ultimately led to complete failure. The solution in my mind is to simply acknowledge from the beginning that you are most likely wrong about everything, until proven otherwise, instead of the opposite which too many inexperienced traders make, and then create measurement goals to help you in a categorical way break down the various elements of trading into sub-sections so you can evaluate yourself (score yourself) on each of these on an ongoing basis.

Mike

This is a great post, this is right on the money here.

I really think that if you are not someone who automatically thinks in a contrarian way relative to others then you have to consider how on earth you can make money in a zero-sum game doing the same things other do?

Another aspect I found useful in my development was to reframe what you are doing and consider it from different perspectives. For example, your method that you trade with, could you picture Paul Tudor Jones, George Soros or perhaps Ray Dalio using the same method as you? What do you think they would make of it? Why? etc etc

January 9th, 2014, 12:26 PM

Traderwolf

If you have all of that , then it is a matter of do you have the psychological skills to trade it. Some have a great plan with a positive expectancy and can never trade it well enough to make money..

No seriously though. I've made some money, but not nearly what I need to be truly successful at this. Been battling psych issues ever since I've been doing this. It's been a real chore trying to get the psych up to the level the analysis/method are. Too many other outside factors still affecting how I execute, especially my comfort level (or lack thereof) with non-trading reserves and trying to pay myself monthly. The average month contains 20 trading days and I know a large % of my positions need more time than that.

Oh to be in the position where I was free of that arbitrary time constraint. I'm not willing to increase positions sizes to potentially try to offset the time issues so I may just have to go back out there and get some part time work for a while.

January 9th, 2014, 08:01 PM

Rock Sexton

Been battling psych issues ever since I've been doing this. The average month contains 20 trading days and I know a large % of my positions need more time than that.

Oh to be in the position where I was free of that arbitrary time constraint. I'm not willing to increase positions sizes to potentially try to offset the time issues so I may just have to go back out there and get some part time work for a while.

Looks like you have answered some of you own questions or concerns.. If your trading plan will not generate the amount of $$ you need(theoretically) due to time constraints and unwillingness to size up, your trading plan is not meeting your needs(like you have said).

This is not a psychology issue at all; but is a trading plan issue. I have found that many traders(myself included) tend say they have a great trading plan but just can't follow it (implying psychology issues) when in fact their trading plan is very inadequate. Symptoms of an inadequate trading plan can include:

- Large drawdowns leading to lack of confidence in oneself and trading plan
- Entries vaguely defined leading to trader hesitation and confusion on entry
- Exits poorly defined leading to jumping out of trades early
- Excessive risk or leverage for the size of account leading to pressure for every trade to win

There are definitely psychology issues in play in trading, but we should be mindful that some of what appears to be a psychology issue may in fact be a trading plan issue.

All the best to you...

Wolf

January 9th, 2014, 09:43 PM

no doubt ..... the plan has to be nailed down; numerous other posts and time trading tell me the plan is critical and then comes your head. Pick any setup you like .... are you taking it EVERY TIME with a cold disdain of the market. Pick any one of the few setups you trade, are you taking ALL of those with the same cold calculation ? I know myself and I bet your not. Cheers

January 11th, 2014, 11:48 PM

I have taken a similar path to many I suspect. Always trying to use other people methods and use their edge.

I knew that if I questioned if I was on the right path with this method I probably wasn't. I finally found a method that at the core felt right- One that actually made sense as to how the market works. Instead of expecting price to react off indicators and instead understanding how participants were trapping traders to move the market.

This was something that resonated to my core and something that I could believe in. This would be my structure. I just could not follow all the other rules to this method I had written a plan - had it approved by the author but
I could not follow it.

Every day I would practice in the market and every night I would go back and redraw my structure.
I can't tell you how many thousands of hours I did this. Then one day I noticed something- an edge that
had been there all along that I had previously missed. I saw it repeat over and over.

I looked at charts archives from several years earlier- It was there as well. It was a night I will never forget
I stayed up all night that night and I had my system. It was then I knew I was in the home stretch.

I had been given the house structure but it was up to me to install the windows the stairs and finish the
interior.

So for me I knew I was on the right path when I could answer why and what made the market move and toss out the indicators. When I found the pieces to complete my edge I knew in an instant.

How do you know you're on the right path? Am I?

Discussion in Psychology and Money Management

How do you know you're on the right path? Am I?