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well it turns out there is a reason I don't post in threads where the math guys hang out...I cant even add the number of ticks properly..... a -10+BE+33+10 does not add up to 43. It adds up to 33 which matches my PnL.....
sheesh.
Simplicity is the ultimate sophistication, Leonardo da Vinci
Most people chose unhappiness over uncertainty, Tim Ferris
Over the month of December when I wasn't trading, I looked at lot of historical charts with the 21 and the 89 on them. The 21 seemed to be pretty decent at following a trend and catching smaller pull backs on the 1M chart. However, as you know, there is a lot of noise on the 1M chart. Over the course of the month, I noticed that the slower MA tended to catch the deeper pull backs better (duh) and that the moves from there were often times much larger than from the 21. So I made a decision to trade both the 21 and the 89.
After a couple of days of that, I decided to look at the price action with just the 89.
Since I trade only around the MA, this produced fewer trade opportunities thereby helping to reduce over trading, it reduced my decision fatigue by removing the number of times I have to make a decision and it opened up the possibility of targets larger than 15 ticks. And for some reason, it seems like my stops are smaller....but that could be my imagination as I have NOT tested that theory.
In theory anyway, if you can get all the stars lined up, a nice long run will ensue......which appears to have happened twice today.
Anyway, its also forcing me to read price action away from the MA for either a continuation trade or perhaps a counter trend trade like I did today. If I can get good at those two trades, I might have something going on.
Short question, long answer.
Simplicity is the ultimate sophistication, Leonardo da Vinci
Most people chose unhappiness over uncertainty, Tim Ferris
Whenever I am looking at a 'system' or 'tweaks' I always look for 'death days' and I am curious if you have identified any days that will really hurt? What does that look like, etc...
My favorite MA's that I have identified (depends on the instrument) are the 21/34/89... Funny how after being introduced to those that people still find them interesting.
Any day can be a death day. But I assume you mean taking trades based on what I think should happen around the MA and the answer is it depends. Do you trade every bar? Do you wait from some sort of price action you recognize? Do you stop trading if you have 2-3 losers in a row which more than likely is trying to tell you something?
I to like those three MA's. However, there is no magic in them, just context for price action.
Anything works within reason or within context. Its 100% the trader that determines the success/failure of the chosen trading method.
Simplicity is the ultimate sophistication, Leonardo da Vinci
Most people chose unhappiness over uncertainty, Tim Ferris
What I mean is a visual backtest of how often between the time you trade will it be a really bad market condition for the method. Just something I do whenever I change something is look at market conditions of Christmas Past to see what could happen etc.. That is all I meant...