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This post may sound (read) silly, but I find this amazing. It is intended
for all people that trade based on indicators.
The point of this experiment is to create statistics for people that do not
back test systems. If you know the potential of your system, the risk and
it's accuracy in solid numbers, you gain much needed confidence. I believe
that a lot of us do not have a system that we can back test, we rely on
discretion quite a bit, therefore we miss out on thee important stats.
My suggestion: Hide the price charts, fly blind, use indicators only. Change
the color of your price chart to be the same as the background. Call trades
based on your indicators only, writing down times not prices. At the end of
the day, reveal your prices again and find out how you did. You will be able
to calculate accuracy, potential and max risk. Do this for a few days and
refine your system.
I found this to be invaluable. As a matter of fact, I trade this way now, as
in I do not look at prices. The idea is nothing new, pilots are trained this
way to my knowledge. You have to trust your instruments and not go against
them.
Obviously this does not apply to everyone...
All of the anxiety of watching prices tick against you, all of the fears of
pulling the trigger disappear, you find your max risk and able to figure out
ultimate stoploss point and many more benefits...
Opinions?
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Shay Horowitz
www.teamzeus.com
www.zeus-holdings.com
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