|
PureBytes Links
Trading Reference Links
|
As someone struggling with the same issues, here
are some of my personal lessons (not recommendations).
I think trading has a lot to do with personality
(as Ramon pointed out). I want to make money but with little risk.
And I cannot trade the 3 / 5 minute charts since they require speed and
offer excitement that I am not comfortable with. My analysis works, the
drawdowns are smaller, but the speed kills me when I trade short
timeframes.
Therefore, I wait (with a great deal of
impatience) for what I consider to be a low risk trade, e.g., very overbought /
oversold situations, market clearly trending in a certain direction, base / top
formations, on longer timeframes.
I use a combination of structure (trend
lines, Hurst cycles, channels, etc.) and momentum (MACD, RSI) to determine my
entries and let the trades come to me (thanks Clyde). I prefer to use 15
minute+ timeframes ... usually 45 minutes to daily for my
analysis. I have also realized
that it is ok for 30% trades to be unprofitable, 30% to be marginally profitable
/ breakeven and of the remaining 40% profitable trades, not all will be home
runs. Not very comforting since I would like to make lots of money on lots
of trades, but even these ratios work out. E.g., lose 4 points for
losses and make 8 points for profitable still yields you good
money.
So my money management parameters are designed
keeping these in mind. It determines where I will put my stops, it
determines how I move my trailing stops when a move goes my way, and since I
watch momentum very closely, it adjusts the room I permit my profits (sometimes
to my detriment, e.g., today I was short, tightened my trailing and got stopped
out very early - yuck). Obviously one would give more room on a 45 minute
chart than on a 3 minute chart but if the above trade-offs have been analyzed,
then one can be pretty profitable.
Occasionally I miss trades since they do not come
to me but that is alright. And on days when I am out of sync, I lock
my order bar and walk away ... It is very important to approach each trade as if
the previous one had not happened. That prevents bias (fear, exuberance)
from changing the approach.
There are those who suggest that the market is
deterministic and not probabilistic ... i.e., they forecast price and
time. Since I do not have those skills, I continue to look for low risk,
high probability trades.
I hope this helps,
Navtej
----- Original Message -----
<BLOCKQUOTE
>
<DIV
>From:
ketayun
To: <A title=realtraders@xxxxxxxxxxxxxxx
href="">realtraders
Sent: Thursday, May 01, 2003 10:27
AM
Subject: [RT] Actually trading the
analysis
Hi,I was wondering if anyone has any
personal/book/website suggestions about how to enter/exit trades. I find that
on paper what I project within time/price comes true about 90% of the time.
However I don't make the profits. At first I would
enter on the first signal only to find the stock to slightly reverse and then
I would exit (going flat)out of relief . My next thought was to enter on a
pull-back but often the trend is so strong that there is no pull-back until
after it reaches my profit objective or if I just jump in somewhere before the
profit is reached panic sets in because I did not have any clear signal to do
so. BTW I use 65,39,13 and 5 minute charts. Major pattern is usually on larger
time frames with entry/exit on smaller (to keep losses down).Any and
all suggestions welcome.Thanks,Kate To
unsubscribe from this group, send an email
to:realtraders-unsubscribe@xxxxxxxxxxxxxxxYour
use of Yahoo! Groups is subject to the <A
href="">Yahoo! Terms of Service.
Yahoo! Groups Sponsor
To unsubscribe from this group, send an email to:
realtraders-unsubscribe@xxxxxxxxxxxxxxx
Your use of Yahoo! Groups is subject to the Yahoo! Terms of Service.
|