Daytrading Stocks & Index Futures

Article43

I have done a few posts in other threads on this forum, as the concept of daytrading is very hard to grasp, and thus not too many will be able to relate to it.

I will contine to post here as questions are asked from those that want to learn a bit about it, but I will not tell someone how to do something, as they need to discover that themsleves by experience.

I will of course give some pointers, based on my experiences, but that is excatly all they are, pointers as to what I have done, and do, and what I do, may not suit anyone else, as we all think differently !

portomar

Article43 wrote: »

I have done a few posts in other threads on this forum, as the concept of daytrading is very hard to grasp, and thus not too many will be able to relate to it.

I will contine to post here as questions are asked from those that want to learn a bit about it, but I will not tell someone how to do something, as they need to discover that themsleves by experience.

I will of course give some pointers, based on my experiences, but that is excatly all they are, pointers as to what I have done, and do, and what I do, may not suit anyone else, as we all think differently !

article43, if you llok back at my post i was asking to be pointed in the direction of the THEORY of scalping, not to be shown how to do it. you seem to be referring to me when you say that we should find the info out for ourselves. fair enough, but ive already outlined some of my trading strategies, and i do my research into those methods i use. i am not omnipotent, hence i dont know about EVERY theory of stock trading. i am asking you to impart knowledge, or at least its location, which as far as im aware, is one of the points of sites like boards. i have no doubt that i need to learn from my oen experience, but giving people a hard time about asking the theory behind or some pointers on where to get info turns people off straight away.

im sorry you feel no one gets your theories, i have agreed with most of the things you have said, what you seem to be looking for is a thread with people who you feel are on the same level of experience and knowledge as you, which would be pointless in the first place because youd have nothing to say to eachother anyway.

lastly, i cant see myself ever trading the open, as the stocks i look at tend to be volatile enough to make it border on foolish to risk the opening gaps. would have been nice to be pointed towards any info though.

ChartTrader

Portomar, one futures strategy for trading the open is to 'fade the gap' - that is, if the Dow gaps up by, say, 50 points, to short it at the open and cover the trade when(if) the gap is closed (ie, when price returns to the previous day's close). Ditto for gaps to the downside (note that each 1 point move in 1 mini-dow contract is equal to $5). John Carter, a trader and author, has written extensively about his gap trading methodology (note that he employs a pretty wide stop - a 1.1:5 risk reward ratio. That is, he is risking $1.50 for every $1 he hopes to make - he says that the trade's extremely high success rate means that it's still worth taking). See link below for detailed Carter write-up.

http://www.cbot.com/cbot/pub/cont_detail/0,3206,1070+14719,00.html

Regarding trading stocks at the open - yes, it's a very volatile and more difficult time to trade. I tend not to trade stocks in the opening 15 minutes or so myself. The above Dow trade is a nice one though - worked nicely yesterday too.

PDelux

Some people like the trading at the open though.
This guy calls his method Millk the Cows cos he has to get up early to catch the open:
http://kreslik.com/forums/viewtopic.php?t=88&highlight=milk+cows

It is based on statistics. For example stocks like BIDU, DRYS, WYNN, in over 90 of the last 100 days when the price went .10 above the open it went over .50 above the open. So these guys place a mark on the chart called Buyzone and similarly for the Sellzone, when the price is in the zone, go Long or short.
Problem i see with it is there are no stops and no targets, its a "get what you can" mentality.

portomar

thanks chartrader and p.delux, ill do my researxh and see if open trading is for me! thanks for the info.

Idu

Article43,

Just wanted to ask you a few questions regarding this thread. Apologies if they've been asked before but I didn't read through the whole thread.

1) What is your average time in a trade?
2) What trading platform(if any) do you trade on?
3) Do you rely heavily on technical analysis for your entry points?
4) Have you considered working for a trading house here in Ireland or abroad as a profession(assuming you don't already)?

Thanks

Ex-D

Artice43, I read your thread from start to finish in a couple of sitting - very informative Thank you!

My understanding on what you are trying to convey is, in a nutshell,

Buy early in the day
Set a stop loss (0.5%) and stick to it
Sell before the day is done - whatever the price!

Now for the questions:

What do you use to pick the stock? There must be 10's of stocks to pick from and virtually all of them has the potential of making (or loosing) you a couple of dollars for the day.

When do you sell? do you set an upper limit and sell when that is crossed.?

What amount of money is needed to start up?

casey212

How are we all getting along lately. Don't tell me you also timed the market and jumped to the short side. Remember however, the best time to buy is when the blooding is flowing in the streets.;)

portomar

casey212 wrote: »

How are we all getting along lately. Don't tell me you also timed the market and jumped to the short side. Remember however, the best time to buy is when the blooding is flowing in the streets.;)

did very good, had just been shut out of a short position on a stop loss 2 minutes before the rate cut. lucky me. couple of shorts couple of longs, good all round.

casey212

You need a pair of brass ones to trade lately, see-saw, baby. I myself am debating on wether to sit it out for the next week or possibly play the bounce.

Idu

what do you guys trade?

Pascal14

I am tipping away at the currency markets lately. Some nice swings, I see a bit of weakness for the euro. The cable also looks to be shaping up nicely.

portomar

i trade indices and stocks.more indices lately.my ambition is to trade google shares on my spread bet account.mama thats volatility.

IrishMike

Article43 wrote: »

If you want my opinion, MACD and the majority of TA indicators are of little value.

If you must use indicators, then the ones you might find the best in relation to what way the stock is trending is RSI and Money Flow.

But remember, no matter what the indicators might say, the fact is, the minute your trade gets filled, the price can go against you, and stay against you for days, maybe even weeks, and no indicator in the world will get you out of a mess like that when it happens.

The only thing that will save you is your stop.

Have read this entire thread but honestly have to take some serious issue
with some of the stuff you have posted Article43.
Im an equitys analyst and so actually know what im talking about.
I also do a fair bit of spreadbetting (or gambling on daytrading as you say)
What i would like to know is how you can say that TA indicators are of little use?
Thats mindblowing
You havent spoken of resistance levels, spikes etc.
You also say that news reports have little relevance...this is complete and
utter maddness. Negative or positive news definitely affects stock prices in
the short term. A profit warning or news of a possible merger will hugely
effect the stock price at the opening of trading
The more of your posts i read the more i think you dont really understand
the topic yourself tbh.
You fail to mention sector rotations, cyclicals, defensives, downtrends or
uptrends and ignore TA yet you claim to be able to daytrade?
Do you even play gaps in the market?

Thats like a soccer player saying he is able to play at the top level but
doesnt use his feet!

PDelux

Have read this entire thread but honestly have to take some serious issue
with some of the stuff you have posted Article43.
Im an equitys analyst and so actually know what im talking about.
I also do a fair bit of spreadbetting (or gambling on daytrading as you say)
What i would like to know is how you can say that TA indicators are of little use?
Thats mindblowing
You havent spoken of resistance levels, spikes etc.
You also say that news reports have little relevance...this is complete and
utter maddness. Negative or positive news definitely affects stock prices in
the short term. A profit warning or news of a possible merger will hugely
effect the stock price at the opening of trading
The more of your posts i read the more i think you dont really understand
the topic yourself tbh.
You fail to mention sector rotations, cyclicals, defensives, downtrends or
uptrends and ignore TA yet you claim to be able to daytrade?
Do you even play gaps in the market?

That's interesting.. being an equity analyst i would have thought you'd have been studying P/E ratios , earnings growth etc. to see if a company is good value rather than using TA? Or do you consider both?

portomar

equities analysts would surely cover all of the things you mentioned article, plus the technical indicators mentioned. even if you are not a technical indicator officanado, you should take them into account because others in the market do.

glad to see people in the industry follow TAs aswell as me!

A Random Walk

IrishMike wrote: »

Im an equitys analyst and so actually know what im talking about.

Riiight, but obviously not enough to know that the word is "equities".

ChartTrader

Im an equitys analyst and so actually know what im talking about.
I also do a fair bit of spreadbetting (or gambling on daytrading as you say)

No offence but you mention in another thread (http://www.boards.ie/vbulletin/showthread.php?t=2055223930) that you have just started work for a stockbroker and are trying out the Paddy Power spread betting simulator. That doesn't imply day trading expertise.

What i would like to know is how you can say that TA indicators are of little use?
Thats mindblowing
You havent spoken of resistance levels, spikes etc.

I would agree with the OP that most indicators are useless. Most of the time, they will get you into a move too late. For day trading, you're better off concentrating on price, volume, support/resistance levels,etc, rather than assing about with MACD and the likes. Moving averages are about the only indicator worth bothering with, imo.

You also say that news reports have little relevance...this is complete and
utter maddness. Negative or positive news definitely affects stock prices in
the short term. A profit warning or news of a possible merger will hugely
effect the stock price at the opening of trading

Yes, but you need not fret about mergers and the likes if you're day trading, it will already be reflected in the opening price. Many, many day traders concentrate solely on the chart rather than following news headlines. If something big happens and the trade goes against you, you will be stopped out - you don't really need to know why. There's too much subjectivity involved in buying/selling on a headline. Besides, ordinary day traders can't expect to compete with professional traders utilising Bloomberg terminals and the likes. Better to develop a personal, chart-based approach rather than trying to figure out likely market reaction to a news event. News matters but it's very difficult to trade it so don't try to. Secondly, exit positions in advance of major events (eg, employment report, fed meeting etc). Read the news, then forget it, as a trader once said.

You fail to mention sector rotations, cyclicals, defensives, downtrends or
uptrends and ignore TA yet you claim to be able to daytrade?

Secor rotation, cyclicals etc is irrelevant to most day traders. Most tend to focus on a number of charts and follow price closely. As for TA, the OP presumably practices his own brand of TA - he just doesn't use indicators.

daveirl

This post has been deleted.

IrishMike

ChartTrader wrote: »

No offence but you mention in another thread (http://www.boards.ie/vbulletin/showthread.php?t=2055223930) that you have just started work for a stockbroker and are trying out the Paddy Power spread betting simulator. That doesn't imply day trading expertise.

Never for a second said i was an expert.
I just said i knew what i was talking about.

I would agree with the OP that most indicators are useless. Most of the time, they will get you into a move too late. For day trading, you're better off concentrating on price, volume, support/resistance levels,etc, rather than assing about with MACD and the likes. Moving averages are about the only indicator worth bothering with, imo.

Thats your opinion but i definitely dont agree with it.
Macd crossovers are rarely rarely wrong, they provide a good warning when to get out.
Other idicators like bollinger bands, adx indicators, cci indexes are also very useful

Yes, but you need not fret about mergers and the likes if you're day trading, it will already be reflected in the opening price. Many, many day traders concentrate solely on the chart rather than following news headlines. If something big happens and the trade goes against you, you will be stopped out - you don't really need to know why. There's too much subjectivity involved in buying/selling on a headline. Besides, ordinary day traders can't expect to compete with professional traders utilising Bloomberg terminals and the likes. Better to develop a personal, chart-based approach rather than trying to figure out likely market reaction to a news event. News matters but it's very difficult to trade it so don't try to. Secondly, exit positions in advance of major events (eg, employment report, fed meeting etc). Read the news, then forget it, as a trader once said.

Agree with you on this

Secor rotation, cyclicals etc is irrelevant to most day traders. Most tend to focus on a number of charts and follow price closely. As for TA, the OP presumably practices his own brand of TA - he just doesn't use indicators.

Well if thats the case in my opinion those daytraders are not fully utilising
the tools available to them. There is a huge amount of information
which is very relevant.


Anyway its not my job to tell someone what they should and shouldnt do.
I just gave my opinion

CHD

janets_on_clubs wrote: »

what do you guys trade?

football stickers

Oct2008

What company/website do people use to buy and sell shares if you want to day trade?

What shares can be effectively day traded, I presume ISEQ shares can't be traded efficiently because of the stamp duty?

i know spread betting is an option but just asking about the options where you want to actually buy the shares in question.

portomar

Oct2008 wrote: »

What company/website do people use to buy and sell shares if you want to day trade?

What shares can be effectively day traded, I presume ISEQ shares can't be traded efficiently because of the stamp duty?

i know spread betting is an option but just asking about the options where you want to actually buy the shares in question.

daytrading while buying the underlying share rather than spreadbetting or options trading would seem to me to be horrendously innefficient. unless huge sums are involved... some may disagree?

iseq shares can be daytraded through spreadbetting, but most would not be volatile enough for your average daytrader

Mikel

IrishMike wrote:

Macd crossovers are rarely rarely wrong,

Says who?
have you published research?

IrishMike

Mikel wrote: »

Says who?
have you published research?

Says me.
I dont have published research, i do however have the returns from a hugely
successful hedge fund which uses just technicals to make calls.
Market volatility and technicals are a licence to print money.

Article43

IrishMike wrote: »

Have read this entire thread but honestly have to take some serious issue
with some of the stuff you have posted Article43.
Im an equitys analyst and so actually know what im talking about.
I also do a fair bit of spreadbetting (or gambling on daytrading as you say)
What i would like to know is how you can say that TA indicators are of little use?
Thats mindblowing
You havent spoken of resistance levels, spikes etc.
You also say that news reports have little relevance...this is complete and
utter maddness. Negative or positive news definitely affects stock prices in
the short term. A profit warning or news of a possible merger will hugely
effect the stock price at the opening of trading
The more of your posts i read the more i think you dont really understand
the topic yourself tbh.
You fail to mention sector rotations, cyclicals, defensives, downtrends or
uptrends and ignore TA yet you claim to be able to daytrade?
Do you even play gaps in the market?

Thats like a soccer player saying he is able to play at the top level but
doesnt use his feet!

Firstly - Economics is not a science, and it has been rightly said that this is one of the biggest calamities inflicted on mankind in the 20th Century, and I must say that I agree 100%.

I would imagine that many of the so called traders that run the pension funds are also equity analysts - and we all know what results they have achieved this year

You know what you have been shown by others in the same game - this does in no way mean that you, or them, know the best way to trade the markets for consistent profits utilizing low risk strategies.

Knowing when news is coming out is important - there is no way to know what the news will be, nor is there any need, unless of course one is a member of the elite few who have access to inside information - but for the majority of people this will never happen, so it is not even worth thinking about it.

You can think what you like - it does not bother me one little bit - really.

Sector rotations, trends, pivots, fibs, ma's, cci, and all the other myriad of textbook trading stuff, is what everyone is looking at and interpreting differently - this is rubbish, and has absolutely nothing to do with taking money out of the markets - I think I have already mentioned what the best approach is, so I am not going to repeat myself over and over.

Gaps are one strat that can yield a very fast return - but they can also go against you very quickly, so control is the key, and a bit of knowledge about leading indicators, not lagging indicators which the majority look at all of the time.

Analogies do not apply to the stock market - as we need to do the exact opposite of what we normally do.

In summary, you are an equity analyst - so what, there are thousands of you out there, but that means nothing to someone who wants to learn how to take some money out of the markets without losing all they have in the process of trying.

Think back to my first posts on risk control - trading no more than 100 share lots until you actually learn how to do it - consistently - and if you can't analyze that logically, then I doubt that your analysis techniques are of any real value - it is just more of the same old stuff - you are a member of what I call the "usual suspects" - and the world is just full of them.

Here is an easy question, the answer of which has the potential to present many good trading opportunities - each and every day - with low risk entries - a must for pulling money out of the markets.

Q1 = How many stocks are in the Dow 30?

Here is a bit harder question.

Q2 = What is the best leading market indicator - hint - it is not the Dow 30 or the S&P 500.

Now, when you can analyze these 2 simple questions, and come up with the correct answers, then you are on your way to discovering low risk entry trades, each and every day, and what is more, the market direction does not matter one little bit, for we should be trading in the direction of the best leading indicator - for the selected stocks that we trade of course.

Happy Easter to all - and I hope you all gave something up for lent - next year you might be able to give up losing in the equity markets - that is of course if you listen to the right people - and it is very easy to know if you are doing so - you just ask yourself - one simple question, and that is, does it make sense - for you will be amazed at how uncommon common sense is

Article43

portomar wrote: »

article43, if you llok back at my post i was asking to be pointed in the direction of the THEORY of scalping, not to be shown how to do it. you seem to be referring to me when you say that we should find the info out for ourselves. fair enough, but ive already outlined some of my trading strategies, and i do my research into those methods i use. i am not omnipotent, hence i dont know about EVERY theory of stock trading. i am asking you to impart knowledge, or at least its location, which as far as im aware, is one of the points of sites like boards. i have no doubt that i need to learn from my oen experience, but giving people a hard time about asking the theory behind or some pointers on where to get info turns people off straight away.

im sorry you feel no one gets your theories, i have agreed with most of the things you have said, what you seem to be looking for is a thread with people who you feel are on the same level of experience and knowledge as you, which would be pointless in the first place because youd have nothing to say to eachother anyway.

lastly, i cant see myself ever trading the open, as the stocks i look at tend to be volatile enough to make it border on foolish to risk the opening gaps. would have been nice to be pointed towards any info though.

Apologies portomor - i have been very busy, and due to my inability to monitor the markets, and having index futures trades open at the same time, I have lost a lot of money that I had made - and that is not something I like doing at all - but what is done is done - and it should not have happened to the extent that it did, so I learned another valuable lesson, which we must all learn from as we progress and continue to expand our knowledge base of trading the financial markets.

Stocks are the safest bet - by far - but only if you are in conplete control, and only if you are daytrading, holding no positions overnight.

Sure you can buy when the market tanks, and the odds of a bounce are then in your favour, but if you overtrade and risk too much, then odds are you will get stung badly, maybe not today, or next week, but it will happen ig you do not sticj to strict money management risk control - it is the key to consistent profits - don't mind what all the idiots say, for again, common sense is all you need, with a little bit of skill, deriived from first hand experience with live trading (100 share lots at first - remember).

Must run - will finish off later - but as for no one geting my theories - they are not mine, it is simple maths - if you lose 10 x 100 then you lose a 1,000, if you lose 10 x 5000 then you lose 50,000 - if you had to lose which one would you prefer - common sense is it not!

Article43

janets_on_clubs wrote: »

Article43,

Just wanted to ask you a few questions regarding this thread. Apologies if they've been asked before but I didn't read through the whole thread.

1) What is your average time in a trade?

It depends on how fast it moves after entry, and in what direction - and what the leading indicators are doing if you get into a winning position - as a rule, when you have money lock in profits by moving your stop up, or down if you are short. If you get into a losing position you get out very fast - as holding a losing position is not where you want to be - especially in these volatile markets.

2) What trading platform(if any) do you trade on?

I use IB (Interactive Brokers UK) data feed (you need to have an account with them to get live data) with Quotetracker (free charting software) - it is as good as any professional charting package out there, all you will ever need - well, if you want to trade a few million dollars at a time that is a different story, but I think most of us will not have to worry about that for a while

3) Do you rely heavily on technical analysis for your entry points?

No - I don't use any TA as such, just straight lines mostly and sometimes angled lines to see a short term trend shift - but too many lines will just stop one from seeing a clear picture of the chart/s. I use charts slightly different to most, as sometimes it is better to do what you feel is best yourself - not what the majority think. Remember, this is a game of odds, nothing more, and trying to justify that you are right, when you can never know if you will be, is, well a receipe for losing money - as the majority do most of the time.

4) Have you considered working for a trading house here in Ireland or abroad as a profession(assuming you don't already)?

Last year I spoke with an Irish prop house called Reminiscance in relation to opening a new one in the south of Ireland - and I called to their location about 6 weeks ago - Trinity Business Centre - and guess what, they disappeared without even contacting Trinity - big surprise, they have gone to the wall like many so called professional trading houses, I guess all the new college students were trading more than 100 share lots :rolleyes: - common sense, remember

I have recently sussed out a few US prop firms that are trading internationally - but they are all failing my simple tests to see if they really are good partners to do business with - so far not so good, but I have a few plans that I am working on for this year.

Thanks

You are welcome.

Article43

Ex-D wrote: »

Artice43, I read your thread from start to finish in a couple of sitting - very informative Thank you!

My understanding on what you are trying to convey is, in a nutshell,

Buy early in the day

It depends on your situation - we are all different with different responsibilities - but in general - the open tends to offer greater opps than any other time of day - but the risk can be high if you dont have a strict plan - and stick to it. Also, trading NYSE stocks at the open is differnet to trading Nasdaq stocks at the open - it is like chalk and cheese.

Set a stop loss (0.5%) and stick to it

Again - it is a personal thing, but at first one should only trade 100 share lots with a max risk of 20 cent if possible - that is a total risk of $22 dollars per trade, including commissions. When one gets good at it, after many many live trades, then one can do larger size, say 200 to 300, but never more than 500 - and max is 1000 if you become an exceptional trader - remember, one can trade 3-5 stocks at the same time if one has the right setups.

Sell before the day is done - whatever the price!

Covered already - lock in profits and take money off someone else when you have it - get greedy and you can end up giving them your money.

Now for the questions:

What do you use to pick the stock? There must be 10's of stocks to pick from and virtually all of them has the potential of making (or loosing) you a couple of dollars for the day.

Well, as per my reply to the analyst - the DOW 30 is a very good starting point - after all, you only have to watch 30 stocks as opposed to watching 60+ when trading Nasdaq Tech stocks.

When do you sell? do you set an upper limit and sell when that is crossed.?

You buy when the price is going up - you sell when the price is going down - when you are filled, if the trade goes against you and your stop is hit (this is a mental stop most of the time), get the hell out and either reverse direction or wait till the price starts to move away from the basing area - if you want to call the right direction then become an analyst, if you want to take money off other traders, then learn to get in and out quickly, taking money when you have it.


What amount of money is needed to start up?

Well - you need $25K dollars for daytrading margin requirements - otherwise you will not be able to trade after you complete 4 trades in a set period, which I think is over a week, but as I never had to worry about that I am not 100% sure - and then another $5K dollar risk money - so in total $30K is very adequate, and now is a good time to start with the dollar exchange rate.

Article43

Article43

ChartTrader wrote: »

As for TA, the OP presumably practices his own brand of TA - he just doesn't use indicators.

You are of course right CT - as reading a chart is TA, but most take TA as using the indicators and all that stuff.

Trading is nothing more than a game of odds - and no matter how much one tries to thing otherwise, it does noit change the fact.

Some price movements are controlled by big money - but if you can be close to the action, and control yourslef, then there is no need for the in-depth analysis such as Market Geometry used in the commodities markets - where I have seen it demonstrated to me by another trader, and I must say, I was very impressed at what happened - but not for me, no thanks, the risk is still too high at times and many weeks of trading profits can be wiped out in one or two spiking days by the pros - remember, these guys have tons of money, and moving the market 0.5% is not uncommoon for these guys.

Mikel

IrishMike wrote: »

Says me.
I dont have published research, i do however have the returns from a hugely
successful hedge fund which uses just technicals to make calls.
Market volatility and technicals are a licence to print money.

That doesn't prove your statement 'rarely rarely wrong'
To do that you have to compile a list of all the crossovers and analyse how many of them were accurate.
Rather than basing it on:
ONE hedge fund
Do you know all their trades
Do you know which signals all of these trades were made on?

IrishMike

Mikel wrote: »

That doesn't prove your statement 'rarely rarely wrong'
To do that you have to compile a list of all the crossovers and analyse how many of them were accurate.
Rather than basing it on:
ONE hedge fund
Do you know all their trades
Do you know which signals all of these trades were made on?

I didnt base it on one hedge fund.
Its based on 12 years analysis and back testing of the all stocks in the S&P

Yes i know all of their trades
and yes i know what signals the trades were made on because i wrote most
of the software and filtering system that makes the calls.
Does that validate my argument enough for you?:cool:

Mikel

IrishMike wrote: »

I didnt base it on one hedge fund.
Its based on 12 years analysis and back testing of the all stocks in the S&P

Yes i know all of their trades
and yes i know what signals the trades were made on because i wrote most
of the software and filtering system that makes the calls.
Does that validate my argument enough for you?:cool:

LOL!!
So, you wrote the software for a 'highly successful' technical hedge fund, presumably backtested it. That sounds like a pretty skilled thing to do, someone could earn a lot of money in London doing that kind of thing.
Yet here you are in Dublin working as an 'equitys analyst'
Is someone telling porky pies??:rolleyes:

ChartTrader

Other's backtesting (on S&P 500 index) of MACD brings very different results, see
http://www.cxoadvisory.com/blog/internal/blog3-04-08/default.asp

and
http://www.cxoadvisory.com/blog/internal/blog3-05-08/default.asp

Article43

ChartTrader wrote: »

Other's backtesting (on S&P 500 index) of MACD brings very different results, see
http://www.cxoadvisory.com/blog/internal/blog3-04-08/default.asp

and
http://www.cxoadvisory.com/blog/internal/blog3-05-08/default.asp

Backtesting is useful in certain scenarios only - and that is, when you want to compare several proven consistent profit producing strategies to optimize the returns based on different position sizing techniques.

This is only for the traders that have reached the top level of trading.

Backtesting to see if you can come up with a winning strategy is for amateurs!

Mikel

ChartTrader wrote: »

Other's backtesting (on S&P 500 index) of MACD brings very different results, see
http://www.cxoadvisory.com/blog/internal/blog3-04-08/default.asp

and
http://www.cxoadvisory.com/blog/internal/blog3-05-08/default.asp

That's interesting......... nice quote from Andrew Lo:

...if one tortures a dataset long enough, it will confess to anything!"

Idu

Article43 wrote: »

Q2 = What is the best leading market indicator - hint - it is not the Dow 30 or the S&P 500

Well what is?

PDelux

Well what is?

You're wasting your time. Article43 doesnt discuss, he lectures. He hasnt answered many questions on this thread like my one a while back about currency exposure. The only day trading example he actually gave came out with a loss... but maybe that was to "teach" us what not to do
Maybe i'm being a bit unfair but there's too much waffle on this thread.

Article43

PDelux wrote: »

You're wasting your time. Article43 doesnt discuss, he lectures. He hasnt answered many questions on this thread like my one a while back about currency exposure. The only day trading example he actually gave came out with a loss... but maybe that was to "teach" us what not to do
Maybe i'm being a bit unfair but there's too much waffle on this thread.

You are of course entitled to think what you want - but that does not change anything.

If readers here are so thick that that they can't understand the basic principles of risk control as part of gambling - then they are welcome to go elsewhere and play silly games with other idiots - I have no intention of wasting my time amusing silly boys who behave like old women.

As for waffle - maybe you are right, for most of what is out there about trading is just that, waffle to the highest degree - so why should I behave any different

Now, let me recap a little, just to see how much waffle I exhaled.

1. Start small and risk very little to learn the ropes - yep, that is waffle alright!

2. Pick one market and focus on a small group of stocks - more waffle!

3. Ya-ya-ya - sure you all know the rest of the waffle so I wont bore you with it:D

Why do you think I started the other thread - if any idiot starts to play granny games in there they will be requested to be banned right away - I am used to dealing with idiots and know only too well how to handle them.

You are of course welcome to post relevant questions - but you have been warned upfront - time is money and idiots are of no use to anyone, especially themselves

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janets_on_clubs wrote: »

Well what is?

What do you think in is Janet ?

Is it the TICK, or the TRIN maybe, or maybe if we are only trading the DOW 30 stocks it is the TICKI?

Or, how about the YM Futures, or the ES & NQ, or hold on, many traders swear that the ER futures lead the others..or maybe its the whole bloody lot of them together, on 4 screens with 4 charts for each one!!

Are you begining to see the big picture here?

Most of it is pure crap - belive me, I know.

eggie

Using a weighted index, whether price or MV weighted as an indicator for trading individual stocks would obviously be suicidal.

Idu

Article43 wrote: »

What do you think in is Janet ?

I only scalp the european markets not individual stocks so I think the leading indicator changes all the time. Sticking to one is foolish and short sighted. I think the ES is a good indicator for european stocks when the US market opens but I'd still be more inclined to follow whatever the FESX was doing and the cash market of whatever market I was trading.

The Dow should never be used as an indicator IMO because its a price weighted index so it's too open to fluxuation from individual stocks

The NYSE Ticker is good for general market sentiment or the Fixed Income markets or the I-Traxx crossover. All have their merits. I dont think any should be used alone religiously

Article43

It is all relative - one uses what works best for what one is trading.

An individual stocks momentum is always given top priority - but as per the so called herd mentality - it can be wise to keep an eye on what the majority are doing, for if the major markets are moving down, this can have an effect on how investors/traders react.

If you are long a stock with a 40C profit realised - it is much better to take the profit if the major market sentiment changes, as I keep saying, re-entry is but a click away.

Some traders actually have their software programme set up to adjust positions based on momentum - price stalls and the software offloads shares to lower risk - momentum returns and the software loads up again - or reverse trades based on the settings.

I never tried this, but as I have no interest in this type of trading then that is no big surprise - I prefer to use the most complicated computer in the world - aka, The GM Machine.

No matter what the approach one takes - if the results are satisfactory then all is well - if not, then it should be obvious that things need to change. Ones results will be in direct proportion to their experience level - and more importantly, the logical framework that they use for trading the markets - for bad experiences coupled with a bad framework, is a recipe for disaster.

Article43

For the mods:

Q: Why does this site keep logging the user out?

I have replied to a post in this thread, it took some of my precious time, and then when I submitted it I was asked to log in again!

I am not typing it out again.

Idu

im not a mod but if you click the remember me tab then you will stay logged in

Article43

Thank you Janet - as mentioned previously, and as you have just demonstrated, we can all learn from each other, as it is impossible for the human brain to know everything that there is to know.

Article43

Not sure why jamm222 lifted my post - do have something to add j22, or maybe a question?

xebec

Article43 wrote: »

Not sure why jamm222 lifted my post - do have something to add j22, or maybe a question?

Deleted.

JAMM222

sorry meant to say it was yours! just thought that people wouldnt be able to see it cos the writing was in black!

Actually now that i think of it most people could probably see it the reason i couldnt is because i am using a black theme!

Article43

NP J22 - just thought you had a question and forgot to include it in the post - no sarcasm meant.

Article43