MightyMouse

Quadcam, If you are buying stocks that are in the $1-$2 price range, the stocks you are buying are probably in very long term down trends, since most of these stocks started out priced much higher. Its not an easy game to play especially for someone who has the experience that you do. The best bet for trading these low priced stocks is to do something like buy a few hundred different ones and expect most of them to fade to oblivion and a handful will recover and have stellar gains. Any hard stop you set will get hit. These stocks have very little "serious" interest in them. Most institutions won't have them on their radar until the stocks are priced over X dollars. X can be 10, 15, 25, etc. You are therefore trading against hedge funds and other market makers who make a market for these low priced stocks. What that really means is that they specialize in extracting the equity of people who are attracted to low priced stocks or they would not bother with these low priced issues. So setting a stop and a target guarantees you to lose money with these issues. The target tremendously limits your ability to make money in this instance. The only way for your $1.15 stock to get to $20 is to go through $2.3, $5, etc. It takes serious patience to let that happen too. And, the stop you set, which they can see, allows them to liquidate their short positions that they accumulate at higher prices. It is a very unfair game, because not everyone can short these stocks. Besides, most of these stocks are in long term down trends. On the other hand, if you bought a stock like Coke, IBM, COP or some etf's you can be reasonably assured that they are not overly manipulated and you will make money over time if you are patient. The hype with these lower priced stocks is that you can make a zillion times your money and be rich like the bald guy in the advertisement. However, look up information on why you shouldn't buy these stocks to counterbalance the reasons you have for wanting to buy these stocks and be rational. If you are trading to have fun and not necessarily to make money, then have a good time. MM

Read through a Forbe's Magazine list of billionaire's, you'll read about the made for print profiles of many of the self made billionaires. Believe it or not, there are only a few that started out rich and became richer. Most started out poor. I am doubtful that anyone on that list read a book on how to become a billionaire and applied the principals they read. I do believe that almost everyone on that list that is self made is a ruthless business person who learned how to manipulate the capitalist system to their advantage. Take Opray. She is on that list. Her TV personality seems so nice and warm and she has a following that is incredible. It is easy to assume that the billions just happened. Nothing could be more false. No one gets to be a billionaire unless you are incredibly greedy. Yes, the warm, lovable, big African American woman on TV is a ruthless, capitalist, greedy business person. In order to trade successfully, you have got to be greedy. You are trading against people who are greedy. In order to consistently take money from greedy people, you have got to be greedier. Greed and hunger are very similar. The poor people on the Forbe's list, or those who started out poor, started out hungry. When you are truly hungry, you will do things that you would not do if you were comfortable. You will not think about fear or uncertainty if you are hungry. That is something that the people who are comfortable think about. Reading about fear and uncertainty may make you understand it, but it will not help you overcome it. Most of us, or I will speak for myself, can be considered poor traders and therefore need to be hungry when we trade. As a hungry trader, you have to take money from other greedy traders or you have to be hungrier than the hungry traders, or we simply hope that we come across a comfortable trader. If we have to chose, we are better off trading against the hungry than the greedy. If you are comfortable, then you will quit if there is too much pain and you will seek the caressing hand of your momma. Greed, is the most important element. In a capitalist regime; it is what distinguishes one from the other. The markets within which we trade are the truest and probably the last bastion of capitalism on this planet. Greed is thrown around on this forum as if it a dirty word. If you are not greedy and still want to live in the comfort provided by your momma, the markets, either directly by losing or indirectly by paying transaction costs, will suck the capital out of you. Successful traders are simply greedy.The trading psychology books explain trading psychology to you. Those books will not teach you to be greedy. MM

Its all about getting people to pay you when you enter the market. I choose to get as true a reading as possible so that I am not acting like a monkey throwing darts, or worse, so that I am not getting sucked into a trap by other traders seeking to extract money from me. Unfortunately, i need to expend thought which I do not mind doing. Others may try to do it with less thought. All I can hope is that they trade the same markets I do.

You would want to use any volume that is related to the s&p 500 which is the underlying instrument of the S&P emini (ES). You will notice that there are times where the volume, for instance, on the ES has a dramatic increase and the S&P volume of all the stocks traded in the S&P did not have a dramatic increase in volume. The dramatic volume from the futures contract may generate a signal where as if you were using the S&P 500 volume you would not be entering or exiting the market. To me this leads to a discussion of whether one leads the other, which tells me that sometimes one does and sometimes the other does. If that is the case, then the value of the signal is watered down if you cannot gauge the complete volume picture. So using price along is probably a cleaner approach. I am not suggesting anything about the software since i have never even seen it, but fundamentally, I wouldn't use it with ES for the aforementioned reasons unless I could get a complete picture of the volume traded.

In order to get the full benefit from VSA or wychoff, you have to consider total volume or total market open interest for a security. Published volume is really only what the symbol traded on the given exchanges. However, you can purchase a security as part of a futures contract, an option on a futures contract, an option on the security itself, a sector etf, etc. The more of those you can include, the better the volume picture you will develop and VSA will perform better for you. If you are a trader who wants to use VSA on an instrument like ES and plan to use the volume of only ES, then the above statement is not a myth, since ES volume only gives you a sliver of needed volume information and trading with price action alone will produce similar results. You can certainly try to use only ES volume with VSA, but a monkey will get it right too by throwing darts at 2 circles labeled long and short, but it doesn't need software to do it. MM

MMS, I started with 5 minutes. It takes a while to build up to longer periods of time. 20 minutes, early on seemed like an eternity, but you begin to want to do it for longer and longer. I go an hour and use a timer to stop myself. I too have obligations that I need to fulfill. I now tend to do it very early in the morning or as needed, but never meditate more than 2-3 times a week. You will actually look forward to it. The feeling you get from it is very similar to the way you feel when you come back relaxed from a vacation. A real vacation and not one spent chasing around little kids and having forced conversations with your aging spouse. MM

You have to wonder why SAC needed someone like ari kiev since they are alleged to have been trading with tomorrow's newspaper. Perhaps it was all part of some elaborate scam.

At the very least, meditation helps relax your mind, putting aside all "noisy thoughts" so that you can trade with as clear a mind as possible so that you can understand what is happening. Try to calculate 5x7 on a calculator with all the number keys pressed at the same time. Meditation is a process and therefore takes time to reap the benefits from it. It will not directly improve your trading.

I started meditating every day over a year ago and found it very, very helpful in getting me in the right mindset, mentally, to interpret the market. I started with 5 minutes, then added time and added time. I found that after a while i did not need to meditate every single day, since i began to get right in that zone whenever i sat in front of the screens. I completely recommend that everyone do it who trades with discretion.

Of course your not trying to pretend that you are the very best trader. Of course you have nothing to prove. If you were doing that you would say that you do significantly better than 95% winning trades. Your string of winners would far exceed 50 in a row and you certainly wouldn't say that it takes you so much time during the day to do it. I apologize for being harsh since i mistook your trading statistics as exaggerated claims. I am the type of trader who trades and puts real money on the line each and every trade I take. I trade independently and would not want to ever trade for a firm. The last person I worked for was my father when I was 16-17 years old. Its great, however, that you work for a hedge fund that allows you to trade for one hour. That allows you plenty other hours of the day too heal the infirm with the touch of your hand. Hell, you may be able to heal them simply by looking at them. Praise the Heavens for He walks among us. I am not bashing but it is my opinion that you are a little boy who likes to make people believe in fairy tails about trading.

Oh yeah? I made 50 bazillion million stock trades in a row without a loser. Your claim is EXTREMELY transparent.

Do you feel like you are prepared prepared??

Step 39 is when Shrek and Feona have a family and live happily ever after

First prize is a Cadillac Eldorado. Second prize is a set of steak knives. Third prize you're fired. Glenn Gary Glen Ross

MMS, Why have you had a problem? Simply start following and tracking lunar phases and start believing that it has an effect on the market. No problem MM

Thales, When I thought about it last time, I thought it might make sense if we all had a common broker and we gave them permission to audit the accounts and post the results and offer a prize. You have to figure that they would love to have a bunch of cowboys trying to achieve riches while they get paid commissions. But, if we are not going to be trading the same type of instruments, then it limits the number of brokers we can use to only a few that broker all types of instruments. MM

Sure, If MMS would be willing to do the math and make it an official TL event, then that would be great. MM

Yes, Thales. Its about the almighty dollar and not the percent winners vs losers of trades. I also indicated to Paladin that using the stop that I do, you also need to be able to pounce when it moves in your favor. In addition, you also have to be able to get in in again once you get stopped out at possibly a worse price. So, out of context, a minuscule stop like I use may not seem reasonable if you don't recognize all the other variables to using it. I assumed that since he was even asking the question that he was very new and losing as little as possible seemed like good advice from a practical perspective, since his potential for blowing an account is near 100%. As far as the contest, I can do it now, but in a few months I may be permanently taking on additional responsibilities which come with both a large capital outlay and a larger amount of debt. If I do that, then it would be a mistake to spend a day in front of a screen. So, if I begin, I may not be able to finish if I end up acquiring that business. MM

Theory versus practice. when you lose, any amount is too much. A smaller amount is better than a small amount. I lose more trades than I win so smaller is better.

Ingot, I do not know you and I can say with near certainty that there is not a thing wrong with you. So, a good way to start is to stop thinking that there is something wrong with you and seek solutions that will improve your trading. MM

Paladin, It's a fantasy to know what your expectancy is before the trade. So you should treat every trade as if it's more likely to be a loser than a winner. In which case you want to lose as little as possible on each trade. Then, it is going to depend on the type of trading and the instrument that you are going to trade. I trade CL and GC mostly and I risk about .2% per trade. So 5 bad trades in a row and I am down 1% plus the vig. I take lots of small losers and anywhere from small winners to very large winners. Small losers allow me to not think twice about taking the next trade or the next or the next. I trade mostly intra-day too, but i would design it the same way if I were to go back to short term or swing trading. So, if I were starting with a $10,000 account, a .2% stop would be 20 dollars. There isn't too much that you can trade other than stock that will work with that risk level. Something like losing a dollar on 20 shares of a $10 dollar stock. It probably sounds ridicules, but it works. If it goes up, you can start adding to it. But, each time you lose, you will be happy it was only 20 bucks. You could trade a futures contract and give it 2 ticks or so, but you are going to have to become comfortable with taking a whole lot of losers waiting for that winner and when that winner comes, then you need to be able to pounce. Small losers and small winners is not a good combination. If you can't learn to take the big winners, you'll ruin your account and your psyche. Trading is easy, but it can be really difficult if you learn to trade from someone who doesn't know what they are talking about. MM

Out of curiosity, how did tradestation make your trades go red when they should be green?

JB, I do not think it is as simple as just stops, but certainly stops are a good part of it. I Think, categorically, we can say that blow-ups are a result of positive reinforcement of doing the wrong thing over and over. So, speaking from experience, having a poor strategy of adding to a loser once, twice, three times, and having it work in your favor. Eventually, if it's a poor strategy, a trade comes along that won't come back and your equity spirals to hell. MM

I don't eat when I am trading. Coffee or diet soda, depending on the time of day, yes. Food no. I'll take a lunch break when i am not in a trade, but that is away from the desk.

Cory, He isn't attributing everything to randomness. If you recall in the example where they were trying to duplicate joe dimaggio's results in a simulation. Each players stats were weighed and then "flipped". It wasn't just that they took an equal number of players for that period of time and gave them a 50/50 assignment of heads or tails. If the player was a strong hitter, he was more likely to get heads, say, than another player.The results made perfect sense and can be applied to the real world and to trading. You could possibly do the same with strong and weak traders, though it is harder to measure if someone is a strong or weak trader. MM