jonbig04

It's crazy how quickly those emotions come into play. Even when you expect them, its difficult not to succumb. IMHO, If you want to do something truly worth a great effort, you are not going to be equipped with everything you need to succeed at it. You will have to mold yourself into what it takes so be successful at any given venture. Just like an running-back building up his leg muscles. He also may have had to build up his confidence to perform under pressure or whatever. Behavior modification. Modifying yourself into what you need to become to win. Thats what its all about, I think.

In my opinion one of the keys to success (I wouldnt know) in trading or anything else is behavior modification.

A dog thread! Here are some pics of my dalmatian Austin, he's a year and a half:)

I now have what I think to be a consistent way to both identify direction of trend and assessing its ability to RET multiple times without reversing. Yesssss :thumbs up: I also think I have identified the most common characteristics of RETs before and while they occur. Next I'm going to study reversals. Hopefully this will help with a couple different things. First, If I can identify some reoccurring traits of reversals I can differentiate them from RETs, which is obviously important. But also to one day help with actually trading reversals/breakouts, and maybe even one day trading them both at the same time . But for now I'm going to study them with the main goal of avoiding them. My whole scheme is to study different aspects of PA one at a time. Eventually I can start to piece them together and develop a strategy that covers more time and more market conditions. As it is now with this particular strategy, I usually will find the setup I'm looking for 1 or 2 times per day, but sometimes It doesnt show up at all and rarer still it doesnt show up for 2 days at a time. But thats ok because I'm only trading one strategy. Like I said, whenever I can (assuming I make it out of this stage alive) trade this strategy I will be able to focus on other aspects, eventually stringing them all together to have a very good understanding of PA. I can't understand why people try to grasp it all at one time. For me, its not possible. Just trying to comprehend RETs and the common factors in them boggle my mind, I can't imagine trying to predict breakouts, springboards, etc Next I will have to determine an entry/exit strategy, which I know is going to be rough. I plan on using multiple time frames for this, along with scaling in and out, and other ways of hedging risk while maximizing profits. At least thats where I'm going to start. This is where I will determine my stop strategy, including trailing stops etc. The method is coming a log, one slow step at a time. I guess thats why its called a method, it's created methodically.

Because we all had a lengthy discussion on that exact subject not too long ago. That's why I haven't mentioned it anyway.

You are right. I didn't mean to imply they weren't useful for anyone else, or even for me in some other part of my strategy. Yesterday I was testing something very specific and I couldn't find a way for trend lines to do the job I needed done. I admit I did pretty much hate them for a while for letting me down like that. But like you said, I can't expect to master a tool in a day. I really like S&D lines, just not for this particular step. I do not yet see a use for the MA's beyond being a quicker way to identify trend. I've tried a couple different ones, but they just seem to quantify what I already know, but in a quick glimpse. I have them on my screen though for any possible patterns they might produce. Like you said, might as well test the hell out of something. I'm going to keep that in mind. Thanks.

RET= retracement. Sorry, made that one up.

So it seems like I may have stumbled upon a way to identify RET producing trends while they still have a good amount of RETs left in them. So far so good. Still more testing to do. I spent most of the day doing calculations and when I went back and looked they had no consistency in identifying RET producing trends and ultra short lived trends.

I found this post on "Re: Ideas for Struggling Traders" interesting and have nominated it accordingly for "Topic Of The Month August, 2008"

That makes sense. What about the retracements of the smaller trends, eg 1-3 hour trends? Or of course the daily trends. That what I'm attempting to do anyway..

I'm curious, what is a trend day? I mean i could look up the answer, but I'm guessing it means different things to different people. Thanks for the links browns. I will check them out. I need all the help I can get.

So despite all today's testing, everything was for nothing. Blah. I'm open to any suggestions on PA used to identify a trend and verifying the strength of it. Trend lines alone didn't work, neither did supply/deman lines or the channels created by them. . I have a few other things to try, but like I said..I'm open to any suggestions!

I only spent about 2 or so hours today on my system. I was kinda burned out. My brain was fried and I was making stupid mistakes. I gave it a rest for the remainder of the day, but will be back at it tomorrow. For some reason I can go fine with no sleep for a day, but getting 4 hours a sleep 2 days in a row messed with my head. Strange.

Edge is just a general term used to describe the fact of positive expectancy, eg. a statistical advantage. Casinos make large profits because all their games have a built in mathematical edge on their side. Over the long term they will make more money than they lose. Period. If you don't have an edge (long term mathematical advantage) the best you can hope to do is break even. In trading though you won't even get that far because the odds are stacked against you to begin with (commish, slippage, emotions). Without an advantage you will lose money slowly, or all at once. In the context of trading most people's edge is a system that they have tested an defined rigorously and have found to make them more money than they lose, giving them the advantage. This could be based on price action, canned indicators, fib numbers, phases of the moon, or their astrological sign...as long as it gives them a positive expectancy over the long term (yielding profit), its an edge.

Interested to see how it works out. I guess if we never hear from brownsfan again, we can assume it worked perfectly and he's in mexico on the beach while his comp trades for him

Wow thats interesting. Another factor that I will be checking for any consistency, Thanks.

Oh sorry, about the trend lines. I was trying to identify the trend by connecting 3 or 4 HH with a straight line, without going through any other prices. Then I would use that line to make a right triangle and I would measure the trendline (hypotenuse) and come up with the points per hour that it yeilded and with that hopefully find out which trends produced the most RETs, but it didnt really work out

Sure. i don't want to bore you guys with the details, but this actually would be a part of step 1 in my plan. Stupid I know, because I have a lot of progress on step 2. When I first did it I used a combination of HHs or LHs and it seemed to work very well in defining the prevailing trend, but when I looked back at the HH and HLs I had marked they weren't HHs or HLs per se, they were actually significant HHs or HLs. Meaning price had retraced 3 or 4 times but each consecutive HH was higher than the previous HH. If that makes sense. They were also HH's that you could connect together using a straight line without going through any other prices. What I had drawn, without knowing it, were supply and demand lines. I think. The problem was I drew what I drew in the context of the chart, when obviously in real time I don't know what the rest of the chart is going to looks like. So now I'm going back and looking at the lines I drew and I'm trying to find a connection between them that I could actually see in real time. Its just a hurdle I guess.

Trend lines are a little too slow for what I need them to do. I'm going to try a few other things. Maybe S&D lines, or some combo etc...

As usual, this makes perfect sense. I suppose there is a part of me that just wants to rationalize everything. Automation seems like it would be very hard. I know I couldn't do it. It just seems to me that if your method is clearly defined, it should at least be possible. I was more curious than anything. On a side note, I'm working with trendlines right now and I'm doing a little math and finding the points per hour that the particular trend yielded as a way of comparing them to each other. Does anybody else do this? I'm not sure if it will be a good way to compare yet, but it seems logical.

I certainly am not. It just seems like it should be possible. The frustration is mounting! I do 40 tests and then realize something wasn't well defined enough. So now I have to go back with the definition and do them all over again. Damnit. :crap:

funny. that's the one I use too!:o

For sure. I was in the shower thinking about the common factors that I am starting to get together and I had a sort of epiphany. I don't think recognizing and cataloging them is enough. Well maybe its enough, but I think I should be doing more. For example lets say I noticed that price always behaves a certain way while vol is doing this during a RET. Shouldn't I be trying to find out why? Why is price behaving this way in the context of the overall picture? Or does that matter? It seems like it should matter in that understanding the market (human behavior) is our over all goal, right? Maybe its not so important in the system of a day-trader, but honestly I hate that description of what we do (or try to do). Day trading to me should be just a stop on the way to really understanding how the market works: fear, greed and their relationship to supply and demand. Thoughts? Is the "why" important? Another question. If you develop a method that is rigorously defined and profitable, shouldn't it, almost by its definition, be able to be automated?

Thanks bro, I appreciate the kind words/ advice.

I understand. Honestly I just feel like I have to do the work/research for myself. I'm just trying to get to the point where I can do some testing tomorrow. I don't know if I'll make it though.