Tradewinds

I'm not sure what you mean by the underlying issues?

The key issue seems to be many, unbroken, multiple losses in a row. This is my starting point for dealing with the issue of Risk of Ruin. So, I would backtest, forward test, whatever test how many losses my system took in a row. Let's say that 7 bad trades would ruin you. If your system had lots of occurrences of 4 or 5 bad trades in a row, I'd be a little nervous. If my system seemed to only have 2 or 3 bad trades in a row, then I'd feel safer. I know that you want to focus on the math for the RoR calculation, but won't the equity curve of your backtest basically give you all the information you really need? The equity curve will be calculated in part by how small or big the trades were, and it will show what the overall profit was. From that, you could work backwards to determine what beginning investment seemed reasonable to you. The beginning investment seems to be one of your major concerns.

I found these links: Risk Of Ruin Definition Risk of ruin - Traderpedia Ruin theory: Definition from Answers.com Gambler's ruin - Wikipedia, the free encyclopedia

I would think so. Otherwise it would be unbounded, which would mean that it could go to infinity? What would infinite volatility on the open of the next bar be like? On the open of the next bar the universe would explode and we would all be instantly vaporized? :rofl:

U.S. paying millions of dollars to help save Mosques overseas. It's not getting much attention. Maybe you could send the link to friends. Channel2ActionNews's Channel - YouTube

Part of the main theme here is the idea of engineering a social system. Another major theme is the issue of what is fair and unfair. The "Human Farming" is a system of people exploiting other people. For one group of people to exploit another group of people in an unfair and unjust way implies that there is a "built-in", evil potential inside every human being. The group of people who somehow find themselves in the situation of being able to manipulate and exploit the main population can't resist the temptation to do so. Should the people who do resist the temptation to exploit others for their own selfish gain, try to influence the world for good? Or should they just give up, and take a fatalistic attitude that this world's ultimate destiny is that evil will eventually take over and rule? Evil will ultimately implode in self-destruction. Evil can not sustain itself. It makes me think of the story of the pirates on an island who killed each other.

Yes, you are right. Intuition is extremely important, especially with the type of trading that I'm focused on, which is scalping. I don't have time to analyze 100% of the inputs, every split second, and think about what to do. I'm making split second decisions on the exits. There is no time for much more that an intuitive feel for what the price action is doing. You bring up a great point about traders duplicating themselves. Maybe that's one aspect of people trying to automate their trading, or the name "bots" (robots).

Definitely. You are right. That's why we need to take it to the next step and consciously understand what we were doing right. Otherwise we can degrade and regress, or like you said, it may have been just a streak of luck.

Would you be willing to post the code? I'd be very interested. There is a coding forum here: Coding Forum - Traders Laboratory Forums

Today I came to the realization that I'd intuitively been trading a certain way, but could not define or explain it. This state was very frustrating to me. I could trade well, and immediately afterwards have absolutely no idea why I did well, and couldn't explain it to you if my life depended on it. That state does not give me confidence. I am an intuitive person, but I also have a hard time trusting what I don't consciously understand. Especially if it comes to a situation where there is substantial risk involved, like trading. I realized that when I watch the price for exit cues, I do very well. But I didn't realize what I was doing. Basically I'm reading the price for exits, and using my indicators to determine what the trend is doing. I base entries on my indicators and use my indicators to anticipate what the trend is doing, but I base my exits on pure price action. Then I realized that my indicators sometimes lag the price ladder. So price can take off, and my indicators don't show any reason for the price taking off. That doesn't happen all the time, but it happens often enough to make a significant difference in my decision making. So there are times when I need to give price the priority, and times when I need to give my indicators, and my trend analysis the priority. Again, I've realized that when I read pure price action for the exits, my trading is significantly better. I attribute it to some intuitive feel for when price is about to hit its' major profit potential. Now I want to consciously define what I'm intuitively sensing. I've categorized some phases that seem to be part of the process of going from intuition to intentional action: Enter into a certain state of mind (The "Zone") Intuition Discovery - Subconscious Realization Definition Conscious Intentional Action Some people may have no desire to go from intuition to the conscious realization of what they are intuitively doing. (E.g. Belief that traders are just "born". Can't be trained) So the journey would end there. I want to get to a disciplined and intentional conscious action. What are your thoughts on the subject?

Here is a count down timer for Easy Language that only works on an intraday chart. I hacked up that other code, and stripped out a lot of stuff. I got rid of a couple of function calls, and changed where the countdown display is located on the chart. I put it right next to the price bar. That's where I want it. {NAME: BarCountdownTimer TYPE: Indicator Modified code originally created by Bill Conley (AKA Kahuna) https://www.tradestation.com/Discussions/Profile.aspx?Member_ID=2786} inputs: AlertPct(15); // (0->100) Change color when this percentage of the bar remains var: LastBar(False), TxtStr(""), // Text String TxtID(text_new(date,time,close, " ")), // Text Object Reference dtEndTime(0), // EndTime for Bar dtTimeLeft(0), // Time Left in Bar dtBarTime(0), // Total Time in Bar BarLeftPct(0), // Percent of Bar Remaining MinDayInv(1/1440) // One Min portion of day ; const: { Display Options } cDispRaw(2), // Option to display Time/Tick/Vol Values { Bar Types } cMinute(1) // Intraday (Minute) Chart ; var: CntrHeight(0); {== Initialization ===================================================} once begin // Check for valid chart if BarType <> 1 // Intraday (Minute) Chart then RaiseRunTimeError( "This code only works on Intraday chart"); if AlertPct > 100 or AlertPct < 0 then RaiseRunTimeError("The AlertPct input must be set between 0 and 100"); // Calc Total Time for Bar dtBarTime = MinDayInv * BarInterval; end; {== Calculations ====================================================} LastBar = D = _LastCalcDate and T = _LastCalcTime; if LastBar then begin // Only display in real-time Text_SetLocation(TxtID, D, T, (H+L)/2); // Set Text Location Text_SetStyle(TxtID, 0, 2) ; // Left & Centered If BarStatus(1) = 2 then // BarStatus determines whether the bar is at open or close: 2 = close dtEndTime = ComputerDateTime + dtBarTime; if dtEndTime <> 0 then begin dtTimeLeft = dtEndTime - ComputerDateTime; // Calc Time Left & Pct. Left BarLeftPct = (dtTimeLeft / dtBarTime) * 100; TxtStr = " " + FormatTime("m:ss", dtTimeLeft); // Format the text End Else TxtStr = "Syncing..."; text_setstring(TxtID, TxtStr); if BarLeftPct < AlertPct then text_SetColor(TxtID, Red) // Use Alert Color Else text_SetColor(TxtID, Blue); End;

It's very difficult to time the perfect entry or exit. You need a good "signal" to tell you when to fire off the trade. If anyone watches price on the trading ladder, you'll see price surge hard when it decides to move to the next level. And often times, when price crosses a major support or resistance line for a peak or bottom, the price literally only crosses the line for a split second. You have no time to react in those situations. It's difficult to know if price is going to surge hard over a support or resistance line and keep going, or just cross the line in a split second, and then reverse. Automated entries and exits would probably help with speed of the execution, as long as it's a good signal. If it's a set up that you use all the time, then I'd think an automated order would be great. Then there is the option of scaling in.

Maybe. I wouldn't doubt it. Although I'm guessing that there are plenty of traders using some kind of proprietary code to assist them in their trading.

I think it would be great if Trader's Laboratory had a section for people who were willing to be trading mentors. Each person willing to be a trading mentor would need to outline a program that they would implement, and be subject to review from the people they mentored.

My mistake. The bar is only 7.9% complete. I got dyslexic there. I appreciate knowing of the availability of the program, and it looks like something worth looking into.

I'm using the video replay for strategy development. That software that you are referring to is already developed, published and offered to the public. I'm trying to use the video replay as a tool in data to price intrabar behavior analysis. That software won't help me study the data to price behavior that I am studying.

Okay, so that bar is getting near completion, and there has been more selling than buying, and the low of the bar looks like it may have a higher low before it closes. I'm not sure what that means though.

Price can do all sorts of things intrabar. Staring at a static chart will not tell you what the price behavior was intrabar. One way to analyze intrabar behavior would be to do a tick by tick forward test with actual ask/bid price replay. But if your platform can't do that, or you can't, or don't want to program a strategy for testing, there is another way to analyze intrabar price behavior. Record your chart in a video as real time data is streaming to your computer. I use BB FlashBack Express Recorder. http://www.bbsoftware.co.uk/BBFlashBackExpress.aspx "Free to use forever!" You can pause the replay, move backwards, and replay at slower speeds.

The market reacts almost instantly to news. The average person does not have time to react immediately. If you don't have time to react immediately, then getting news the very split second it comes out, really doesn't do you any good. If you get a news service, and they give you the numbers the second they come out, you need to know what they mean, and react within a couple of seconds. It's not possible. You still need to know what the news is, but whether you get it the second it comes out, or 10 seconds after it comes out is immaterial. If you are paying huge amounts of money in order to get news the second it comes out, then you can't react fast enough, then it's all just pointless. It's important to know when the major news releases are coming out, so that you don't get caught unexpectedly in a very volatile market. Watch what the initial reaction to the news is, then look at what the news actually was. Then decide what the bias is. For example, if the price spiked way up, then went way down to a new low, and the news was good, and the price had been falling on expectation of the news, that may have been the bottom. But it can get tricky. I use Forex Factor for news releases. Forex Factory

The rich, the super rich, and the big investment companies would like to thank all the regular people for leaving their money in the market while they sell. Thank you. By having the regular people keep their money in their 401K's, it has left enough stability and liquidity in the market for them to be able to exit. Again, thank you.

Boys, Oh Boys, Oh Boys! It's makes you wonder! :rofl: I really only care about the mean reversion after an unusually big price move in a short period of time, or an extended, steady price move. Other than that I'm looking to exit at price extremes, and re-enter at a better price if I think the trend will continue. If i don't think the trend will continue, I'm looking to enter at price extremes.

You are making the ultimate sacrifice to help others. You truly have a good and caring heart. You are phenomenal. The world needs more people like you. Imagine a world full of people like you. It would be the perfect world.

God has the absolute truth. The rest of us have partial truths. Wisdom is when a person is willing to admit that they don't have the absolute truth. For someone to think that they have the whole truth, would be for them to consider themselves "godlike". Sometimes, when a really good things comes along, word spreads, and people flock to the source of the good thing.

Good analysis. You have put into words, and defined something very basic to trading. I have been struggling with which of the two methods to use, anticipation or reaction. I really like the suggestion of the combination approach. In my "Black and White" thinking, I was focusing on one or the other. When I anticipate, I tend to make better decisions, and have time to analyze what is really going on. When I'm in reaction mode, things can quickly degrade into chaos. In reaction mode, I start micro managing, stare the the price, and loose track of what is really going on. Again, I've been struggling with these two perspectives, and feeling very conflicted between the two. I've practice traded both styles, but have not consciously defined, or been aware of my behavior to the degree that you describe in the article. Now I can define and recognize what I am doing, and be aware of what "mode" I'm in. Sometimes I switch back and forth, or degrade from anticipation to reaction.

I think that being a successful trader, at least for a man, would make him have a better image of himself. A man's self worth can be tied to his ability to provide for a wife and family. And that ability to provide, can be tied to his self-worth, and the self-worth can be linked to interest in sex. This is out of my "comfort zone", and I'm pushing my limits here. I think we are venturing from PG, to R rating now. :rofl: