jackb

Diaphragmatic breathing may be a valid path for some to improve their trading, but its not an absolute requirement or the only way to go. That said, it wouldn't hurt to learn how to breathe properly. Paul Tudor Jones is a fair trader. Yet, in watching this video, we see someone who is very high strung and someone who relishes in "making them pay" after taking a big loss. Yet, he still gets the job done. I also think different trading styles tend to accommodate certain personality types. Again, don't get me wrong...there's nothing wrong about infusing your body with as much O2 as possible via proper breathing techniques.

Thanks for the leg work and posting the charts. Much appreciated.

Interesting. Can you find the last one and provide a date? Again, no pullback greater than 3pts on a range expansion day.

Was yesterday's S&P 500 intraday session one of the tightest ever on a day that happened to also be well above its ATR? In looking at the ES, I don't see a pullback greater than 3 points. I can't remember ever seeing such a day in the ES. Of course, I'm old and I can barely remember my address. Does anybody have the historical data and data mining chops to confirm where this day ranks (maybe a job for Bespoke)? With the given parameters, I'd be surprised if this day isn't in the Top 5...which in turn makes it a Bottom 5 for counter-trend traders.

Hoffman/TTM have been playing up Hoffman's "victory" in a "live" 1-hour trading contest at a recently held show/conference. While they're all giddy about the win and encouraging people to watch the video recording, it's a damning video that eliminates all doubt. Hoffman makes it clear multiple times that he "hates getting stopped out" and his "solution" is to take a trade based on a short time frame and if it goes against him he simply stops looking at that chart in favor of a longer time frame chart for a supposed "fallback" s/r zone and if it still goes against him he jumps to another time frame, etc, etc. His layout involves 5 different time frames. Of course, it's a simple matter to just create another longer periodicity chart and if you've got enough bullets you'll easily bamboozle enough people into believing he's "on to something." That approach and the one about getting a mailing list and telling half that your pick is long and half that your pick is short and then stepping through several iterations until you have "proven" to a given number of people that "I/he called it right 10 times in row", is ballsy and yet so sad.

I've seen similar responses by other unsuccessful discretionary traders that jump completely to the other end of the spectrum and cling hard to the "holy grail" of backtested results. Of course, it's not a holy grail and most don't even properly backtest anyway. Something as basic as running a system against multiple data feeds is a rarity for most systems traders. Most simply work off a single, unscrubbed set of data (i.e., the one provided by their broker which undoubtedly has more than one error) and then run out and start trading as soon as they find something looks promising.

You're right, I'm not interested in conversing with someone who is incapable of responding to simple questions and acts like a child. Run along now, it's past your bed time.

This has nothing to do with you and your (im)patience. Why is that you felt compelled to make such a comment? Again, do you know Hoffman personally?

How do you know that Hoffman knows he will have a loss? Do you subscribe to his room? Is he a friend of yours that you have had intimate conversations with on this topic?

I can only surmise that he/they: 1. Know the truth and they are actually in awe of the Kevin Trudeau's of the world. 2. Kind of know something's not quite right but they prefer to deal with it through compartmentalization, obfuscation and self-deception. Such an issue isn't worth really addressing if it runs the risk of chasing away clientele. 3. Are completely clueless and oblivious as to what's really going on. Right now, I'm inclined to believe it's a little of #2 and a greater amount of #3. But I'm also inclined to believe that he/they will become privy to this thread or other similar critiques elsewhere. So, ultimately he/they will become fully vested in #1. The nice thing about it is that I'm confident one of their customers will post here when D-day hits since it's really just a matter of When, not If. I don't begrudge them for riding it for all it's worth. Hell, even after the blow-up, people will rationalize it as being caused by something other than a fatalistic Martingale system.

Yes, even if you do rudimentary things like what you listed, its still a blow-up in the making.

Blowfish, Isn't that funny...we were writing essentially the same posts at the same time. Great minds... :o

Yep, the feedback confirms it...it's nothing but a 300 year old Martingale strategy. I'd lay dimes to donuts that Hoffman isn't even aware he's deploying a martingale. That being the case, then he's certainly ain't going to like hearing the following cold, hard reality: Using a martingale betting strategy is a good example of a Taleb distribution - the gambler usually wins a small net reward, thus appearing to have a sound strategy. However, the gambler's expected value does indeed remain zero because the small probability that he will suffer a catastrophic loss exactly balances with his expected gain. Players (traders) using the Martingale system do not have any long-term mathematical advantage over any other betting system or even randomly placed bets. He's simply benefited from the characteristics of trending markets that have been in play over the purported period in which he "hasn't had a losing day." I'm afraid he's deluded himself that he really is a professional trader with a definite edge. There's no question he'll end up with a losing day...a day in which he fires 6, 7 even 8 or more times and yet a bailout never materializes. It's going to be spectacular. And I don't mean that in cruel, Schadenfreude kind of way. This story has been played to the same tune thousands and thousands of times. And it will again, longer after Hoffman's interlude. "While history does not repeat itself, it does rhyme." -- Twain

Had started trading DAX futures intraday and was doing okay after a couple months of trading. After getting long 4 contracts one day, quotes suddenly stopped updating. But I'm still getting data on all other contracts. So I'm thinking it's a data feed issue specific to that symbol. Better quickly hedge that off with some SP eminis...crap, now I can't get an order to route. What the hell is going on? This is through IB and I hate dealing with them on the phone. I place the call and promptly get schooled on the intricacies of DAX futures on expiration day. It was my first roll with the DAX and unlike US futures, there isn't an early handoff the week before as the front month contract remains the most liquid contract all the way to the last day. But, wait, there's one other...um....noteworthy difference with DAX futures...they settle MID-day. Mid-mfing-day! Are you kidding me! What kind of BS is that? I knew it was expiration day, I just assumed that by "day" it implied "all day", you know, as in "end of day." Nope. End of the morning session...4am my time (PDT). So, I'm told I have just taken 4 contracts into cash settlement and because of that, the increased margin requirements maxed out my buying power and it wouldn't be until the following Monday before my account would be available to trade again. So no laying off that open position. Completely naked and no one able to tell me when a settlement price would be posted. Sweated bullets for good while before the price finally posted and I ended up being paid about $2600 for my ignorance. Total absurdity. Rest assured, I have plenty of horror stories that more than offset that "ill-gotten" gain.

Cory, I forgot to mention the other big take away from Mlodinow. As you saw on the video, the story of Bill "Money Mag's Greatest Investor of the '90s" Miller, is a must-know for any trader. Beating the SP500 in 15 consecutive years was a statistical given. But that doesn't make for a good story and most would rather be told (believe) it was due to utter brilliance. Of course, there were plenty of spec traders in the 90's beating the SP year after year buoyed more by a trending upmarket than anything else. Now that Miller is a perennial under-performer...well, maybe if we don't talk about it, maybe it won't need to be incorporated into one's trading outlook. To his credit, Miller comments on his streak that "maybe it's not 100% luck—maybe 95% luck." I remember reading about an analysis that addressed this exact topic (outperforming the SP), and it concluded that a money manager needs to have something like 20-25 years of consecutive out-performance before a definitive statement could be made that it was something other than luck. The relevant point is that few have achieved that and the likelihood that they are posting on this forum are minuscule. Now, there may be some members here that have out-performed the last 10-12 years in a row and it may seem sad to them that they still need another 10-12 years before they can attribute it all to their hard work, discipline, patience, sophisticated position sizing scheme and exquisite trend-following (or S-R or volatility expansion) prowess. It's a cold, hard fact. And for some, it's just too much to deal with. For them, their conditioning to random rewards will ultimately catch up to them...that is, unless they're....you've got it....lucky. P.S. There's another PI presentation that you might enjoy (and relevant to trading)...Jeff Rosenthal's Curious World of Probabilities. P.P.S. I found the source for the 20-25 year time frame I mentioned above. It's from Larry Harris' book Trading & Exchanges, Chapter 22.

MM, I'm pretty sure I know the context in which your comments have been couched. For those detractors of yours, I think they don't take kindly to being disabused of the fact that one's intellect and hard work aren't quite as important/relevant as they may want to believe. A little humility on their part might be nice. A good way for that to happen is to let someone else make the case. Someone who does a great job with this is Cal Tech's Leonard Mlodinow, in his book The Drunkard's Walk. Don't want to buy the book, here's a link to an excellent online presentation he made at the Perimeter Institute: View Past Public Lectures - Perimeter Institute for Theoretical Physics The best take away from his book/lecture is "The rat wins." Once you understand that in the context of trading, it's easy to be humble about bringing one's intellect to bear on the market. Gladwell's Outliers, as another poster mentioned, is also apropos.

Some aspects of trading can be analogized to "games of chance." And many newbies all wide-eyed from ads they see about 1000% gains definitely are approaching it that way and, in turn, give trading a bad name. Other aspects of trading are better analogized to "games of skill." Poker is the classic example and a very good one at that. Particularly since disinformation takes place in the markets same as it does on the felt. Finally, you're free to engage with trading as nothing more than a game, possibly a hobby and even a business. When done as a business, there are other analogies that can be made. Probably one of the most important of which, is that it typically is very much like running a small independent retail store in a large shopping mall. If you're familiar with the term "Black Friday" then you'll know where I'm heading. You need to plan/expect to run in the red for a large portion of the year (you'll need to have a sufficient working capital base to survive). You'll then be taking a gamble that a certain time of year (i.e., group of trades) will put you over the top and yield a sufficient return on your capital and time. Equally important is that the "off season" has to be well-managed (i.e., losses kept small). Of course, most small businesses fail. Many that don't fail are just breaking even. And a good portion that are making money barely yield to the owner an imputed hourly wage greater than a few bucks an hour. Very few small business actually create substantial wealth for the owners.

As some may already know, John Carter’s TradeTheMarkets recently brought under their umbrella Robert Hoffman’s PowerCharting, a live daytrading room. They just concluded a 3-day free trial that ran M-W this week. The room maxes out at 1000 and it apparently was full every day during the trial. I couldn’t get logged in on Mon or Tues, but finally did on Wed. For some reason, I’ve gotten the sense over the years of keeping tabs on Carter, that he was a straight shooter. I’m now inclined to consider otherwise. Needless to say, Hoffman was less than impressive on Wed, failing to make even one trade and not offering any unique insights or approaches. The big selling point of TTM for this room was that Hoffman hasn’t had a losing trade in over a year and that they had reviewed his trades and could attest to the claim. Unfortunately, Hoffman doesn’t disclose anywhere on his site a history of his trades, so one is left wondering what exactly the details are behind the claim. That was the reason I wanted to attend; to ask some specific questions. Would it surprise you that those questions went answered? More precisely, since I asked them numerous times, they were ignored. While logged in, I was scouring the web seeing what others had to say about Hoffman. Threads at ET and Investimonials provided meaningful insights into his style and approach. At the same time, I ran across a positive review…and you’ve gotta love this. A few minutes after stumbling upon it, Hoffman starts regurgitating it word for word as if someone in the trading room had just made the comment via chat. I find that possibility to be highly unlikely. I suspect it was simply a premeditated gimmick Hoffman added to his sales pitch. As far as the neutral/negative comments, it appears this guy loves to average in and that he takes small wins and big losses. So, he’s a gambler headed for his comeuppance. The sad part is that this is the exact style Carter rails against. The irony is palpable. Not only that, the only time he came close to putting on a trade on Wed was when the crude report got released. Within 15 seconds he has getting all serious about thinking the price action was warranting a trade. He later confirmed that he will trade news events immediately after release. Mmmmm, that’s good gamblin’. Sadly again, Carter comes to his defense and says it’s no big deal. What I’m hoping is that some subscribers to his room will start posting his trades, complete with detailed information. At a minimum, keep us posted on his “no losing trade” streak. It will come to an end and I don’t think it will be pretty. Of course, at $300/mo with 500-1000 subscribers (apparently he had around 300 prior to joining with TTM), I think Hoffman will be just fine.

Is your laptop equipped with wireless? Do you have a wireless router on your desktop? Chances are that someone in your neighborhood has an unsecured broadband wireless router connection that you'll see upon doing a scan with a wireless device. This approach has the added benefit of being fairly inexpensive...i.e., free.

Thank you everyone for your replies and thanks for the link MightMouse. MMS, your comments about getting laughed at by others when talking about single digit monthly returns is timely as I recently read through the "The Truth of Trading" thread. I saw that exact thing, where certain members were infuriated that low rates of return were being discussed as realistic. I suspect it's a bit of cognitive dissonance.

Has anybody ever ran across any definitive studies about speculative trader fail rates (i.e., the net of the trader's career resulting in lost money)? All I've ran across are antecdotal reports. It won't surprise me that the oft mentioned figures of 90-99% are fairly accurate, but I'd love something more concrete to reference. Whatever that number is, what's interesting is how little attention is given to the non-fail (remainder) stat. I get the sense that most newbie traders fixate on that remainder percent figure as the rarefied stratum (a supposed "success" level) they must shoot for. But that's not quite right, is it? That remainder stat is just the beginning of non-fails and, as such, it has its own spectrum of non-failing: beginning with breakeven and topping out at some CAGR that some spec trader has been able to achieve over a significantly long period (minimum of at least 20 years). So take whatever the definitive fail rate is, add to it the percentage points comprised by all the breakeven traders as well as all the other traders that are achieving returns that would not support "making a living" for you given your capital base and lifestyle and isn't that the stat one needs to focus on? If you arbitrarily group those non-fail traders into something like: Breakeven - 5%; Over 5% up to 10%; Over 10% up to 15%; etc., I suspect a disproportionate weighting will be found in the groups below 10% and that a insignificant number will be found in the groups above 20% CAGR. Exactly how small does that stat fall to given that one needs/wants/desires at least 20%?

HSI futures are very thinly traded and as such, when volatility picks up, you'll see wicked moves that drop/pop 50 to 100 ticks (points) in less than 10 seconds...a real gamblers paradise. IMO, it's got to be toward the bottom of any futures list of recommended beginner's markets. If you insist on trading it, at least consider trading the mini.

Patuca, It shows that you have been a TL member since 2007. Have you been trading live since that time (or maybe before or just recently)? You said you just started scalping the ES. Is that live or sim? Have you ever scalped other markets? Happy new year.