Avarice

Excellent advice, thanks for sharing!

It all depends and only you can answer this question. But since you asked : Going from $1000 to $1350 equals a 35% increase in exposure. Have you considered that the marked might also gap through your stop loss forcing you to eat even more that the current 2 x $1350 potential loss? Are you prepared to take it? Financially and psychologically? My : My primary goal in trading is capital preservation. Since I want to live to trade another day even if I get stopped out of everything I do not risk more than 2% of total equity on any one trade with a total of 6% in total exposure. Those ratios are fixed and I don't make exceptions. Had this happened to me I'd be running for the hills, but I'm a conservative old git and I know nothing of your account size or risk strategy. So please take all this with a grain of salt A

Ingot I value every constructive help I can get and I appreciate your input. Don't worry about expressing criticism or pointing out possible errors, that is precisely why I am on this forum OK on to the beans trade - have a look at the first attachment. This is my screen from today, approx 15h00 GMT+1, price is currently at 56.59. The previous bar (the one with the triangle above it) is my signal bar, ie. yesterday's bar. Interpretation: (1) EMA65 > EMA21, so only shorts are allowed (2) the candle is touching an EMA line and (3) MOM8 was positive and has ticked down. So we are go for an entry. The entry price then is the low of the signal bar minus 0.1ATR10 (this is the wee green line under the signal bar). All of this was calculated yesterday evening, after the close at 20h15 GMT+1. After I got those numbers I created a stop sell short order with my broker and attached the buy to cover stop loss order and went to watch some telly. As you can see from today's bar I got filled on the way down, sometime during today's early electronic session. The second screen is oats where I just got filled too; manipulation was the same as above. I should add that both contracts are December, open interest was just that much higher than with previous months although volume for oats is still kinda crappy. I hope this shows when / how I got my fills, if not -- or, if I made some stupid mistake -- do tell me A

I have just been filled Soybean Oil @ 56.90 with a stop at 58.63. I have another short awaiting entry in Oats at 349 and I plan to go long CAD as soon as it hits 1.0429. This is a new system for me, so order entry is currently accompanied by all sorts of second guessing and doubts about the system's viability. Don't worry, no need for pep talk -- at least not yet -- I know these feelings will pass a couple of weeks in. But still it's funny how different things become once you start to put real money on the line. A

I wear my watch on the right arm. This makes using my computer mouse a tad uncomfortable, reminding me of the watch. The watch in turn reminds me of the fact that time passes by and that it is me that needs to react to what the market does and not the other way around. It tells me that I have to be in charge of my position instead of letting the market do its thing to it. It reminds me of my own accountability and that blaming bad performance on the market is a loser's game. It was Phantom of the Pits, with his slider rocker office chair and talking clock, that inspired me here. Credit where credit is due. A

Sure here goes, remember I use MOM8 instead of stochRSI. A

Neo that's indeed a beautiful setup you found yourself there! If this was my trade (which it isnt so take this with a grain of salt ) I'd see how it manages to pierce the 110.5ish support (start of July, Fukushima in mid-March) and if it clears that I'd set course for 107 with a wide enough stop (I'd allow for a rally of half of the decline). Sorry for the :spam: but this setup is just gorgeous, couldnt help myself A

Update : The system did not enter the live cattle trade, entry stop was not touched. August LIVE CATTLE (LE), long entry signalled @ 111.875, stop @ 108.675, risk $1282 (entry not triggered) The following trades were signalled for tomorrow's session: August FEEDER CATTLE (GF), long entry signalled @ 136.625, stop @ 133.2, risk $1716 (taken) August LIGHT SWEET CRUDE (CL), short entry signalled @ 97.02, stop @ 101.79, risk $4770 (not taken) You'll notice that this is the second time the system signals a long trade for GF. Yesterday's risk was too high for me (the stop was too far off). But GF has been pretty flat for the past few days and thus my volatility-based stop is getting closer to the entry point which results in a smaller risk. This time it fits my parameters so I'll put up the trade. There seems to be some resistance at the 142-144 level, once the trade reaches this zone stops should be tightened aggressively. Alain

Update : The system did not enter the soybean meal trade, entry stop was not touched. August SOYBEAN MEAL (ZM), short entry signalled @ 353.4, stop @ 365.7, risk $1280 (entry not triggered) The following trades were signalled for tomorrow's session: August FEEDER CATTLE (GF), long entry signalled @ 137.622, stop @ 133.496, risk $2063 (not taken) August LIVE CATTLE (LE), long entry signalled @ 111.875, stop @ 108.675, risk $1282 (taken) August SOYBEANS (ZS), long entry signalled @ 1386, stop @ 1340, risk $2300 (not taken) Alain

Okies I think I backtested what was to be backtested, it's time I went "sim-live" with this little strategy. I'm going to adhere to what OT outlined: trend analysis with 21- and 65-day EMAs, trade entry done at previous day's high/low +- .1ATR10. Since I only trust what I can calculate mentally I'm going to use the MOM8 oscillator to time my entries. My only addition to this strategy is going to be (1) a mechanical trailing stop based on Elder's SafeZone stops that's going to be both my stop loss and my profit taker as the trade progresses and (2) a few home-brewed money-management and risk-control rules. Trades that are compatible with my position sizing rules will be marked with a TAKEN stamp, trades that are too risky are indicated by, well, NOT TAKEN. I'll try to make 10 minutes every day to post my trade updates here. So for today we have : September CORN (ZC), short entry signalled @ 669'4, stop @ 711'2, risk $2087 (not taken) August FEEDER CATTLE (GF), long entry signalled @ 136.776, stop @ 132.97, risk $1903 (not taken) August SOYBEAN MEAL (ZM), short entry signalled @ 353.4, stop @ 365.7, risk $1280 (taken) September CRUDE OIL (CL), short entry signalled @ 98.26, stop @ 102.22, risk $3960 (not taken) Alain

I don't think you have been all that wrong about the pullback. OT waits for a pullback into a previous support/resistance zone, which prices seem to have hit at around the blue-dotted line at 1.330 on your chart (support up until the end of May, resistance since July). I don't have the exact wording in mind but I think the rule states something like "prices print between the EMAs (or slightly above/below)". Seen in this light this aspect of your entry seems perfectly valid. The price at which you propose to enter (black mini-line below the low) looks about right now. An entry stop at this level ensures that it is price action that takes us into the trade, it has to move in the right direction before we jump on board. The only leftover problem I see now is that stockRSI didn't turn down on the signal day (but I think you mentioned it was down at some point and this hardcopy was made later). Cheers, A

Hm Ingot, I'm not sure that the bar you point out to be the correct entry would indeed be the correct entry... Shouldn't that bar rather be the entry signal? Trade entry then would be made via a stop at the signal day's low (.1ATR10 below the low, really) which hasn't been taken out yet -- so you wouldn't be in this trade at all. Correct me if I'm wrong. It's early morning over here and I'm still half asleep, gonna make a cup of coffee now...

This "computeOnClose" rule is what made me think of trading hours (see my previous post). If you apply this to the daily chart of a security that's traded almost 24/24 you get your close for the day at midnight -- at which time I'll be sleeping the sleep of the just. I have circumvented this difficulty by deciding that "my" trading day will close between 7pm and 8pm, so basically I will take the oscillator's value at that time of the day and decide on a trade from there. I concur with OT in that -- if I manage to follow this rule consistently -- it should not make a difference in the effectiveness of the entry setups. This is one of my biggest problems. Not in the way that I tend to proliferate the use of filters, but I find it very hard to apply "soft" rules to my trading systems. What I mean by this is that, even after reading (and wholeheartedly agreeing with!) Wyckoff, Livermore and now Kroll on the subjects of supply and demand, I find it VERY hard to give priority to support and resistance zones that are (often very clearly) visible on the charts over my computed stops. In a sense my IT-trained mind seems to have a lot more confidence in a computerized formula that spits out hard numbers without any real "knowledge" about the past than in what I am seeing on the chart. I envy traders that learned their craft 20 or 30 years ago: data acquisition might have been a lot harder but they were forced to concentrate on what really mattered instead of being lulled into a false sense of security by ever so capable computers. I for one feel that my next big step on this journey will be to detach myself from the mere mathematics of trading in order to make room in my head for a deeper understanding of what's really happening in a security. As in, what is its price action. I have a mechanic in place that will stop me from trying to enter a market too many times if my timing is not right. In a nutshell: I have a set amount of money (currently 6% of total account equity) that I am allowed to lose over a moving window of 10 days. I sum up all my losses (exclude the winners!) over the past 10 days and if this running loss is larger than the 6% cutoff, I'm not allowed to trade the security until running losses are below 6% again. I found that these forced "sabbaticals" keep me out of markets that are unclear, and more often than not once the trade ban has been lifted the market has moved past its indecisiveness. Example, let's say 6% cutoff is $2000, window is 10 days (Wins are only mentioned to show that you do not take them into account) : Day 1: Loss 1000 Win 200 Running Loss 1000 Day 2: Loss 500 Win 100 Running Loss 1500 Day 3: Loss 0 Win 100 Running Loss 1500 Day 4: Loss 500 Win 0 Running Loss 2000 Day 5: NOT ALLOWED TO TRADE, Running Loss 2000 Day 6: NOT ALLOWED TO TRADE, Running Loss 2000 Day 7: NOT ALLOWED TO TRADE, Running Loss 2000 Day 8: NOT ALLOWED TO TRADE, Running Loss 2000 Day 9: NOT ALLOWED TO TRADE, Running Loss 2000 Day 10: NOT ALLOWED TO TRADE, Running Loss 2000 Day 11: Loss 0, Win 2000, Running Loss 1000 Day 12: Loss 200, Win 0, Running Loss 700

Guys there's something about U.S. trading hours that I find utterly confusing. Most of the contracts OT selected in the introductory posts trade (almost) 24 hrs per day. The proposed strategy is -- at least if I understood correctly -- an EOD strategy. My question is, how do you apply it to a contract that's traded 24/7? At what time of day do you look at your charts and say "Aha there's my setup, I'll put up an entry order for the next session" ? Do you guys use your own, personal timeframe? If yes, when does "your" day end? Do you sync with the pit-traded contract's RTH? Do you consider "your" day at an end when volume drops? Or do you actually wait for eCBOT's daily maintenance break and cram all your work into these 45 mins? What do you make of contracts that trade in the pit AND electronically (take ZC - Corn, for example)? Do you still trade the electronic contract even if the pit's open? I live in Europe and I I'm not overly familiar with the intricate details of U.S. futures, so please be gentle And sorry for the slight off-topicness!

If you consider markets to be random in nature (which I don't think they are so hold your horses) it can be demonstrated using Monte Carlo simulations that a trading system that takes random entries is indeed profitable if (and only if) it "lets profits run and cuts losers short". The "letting profits run and cut losers short" part is your exit strategy so we could conclude that, indeed, exits are more important than entries. BUT I don't think that a comparison between the quality of entry setups vs. exits makes a lot of sense. Both are integral parts of a trading strategy and one should not be considered without the other. If your entries suck you can have the best exits in the world yet you'll end up broke, and superbly timed entries will still tank your account if your exits are not working. What's important for consistent success is a system with a good expectancy over time coupled with decent risk management. Entries and exits are a part of both so again, I don't think it's feasible to discuss them without consideration to the other components of a trading system. If one wanted to be a wise ass one could say that the whole is greater than the sum of its parts.

A question about execution (of trades, not the trader :doh:) What type of entry order do you guys think would be best for this system? a STOP LIMIT oder - reduces slippage ; - makes us miss out on potential moves if prices gap past the LMT price ; - reduces chances of getting whipsawed by the filling of said gap (remember the old rule "most gaps get filled"). a STOP MARKET order - is a license to steal our hard-earned cash (potential for huge slippage) ; - is a guarantee that we always get in on the action when the price makes a move in the direction of the planned trade ; - potentially messes up risk/reward calculations due to a different entry price. The two order types appeal to two different types of traders: The conservative player has no problem knowing that he might miss out on a potential trade, this is the price he pays for the peace of mind knowing that his slippage will always be reasonable. He will use the limit order. The aggressive trader banks on the assumption that each entry might potentially lead to a huge profit and gladly pays the slippage which, in his eyes, is the price to pay to be part of every move. He will enter the trade with a stop order. Up until now I have always used STP LMT orders simply because I told myself that my entry price is my entry price and if the market decided to not let me enter at that level then so be it. Also I didnt like the idea of trying to enter a trade on a 3:1 RR ratio only to find myself going long or short at a 1.5:1 (or worse) ratio. What are your comments, thoughts?

If I may be so bold I'd like to summarize what we got so far (this presupposes ofc that MOM8 is indeed the new star in the bar ): IF : (1) the 21 EMA is above the 65 EMA and (2) the low of the current bar is below the 21 EMA and (3) the high of the current bar is above the 65 EMA and (4) the previous bar's MOM8 is lower than the current bar's MOM8 and (5) the current bar's MOM8 is below 0 then and only then do we place a stop limit buy order at the current bar's high and let tomorrow's action take us into a long trade. Likewise, IF: (1) the 21 EMA is below the 65 EMA and (2) the high of the current bar is above the 21 EMA and (3) the low of the current bar is below the 65 EMA and (4) the previous bar's MOM8 is higher than the current bar's MOM8 and (5) the current bar's MOM8 is above 0 then and only then do we place a stop limit sell short order at the current bar's low and let tomorrow's action take us into a short trade. Conditions (2) and (3) could use a bit of tweaking in order to take into account the notion of "slightly above / below" (see OT's post above) albeit I have to say that I like the "hard coded" version where you compare 2 numbers: one is either higher than the other or it is not. The notions of slightly, almost or near give room to human interpretation and we all know where that ends :doh: Anyhow. What the above conditions do is to ensure that a trade is always taken in the direction of the longer-term trend and they time the entry in such a way that a position is only taken after a retracement or pullback has taken place. In essence, OT is betting on the continuation of an established trend and tries to get on board at a slightly better price than the sucker that jumped on the train when the retracement started. IMHO this is a very sound strategy and it should work out fine IF we (as in the participants in his next poll :missy:) pick a decent tactic for placing the stops (and, eventually, a profit target). I know that this post is mostly a waste of bandwith since everything I've said can be found in OT's posts. Still I wanted to sum things up so that (a) I'd be sure that I understood correctly what we're all talking about here and (b) to emphasize the importance of understanding thoroughly what OT is trying to do here. The basic concept is what is important and not what type of oscillator we'll use to time our entries (and I think OT demonstrated this fact by showing how interchangeable stochRSI, Momentum and Williams %R all are.) Alright enough babbling from me, laters all.

I am following these threads with great interest, thanks for this OT! I have a few questions about the entry signal: 1) At what level do you consider the stochRSI to be in overbought / oversold territory? Above/below 80/20, some other threshold values or do you only consider them at 100/0? Albeit they do help to illustrate the principle quite well this is kinda hard to tell from the charts you posted. 2) Does the mere fact that the indicator plots at a certain threshold trigger the setup or do you wait for it to rebound? Somebody somewhere asked for a simple indicator that would be present in most mainstream charting applications; I for one use MetaStock which does not have stochRSI out of the box This is the code I use (if someone's interested): bars := Input("Periods",2,255,7); Rs := RSI(C,bars); StochRsi := (Rs-LLV(Rs,bars))/(HHV(Rs,bars)-LLV(Rs,bars)+.000001)*100; StochRsi OT you wrote that you prefer using a 10 tick bracket for your stop. Is there a specific reason you are not taking volatility into account (by using some kind of ATR multiple for example?) Last question is about the EMAs. Can you explain, in a nutshell, why you picked the number of bars you picked (21 and 65)? What did you consider? How smoothly it hugged prices? Delay? Sorry for the many questions, but this stuff gets me going so thanks again

Hello all ! First off let me say that I'm not sure whether this is the right place to post this. So if a moderator thinks that it is better off elsewhere (or maybe even integrated in the "ask any Wyckoff question" thread?) feel free to move my post around. Because... A few introductory words on what I'm trying to do here: I'm fairly new to Wyckoff, in fact I started studying his work only a month or so ago. Following his methodology I started out by analyzing market averages. I opted for the Dow Jones Euro STOXX family of sector indices since I found that they provided a pretty decent bouquet of EUR-denominated securities (I live in the Eurozone eh). But since I wasn't too happy with the different weightings of the index components I decided to create my own "proxy" indices which, while still based on the same constituent securities, are equally weighted. Furthermore I created a "global" index that incorporates all the securities that are currently on my watch list. It is this "global" index that I set out to analyze using the Wyckoff principles and which I posted below. So just so we're clear on what you are about to read (should you elect to, I know it's a hell of a long read): this analysis aims at determining what mode the overall market is in and thus point me at the type of position I am allowed to take: bullish, bearish or neutral. I would be very grateful if one of you tape-reading Wyckoff wizards could take a couple of minutes to read through my text and tell me what you think of it. Now let's be clear about one thing: I DO NOT SEARCH FOR CONFIRMATION of what I wrote, I don't want you to do my job. But I am in dire need of someone who can criticize my reasoning, rub my nose in false assumptions and point me to obvious flaws. It is how I learn best, and I suppose that I still have a lot of learning to do so please don't be gentle! :security: Much obliged, A. --- GLOBAL Index At the end of 2010 the GLOBAL index is trading at new highs: it closed at 101.48 on December 22nd after an important advance that started in late August. We will assume that we were bullish during the past couple of months. On its most recent rally the index gained 8 points but falling volume and a period of three consecutive days with no further material gains indicate that buyers are having a hard time pushing prices past 102.25. January 2011 On January 4th the bulls try to push prices through the 102.25 resistance line but they fail: prices fall back to close near the open on average volume. This shows that buying enthusiasm seems to be running out, and logically prices fall by almost a full point the next day. But the index closes in the middle of the bar, telling us that even if selling pressure seems to be rising bulls haven’t given up yet. On January 10th prices fall to 99.77 but rebound off a previously established low of 97.95 (first established on December 9th), indicating that there is support coming in around 97.90. Prices rise on the 11th, hinting that the index might be locked in a trading range between preliminary support at 97.90 and resistance at 102.25. This is confirmed on the next day when a rally of almost 3 points on important volume is stopped just short off 102.50. Surely enough bulls retest resistance during the next session but they fail: high volume indicates that there seems to be ample supply above 102 and seeing that prices fail to advance further bulls take the chance to cash in on the recent advance, thus strengthening resistance even more. We switch our stance from bullish to neutral. Up to January 19th the 102.50 zone is tested twice more, both times to no avail. Since the end of December 2010 traders have now tried to overcome this zone a total of 7 times but they never succeeded. Diminishing volume on the last two tests indicates that buying power is running out and so it seems rather implausible that the index will manage to rally through this important supply zone anytime soon. And so on the 20th the index falls 2 points to retest its January 10th lows. But the next day's advance yet again confirms that demand flows in around 97.90 and that the index has hedged itself into a trading range between important demand at around 97.90 and supply above 102.50. Traders seem to be indecisive as to which direction to take. But we suppose that we will not have to wait long before this situation is resolved: the August 25th to November 30th supporting trend line is closing in rapidly on the index and this might well be the trigger for further action. We remain neutral. February 2011 On February 2nd the index tries yet again to break through the resistance line of 102.50 but, once more, fails. The next couple of days are marked by more hesitation. On the 7th the index manages to close almost exactly on the resistance line at 102.48. Volume is still on an average level, but the index managed to produce a series of higher lows over the last 3 days which seems to indicate that either bulls are gaining in strength or that selling pressure is starting to evaporate. On the next day the index closes clearly above the resistance line on increasing volume: it seems like bulls have won the battle and that the index can now resume its advance. But instead of continuing its advance the index hits new resistance at 104.30. It tries to push through this new zone of supply for 4 days until bulls give up and the price drops to close just above the previous resistance line of 101,50. The next days are marked by more horizontal action, indicating that the supply zone reaches as high as 104.30. If the index is to continue its advance it will have to eat through all this selling before bulls have finally overcome bears. On February 21st then, prices fall back inside the previous trading range: buyers seem to have given up momentarily. But hope remains: the incoming August 25th to November 30th supporting trend line might bring the surplus demand that has been missing to allow the index to rally through the important 101.50 to 104.30 resistance zone. On the other hand, should bears manage to breach this trend line in a convincing manner and gun for the 97.90 support zone, the index would be set for a reaction to the August advance. In any case, the index is currently in a critical position and the next days are sure to provide further hints on its future course. As was to be expected, traders test the August 25th – November 30th trend line on the very next day. But a close above the trend line on decreased volume indicates that selling power is probably not high enough to overcome demand in a meaningful way. With a close way below the trend line, February 23rd paints a different picture. Should bears manage to keep prices thus depressed the next important test would be on the 97.90 support level. And surely enough, on February 24th prices flirt with this important supply line. But February 25th brings relief for the bulls, sending prices right back on up to close almost precisely on the August 25th – November 30th trend line. We are almost 3 months into this trading range now and both resistance and supply zones still manage to keep the index in check. On February 28th, traders once again try to break through the 102.50 resistance, lifting the index above the supporting trend line. But average volume fails to give comforting signals. We remain neutral for the time being but we stay on the lookout for more bullish signs to manifest themselves. March 2011 On March 1st prices stay stable but the index marks its fourth higher low and higher high on decent volume since the recent low at 97.97. The index continues to oscillate in its trading range until March 14th where a sharp drop below the 97.70 resistance line on huge volume indicates that something is amiss. This could be a selling climax washing out weak buyers. The next day might bring clarification. On March 15th, the index falls almost 4 points before recovering to close below the top third of the bar, all of this accompanied by a huge volume spike. This move is too violent to be a normal reaction to the August advance and the relative high close indicates that the worst of the selling should be over. If the index shows signs of recovery over the next couple of days we will conclude that this selloff was indeed a selling climax and that higher prices might be just around the corner. Prices continue to slide on higher than average volume. The higher high and higher low are the only signs that there are still some buyers around. On the 17th, prices erase the previous day's losses and volume, while still high, seems to be quieting down. The selling climax might be over. This is confirmed when the index inches higher on the next day, ready to tackle its previous support line (could this now become resistance?) of 97.90. (As an aside, prices were stopped short in their drop at the November 30th low of 92.75, indicating yet another zone where potential buyers are inclined to enter the market.) On the 21st of March we move back into the trading range. Average volume indicates that the selling climax is now definitively over and that prices should rally to 102.50 without further interruptions. We start to feel more bullish. Prices hesitate to leave the support line for three days, but on March 24th the rally resumes on average volume. These are still more bullish signs. On the 31st we are back to where we left off before prices slid down on March 15th (which was, of course, due to an important earthquake in Japan). Bulls are once again gunning for the resistance zone above 102.50, but due to the important selloff in the third week of March we surmise that the index should now be in a rather strong technical position and so we anticipate that bulls will succeed in driving prices higher. We change our assessment from neutral to bullish. April 2011 The index continues its rally and enters, as predicted, the 102.50 to 104.30 supply zone on April 4th. It manages to hold on in that area for more than a week but drops back out of it after 7 days. We are not overly concerned though; a reaction to the pretty strong rally from the March lows would only be natural at this point. On April 18th, the index reaches its natural target for this reaction. The rally on advancing volume over the next 2 days confirms that this recent price action was indeed only a technical reaction and that bulls are still at the helm. We are of course on the lookout for a second technical reaction but we remain bullish in our analysis of the index. The index continues its rally and touches, for the first time in almost 3 months, its old highest high of 104.30. Declining volume indicates that bulls are still indecisive whether they should try to push prices higher, but we are certain that we will not have to wait for long before we know what will happen. And on April 28th it is finally done: the index closes for the first time above the important supply zone of 102.50 to 104.30. Volume is slightly declining yet decent as we start to wait for a new technical reaction given the recent rally's steep slope. On the 29th the index tries to consolidate its position but volume drops sharply, showing that buyers are running out of steam. The aforementioned technical reaction is due any day now. Since this would only be normal, we remain bullish. May 2011 As was to be expected the index falls to the midpoint of its recent rally on May 5th, reaching its targeted price for the expected reaction; all the while staying above the March 15th to April 18th trend line. Prices rally sharply on the next day, indicating that bulls are not yet done buying and that the index is set for a further advance.

Thanks for the replies! My main concern was that an odd lot order would be treated differently (slower?) by the exchanges. I had that wierd idea of two seperate queues, one for lots and one for odd lots, with the latter being on a lesser settlement priority than the former. Since my sizing algorithm does not round to the nearest 100 I do trade a lot in odd lots and I was afraid that my stop-loss market order would be handed down (past the lots) until it was finally filled -- resulting in unnecessary slippage. Siuya's remark about computerized settlements makes absolute sense, thanks for that. And no I'm not big enough to worry about splitting an order over a day. But we'll get there. Someday. :haha: A

Well don't be shy, I won't bite

Hello all, I have a very noobish question concerning stock trades. What's the advantage in trading in lots? My entry and target orders are both STPLMTs, but my stop loss is a MKT order -- am I at a disadvantage (execution-wise) if I trade in odd lots? Or am I perfectly safe putting up trades for 1,234 shares? On a more general note: can someone point me to a documentation of what happens to my order once I press the "transmit" button? I found a small infographic on IB's website explaining their SMART routing technique, but if I'm honest it's mostly gibberish to me :missy: Much obliged, A

1999, the dotcom boom. My plan was simple: monitor penny stocks, wait for any news concerning that stock, then go full-in in the direction of the opening gap. I rode the wave, baby. I had it down... I mean what could go wrong? I was more intelligent than those schmuck dentists, better informed than the housewives -- hey I saw Stone's Wall Street. Blue horseshoe, anyone? Stops? You gotta be kidding me. Stops are for wimps. Real men didn't need stops back then. Position Sizing? Sure, I did that -- my position was either 200% in -- or out. Record keeping? I started my chimney fires with those slips. Liquidity? Wha?! Liquidity was the freight train that hit me. One of my "sure" trades turned sour only minutes after I got in, and after trying to sit it out for 10 minutes the heat got too much and I wanted out. The thing was, EVERYBODY wanted out, the market dried up. No liquidity... The wave I wanted to ride turned into a tsunami, only in the opposite direction: I remember -- as if it were yesterday -- hitting the "sell to market" button and waiting. And waiting. And waiting. The liquidity freight train was loaded with trucks loaded with trains. Drawdown that day? 90%. In 30 minutes. And why? 1. Complacency. I thought I was smarter than anybody else, that I "had it down". I learned that, in trading, you never "have it down". Trading is a job. And just as with any other job, you have to work. Or you get the boot. 2. Unrealistic trading plan. This is putting it mildly. I didn't know what the feck I was doing. Today, I only trade instruments I know, using mechanics I understand. 3. Overleverage. It's fun watching your equity grow in multitudes if the trade goes in your direction. Well, it sucks if it's the other way around. And those margin calls -- they HURT. I don't overleverage anymore. 4. No risk management. I had no protective stops, the term position sizing was foreign to me. These days, ALL my positions are based on my risk parameters and every trade is protected by a stop loss order. And all those trades I thought I *had* to take, because the opportunity would be gone the next day? Well guess what, this was over 10 years ago -- and the market is still there! Patience. It's a virtue :p

Marco, I can't help you regarding VBA, but did you check out NinjaTrader? Its programming language (for both indicators and strategies) is C# which, given your working knowledge of VBA, shouldn't be too hard to get into. Plus you won't have to worry about importing / converting your data or developing your own trade execution engine. Hope this helps, A

Morning ! I am looking for ways to widen my trading horizon and as such I'm looking for (good) newsletters to subscribe to. What do you guys read to keep up with it all? I'm currently subscribed to - Van Tharp's Thoughts (http://www.iitm.com, markets overview, psychology, LOTS of adverts) - STRATFOR's intelligence reports (http://www.stratfor.com, mostly geopolitical analysis) - John Mauldin's Investor's Insight (http://www.investorsinsight.com, markets overview, major macroeconomic topics) Anything else I should dig into?