steve46

Yes thanks "Ezekiel"....is that really your name? if so, your family (obviously Asian converted to christianity long years ago and having to deal with the communists policy toward western religion, decided to move you to the west....) is that the short version...I think so.. As to the question of how to be consistently profitable in Forex...the first step is to NOT TRADE FOREX..... Everybody with me so far....excellent...then you pick an excchange traded currency and learn that market....choose one of several simple systems (volatility, moving average, oscillators, price action, etc) and learn it top to bottom.... Step 2....backtest systems unitl you find one that fits your temperment, account size...and provides the kind of (realistic) performance you require. Step 3....Find a decent broker and put your account together with the appropriate amount of capital. Find decent order execution software and learn to use it (NinjaTrader is one example). Step 4....learn to recognize (and execute) your system's signals with discipline Step 5....learn to manage risk Step 6....start trading Step 7....keep good records Step 8 ....review your results every week, month, quarter and year and make the appropriate adjustments so that your system remains profitable Step 9....send me a check for putting you on the right road so long ago.. Step 10...live happily ever after....like in the movies. You're welcome Edit....of course this is oversimplfied and somewhat tongue-in-cheek....it would actually work....if one were into "work", "dedication to reaching a goal", and other very important character issues....for those into successful scenarios....have at it.....one thing is certain...you have much better odds of succeeding using that scenario than you would have trading forex.

The title of the thread is interesting. The relationship between concious and unconcious is (I think) fairly straightforward. We either have natural talent and ability or we don't....if we do.....then we follow our internal instinctive mandates and we learn to the limit of our natural resources....at that point, if we feel it is necessary we can obtain further training If we do not have natural talent or ability, it becomes a challenge to learn what does not "come to us naturally"....people who do this are called "overacheivers" however I see it differently...from my point of view this group has another important resource to call upon.....I call it "character"....generally if they want something...to obtain a skill, to reach any goal in the outside world, these folks actually look forward to overcoming obstacles, whether natural or put there by others. They exhibit "driven" behavior or what some might call "compulsive" behavior. They are persistent, organized, and willing to do "whatever it takes"....they are willing to put themselves "on the line"...to risk their self image in order to get to their goals...I know this type of person well, (I am one of them) and I do not stop, I do not give up, I give it everything I have until I get to my goal.. period. As to competence...it is concious competence that "comes" first to those who are not "naturally" talented, and that may even extend to those who are....it seems to me that we first have to make concious our skills, then through practice, we internalize our skill set, in much the same way that a young person learns to drive a car....for those who can remember back to that event...at first you cannot hold a conversation with someone while you drive....if you try to....when you come to an intersection, the conversation stops, because you have to conciously monitor all the data....is the light changing...are their pedestrians, or other cars in the road ahead of you....as time passes and you have more "repetitions", the skills you have learned conciously become "internalized" and are for the most part unconcious...once you get to that point, you can carry on a conversation, listent to the radio and sometimes you get to where you are going and don't even have a concious recollection of how you got there....now that you have "internalized" those skills, when you drive you are for the most part "on automatic pilot". The bottom line is that we are biologically based "machines", controlled by sophisticated software.....once you understand how it works, you have choices available to you....you can simply use your "god given" skills, and be content with that, or you can obtain new skills, as long as you are willing to pay the price.....(within certain limits) its up to each individual... Good luck folks Steve

This last screen shot shows how I use what I call "insets" to help me determine when to take profits The darker blue bands show areas of significant previous imbalance. At these points price often either reverses or simply retraces....depending on other factors, the trader can at his/her discretion, decide to take profits on the initial test or even scale in additional size if they think the trade has more room to run. The attached chart shows my last hour trade entry and the termination at a test of 1400..... As with all trades I took most of my profit lower down and simply held a small piece to the last target.... Good luck Steve

Had a guest with me today, watching my process He is a person with a good general background who is having problems pulling the trigger I showed him my last hour trade which often triggers right around 12:00 local time... in this instance the initial signal occurred right at noon and the algorithmic pattern developed so that the entry was at 12:06. Watching this, my friend asked the obvious qeustion, how can he develop the confidence to pull the trigger when (in his estimation) there is reason to believe that price could move in either direction? The first part of the answer is simple....if you have doubts, you probably havent done your homework properly....the testing we do prior to trading should provide the platform for you to understand what your risks are and what your probability of success is on both the long and shorter time frames. Second, once you know what your odds are, you should also know that not taking the trade constitutes an "oppportunity cost"...meaning that you lose that opportunity to make a specific amount of money...(according to your plan)...if your plan is correct and profitable, you can quantify that and THAT ALONE should provide the motivation to take trades. Finally, those of us who do this on a regular basis have a track record that we can look back on and it should provide some psychological comfort as to what we can expect per day/per week. Any way as can be seen on the chart this last hour trade worked out fine, the only problem for my guest was that they had insufficient size on (because they are still learning) and so the profit was small... On the technical side the trade started at 12:00 with the initial signal....a move down to test a demand node at 1392....we had a number there to provide confluence....the tick tested a previous made ledge low and the DAX showed that screen traders were already moving the market up....this one was pretty much textbook....interesting how differently the situation can be interpreted one person to the next... hope everyone had a good day. Steve

I want to comment on OTA in particular although I do not know the individuals, what I have been led to understand is that the concept is essentially a franchise....that is to say that each location is owned by a franchisee, a person who pays a fee and in return gets to operate an office in a geographic location, and the parent company then advertises and (if I am correct) furnishes staff (trainers, educators, call them what you will) who conduct the core courses. I am not saying that this is good or bad...no judgement involved. I am not sure that my description is entirely correct however, I do think that this concept is no better or worse than any of the others that I have seen in the past (Pristine, and others).... If I am correct, there is no "screening process"....meaning that if you have the money to pay for the courses, they are going to take your money and if you fail....so be it.. This is very different from the way that formal institutions work.....in THAT setting, a candidate is screened and has to qualify to be a student.....by virtue of past performance or by passing a screening exam and sometimes a face to face interview as well....While people may not like that process, it does provide some quality control and weeds out those who are obviously unqualified or who may need to obtain more background education before going into the profession... If memory serves in the Bay Area (San Francisco CA area) a gentleman named Hank Pruden at the Ageno School of Business (Golden Gate University) also offers courses in trading....I am afraid I don't know much more about it, but it may be worth investigating... As before I would suggest prospective students spend time doing a thorough due diligence process before getting involved... Good luck Steve

Actually I have never thought about it that way....my next two levels are at 14.50 and 20 even I have to admit it would be a surprise if we got above the 3rd standard devation at 14.50, but if it does, well thats why they coined the term "outliers" for that kind of move....one has to remember that this (financial markets) data is not normally distributed over the longer time frame.

Right, I understand....so I won't bore you with the calcs...it is after all basic first year statistics

To each his own of course Tom.....I see it a bit differently....from my perspective a technical tool is either reliable or not....its either "yes" or "no".....the result for my system is that I use very few "technical" tools....but the ones I do use I weight evenly....it makes the decision making process a bit easier...if the majority of my data points in one direction that is the direction I trade in...so far this approach has worked very well.... As for leaning on a concept, the one I seem to rely one is to trade extremes of the distribution... After that I rely on experience to know when to "break the rules"...I put it this way because at this late date, I think I have earned the right to change my mind on the fly based on my intuition and experience....so far this has added value, and hasn't hurt me....probably because I have tended to trade aggressively, and in this business (if you have an edge) an agressive approach works....

Thanks for the kind words, and best of luck to you in the markets and now back to my secret agenda "recruiting" unwitting amateurs (see post 12).......hahahaa

So on this trade it looks as though I am about to learn that I am wrong The premise is that if we see a close above 1405.50 generally the short side is wrong What I have done is to throw a Bollinger Band on the attached chart, so you can see how strong the move is....price shows very little overlap on the up bars, and during this move up, price stays away from the 20 period moving average....pretty good indication that as folks come back in from lunch the agenda might be to continue the move north to test the previous high at 1408 This trade is pretty characteristic of my method...when I am wrong I try to bank a couple of points off the primary scale out....then I can let the balance run until one of two outcomes takes place....either I continue to see favorable progress, or I see "adverse excursion" and price takes out my entry point....(I am willing to pay a tick + commission on the stop out)....

As mentioned in the post, from the previous close ("taking friday's close as my point of origin")

Have about a half hour before I have to get back to the markets the main concept that I wanted to touch on was the idea of using standard deviation as a tool for identifying prices where the trader might find favorable entry Today I saw that the markets were going to be operating at the boundaries of my time based pivots.....so I look to my volatility bands (my way of expressing standard deviation) in order to obtain some anchor for a reversal. Today for example my upside bands were (taking friday's close as my point of origin) !st standard deviation at 1400.50 2nd standard deviation at 1407 3rd standard deviation at 1414.50 Notice that price moved up to test the 2nd standard deviation, then failed (up to this point in time).... Also in the attached chart I show what I call an algorithmic reversal pattern (on the 3 minute time frame) The red arrows show multiple points of entry for this trade. Edit Important to note how risk management plays into this...for the reversal itself I look for price to display characteristics of failure....one of which is the wick at the top near 1407, followed by retracement into the supply node...all the while I am monitoring market breadth, the NYSE Tick and time & sales....time of day also plays into this as happening in the time period from 7:18am PST into 8:30 which is near to NY lunch hour....for this trade to work the ideal entry is as close to lunch as possible...If I am wrong, price would reverse on me at 1403.75 (approx) and so that is the primary scale out point....

Hello WRB has presented a good summary of the current situation... There are a couple of options, however the idea that everything a trader needs is available on the Internet (taken from the next post) is inccorrect (in my opinion)... The issue of due diligence is critical to the trader's success...the problem in my view is the candidate's lack of experience and education.....simply put, most people who are trying to located qualified education are unable to recognize the difference between the "good" and "not so good" options.... I think the old fashioned method of auditing a class (if one is interested in formal education) or in the case of private schools or offerings (sitting in for a limited period of time at no charge, also called a "free trial") is probaby your best bet... and of course I am assuming that one is actually interested in obtaining an education as opposed to simply sitting in a chat room and taking signals to buy and sell. With regard to obtaining a high quality education....know that you cannot obtain that in a short period of time (like a weekend class for example)....therefore if an institution or private school offers such a "class", it may not fit your goals. If instead you want to obtain entry to a chat room where the moderator simply tells you where he/she is buying and selling, then in my opinion, your odds of success are very low....in fact it is basically a "coin flip" .....I have not seen even one such chat room that offers a long term record of actual trades and profitabiilty.... At this point I think the best way for the prospective student to get where they are going is to try to obain some education on a piecemeal basis by looking to publicly offered resources sponsored by each of the exchanges...and as you gain knowledge and experience, continuing to evaluate both formal (institutiional) resources and privately offered education from individuals.... Good luck Steve

Tom I think you may be making this a bit more complex than it needs to be Markets exist in a framework of events....those events impact markets and the result is "cyclical behavior"... To the extent that you are able to anticipate the result of this cyclical behavior you should maintain a presence in the market continously.....most folks do not have the skills to anticipate the swings and so they look to smooth out the cyclical behavior by investing long term... Some think that trading swings (medium to long term) gives them the ability to realize a profit so they use that approach and some few of us, believe we can anticipate that cyclical behavior on a short term basis.. No matter which framework you choose, the operable concept remains that you can't profit unless you are in the market......for me, I am very good at seeing opportunity and getting on board (entering favorably) however I cannot predict how long a trending move will last.. My solution is to leave a small piece of my position in the market for as long as I believe a trend is in place...Now the next question is "how do you determine whether a trend is being sustained"? There are several easy methods for determining whether a trend is likely to continue. One, is to use a moving average....for the ES contract I like to use a 20 period EMA...as price moves you simply monitor the distance from price to the moving average....if price stays away from the moving average...it means that the trend is sustained....if price tests or crosses, this signals a possible end to a trending move....Bollinger Bands also work very well for this purpose. Two, price oscillates from balance to imbalance....balance is seen as horizontal development (sideways movement) while imbalance is seen as sustained directional movement with very little overlap of bars (vertica movement).... Three....The S&P market displays seasonal fluctuations in volatility....these fluctuations are what professionals call "length of line"...meaning that once a trend starts...there is a good chance that it will continue for a specific number of points...3, 5, 7, 10...some of this is expressed using the charting tool "average true range". As an exampe, yesterday, I got long at 1382....I took profit at 3 points and then left the rest to run, "knowing" that the odds favor a sustained trending move throughout the morning...after lunch, I noticed that programs were still marking this market up.....at my discretion I simply left that balance in place until the close....for this market, at this time of year, my goal is 10 points.....if I get more great...if I was wrong...well thats always part of the game isn't it...? One thing that is clear....in order to have a longer potential length of line, you want to establish a position early and stay with it...

Negotiator All well and good....most of your comments are valid...one problem though....every so often there is going to be a person who simply put...IS VERY GOOD at this profession... I think you need to hope that there is at least one person of that calibre in the crowd, willing to put up with all the nasty misguided comments that come from folks who have been scammed, not to mention those who for any number of reasons, simply don't have the aptitude or education to make it in this business. Otherwise, what you end up with is a group of amateurs asking each other how to do this...the blind leading the blind... This should be obvious, but if not, let me make it explicit....a person who does this well, and has the ability to make money consistently....doesn't really need you (or this site)....ask youself why they might stick around and put up with all the negativity.....? I would suggest that the counterpoint can be expressed as follows;.... "protect yourself" but understand that there are decent folks out there trying to help as best they can.... Good luck in the markets Steve

Actually there are some who use only statistics to trade, and they do so fairly successfully. To each his own I imagine....I consider this data (calculating volatility bands) whenever price moves beyond my local time based pivot range (beyond the range of the previous day & week). In this market moves of 2 standard deviations are often areas where reversals take place. At the very least I can count on a reaction there that is worth a few points. In a market populated by other professionals with similar training I am probably going to take it if it shows up...and looks good on the tape. The other consideration is how it is calculated. Most folks are math challenged and don't make the calc correctly.... I agree with your assessment, I also think of it as just one input.... Good luck today Steve

Don't have a great deal of time here, but looking at the posts, I wanted to suggest a couple of things... As I have mentioned a couple of times, this is a news driven market....and we had quite a bit of negative news over the last several days...if you looked at a 15 minute chart, one thing that becomes evident is the way that Asia and Europe have reacted during the Globex session...from my point of view it seems obvious that we could expect some follow through during the US session...frankly I always bet on continuation of the most recent primary trend With regard to today's last hour, there are several good reasons to anticipate buying, but for the technical traders, one easy way to understand is to use basic statistics....long story short you simply construct volatility bands based on the previous close....For today, the 2nd standard deviation from that close occurred at (you guessed it) 1382.50...for those who understand basic stats the 2nd standard deviation should include the majority of price action intraday...in other words 1382.50 is the place where you might expect a reversal.

Today's open This is the second test of 1400...and I expect it to have better odds of success....that is why I was waiting for the open today My entry was confirmed by what I call (and have posted several times) an algorithmic reversal pattern...this is a low risk entry...you know you are wrong if it comes back to take out the entry by a tick or two....so the risk/reward is pretty good....at this point (about 6pm PST) we have aready tested 1402 By the way there was a second low risk entry at 1397.75....same basic configuration...and of course it was successfull as well....this is often the case when you have a trend move right off the Globex open...

had a lovely $450 conversation this morning with Esignal's tech support staff, who informed me that although I had the correct symbol entered, for reasons unknown to them, the continouous contract (for the DAX) did not roll over.....and would I please (for "now") use the current front month... This happens from time to time with Esignal, and I am wondering if any of you use the DAX feed with IRT? If so what is your experience.... Although I can get by without that data (I use it to confirm my ES entries), it sure makes my job easy when it is available. Thanks Steve As a post script to my comment here is a chart showing the DAX providing a leading indication of a failure short at 99.50.....used to use IRT but my experience was not good....that was a while back....I would prefer not to change but I will consider it if this situation continues. Thanks for the comment Josh

Yes Tom, entry at 93.50 (probably fill at 93.75) and my stop is a close below 93.....realistically I am reading the tape and I can see if it is going in that direction....it is unusual for me to take more than a point loss on a trade. naturally I am disappointed that I missed this one....I would have taken profit at the next node even though it wasn't exactly three points, and I would have left a small piece in there just in case...I have heard traders call this a "risk free" trade....there's really no such thing, but I understand the reasoning....

Again this may help some The attached chart shows two views.....a 3 min chart on the left and on the right a 1 minute chart On the three minute time frame price tests into a demand node....then you scan left and in the elipse I show an area of previous balance inside that demand area.....just to the right of that area of balance, you see the start of a trend up as buyers come into the market. The confluence of price testing an area where previously buyers were willing to act with a demand node, suggests that participants might come in again to try to move the market up and in this case, that is what happens On the right side you see the reversal pattern on a 1 minute time frame...

I closed my early long entry (from 88) at 95.....and I always "look for" continuation of the primary trend... and for the person who came in looking for advice on his system....my strategy is to adapt to seasonal variation in volatility by managing size and scaling out....this is pretty much the way it is for the S&P market....I look for a baseline of 2 or 3 point wins to keep me in the game...I leave a small piece in there in case a trade runs in my favor....just this one strategy has the effect of (approximately) doubling my R/R on a given trade so in my opinion its worth it...and when volatility comes back into the system, those 2 or 3 point wins turn into 5,7 or 10 points.

I had a reversal signal at 1393.25 but simply missed the entry Here is the chart The green arrow shows price testing the midpoint of a demand node.....I did not have a number there but I did identify an area of previous imbalance.... it was a valid signal for my system....I didn't have my head in the game and missed it....

I always use 24 hour charts I find that my system provides sufficient signals to keep me busy so except for (previous) value extremes I don't use MP or VP displays...I stick to the confluence signals provided by supply/demand nodes, areas of balance/imbalance and time based pivots.....and I read the tape....I try to keep it as simple as possible..

I think quite a few folks got on board in the area around 87-88 so they are motivated to take profits here (looking for 10 pts) In a strong market, this is what a failure looks like on the sub-minute time frame...and the DAX provides confirmation as the Germans close shop for the day...cash closed a while ago The move down occurred off of a high (800+) tick as it usually does. Usually on a strong day the automated execution will take over and move us up to test the big number (1400)....I have no way of knowing if that will happen here or not...will simply react to it like everyone else. If we do test the number I would expect a failure on the first try.