How Did You Do in the Past 2 Weeks of the "financial Crisis"?

[AgeKay 10]

How did the volatility of the past 2 weeks affect your trading strategy? Did you make more money then usual? Did you lose money or did you even blow up?

[brownsfan019 17]

You first.

[daedalus 10]

I walked away. If its outlier price action then I don't have an edge. I make my living on the rule, not the exception to it.

 

I just focused on spot FX the past two weeks with reduced size and did pretty well.

 

In the futures market as far as i'm concerned there weren't trades, just gambles. And the stop placement I would have to use on my method with the increased volatility is 2-3x's bigger than normal so I said no thank you.

 

What about you guys? Did you all play in the sandbox?

[AgeKay 10]

You first.

 

I didn't trade at all during that time. Didn't even watched the screen so I heard about it in the news like the general public...

[zdo 20]

This has been the most fun and exciting trading I have had since the mid 80's

My usual 'representations' / 'indicators' have been sufficiently adaptive (with understandable but consistent overruns of course)...and I dusted off a couple latent methods and styles from the old days

Basically, I have been running wide open at pretty heavy size 5 to 6 hours a day for the almost a month now. Only losing day was Oct 3 - some days I can't actively trade my way out of a wet paper bag and that was one of them. Otherwise simply amazing, incredible. Was 'proud' the first few days - that has given way to feeling blessed and grateful... I could stand weeks and weeks more of this but am prepared for it to suddenly and / or gradually be over

Major adjustments made -

1 went to one time frame only,

2 widened stops considerably

3 worked a little on being more patient to let moves complete before acting. ie no stepping in front of trains

4 in execution increasing reliance on market orders (eg in more 'normal' conditions would be concerned to keep an ES point - in these conditions willing to give up a point to keep 9 or more etc.)

[AgeKay 10]

Very cool zdo, thanks for sharing. I would have loved to see the trading activity in real-time during that time.

[Soultrader 12]

3 worked a little on being more patient to let moves complete before acting. ie no stepping in front of trains

 

This I also found to be a very key factor during these times as well. I waited an extra step to initiate a position instead of the typical aggressiveness. Good stuff zdo.

[Sledge 13]

Been doing some quick 12-18 hour hops and have done better these past 16 days than I ever have in the past. I think it was a combo of:

 

1. Watching the freight train bars- you see a weekly bar with bears fully in control- you'd be a fool to do anything other than short

2. Spotting exhaustion and cashing out.

3. Patiently waiting for opportunity (even if it takes 12-24 hours) and THEN pulling the trigger.

 

Aaron

[waveslider 10]

Man if you are quick these are killer times to be scalping ES! My futures account is up 25% in the past month and a half.

Money I manage has been in cash quite a bit, up about 1.5% in the past month and a half. These are the times that prove what how adaptive you are.

[zdo 20]

End of a Run…

 

Tue 12/16/08 was the first day I ended up in the red ndx daytrading since early Oct. and the only other one since early Sept. Definitely not my first off day of this run… just the first time it showed up on the bottom line. Techniques, perseverance, getting down and playing some hardball with them etc (even maybe a little discipline) had pulled me through on previous occasions

 

Also, have been operating in the ndxs recently with a short only constraint… actively hedging a lucky swing trade long in DDM and SSO etf’s. When indexes are trending up intraday I go over and look to buy currencies, check other positions, and read threads etc. If you were ‘there’ on Tue though you can attest that the bias was up all day even during the congestion wait – making it tough to short…

 

Two trading mistakes account for about half the $ loss – 1 holding a loss too long and 1 ‘prediction’

 

( You strictly rational types can stop here and skip the rest…for you I didn’t follow my rules precisely with obvious consequences and there were losing trades that just happened like they just happen and that’s that. )

 

But for us traders who are blessed / cursed with more emotional intensity - what about the other half of the losses?

… some steam of consciousness reflections on that

 

>Am recovering from a cold. It had not seemed to have an effect on Monday’s trading, but sleep was far from optimal sun and mon nights… felt like napping all day and didn’t…plus it was rainy and grey

 

>distractions early in the day… people popping in or calling

 

>showed up late (not physically) by still messing around after the open with paper hedges / futures on ‘real’ money / physical metals positions

 

>implementing / integrating additional techniques (not changing existing ones btw) – which always seems to be accompanied by setbacks, resistance, obstacles for me... chalk that up to genetic neuroses from many grandmothers…

 

>while shopping the evening before had encountered a relative who mentioned ‘family’ topics I hadn’t thought about in months.. old pains… wonder if that evoked some ‘old identities’?

 

>while avoiding Christmas music for one more week found myself listening to music I listened to long ago during some very low miserable points in my life. Beautiful music with painful far away associations – hm… more ‘old identities’ stirred ?

 

>commentariat may still by ‘articleling away’ about the ‘volatility’, but intraday things have settled down significantly. things certainly aren’t in a summer sleep but compared to the all day madness we’ve enjoyed up until recently - intraday is now quite mellow…

 

No excuses – just some possibilities or possible confluences…

 

…,

 

Post Script. Time ran out. Since I didn’t have time to take it back before the close, I stayed ‘hedged’ / short. After the Fed 'rush' was over my original analysis held up... and the position was lifted through the night at a profit so the whole 24 hr period was still profitable (see attached)... and so far today back on track.

 

 

My insight from the day:

The gap between winner and loser is extremely miniscule so...

Losers take heart.

Winners be careful

[The Bear 10]

-48.14% YTD 2008

 

Over-leveraged position trading (Oil Futures & Stocks)

 

All in all, I was quite pleased with the results. After SEPT I turned things around for the better, and prevented total collapse....there was a time where I saw the total collapse coming though.

[BennyHey 10]

One of the things I did during this time was to not trade RTH. If you watched the mkt between 6:30 and the open it was similar to the less volatile mkt I was used to trading. So that was one way I traded during that time.

[Dacamic 10]

I walked away. If its outlier price action then I don't have an edge. I make my living on the rule, not the exception to it.

 

An excellent point. The right choice for many people is to take their surfboards outta the water when there are 50-foot waves (which is what I did).