Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.

gifropan

Does Traditional Trading Advice Work?

Recommended Posts

Sorry. Stopped Out at Break Even. :)

 

Ahh, thanks. Learnt something new there:) Actually the two charts where pretty interesting too from the point of view of how someone might manage the meanderings of price between 'R' and 'S'.

Share this post


Link to post
Share on other sites
Just posting a chart of my trading today to illustrate the point i made earlier in the thread.

 

It was a really slow and boring today, there was a complete lack of volatility in the market and after the worse then expected figures we just trended down all day. I had four trades, all going with the trend using a trading style that i like to use when volatility and momentum is low. I went with the trend,adjusted my came plan to how the market was trading, and i walked away with 8 points on ES, and not one of my trades was a buy.

 

Do you need a better example of the trend is your friend?

 

 

How does support/resistance match up with trends. Because as the price approaches a support, for example, it is in a short term downtrend. So buying at support you are not actually going with the immediate trend or are we buying in the slightly higher time frame which would make it in the direction of the trend.

Share this post


Link to post
Share on other sites

You say you only use a 5 tick stop. What profit target do you use if you stop is only 5 ticks and how long do your trades last? I always find that close stops get taken out all the time.

Share this post


Link to post
Share on other sites
You say you only use a 5 tick stop. What profit target do you use if you stop is only 5 ticks and how long do your trades last? I always find that close stops get taken out all the time.

 

 

I hate these types of questions lol :)

 

5 ticks is just fine for my trading, but it all depends on market conditions, if there's massive momentum and volatility in the market then at times i will go up to a 2pt stop, but only rarely. If you're right you're right, if you're wrong then you're wrong, no need to use a massive stop. Plus if a trade changes after i'm in it i'll just scratch it or take a 1tick loss on it.

 

As for exit targets, once again, all depends on how the market is trading. For example yesterday was pretty damn slow, complete lack of volatility etc, so i was just taking 2pts on my trades. Near the end of the day we broke the tight range of the session and momentum kicked in and i took 6pts on that trade. It's all about feel, being able think quickly on your feet and being fickle. There's no A+B=C in trading, you just have to put the time in to develop your feel and find what suits you, because no two traders are the same.

 

I know it's not the answer people want, but it is what it is.

Share this post


Link to post
Share on other sites
It's all about feel, being able think quickly on your feet and being fickle. There's no A+B=C in trading, you just have to put the time in to develop your feel and find what suits you, because no two traders are the same.

 

I know it's not the answer people want, but it is what it is.

 

It's also about having a trading plan and a well-thought-out strategy, which is a far more rare combination than it should be.

 

Learning to trade via message board posts will only take one so far, like from here to here. If one wants to get from here to ........................................ here, that takes a bit more work.

Share this post


Link to post
Share on other sites
It's also about having a trading plan and a well-thought-out strategy, which is a far more rare combination than it should be.

 

Learning to trade via message board posts will only take one so far, like from here to here. If one wants to get from here to ........................................ here, that takes a bit more work.

 

What he said :)

 

You wouldn't think you would become a top barrister by just reading a few books and an internet forum would you...

 

I do find it shocking the amount of people who think trading is going to be easy to learn and is a quick path to riches.

 

It's a job, a professional job and it takes time to get anywhere with it.

Share this post


Link to post
Share on other sites
What he said :)

 

You wouldn't think you would become a top barrister by just reading a few books and an internet forum would you...

 

I do find it shocking the amount of people who think trading is going to be easy to learn and is a quick path to riches.

 

It's a job, a professional job and it takes time to get anywhere with it.

 

This is an excerpt from something I posted yesterday. It's made the rounds, and old-timers will already have read it.

 

38 Steps To Becoming A Successful Trader

 

  1. We accumulate trading information - buying books, going to seminars and researching.

  2. We begin to trade with our 'new' knowledge.

  3. We consistently 'donate' and then realize we may need more knowledge or information.

  4. We accumulate more information.

  5. We switch the commodities [or stocks, or futures, or...] we are currently following.

  6. We go back into the market and trade with our 'updated' knowledge.

  7. We get 'beat up' again and begin to lose some of our confidence. Fear starts setting in.

  8. We start to listen to 'outside news' & other traders.

  9. We go back into the market and continue to donate.

  10. We switch commodities again.

  11. We search for more trading information.

  12. We go back into the market and continue to donate.

  13. We get 'overconfident' & market humbles us.

  14. We start to understand that trading success fully is going to take more time and more knowledge then we anticipated.
     
    Most People Will Give Up At This Point As They Realize Work is Involved

Share this post


Link to post
Share on other sites
This is an excerpt from something I posted yesterday. It's made the rounds, and old-timers will already have read it.

 

38 Steps To Becoming A Successful Trader

 

  1. We accumulate trading information - buying books, going to seminars and researching.

  2. We begin to trade with our 'new' knowledge.

  3. We consistently 'donate' and then realize we may need more knowledge or information.

  4. We accumulate more information.

  5. We switch the commodities [or stocks, or futures, or...] we are currently following.

  6. We go back into the market and trade with our 'updated' knowledge.

  7. We get 'beat up' again and begin to lose some of our confidence. Fear starts setting in.

  8. We start to listen to 'outside news' & other traders.

  9. We go back into the market and continue to donate.

  10. We switch commodities again.

  11. We search for more trading information.

  12. We go back into the market and continue to donate.

  13. We get 'overconfident' & market humbles us.

  14. We start to understand that trading success fully is going to take more time and more knowledge then we anticipated.
     
    Most People Will Give Up At This Point As They Realize Work is Involved

 

bang on mate, couldn't of said it better

Share this post


Link to post
Share on other sites

It seems everyone agrees that trend-trading works, although the evidence presented seems mostly anecdotal. FWIW, here is what my testing shows:

 

1. swing and long-term trading- trend trading does not work for stock index futures (e.g. ES) and has not worked for many years. Still works generally for commodities, although not in the last year.

 

2. day trading- will work with the right strategy (such as mentioned by many of the contributors), but not so much this year, where there have been an inordinate number of afternoon reverses- look at yesterday (June 10) for example.

Share this post


Link to post
Share on other sites
It seems everyone agrees that trend-trading works, although the evidence presented seems mostly anecdotal. FWIW, here is what my testing shows:

 

1. swing and long-term trading- trend trading does not work for stock index futures (e.g. ES) and has not worked for many years. Still works generally for commodities, although not in the last year.

 

2. day trading- will work with the right strategy (such as mentioned by many of the contributors), but not so much this year, where there have been an inordinate number of afternoon reverses- look at yesterday (June 10) for example.

 

Your input is appreciated, however, that means nothing without specifying what exactly you define as "swing and long-term" and "day" trading. If you simply say something like "a strategy that exploits the trend does not work for day trading," that statement really doesn't mean very much, because there are many different ways to trade intraday. Of course, it would also help to know what you mean by "trend trading".

Share this post


Link to post
Share on other sites
Your input is appreciated, however, that means nothing without specifying what exactly you define as "swing and long-term" and "day" trading".

 

"Means nothing" unless I define 3 basic trading terms?

 

Hmmm.

 

I'll give 1 example before I go. Take your favorite trend system (MA cross, MACD, breakout) and run it on a daily chart of the ES for the last 10 years. What do you find?

 

Now I'll bow out and let the trading myths and anecdotes continue.

Share this post


Link to post
Share on other sites
"Means nothing" unless I define 3 basic trading terms?

 

Hmmm.

 

I'll give 1 example before I go. Take your favorite trend system (MA cross, MACD, breakout) and run it on a daily chart of the ES for the last 10 years. What do you find?

 

Now I'll bow out and let the trading myths and anecdotes continue.

 

Hi there,

 

No need take a bow, friend. What we have here, no doubt, is failure to communicate.

 

I think that while you understand what you intended to communicate in your first post, it was not presented in such a way as to allow those of us who are not as wise as you to comprehend.

 

For example, the phrase "trend trading does not work" seems just a bit vague. What do you mean by "doesn't work?" Do you mean that it is unprofitable to trade with the trend? Or do you mean that trend following produces a small percentage of profitable trades relative to losing trades? Or do you mean something else altogether?

 

In my experience, I have found that it is best to define one's terms as accurately and comprehesibly as possible, for we cannot assume that one's interlocutors possess the same understanding as does oneself.

 

 

 

Best Wishes,

 

Thales

Share this post


Link to post
Share on other sites
Oops- that was a long only example. Here is the result using a standard (12,26,9) MACD long and short on 10 year daily ES data with $25 RT for slippage and commssion..

 

If you're defining trend as an MAXO (or any other indicator cross or hook or whatever), then of course you're correct; it won't work. But an MAXO is not the traditional definition of "trend", i.e., higher highs and higher lows or vice-versa. Yesterday, for example, there was a very nice trend in the NQ from the market open to 14:00, then another in the opposite direction until the close.

Share this post


Link to post
Share on other sites

Hi db,

 

Per my first post, I agree with you that there are intraday trends that can be profitably traded, although it has been more difficult recently. Perhaps others have also found this.

 

btw, I found yesterday more difficult than you did, db. (smiling).

Share this post


Link to post
Share on other sites
Hi db,

 

Per my first post, I agree with you that there are intraday trends that can be profitably traded, although it has been more difficult recently. Perhaps others have also found this.

 

btw, I found yesterday more difficult than you did, db. (smiling).

 

If it were easy, everybody would be doing it.

 

Oh wait......

 

:)

Share this post


Link to post
Share on other sites
Hi Thales,

 

I meant unprofitable. I attach a performance report on a simple Moving Average Crossover as an example.

 

Hi Windsurfer,

 

Thank you for clarifying your meaning. That moves us in the direction of what might prove to be a fruitful discussion, and I hope you will humor me as I do find this to be an interesting topic, and I myself am not at all clear on how I'd respond the facts stated in your report.

 

For the purposes of our discussion, you are of the opinion that trend trading does not work, by which you mean to say that trend trading is unprofitable.

 

Furthermore, for our purposes here, you define a trend in terms of the relationship of two moving averages to one another.

 

Would you agree, however, that such a definition of a trend, and thus what it means, strictly speaking, to be a "trend trader," may not be a universally accepted means of defining a price trend?

 

Would you be willing to accept that, strictly speaking, there exist, in any particular time frame, three possible trends in which price can move: 1) an uptrend, characterized by a series of higher price highs and higher price lows, 2) a down trend, characterized by a series of lower price lows and lower price highs, and 3) a sideways trend, characterized by a series of overlapping price movements resulting in no measurable net movement up or down?

 

In other words, would you be able to agree with me, that a trend is primarily determined by the movement of price itself, and only derivitively and thus, arbitrarily defined by, say, a moving average, which is an average of price movement over a period of time selected by the technician, and not dictated by the observable movement of price itself?

 

I think that is enough for now, as in order for us test your opinion on the workability of trend trading, we must make sure that we are in agreement as to the basic terms of the discussion.

 

I appreciate your patience with me.

 

Thank you,

 

Thales

Share this post


Link to post
Share on other sites
Hi Thales,

 

I meant unprofitable. I attach a performance report on a simple Moving Average Crossover as an example.

 

I think this is pretty common knowledge that moving average crossover systems are not profitable. Applying a known non profitable trending system to a market doesn't prove that the market is non trending; it proves that the system as applied is not profitable.

Share this post


Link to post
Share on other sites
I disagree................

 

 

attachment.php?attachmentid=11304&stc=1&d=1244762735

 

erie

 

Not sure what this proves either, or that this is even a MA crossover system for that matter. This is pretty easy to curve any system and post a screen print of a profitable sample. However, I have no interest to get into an arguement about this. If you are happy with your MA crossover system, assuming this even is one, then good for you.

Share this post


Link to post
Share on other sites
I think this is pretty common knowledge that moving average crossover systems are not profitable. Applying a known non profitable trending system to a market doesn't prove that the market is non trending; it proves that the system as applied is not profitable.

 

I agree (with some reservation) and thank you for putting this so succinctly. What I would like to see is the case laid bare showing that trend trading is indeed profitable so ong as one is trading based upon what price is doing, and not on the results of an arbitrarily selected arithmetically derived value(s) from price.

 

My reservation is simply this: While I do not use and would not use such a system to make trading decisions, I would hesitate to argue that all such systems are unprofitable. With a money management system based upon position sizing based upon predetermined inital hard stop points, I believe that even a random entry method could be profitable over the long term.

 

Best Wishes,

 

Thales

Share this post


Link to post
Share on other sites
Not sure what this proves either, or that this is even a MA crossover system for that matter. This is pretty easy to curve any system and post a screen print of a profitable sample. However, I have no interest to get into an arguement about this. If you are happy with your MA crossover system, assuming this even is one, then good for you.

 

 

All anyone has to do is write the ma crossover system for themselves or get someone to write it for them to prove whether blanket statements ,"this is not profitable" is true or not. It's not rocket science. I don't care if you believe me or not. That is not my problem......... It is a breakout strategy of a ma crossover. Remember to keep an open mind and try all timeframes and different combination of ma's.

 

erie

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Topics

  • Posts

    • TDUP ThredUp stock, watch for a top of range breakout above 2.94 at https://stockconsultant.com/?TDUP
    • TDUP ThredUp stock, watch for a top of range breakout above 2.94 at https://stockconsultant.com/?TDUP
    • NFLX Netflix stock watch, local support and resistance areas at 838.12 and 880.5 at https://stockconsultant.com/?NFLX
    • Date: 8th April 2025.   Markets Rebound Cautiously as US-China Tariff Tensions Deepen     Global markets staged a tentative recovery on Tuesday following a wave of volatility sparked by escalating trade tensions between the United States and China. The Asia-Pacific region showed signs of stability after a chaotic start to the week—though some pockets remained under pressure. Taiwan’s Taiex dropped 4.4%, dragged lower by losses in tech heavyweight TSMC. The world’s largest chipmaker fell another 4% on Tuesday and has now slumped 13.5% since April 2, when US President Donald Trump first unveiled what he called ‘Liberation Day’ tariffs.   However, broader sentiment across the region turned more positive, with several markets rebounding sharply after Monday’s dramatic sell-offs. Japan’s Nikkei 225 surged over 6% in early trading, rebounding from an 18-month low. South Korea’s Kospi rose marginally, and Australia’s ASX 200 gained 1.9%, driven by strength in mining stocks. Hong Kong’s Hang Seng rose 1.6%, though still far from recovering from Monday’s 13.2% crash—its worst day since the 1997 Asian financial crisis. China’s Shanghai Composite added 0.9%.   In Europe, DAX and FTSE 100 are up more than 1% in opening trade. EU Commission President von der Leyen repeated yesterday that the EU had offered reciprocal zero tariffs on manufactured goods previously and continues to stand by that offer. Others are also trying again to talk to Trump to get some sort of agreement that limits the impact.   Much of the rally appeared to be driven by dip-buying, as well as hopes that the intensifying trade war could still be defused through negotiations.   China Strikes Back: ‘We Will Fight to the End’   Tensions reached a boiling point after Trump threatened to impose an additional 50% tariff on all Chinese imports unless Beijing rolled back its retaliatory measures by April 8. ‘If China does not withdraw its 34% increase above their already long-term trading abuses by tomorrow... the United States will impose additional tariffs on China of 50%,’ Trump declared on social media.   If implemented, the new tariffs would bring total US duties on Chinese goods to a staggering 124%, factoring in the existing 20%, the 34% recently announced, and the proposed 50%.   In response, China’s Ministry of Commerce issued a stern warning, stating: ‘The US threat to escalate tariffs is a mistake on top of a mistake... If the US insists on its own way, China will fight to the end.’ The ministry also called for equal and respectful dialogue, though signs of compromise on either side remain scarce.   Beijing acted quickly to contain a market fallout. State funds intervened to support equities, and the People’s Bank of China set the yuan fixing at its weakest level since September 2023 to boost export competitiveness. Additionally, five-year interest rate swaps in China fell to their lowest levels since 2020, indicating potential for further monetary easing.   Trump Talks Tough on EU Too   Trump’s hardline approach extended beyond China. Speaking at a press conference, he rejected the European Union’s offer to eliminate tariffs on cars and industrial goods, accusing the bloc of ‘being very bad to us.’ He insisted that Europe would need to source its energy from the US, claiming the US could ‘knock off $350 billion in one week.’   The EU, meanwhile, backed away from a proposed 50% retaliatory tariff on American whiskey, opting instead for 25% duties on selected US goods in response to Trump’s steel and aluminium tariffs.     Volatile Wall Street Adds to the Drama   Wall Street experienced wild swings on Monday as investors processed the rapidly evolving trade conflict. The S&P 500 briefly fell 4.7% before rebounding 3.4%, nearly erasing its losses in what could have been its biggest one-day jump in years—if it had held. The Dow Jones Industrial Average sank by as much as 1,700 points early in the day but later climbed nearly 900 points before closing 349 points lower, down 0.9%. The Nasdaq ended up 0.1%.   The brief rally was fueled by a false rumour that Trump was considering a 90-day pause on tariffs—rumours that the White House quickly labelled ‘fake news.’ The market's sharp reaction underscored how desperate investors are for any sign that tensions might ease.   Oil Markets in Focus: Goldman Sachs Revises Forecasts   Crude prices also reflected the uncertainty, with US crude briefly dipping below $60 per barrel for the first time since 2021. As of early Tuesday, Brent crude was trading at $64.72, while WTI hovered around $61.26.   Goldman Sachs, in a note dated April 7, lowered its average price forecasts for Brent and WTI through 2025 and 2026, citing mounting recession risks and the potential for higher-than-expected supply from OPEC+.       Under a base-case scenario where the US avoids a recession and tariffs are reduced significantly before the April 9 implementation date, Goldman sees Brent at $62 per barrel and WTI at $58 by December 2025. These figures fall further to $55 and $51, respectively, by the end of 2026. This outlook also assumes moderate output increases from eight OPEC+ countries, with incremental boosts of 130,000–140,000 barrels per day in June and July.   However, should the US slip into a typical recession and OPEC production aligns with the bank’s baseline assumptions, Brent could retreat to $58 by the end of this year and to $50 by December 2026.   In a more bearish scenario involving a global GDP slowdown and no change to OPEC+ output levels, Brent prices might fall to $54 by year-end and $45 by late 2026. The most extreme projection—based on a simultaneous economic downturn and a full reversal of OPEC+ production cuts—would see Brent plunge to below $40 per barrel by the end of 2026.   Goldman noted that oil prices could outperform forecasts significantly if there was a dramatic shift in tariff policy and a surprise in global demand recovery.   Cautious Optimism, But Warnings Persist   With both Washington and Beijing showing no signs of backing down, markets are likely to remain volatile in the days ahead. Investors now turn their attention to upcoming trade meetings and policy decisions, hoping for clarity in what has become one of the most unpredictable trading environments in recent years.   Always trade with strict risk management. Your capital is the single most important aspect of your trading business.   Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HFM Economic calendar.   Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!   Click HERE to READ more Market news.   Andria Pichidi HFMarkets   Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
    • CVNA Carvana stock watch, rebound to 166.56 support area at https://stockconsultant.com/?CVNA
×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.