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#1 CLK

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Posted 21 November 2018 - 02:57 PM

The best traders I have been following elsewhere are ones that average down in a trade if it goes against them, they rarely lose because their system is highly accurate, they just don't know exactly where it will turn, these are all futures day traders,

you have to have a good size account for that though, sometimes they scale out, sometimes not, but like 10% of the time stop out for a loss and usually back in later. Last week and this all were bullish profitable trades in a downtrend.

And the few system posts I saw were nothing I've ever seen here before.

 

I'm starting to lean toward either dollar cost averaging long term or day trade scalping, anything outside that is just too hard

to navigate profitably.



#2 saltlake

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Posted 21 November 2018 - 06:49 PM

Where are you following traders ?

#3 CLK

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Posted 21 November 2018 - 09:11 PM

Where are you following traders ?

 

 

I sent you a link.



#4 fib_1618

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Posted 22 November 2018 - 07:15 AM

 

Where are you following traders ?

 

I sent you a link.

 

Not good enough to share with the rest us ordinary schmoes, eh?  :)

 

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#5 CLK

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Posted 23 November 2018 - 03:52 PM

Options are $3.50 at the money with less than a week on them, if you want to swing trade you have to buy $6-7 in the money, those at the money prices in this kind of market won't make you any money, and OTMs will just decay in the slow trending chop. The only option is DITM or day trade with same day or next day contracts, even those are $2.25 just a point in the money. High VIX just makes it tough on option buyers. Nothing wrong with $6-7 in the money, but defeats some of the leverage you are looking for, but far safer than the other choices.

 

I closed all today, just wasn't a good day despite the late sell because I was forced to cover on the open. Waiting for some better setups next week. Would be nice to get another volume signal to fade, very few of them though.


Edited by CLK, 23 November 2018 - 03:53 PM.


#6 Data

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Posted 23 November 2018 - 06:33 PM

I've seen some of those.   They exit as soon as they break even or make a small profit so they can claim a high winning percentage.



#7 NAV

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Posted 24 November 2018 - 01:08 AM

I've seen some of those.   They exit as soon as they break even or make a small profit so they can claim a high winning percentage.

 Exactly !

 

Winning rate is function of risk/reward. You cannot get around it, no matter what system you use. You go for a small risk/reward, you can easily design a system with high win rate. With a risk/reward of 1:1 i can easily design a system with 80-90% win rate. When you go for 1:5 or 1:10 risk/reward, you woud be lucky even if you get a 50% win rate. 

 

Making money in the long run has got nothing to do with win rate. It has do with with consistency and slow compounding. 

 

I have learn't some simple trading truths over the years:

 

Don'ts

 

1) Don't trade options. It's an inefficient instrument. Managing time decay, implied vol and direction all at the same time is a loser's game. Instead trade Futures or ETFs. You just need to get the direction right.

 

2) Don't use leverage beyond 2X. I used to trade 5X leverage with ES futures many years back when my account was small. Not anymore. You could get wiped out.

 

3) Don't day trade. You end up paying a lot in transaction fees and slippage. And you can't see your trade acheive it's profit objective, if you square off early. Besides, it will ruin your health in the long run. Humans are not designed to sit and watch the ticks all day. I realized this after watching every tick on the S&P for almost 10 years. Now once i put my trade on, place a stop, limit order for profits and go talk a walk, read a book or watch TV.

 

Dos

 

1) Try to get profitable consistently month after month, no matter how small the profits are.  Of course there will 2 or 3 months a years you could go into losses. Try to keep the drawdown below 10%.

 

2) Compound your earnings over time. Most important !


Edited by NAV, 24 November 2018 - 01:15 AM.

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#8 CLK

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Posted 24 November 2018 - 09:11 AM

They weren't talking up win rates, average take was 20-30 points from what I saw, kept averaging down if it went against them so that the hard stop was well below the initial, but for averaging it was not a big stop in the end. The key is having a good system edge.



#9 NAV

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Posted 24 November 2018 - 01:12 PM

They weren't talking up win rates, average take was 20-30 points from what I saw, kept averaging down if it went against them so that the hard stop was well below the initial, but for averaging it was not a big stop in the end. The key is having a good system edge.

 

What was the net stop size after averaging down ?


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#10 CLK

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Posted 24 November 2018 - 02:41 PM

 

They weren't talking up win rates, average take was 20-30 points from what I saw, kept averaging down if it went against them so that the hard stop was well below the initial, but for averaging it was not a big stop in the end. The key is having a good system edge.

 

What was the net stop size after averaging down ?

 

 

 

I think around 10 points, I think the ratio was not ideal but it almost always worked out within the day. Just where you would look at price where they started buying and say why, what is it about that spot, a few more adds within the general area and still can't figure it out, then a little later the market turns on a dime and rallies 30 points, the exits were near tops too. My system is not that good, I'm trying to incorporate what they use but not clear because it is a combination of 3-4 main processes, one of which is very complex.


Edited by CLK, 24 November 2018 - 02:42 PM.