Someone finally was able to define the markets in a simple phrase. Just be a weatherman, we know how accurate they are.
Anyway here is the quote:The wind is not random; it is complex. Same thing in markets.
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| My philosophy of Trading https://www.stevehopwoodforex.com/phpBB3/viewtopic.php?t=3627 |
Page 6 of 15 |
| Author: | nanningbob [ Sat May 31, 2014 1:01 am ] |
| Post subject: | My philosophy of Trading |
Someone finally was able to define the markets in a simple phrase. Just be a weatherman, we know how accurate they are. Anyway here is the quote:The wind is not random; it is complex. Same thing in markets. |
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| Author: | nanningbob [ Sun Jun 01, 2014 9:45 am ] |
| Post subject: | My philosophy of Trading |
Institutional traders do not target retailers. It is not worth the trouble. If it just so happens that your stop is near the stop of a big fish, then it is purely coincidental that you got taken out. 200 dollars is not important enuf to manipulate a market.  AWW and here I thought I was important. |
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| Author: | nanningbob [ Wed Jun 04, 2014 1:07 am ] |
| Post subject: | My philosophy of Trading |
Interesting when these guys talk about DD. I did have a 1 million USD budget my first full year trading. My Daily DD was 100K USD at which point I would have to explain myself but not necessarily have to exit the position. If I lost 250 K during the month then I am in trader jail until the new month. It's different in banks as opposed to say hedge funds. I ran a book and provided liquidity/pricing for customers sometimes you get saddled with a bad deal that you have to sit with. I will tell you from all the traders that had long careers we all had our own self-imposed DD's (varying for each individual). It was in our best interest to not DD too much we all wanted the big bonus at the end of the year. So we were all excellent money mangers because we were highly motivated. In my 12 year career I only remembered being triggered once and maybe two or three other guys in that time. The bank gave us plenty of room to hang ourselves but we weren't stupid enough to put out head in the noose |
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| Author: | Saint [ Thu Jun 05, 2014 5:43 pm ] |
| Post subject: | My philosophy of Trading |
Bob, This might be an inappropriate question, but I wish to know, In a day trading, how often you win the trades without DD, a real bang bang shot, I mean, you place a pending order, the order gets triggered and goes straight to the take profit without DD's. and ... you said you don't use SL if so do you close every trade positive?  |
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| Author: | nanningbob [ Fri Jun 06, 2014 4:36 am ] |
| Post subject: | My philosophy of Trading |
OK My final line in the sand is 20% DD At that point I close trades. OK but I never want to get to that point so I am closing trades out earlier than that. 1. I enter a trade and it goes nowhere after a couple of sessions, I just close it and try again. 2. I enter a trade and goes against me but I still like the direction of the trade so I look for a 2nd entrance, remember i like to play only 1/3 of my total lot size for my initial entrance. If after a time I dont get a good 2nd entrance and my first entrance is just a bad trade I close it. My MM of only playing a third of my total lot lets me have a lot more room than the average trader. 3. I enter trades 1 and 2 and still not going in my direction. I have read the tea leaves wrong and I plan on my best exit, most likely there was a surprise change of direction. If I still like the long term trend though I will play my third entrance. 4. The market has truly changed from the long term trend. I close out take my loss and move on. I dont believe there is such a thing as accurately placing trades using 1/100 th of a penny and then using 30/100th of a penny SL. Those that teach that are guaranteeing you lots of SL on trades that would go in your direction with some patience. If you read about traders who play with millions of dollars they use multiple entrances and play long term trends. You can get the trend direction right most of the time but Forex is very volatile at the hundredth and thousandths of a penny. You have to remember you are trying to predict direction on fractions of a penny and that is like a dog chasing its tail. If you dont believe me go to this thread where institutional traders talk about trading. You wont find the head bashing, chest thumping, name calling of these arrogant so.so's who only yell about losing your money. That is what you expect from a broker mole not a true professional trader. You can tell a true trader because he will talk individual trades with you a broker mole wont. Anyway go here and learn from guys who have won and lost millions working for banks or trading institutions. You will see a whole different attitude about trading from them and how they treat others. http://www.forexfactory.com/showthread.php?t=486128 |
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| Author: | nanningbob [ Fri Jun 06, 2014 4:36 am ] |
| Post subject: | My philosophy of Trading |
My lot sizes are based on my goals. I trade 1-3 penny lots for every 1000 of account. If you have 10K account that would be a 10 cent to 30 cent lot size. Depending on the broker that would be .10-.30 lot or a .01 to .03 lot. If you trade one penny lot size to 1000 you would have to loss 100,000 pips to wipe out your account. Now if you are that bad you dont belong in Forex. My goal is to get 5-10% a month. 5% a month will equal 7x your original investment in 3 1/2 years. Those types of goals are both reasonable and doable. My favorite motto is: Trade in such a way that you live to trade another day. I am very conservative with my money and I am not ashamed of it. I am 3.5 years into my plan and have 3-5 years left to retire doing this. Several years ago I stated my goals and got laughed at but I reached them. 1. Pay off all my debt. -------- DONE 2. Take a vacation and then paying off my credit card with Forex winnings ------------- DONE 3. Pay cash for my vacation and not use my credit card ---------------- DONE I went to Sanya for Easter for 5 days, paid cash for everything and my credit is still at 0 balance. 4. Next goal -------------- Pay cash for a house, I am 20% on my way there. I made these goals doing what I proposed. You do not have to trade high leverage, big lots, one in one out. You can trade small lots, low leverage, and grow your account slowly. And the only money my broker makes off of me is the spread. Thats it. |
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| Author: | nanningbob [ Fri Jun 06, 2014 4:59 am ] |
| Post subject: | My philosophy of Trading |
My win rate is just around 75% over the last 3 years. I do not close every trade into profit. there is no such thing as a 100%win system. I play the odds. If I went to every screen and placed all buy orders on 24 currencies and then I went to another broker and placed 24 trades on the same currencies and did sells. You would have a better than 70% chance of each trade either going into profit or coming back for a BE. Markets range most of the time. So I use those odds in my favor and expect price to move into profit at some point or BE. My average pips per trade is under 30 pips but that includes my losers also. Saying that this is when I take profits. Volume or volatility happens 2-4 hours into a trading session. JPY around 2-3 hours in the session, price will hit is high/low. EUR about an hour or so before the USA Open. USA open the high low will be around 2-3 hours in. At that point I often close my profit trades and decide what to do with my losers, (close or continue) That is pretty much my trading day. Except on really dead days I will be taking some kind of profit each session. I live and work in China so my day goes like this (it is the opposite of EST USA) 6-630 AM check my charts and plan my trading day. Close any bad trades or good trades. Set my trades for the JPY sessioin. 10-11 AM I am on break, kids are out to recess. I check my JPY trades and take my profit. 12-1230 I am on lunch and will set up my EURO session trades. 4 PM get home check Euro session trades 6-7 pm Dinner set my trades for the USA session and close my profit trades. Decide if I want to clear out any bad trades. 10-11PM close out the USA profit trades, see which ones I want to continue and then go to bed. That is my trading day. It makes no difference to me if a trade is one that has been sitting for a week or I just entered an hour ago. When I see profit I grab it. If I am sure of a long term trend it doesnt bother me to sit on a trade for weeks adding to a set of trades because of my view of the long term trend. Long term trend is everything to me now. Euro is going down, maybe today, maybe tomorrow, maybe next week, maybe next month but it is going down. Until that changes I am selling the euro. I profit when it profits. That is how I trade. Each time I check my trades and charts takes me 5-15 minutes. I make decisions and move on, I dont care if price would have kept running or not. Profit is profit. Sometimes I play the long term trend, short term quckie, counter trade or range trade. I read my CSS and see whats strong and whats weak, what is angling up and what is angling down. I then go to my charts and trade. I have done it so many times over the years it is 2nd nature to me. I dont need a lot of time on a screen to make a decision. I have 24 screens I can go through but usually the CSS is telling me to look at 5-10 of them. I can look at a screen and decide quickly if I want to trade it or not. I highly recommend Capt. Jack's thread on trading naked and watching price action. You do that after several years and you will find indicators somewhat helpful but most of the time I look right through them for what price seems to be doing in relation to my CSS reads. |
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| Author: | nanningbob [ Sat Jun 14, 2014 10:12 am ] |
| Post subject: | My philosophy of Trading |
I have been preaching this for years. Yes. Retail traders complain and whinge about how the market and their brokers con and scam them. Professionals accept the fact that it's they who need to change. The trading style is irrelevant, the only thing is we need to scale in large volumes over a range of prices rather than what retailers would buy or sell at an exact price. Here is a quote about important fundamentals and what banks face during big moves. 1. The ones you mention are probably the biggest with US nonfarm payrolls the biggest other than Interest rate decisions. What we did as market makers is to check our orders before those number to see what was close. Then you prepare for the client business that follows which is very challenging .... liquidity dries up completely after a big number so when a custy comes in asking for a price you do your best to "not get killed" or shade the price so the custy passes your price. These are the worst times to be a market maker bc there are no prices in the market and invariably every custy wants to play from the same direction (momentum) which means bank dealers are always on the wrong side of the market. |
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| Author: | nanningbob [ Sat Jun 14, 2014 10:16 am ] |
| Post subject: | My philosophy of Trading |
Some stuff about front running a customer. In other words putting you order in ahead of the trader's order so you make money. Inside information: no never but that's bc my def of inside information would be finding out what the US non-farm payrolls is b4 it comes out or any other significant economic release. Now that's information that could make a person rich. Everyone has a Reuters machine. Early in my career dealers front ran customers to a certain extent. It's not the kind of conspiracy you imagine it to be. for example if say EurUsd is 54/55 when a custy calls and says I need to buy 200 mio eur if you came back with a fill at say 61 bc you bought some for yourself b4 you bought any for the customer you will never ever see that customers business again. Customers now know where markets are, 9 out of 10 will not give you an at best order, they will give you a limit. going back to the eurusd example, what you typically see now is that same customer say I need to buy 200 mio eurusd no worse then 56 or work to buy at 54. Also, you couldn't front run an order bc your books are monitored so its easy to see who on the desk or in the bank bought ahead of that order. |
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| Author: | nanningbob [ Sat Jun 14, 2014 10:25 am ] |
| Post subject: | My philosophy of Trading |
Retail traders are nobodies. The amounts we trade are meaningless on the market so no one gives a rip about you. Jacob says retail business is huge. I'm assuming he meant retail FX traders. Jacob could be right on its huge-ness, but my perspective is that it's still insignificant relative to the overall market. In the AsiaPac, for instance, I don't SEE retail orders per se. I see clusters of MANY Bank-only orders (which, come to think of it, may contain tiny elements of retail trades). Retail stops (if they even exist in the Bank's universe) are just tiny parts of the "turnover" you talked about. The point I'm trying to make is this: we don't consciously target retail orders. When a commercial fisherman goes fishing with his nets, he doesn't target a specific fish; he nets up every single one of them. So retail traders should just relax: you're too insignificant for us to even give a sh!t about. |
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