**OFFICIAL** Trading and Investing Thread- Part -II-

[mcichocki]

i wont be back until im net posi so we have a while until that happens. i just was pissed about how he was hating on anything and everything i posted in here. nobody posts any good analysis in this thread anymore anyways, but whatever. i've surely come a long way though i will say that.

If you get so focused on being net posi you might not trade each trade for what it's worth and lose your footing...be careful.

Think back to how cocky you were. You deserved the hazing, it wasn't hating...it was hazing. Induction to the big leagues, which you were trying to play in.
I remember when you got on the option bus and were spouting off like you were a pro. I warned to be humble.
You were playing like a fighter swinging for the fences back then, I hope that's no longer an issue. Keep pluggin away and protect equity...you'll get there.

And WTF...I post links to my TradersBASE analysis. Nobody comments or does what I'd like which is to get traffic up there and make it a cool site again.

[mcichocki]

technical indicators > 1hr, mostly the rsi and stochastic. for some reason its been foolproof.

system was long from 1.3970-1.4110 (+140 pips), then got short at 1.4110 and is currently still in the trade at 1.4077 (+33 pips)

just FYI, margin on 1 contract is about $140 bucks so just today its made 126% (177/140) (each pip for 1 contract = $1)

I would shed "foolproof" from vocab. Other than that keep up the good work. I hope it pans out for you.

what do you mean what did I backtest it against? it isnt a mechanical system (not coded, just manual) so i can't backtest it on metatrader or anything. just visually backtested it and have been playing it for a couple weeks so far.

Of course a few weeks isn't much for reliability in a "system". I will go against the majority though and say forward testing is MORE important than backwards testing overall. JMHO anyhow.

GL bro.

[V8 Muscle]

If you get so focused on being net posi you might not trade each trade for what it's worth and lose your footing...be careful.

Think back to how cocky you were. You deserved the hazing, it wasn't hating...it was hazing. Induction to the big leagues, which you were trying to play in.
I remember when you got on the option bus and were spouting off like you were a pro. I warned to be humble.
You were playing like a fighter swinging for the fences back then, I hope that's no longer an issue. Keep pluggin away and protect equity...you'll get there.

And WTF...I post links to my TradersBASE analysis. Nobody comments or does what I'd like which is to get traffic up there and make it a cool site again.

touche, everyone has to learn sometime. honestly though forex is 10000x easier to trade because I can actually manage my position size/risk and the leverage is high enoough where i can make decent money trading a small portion of my account even though my account is small

I would shed "foolproof" from vocab. Other than that keep up the good work. I hope it pans out for you.



Of course a few weeks isn't much for reliability in a "system". I will go against the majority though and say forward testing is MORE important than backwards testing overall. JMHO anyhow.

GL bro.

and i agree about that, but in all honesty this has had a 90%+ success rate if you can be disciplined enough to take a fairly large drawdown from time to time. the biggest drawdown i've had to take was about 100 points, but im working on the periodicity of the indicators to reduce that a bit. Only 1-2 trades per day also, so commissions are extremely low. And I definitely am learning quickly that stops are important, somehow i didnt set a stop one time before bed and woke up -250 bucks I'm currently "forward testing" this with real money and hopefully the volatility will continue in the EUR/USD because thats what my system relies on.

[vref]

hey guys,

I've recently taken a interest in trading/investing and plan to invest in the near future (primarily in stocks), but before anything i've been trying to do some research so i dont fail. But I need your guys' help.

So far I have read:

Stock Investing for Dummies (I know basic but I needed a basic understanding of the financial markets) (no finance major, im an engineering major)

and read about 1/3 so far of How to Make Money in Stocks A winning system in good times or bad by William J O'Niel

do you guys have any additional books/articles you could recommend me that focus more on technical analysis of stocks and the general markets? as well as economic influence on markets?

my major really had no economics or finance classes (except Engineering Economy) although i do plan to pursue an MBA focusing on Finance a little while after graduation. But untill then all i have is books and investopedia.com lol.

From lurking on this thread, you guys seem very knowledgable, and I would like to soak up as much information as possible.

Thanks in advance!

chyeah, brush up on your stochastic calculus and probability.. if you went to skool when you were 21 you should have taken some calc/prob.... i had to teach myself all this $hit so i could do the cool stuff like gamma scalping as a local and actually know what i was doing. now i need to learn the computer programming so i can make my own software

[Westboarder]

yeah ok

bartoromo may look more like a pig now but erin burnett is hot as hell

Her condescending attitude is a huge turn off. She's always pretending to stroke Mark's cock too. Not to mention a love affair with the repugnant JIMMY CRAAAAMER!

[Morbid_Mind]

and i agree about that, but in all honesty this has had a 90%+ success rate if you can be disciplined enough to take a fairly large drawdown from time to time.

How long have you been using this system? I wouldn't be concerned about a system that yields a ~90% success rate over a brief time period. Once you've tested it in all market conditions then you know you've got a workable system.

For the record, if you're taking drawdowns of 100p on a single trade, I think your risk:reward is ****ed. You're putting up 100p to make 140, not a good ratio. I use a 35-50p stop, the larger end is for more volitile pairs like the beast and some exotics, it's rare that I use anything over 35. I stay in trades for ~400+p, though once the trade has built up a nice cousion the stop gets moved up to where if I get stopped out I'm at worst break even.

[Westboarder]

And I definitely am learning quickly that stops are important, somehow i didnt set a stop one time before bed and woke up -250 bucks .

Not to sound condescending, but this is small beans really. I've lost 250 in an hour. If you set your stops too high, you don't allow sufficient volatility. You have to be able to gauge when a profit taking is occuring and when a steep sell off is about to occur. Even in situations where all the technicals in place, market evidence will change everything.

[Morbid_Mind]

Not to sound condescending, but this is small beans really. I've lost 250 in an hour. If you set your stops too high, you don't allow sufficient volatility. You have to be able to gauge when a profit taking is occuring and when a steep sell off is about to occur. Even in situations where all the technicals in place, market evidence will change everything.

That's why you have to know how to read charts. You can tell by looking at some of the longer term time frames whether it's simply a small retracement or whether the trend has changed. I'm just talking about using candles here. It gets a bit easier if you add in MAs and Ichimoku.

I had a silver trade lose almost a full dollar off of the spot profit only to have it turn right back around and make that up and then some. By no means am I saying to use aggressive stops here, but stops are important.

I've had my ass saved royally by stops. I was long the pound when the UK got downgraded and the thing dropped like a stone, no stop and I would have been deep in the red. But then again, I think that was karma for being on the right side of some SNB manipulations...

[Westboarder]

That's why you have to know how to read charts. You can tell by looking at some of the longer term time frames whether it's simply a small retracement or whether the trend has changed.

I'm just talking about using candles here. It gets a bit easier if you add in MAs and Ichimoku

Candles are great for gauging momentum.

[|ceman]

If you get so focused on being net posi you might not trade each trade for what it's worth and lose your footing...be careful.

Think back to how cocky you were. You deserved the hazing, it wasn't hating...it was hazing. Induction to the big leagues, which you were trying to play in.
I remember when you got on the option bus and were spouting off like you were a pro. I warned to be humble.
You were playing like a fighter swinging for the fences back then, I hope that's no longer an issue. Keep pluggin away and protect equity...you'll get there.

And WTF...I post links to my TradersBASE analysis. Nobody comments or does what I'd like which is to get traffic up there and make it a cool site again.

I read your TB links, MC. I'm just too busy to really post over there. And right now I'm just trying to exit some shorts while I still have some skin left. I bet against Obama and got it handed to me. Lol.

How long have you been using this system? I wouldn't be concerned about a system that yields a ~90% success rate over a brief time period. Once you've tested it in all market conditions then you know you've got a workable system.

For the record, if you're taking drawdowns of 100p on a single trade, I think your risk:reward is ****ed. You're putting up 100p to make 140, not a good ratio. I use a 35-50p stop, the larger end is for more volitile pairs like the beast and some exotics, it's rare that I use anything over 35. I stay in trades for ~400+p, though once the trade has built up a nice cousion the stop gets moved up to where if I get stopped out I'm at worst break even.

No system works 100% in every market. If someone found it they'd be the worlds richest person. Market conditions change so your strategy should as well. As long as V8 doesn't get too greedy (the downfall of any system) and keep his wits about him, he should be able to bank safely and then see when his system is not working anymore and get out of it.

[Westboarder]

I read your TB links, MC. I'm just too busy to really post over there. And right now I'm just trying to exit some shorts while I still have some skin left. I bet against Obama and got it handed to me. Lol.

Guess you should have shorted AE. Solar took a huge ****. LOL

[FranchiseKid]

Absolutely miserable quarter turned in by JPM. That was ugly but I am sure the street will spin the hell out of it to the point that it is unrecognizable.

[Morbid_Mind]

No system works 100% in every market. If someone found it they'd be the worlds richest person. Market conditions change so your strategy should as well. As long as V8 doesn't get too greedy (the downfall of any system) and keep his wits about him, he should be able to bank safely and then see when his system is not working anymore and get out of it.

Never said one did. But he seems to be using an intraday system based off of capturing oscillations. I'm not so sure that system would work as well given other market conditions. If you look at fx market for the past couple months you will notice there hasn't been much of any sustained trend to it, it's just a bunch of whipsaw oscillations not really going anywhere. So his system would work well in this environment, but perhaps not well in others.

I'm not saying his system is bad or unworkable, I'm just saying that he shouldn't get too cocky about it before he has a chance to see how it performs given different market conditions.

[V8 Muscle]

Not to sound condescending, but this is small beans really. I've lost 250 in an hour. If you set your stops too high, you don't allow sufficient volatility. You have to be able to gauge when a profit taking is occuring and when a steep sell off is about to occur. Even in situations where all the technicals in place, market evidence will change everything.

and yes I know its small beans, but im not trading the kind of capital i used to be trading. Yeah I lost it after being a noob, but that **** happens.

and I lost 5k in 30 mins, so how do you like them apples? (not sure if thats something to brag about, but it was after I made 5k earlier that day)

How long have you been using this system? I wouldn't be concerned about a system that yields a ~90% success rate over a brief time period. Once you've tested it in all market conditions then you know you've got a workable system.

For the record, if you're taking drawdowns of 100p on a single trade, I think your risk:reward is ****ed. You're putting up 100p to make 140, not a good ratio. I use a 35-50p stop, the larger end is for more volitile pairs like the beast and some exotics, it's rare that I use anything over 35. I stay in trades for ~400+p, though once the trade has built up a nice cousion the stop gets moved up to where if I get stopped out I'm at worst break even.

Been using it for about 3 weeks (not as well as I should have, still learning how to use it properly). Once I get a program running to trade this thing for me, I'll be planning on scaling in my position over 75 -100 pips, playing the divergence, and waiting for a 150 pip drop that has usually come with divergences on my time frames. Once I get a nice cushion of profit I usually set it to breakeven in case **** happens, and I plan on doing something similar when its automated.

No system works 100% in every market. If someone found it they'd be the worlds richest person. Market conditions change so your strategy should as well. As long as V8 doesn't get too greedy (the downfall of any system) and keep his wits about him, he should be able to bank safely and then see when his system is not working anymore and get out of it.

this is exactly right. my system lives on volatility and only works on the eur/usd (only one i've found it to work on so far) because its such a volatile pair and reverses every day at least once

[Westboarder]

and yes I know its small beans, but im not trading the kind of capital i used to be trading. Yeah I lost it after being a noob, but that **** happens.

and I lost 5k in 30 mins, so how do you like them apples? (not sure if thats something to brag about, but it was after I made 5k earlier that day)

... And you never bought Sirius stock ever again...

[Idioteque]

Absolutely miserable quarter turned in by JPM. That was ugly but I am sure the street will spin the hell out of it to the point that it is unrecognizable.

Dood what are you talking about? They posted record Revenues and 36% increase YoY Net Income..I dont think you know what your talking about. Not to mention they smashed through every single analyst expectation. Not to mention being ranked #1 in M&A for practically every single category possible..

[V8 Muscle]

Never said one did. But he seems to be using an intraday system based off of capturing oscillations. I'm not so sure that system would work as well given other market conditions. If you look at fx market for the past couple months you will notice there hasn't been much of any sustained trend to it, it's just a bunch of whipsaw oscillations not really going anywhere. So his system would work well in this environment, but perhaps not well in others.

I'm not saying his system is bad or unworkable, I'm just saying that he shouldn't get too cocky about it before he has a chance to see how it performs given different market conditions.

and there are plenty of trending pairs in fx, just not eur/usd or usd/jpy. AUD/CAD, AUD/USD, GBP/JPY, etc are trending well and have been for the last few months.

[vref]

and I lost 5k in 30 mins, so how do you like them apples? (not sure if thats something to brag about, but it was after I made 5k earlier that day)

not trying to be nosy, but could you tell us what trades you made?

[Morbid_Mind]

and there are plenty of trending pairs in fx, just not eur/usd or usd/jpy. AUD/CAD, AUD/USD, GBP/JPY, etc are trending well and have been for the last few months.

http://www.bloomberg.com/apps/news?p...d=aLYQxd8ffxck

AUDUSD is probably the strongest trend out there. GBPJPY is not, it went from 148 to 152 in 7 months, strong trend Some real exotics have been trending fairly decently IIRC, the USDNOK is one of the better ones, but don't hold me to that.

The problem as of late with the yens is the BOJ has been doing manipulation when the yen gets too strong. Y90 is the point in which you can expect them to dump some yen on the market.

[southernstunna1]

fuccccc

my dad sold 4 S&P 940 puts a week ago when it was trading around 880. We're at 939 right now and I'm sure the market will be trading upwards tomorrow. fuccccc. They were selling for a buck earlier today and now 940 contracts are selling for 4.10. Disaster.

[FranchiseKid]

Dood what are you talking about? They posted record Revenues and 36% increase YoY Net Income..I dont think you know what your talking about. Not to mention they smashed through every single analyst expectation. Not to mention being ranked #1 in M&A for practically every single category possible..

Yeah, you are right. I have not a clue what I speak of......

Loan losses up
Reserves double from 2008
Gains came from Investment Banking division during a time of epic equity issuance (hence fees)
Home equity charge-offs up 2+x
Prime mortgage charge-offs up 3+x

Completely engineered financial environment from The Fed & Treasury. Yields are being held artificially low and reserve deposits now pay interest. If JPM cannot turn in better results in this type of enviroment, they never will. I think they are the top bank out there but anyone that thinks they turned in a "soaring" quarter needs to peel back a couple layers of the onion.

[mcichocki]

Been using it for about 3 weeks (not as well as I should have, still learning how to use it properly). Once I get a program running to trade this thing for me, I'll be planning on scaling in my position over 75 -100 pips, playing the divergence, and waiting for a 150 pip drop that has usually come with divergences on my time frames. Once I get a nice cushion of profit I usually set it to breakeven in case **** happens, and I plan on doing something similar when its automated.

Trust me...I'm not hating on you.
The markets will do what they want to. To try and predict how many pips it will move each wave isn't real bright IMO.
By now I'm sure you're familiar with the term swing high or swing low right? If not or for others that arent...look that ish up.
Hell, run a 4% model indicator and look at how it turns at swing levels. Those are market structure levels (prime support and resistance).
You're other S&R levels should come from consolidation points aka CHOP. Use S&R for context and then trade divergence into those levels...this will up the odds quite a bit over taking divergence in the middle of nowhere.
Maybe you're doing this or similar, it didn't sound like it though and I wanted to input my 2 cents.

I know...blah blah blah. It's all over on TB I bet, I wrote lots of stuff over there. LOL

[V8 Muscle]

not trying to be nosy, but could you tell us what trades you made?

dont trade like that. please. do yourself a favor.


but that trade i had vix calls when the market blew up in october. hit a 5 bagger in a day, then blew it and bought more when i should have sold.

[V8 Muscle]

Trust me...I'm not hating on you.
The markets will do what they want to. To try and predict how many pips it will move each wave isn't real bright IMO.
By now I'm sure you're familiar with the term swing high or swing low right? If not or for others that arent...look that ish up.
Hell, run a 4% model indicator and look at how it turns at swing levels. Those are market structure levels (prime support and resistance).
You're other S&R levels should come from consolidation points aka CHOP. Use S&R for context and then trade divergence into those levels...this will up the odds quite a bit over taking divergence in the middle of nowhere.
Maybe you're doing this or similar, it didn't sound like it though and I wanted to input my 2 cents.

I know...blah blah blah. It's all over on TB I bet, I wrote lots of stuff over there. LOL

and yeah i've been watching the longer term divergences and scaling in when they show up. today the market was nuts and its all earnings pump right here, but im scaling into shorts at this point. way too many divergences on the 1-2 hr charts to ignore it. after running 80 points on /es in 4 days i think we're due for a pullback anyhow, should be good for eur/usd downside. I know you're not hating on me or whatever, input is always good. As for the range, I dont try to predict the range on a trade I let the divergences and my indicators do that for me. Historically though its moved about 100-150 pips on a decent move, even though thats kinda choppy considering how it moved previously.

[Morbid_Mind]

Yeah, you are right. I have not a clue what I speak of......

Loan losses up
Reserves double from 2008
Gains came from Investment Banking division during a time of epic equity issuance (hence fees)
Home equity charge-offs up 2+x
Prime mortgage charge-offs up 3+x

Completely engineered financial environment from The Fed & Treasury. Yields are being held artificially low and reserve deposits now pay interest. If JPM cannot turn in better results in this type of enviroment, they never will. I think they are the top bank out there but anyone that thinks they turned in a "soaring" quarter needs to peel back a couple layers of the onion.

JPM has large credit card exposure, do you know what the stats were for that this quarter? I have to believe that defaults and charge-offs increased

[vref]

fuccccc

my dad sold 4 S&P 940 puts a week ago when it was trading around 880. We're at 939 right now and I'm sure the market will be trading upwards tomorrow. fuccccc. They were selling for a buck earlier today and now 940 contracts are selling for 4.10. Disaster.

tell your pops to hedge that **** if he didn't already

[vref]

Anyone here into statistics+probability, Monte Carlo, etc?

I've recently been getting into it so I can up my options IQ... makes things a lot clearer.

[southernstunna1]

tell your pops to hedge that **** if he didn't already

he got lucky and the S&P closed at 940.03. haha he lost 3 cents a contract, which comes out to like 12 bucks. Extremely lucky.


EDIT: and by closed I mean the options closed at 940.03. ETF options close in the morning actually, rather than closing in the afternoon of the 3rd friday.

[vref]

he got lucky and the S&P closed at 940.03. haha he lost 3 cents a contract, which comes out to like 12 bucks. Extremely lucky.


EDIT: and by closed I mean the options closed at 940.03. ETF options close in the morning actually, rather than closing in the afternoon of the 3rd friday.

oh, these expired this month?

i didn't see that.. i thought he was writing them for like next month in which case he might be fukced

[Kernkraft]

Anyone here into statistics+probability, Monte Carlo, etc?

I've recently been getting into it so I can up my options IQ... makes things a lot clearer.

taking applied financial econometrics right now, applied statistics along with time series analysis first quarter spring 2010, and then i'm auditing a doctoral multivariate statistics class after I'm done in May...

... so hopefully after all those classes I'll be able to answer your questions...

what's your general question though ... I have an journal article somewhere here on monte carlo simulation with delta hedging (i think that's the title... or was it gamma bridging, little drunk right now)