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MidKnight

Market Wizard
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Posts posted by MidKnight

  1. Posted

    MidK, I can't tell you great it was to see your post. Your area was hit hard by the quakes, from what I heard, and I am happy to see that you are well.

     

    Best Wishes,

     

    Thales

     

    Thank you! :cheers: It's been a rough year to be honest. Current count is over 7,300 aftershocks. Aside from the SEP 2010 quake, the other big ones have been 5-10 km from my house. The house is a wrecked, the city has been closed since FEB 2011 as they demolish large amounts of the city. I'm still living in the house and waiting for my insurance to finally assess the damage and payout the full replacement of my policy. There isn't anywhere else I can really go. It's still liveable, but its on a lean, grossly out of level and every corner of the house has significant vertical cracking to blow the cold winter winds right through it. In summer time, that sort of ventilation could be quite nice though :p

     

    Take care!

     

    MK

  2. Posted

    Hi Cory,

     

    I've been silent on this forum for a LONG time and honestly haven't been to many trading forums for quite a while....

     

    Waiting is productive and unless you are market making it is one of the most crucial things to master! You must remember that trading is not like other jobs where you must be doing things to make money. All trading is, is recognizing the when opportunity is present, acting, and managing. The rest of the time is waiting. I'd say that probably 90-95% of time trading is waiting. During waiting I'll do research, scan the markets probably hourly, chat with some trader friends via IM, listen to music, read some trading forums, go play with the dogs etc etc. It is not unusual that I'll spend a full 13 hour day 'trading' to do zero trades. I know its hard to change our mindset to this when we have been taught virtually our whole life to work HARD towards what you want to achieve, but trading often does require us to do the opposite of what is conventional.

     

    All my best,

    MK

  5. Posted

    It is true Cory. That ever so seemingly simple concept took me 5 years to even start to accept, but once I did things started to get a lot easier AND a lot more boring. Please don't interpret that as me saying I don't find trading enjoyable, I just mean there can be long periods of doing nothing, sometimes several days in a row but I still punch into work every day and see what the day holds. Those are my hardest and most exhausting days -- when I do nothing.

     

    I wouldn't say I have fully accepted the concept yet, but significantly more than I ever have in my life.

     

    Glad to see you are still trading and pursuing your goal.

     

    With warm regards,

    MK

  7. Posted

    <-------------------------------------------------------------------->

     

    The important part is to enter WITHIN 20 pips of the daily low. The RAT REVERSAL is only one entry method.

     

    <-------------------------------------------------------------------->

     

    Hi TRO,

     

    As Jeff65 had previously asked and went by unanswered, I would like to ask the question again. When you state to enter within 20 pips of the daily low, what does that mean?

     

    If you mean to enter within 20 pips from the current day low then yeah, everyone would want to do that. No one knows where the daily low is until the day is over though...

     

    With kind regards,

    MK

  9. Posted

    I have excessively done this when I was scalping the nikkei and HSI. It works outstanding in high volatility conditions (like the start of the subprime debacle). Over the past year though I have altered things do it both ways, and that is to double/tripple down as long as the trade idea is still valid AND aggressively add to my winners. The market is fluid and dynamic, so I need to be as well.

     

    With kind regards,

    MK

  10. Posted · Edited by MidKnight

    Come on, Steve. At least let every one know that you have the capacity to figure out when the Dax opens for trading.

     

    Stop being a dick - OK. This isn't ET. While you may not agree with this thread, there is no need for you to create tension through useless posts like above.

  12. Posted

    As price approaches and enters our S/R target, stops get tighter and tighter as the likelihood of an immanent reversal rises. On the daily chart below, the area between the hash lines represents the 1.2900-1.300 target level for this move. We were willing to add in case the move would have continued, but we did not want to risk more than 50% of our open profit. Also, when pyramiding, we try to keep margin as a % of equity to 33% or less. As price moves against us, margin as a % of equity rises. If it rises to 33% or higher, we stop ourselves out of at least part of the position to bring margin as a % of equity below 25%, and preferably at 20% or below.

     

    attachment.php?attachmentid=23132&stc=1&d=1291209372

     

    Had last week not been Thanksgiving week, we'd have added to our position at much higher levels, and it would have been apparent that we keep our stop much farther away when we anticipate a sizable swing is underway. But as we move closer and closer to S/R, we "ratchet" our stop in - typically moving the stop to the last entry once price is both a) below a break point and 2) 100+ ticks from that entry. We then add to the position with a market order somewhat above the next break low point.

     

    For example, our second to last add was at 1.3090. A few hours prior to that, price made a low of 1.3067. From that low, price rallied to 1.3123, pulled back,rallied to 1.3149, and then fell back below 1.31232. We entered short at the market which at the time gave aus a 1.3090 fill. Why add there and not wait for the break of 1.3067? Because this way, when we move our stop to break even, a reaction back to test "support now resistance" should cause a test of 1.3067 +/- a handful of ticks, and our stop should be safe from a shake out on that test.

     

    How's that?

     

    Best Wishes,

     

    Thales

     

    That was excellent - thanks a lot Thales :)

  15. Posted

    Thanks Thales. I have been applying the same rip cord rules on my adds as well, so they are really treated is independent trades. Because you are not choosing to make that distinction your trade management approach for the adds makes sense to me. Thank you for the reply.

     

    With Christmas cheers for your ears,

    MK

  17. Posted

    Hi Thales,

     

    That is the type of trading I have been doing over the past 4 or so months - great work for team Thales! While that type of trading is not as action packed as day trading, I find it hugely more profitable, but at the cost of trading being somewhat less engaging. Please don't get me wrong, it is still highly enjoyable. When you catch a run like this and you add fairly aggressively to the winners at no extra risk, your R/R goes through the roof. They don't happen every week and that is part of what makes this type of trading unattractive to so many people I think. At least, that is a large part of why I dismissed this type of approach in my early years. I was too hung up on being right and developing a trading style around high win %. I ironically though, the opposite is more profitable for me - go figure!

     

    With kind regards,

    MK

  18. Posted

    Hi Cory,

     

    It's good to hear about your experience over the past year. Sadly, people need to go through these experiences and survive through them. I know many people (including myself) have touched on several areas that you mention in your post, such as:

    - small timeframes

    - importance of context. I was strongly commenting on this importance early on in the real-time thread

    - excessive risk and it's partner patience

     

    It took me 4 years of full-time trading to become a BE trader so I know very well the ups and downs and self-doubt one goes through along the journey. Everyone will be different and there is no need to compare yourself to the results of others. My only small piece of advice is that while it is great to have a plan going forward as you have outlined above, I also think one needs to keep an open mind and try various things out. I don't mean try things just for a week and then try something else. I'm meaning more to keep an open mind and continue to explore, measure, assess, and refine. I think this is especially crucial in the learning stages as not only does one need to find what works in the markets (and honestly, probably every method can work when applied properly), but they also need to find what fits them.

     

    For example, this year I opened my mind to adding to my winners and it has made an enormous change to my trading. Not just in my bottom line, but also to my psychology. Keeping an open mind without being completely sidetracked is a skill to be acquired and one that has taken me 5 years to acquire.

     

    With kind regards,

    MK

  19. Posted

    While this regulation has no impact on me as I only leverage up within the 2-5 : 1 area, I think the overall idea is dumb. People can self govern their finances without restriction and also wear the responsibility of the results. What actual benefit does this regulation have? (non-rhetorical).

     

    With kind regards,

    MK

  22. Posted

    While at present there are no retail packages that make the order book, depth of market, information available for anything other than visual reference, it is rumored that TS V9.0 will. This means that these orders are being place by entities with far greater resources than any retail and many commercial traders.

     

    Hi there,

     

    There are and have been retail packages (at least 1 that I know of) for some years with the ability to use the order book in a programmatic fashion. Check out Neoticker - this has been available for quite some time.

     

    With kind regards,

    MK

  23. Posted

    Funny how James always had a handle on these things....

     

    Guess you never notice the good times until they are gone...

     

    This post was totally not necessary - what value or positivity does your comment add to this thread? You may think it was funny, clever, or witty or something, but ET'ish behavior like this is not welcomed.

     

    I was in the software industry for nearly 20 years and upgrades virtually never go smoothly - use Microsoft as an example and they employ many many very bright programmers. There are always unforeseen problems and quirks that arise. I have faith that MMS and his partner are working to rectify the problem and it will be addressed in a prompt fashion. MMS and crew are doing a great job taking over this forum I'm very glad that it was someone like them; experienced traders, forum participants, and all round good guys.

     

    Lets stay respectful to the community rather than being sarcastic and trying to find ways to dig into them.

     

    Regards,

    MK

  24. Posted · Edited by MidKnight

    At the start of the year I had the opportunity to have dinner with a senor FX trader for the ANZ bank (they account for over 30% of all NZD transactions). He was a very nice UK chap, really warm and friendly buying drinks non stop for the table (damn those bank bonuses!). Anyhow, the guy told me that the majority of the bank profits generally come from their FX trading division and as has already been said it comes from the spread and the fact that they do front run large client orders. Also quite a lot comes from structured products too. I tended to envision it a little bit like being in the pits - they can see the order flow and play accordingly.

     

    Later on the guy gave a talk on something and made a prediction that the pound was going to rally. This was in about Feb 2010 and with hindsight we all know what has happened. Goes to show ya though, these guys have no idea where the market is really going. Embrace the uncertainty of the markets - everyone must face it.

     

    With kind regards,

    MK

     

    PS: On a separate topic, I've read about 1/2 of that millipede thread that daedalus posted and there is really really good stuff in there I think. I'm testing his 'legs' approach across 13 pairs for the year to date.

  25. Posted

    Hi daedalus,

     

    Let me start off by saying that for whatever reasons I seem to be in conflict between scalping and a swing'ish style approach. I tend to find the swing trading time frame a lot easier to analyze and get right but due to my own personal hangups and long built beliefs I am also drawn to the 'work' of scalping. I have never been able to make scalping really work for me on a consistent month over month basis, but like a blackhole it still seems to suck me into revisiting it every now and then....

     

    I agree with virtually everything you say about larger time frames. I'd also add that IMHO, the real market moving forces in FOREX don't even see the small noise people try to scalp around. Aligning with their actions and time frames makes it a bit easier.

     

    I find the 24 hour nature of FOREX difficult to accept for swing trading because I do not want to give up my control to enter and then manage the entry. I sometimes feel that if I could find a way to accept or an approach that manages that somehow then I'd be gladly swing'ish trading the FOREX. But so far I have come up nil.

     

    I guess everything I am saying here points to me not yet at peace between not scalping and being more of a swing'ish trader. As usual with trading, everything is a trade-off :(

     

    I like the idea of going all zen too.

     

    Finally, thanks for the pdfs and links. I like what the millipede guy is doing to some degree. What I __try__ and implement is to swing trade but campaign based upon my trend model - which is mostly a 4H chart view. This is sort of like his approach of adding more legs except it just gives me a little more control to re-evaluate before going back in. Yeah I know....I sound like a control freak, but I'm not honest - haha. I just feel that if I'm putting orders in at X, Y, Z and walk away or go to bed then I need to put my stops way further back (essentially no stop) and this would obviously not be so good for the famous R:R people love to talk about ;)

     

    I have high hopes for this thread. Off to a good start.

     

    With kind regards,

    MK

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