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Profile: davidjohnhall
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User Name: davidjohnhall
Groups: Gold User, Member, Platinum User, TeleChart
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Joined: Monday, June 06, 2005
Last Visit: Saturday, April 07, 2018 9:56:10 PM
Number of Posts: 1,157
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Last 10 Posts
Topic: tc 2000 gives me a new dream
Posted: Monday, June 02, 2014 11:32:04 PM

Hi Flux,

 
Awesome reply.  You said it, the market can be scary.  I've been bitten by that shark a few times.  But focusing on the shark when you trade means that you "trade scared".  And trading scared leads to losses, mistakes, emotional trading, rationalizing, inability to close losers or let winners run.
 
If you trade well in simulated mode that lets you know that you have a good understanding of how the markets move.  Now you need to learn how to manage risk.
 
There's no avoiding it.  
 
I think I read an anecdote somewhere about a a man who was about to face off another man in a duel to the death (this was a long time ago).  The man said to his friend, don't worry, I'm an excellent marksman.  I can shoot an apple off a post.  And his friend said, "That's great, but can you shoot that same apple when it's pointing a gun right back at you?"
 
In the first instance, shooting an apple off a post, there is no risk of loss.  In the second one, there's a huge risk -- the risk of life.
 
I think the fear of loss or problems that come up when you have money at risk is not talked about enough.  That's why i love this thread -- because for me -- it's the most important part of trading.  
 
You can read a lot about it in my favorite trading book -- Trading in the Zone by Mark Douglas. 
 
He says that one of the worst things you can do is to trade like the market is your adversary, out to get you.  This will cause a ton of mistakes.
 
In truth, the market doesn't even know you exist.  it's simply generating information based on the last trade -- and that information gives you an opportunity to do something -- sit out, place a trade, take a trade off, add to a position, reduce a position.  
 
What you do should be based on a method you have worked out that works for you and is profitable.  
 
Once you have that it's a matter of putting it into practice.
 
I don't know what your financial status is, but I know you can at least afford the $30/mo for Telechart.  That's $360.00 per year over 9 years -- that's $3,240.00.  
 
Why not take a small amount of money -- say $500.00 and open an account at Scottrade or TD Ameritrade.  I mention these two because they have low limits for opening accounts.    
 
Once you have done that, place 2 trades per month.  At $7 commission per trade for Scottrade ($14.00 for a round turn buy and sell) that will put you at $336.00 in commissions for the year.  
Your goal should be paying for those commissions and ending up flat or ahead for the year.    
That's it.  Only break even.  If you lose the whole thing -- then that's fine -- it's just a little more than the cost of 1 year of Telechart membership.  
 
It's my belief that even if you loose the whole thing you will get your money's worth in education.  
 
Just something to think about.  
 
FYI: Mark Douglas says that it's our goal to learn how to trade with the same ease that we feel while we're just watching the markets or paper trading.  
 
Ideally you want to see an opportunity, make a mental note that it's your kind of set up, decide how many shares to buy based on your money management method, place a trade, keep it open if it's working and close it if it's not.  All without any change in emotion.  
 
I can tell you that I am definitely not there myself but getting closer every day.  
 
Good luck to you and thank you for your honesty, Sir!
 
David John Hall
Topic: tc 2000 gives me a new dream
Posted: Thursday, May 22, 2014 12:05:16 AM

 

Thanks, flux,
 
Diceman is right, or I interpret things the same way.  Wait for your trade.  Wait for it to set up.  Learn which types of trades work for you and specialize in those trades.  Breakouts, pullbacks, reversals -- maybe one single pattern.
 
I like breakouts -- and sometimes bounces.
 
From my perspective, there is only one mentor you need -- the market.  It will always be honest with you -- and it will always let you know when you are right or wrong.
 
Other than that, keep coming to the forum.  Post a lot. 
 
And start trading with real money.  Trade just for the commissions.  Trade with $100 -- and try and earn the commissions.  Don't worry about making money.  Just begin trading with real money.
 
Pick a trade, post it on the forum with your ideas for entry, or keep the trades to yourself -- but move away from paper trading as soon as you can.  
 
As for the software vs. market question, I agree with dice man again.  The software is just your current way to access to the market.  But there have been others who haven't used any software.  Darvas traded his "boxes" from week delayed telegrams from his broker.  He didn't even use charts.
 
It's all about you. 
Topic: tc 2000 gives me a new dream
Posted: Saturday, May 10, 2014 10:24:16 PM

You're welcome, flux!  You are not alone.  Emotion plays heavily into trading. I used to be down right spastic when i was trading.  

You just need to flip what you are feeling on it's head -- which is no easy thing to do and it took me years.

When you are taking a loss, you should be fearful that it will continue forever.  

A lot of traders don't take losses because they're hoping the trade turns around.  They say "Let's wait and see if this comes back and I'll get out at break even..."  But that day may never come.

You should also play "wait and see" with your winners.  Give it room to become a really big winner.  you only need a few a year.  Of course, some of your small winners may slide back to zero.  

Always look at the chart.  If the chart looks positive, stay in.  Wait for the chart to tell you to get out.  

Let's take one of this year's huge winners, PLUG.  Let's say you bought one of the first breakouts:

The very next day you have a good gain, like this:

Up 10%.  Nice!  But now you're getting nervous.  You want to lock in those gains.  You can do a few things here and the choice is yours.  

If you're happy with 10% -- grab it.  Why not.  But if this is your average gain you have to be much faster to take your losses.  They should be around -3% on average.

Also, you have to be content with taking your 10% and then watching this run higher without you -- if that's what it does.

You could move your stop up under today's low as well.  That would put you at break even if you want to give it room to grow. 

The next day you get this:

Ouch -- down -3% and you are really getting nervous.  What if this is the start of a slide?  What if it takes away all of your gains?

But you have to calm yourself down -- and look at where you are.

You broke out on volume -- this down move is on lower volume.  And your stop has not been hit.

So you hold, and you "wait and see" in accordance with your plan.  I give these 10-15% room to move based on volatility.  But that comes with the very real possibility of them sliding back to break even.

But I know what I'm looking for -- I'm looking for the big move.

And the next day we are rewarded for trading it right --

Wow -- a 60% move.  On even greater volume.  Here I would probably take some shares off.  But I'd leave some on and play "wait and see" with this profit.

Notice how this is the opposite of how most play "wait and see" with losses?

Flip this chart around, pretend you are losing.  How far would you let it go?  Let's say we are perfect traders and we leave it open.  

An even bigger gain!  We are killing it.  But look at the volume.  It's rising still..

Do you want to wait and see again?  Nervous now?  really nervous?  Take off some more of your position.  Let's keep the rest open.  See what happens.

Up another 13% -- but this candle would make me think.  The volume is dropping and we could be topping out.  I'm looking for a 5 day move so I put my stop under today's low and see what happens.

And the next day we are taken out -- but not after gaining over 100% on our trade.

And plug wasn't even done there.  It went on to gain over 1,000 over the next few months.

Anyway, this was just an example of the ways I use the charts to manage my emotions.  

It's not fool proof.  I still have to work to manage my emotions. But it helps that i know what I'm looking for, I have a plan that I execute, and I know all of the stats for my system so I know what to expect.

Anyway, good luck to you, sir!

David John Hall.

Topic: Moneystream divergence
Posted: Thursday, May 08, 2014 4:18:06 PM

Hi bryclen,

I remmeber when I first started trading I went into a friend's office (we worked together at the time) after another failed breakout and I yelled: I need to learn how to tell if a breakout is going to fail!

Haha.  If i knew that then I would be a fat with cash in no time.  For me it's more about how I manage the breakouts I trade -- cutting the losers fast and letting the winners move.

As far as knowing which way a breakout will go -- I only know once it happens.  i try not to anticipate.  

So here in AAPL it's heading sideways in a channel.  If we're looking at moneystream, we see a cross to the downside under a moving average before the breakout.  

But one instance does not make a rule.  You'd have to look at more charts and see if you notice a pattern developing.

Here's the chart:

The upside fakeout around 11:50 is a sign as well.

Let me know if you discover anything!

David John Hall 

Topic: Moneystream divergence
Posted: Thursday, May 08, 2014 3:55:46 PM

Turns out TWTR did not want to hit my target and slid back for a wash.  

I guess if you were pkay with tighter stops and smaller potential gains you could have gotten out a few different ways.

A trend line break:

Swing lows:

And seeing as this is a thread on moneystream, a cross of moneystream on a moving average:

In my experience, 50-60% of breakouts fail, but you should be able to get sme very nice runs about 2-3 times a month daytrading and the rest will be small gains.  

This was cool -- I'll have to do this again sometime.

David John Hall

Topic: Moneystream divergence
Posted: Thursday, May 08, 2014 11:18:32 AM

Time for work!  

TWTR is still making new highs, moneystream is confirming (if it even works intraday haha) and the stop is at break even.  

Let's see what the rest of the day brings.

Have a good day everyone.

Topic: Moneystream divergence
Posted: Thursday, May 08, 2014 10:58:53 AM

New highs here after a couple bars consolidation.  What I don't like here is the lack of volume coming in.  I'd move my stop to just below the breakout zone essentially making this a free trade.

Also, moneystream still looking strong.

 

Topic: Moneystream divergence
Posted: Thursday, May 08, 2014 10:42:39 AM

Well, twitter looks to have made a break and moneystream is now at new highs.  

David John Hall

Topic: Moneystream divergence
Posted: Thursday, May 08, 2014 10:40:05 AM

Seeing as we've already started this discussion using TWTR, let's see how it plays out with moneystream as the guide.

TWTR gapped up this morning and consolidated and is now looking for new highs.  And moneystream is kind of confirming.  Does it even work on intraday charts?  No idea...

Next, here's my target after the base break, based on a 50% retracement of that down move.

The stop would be around the $30.97 area.  So about $1 risk for about $3 gain.  

Oh, and breakouts fail a lot.  Sometimes I think spending time with monks in the mountains would be better training for trading breakouts.  But if you keep your targets at least 3 times your stops you can make money.  

But this is just an exercise -- I want to see how moneystream plays out in this trade.  

David John Hall

Topic: tc 2000 gives me a new dream
Posted: Thursday, May 08, 2014 10:12:09 AM

Hi Flux,

Should start trading with real money as soon as you can.  Even very small amounts.  It would be better to learn what it feels like to win and lose $10 real dollars than $10,000.00 fake dollars.  It's a very different animal.

It's great that you have spent your time learning and perfecting methods, but give it a shot and see how you do.  Your education may begin all over again.  

Just a few thoughts.

David John Hall