| Welcome Guest, please sign in to participate in a discussion. | Search | Active Topics | |
Registered User
Joined: 2/2/2005
Posts: 27
|
I have been using MACD-H settings at 10,20,5. It hasn't been working for me in this down market like I had been seeing in the up market. Is it typical to change settings dependent on market direction? Also haven't been able to use MS like I was.
Maybe just the volotility. Any suggestions?
|
|
Registered User
Joined: 10/7/2004
Posts: 2,181
|
I wouldn't expect anything short term to work very well right now until the market settles into its new trend or shows us that this was one more head fake and continues climbing (which I really doubt this time).
By the way, (I hope this doesn't sound unkind) of course your settings were working in an up market, almost all settings do (some better than others but they almost all work). We are now heading into the time when one can really sharpen their skills and find out if you have the tenacity to hang in there and find out what works in a down market.
Don't marry yourself to any settings. Become familiar with your own perspective on the market, know intimately what you want to accomplish (you should be able to put it in writing...go ahead, try it, it's not as easy as you think until you do it and it will help you really clarify your thoughts) and have a clear cut plan on how you will accomplish your goals.
Once those cornerstones are firmly in place, you'll have a much better chance of looking objectively at what settings you should be using.
I used to hate when people would say this, but you have to let the market tell you what's going to work at any given time and during any given trend. The market is nothing more than a huge graph of human emotions and the current thinking of a society. If you want to profit, you have to read it rather than trying to dictate to it. I know, I tried.
All the best
|
|
Registered User
Joined: 1/28/2005
Posts: 6,049
|
gatman08
This is typical of this type of market environment.
The best thing to do is analyze why trades failed.
Maybe it will led you toward increasing your probabilities.
Typically in this this type of environment a change in style
is required.
I typically trade the strongest stocks I can find but have switched
somewhat to more food tobacco type stocks. Things that have
displayed less volatility.
Obviously your timeframe and style all play a role in this.
Thanks
diceman
|
|
Registered User
Joined: 4/18/2005
Posts: 4,090
|
Diceman. Food tobaco? I've been tripping over allot of Utility stocks in my system... I've also noticed a few tobacco but most are out of my price range and already on the move... though I haven't opened the sector to look for candidates.
I keep thinking we are over sold, at least on the short term so I wouldn't want to short anythign right now and the indexes make another considerable drop. I've never experienced this.. When I developed my aproach (Which is still a work in progress) I "Watched it live" for a while before I traded it and was amazed at th nmber of next day to next week winners it produced...then I started trading it and it did well.. I was getting cautious about the market so I didn't manage the trades optimaly ,also because I was skittish after gettign bloodied for the prior year. BUT it was still producing good stuff tot he long side during the previous decline... This time no. I may get 6 stocks in my scan. Generaly not enough to mess with trading the next day.
But I see the Risk as high in going short right here.. even after one up day on low volume. Even the decline from the highs of the "Tech Wreck" wasn't straight down..... so I keep saying I'm waiting for a bounce, then I'll look at going short. However at this point i've been stopped out of all my non Utility stuff. I'm cautious now to load up on to much utility.. I think some diversity is probably a good thing. So far none of them have had any amazing nice pops or runs... but it SEEMS to be building... at least my utility stocks are climbing a bit in a falling market. Still giving good entry areas IMO.
Thanks for the tip on the food and Tobacco. I came across several Tobaccos last year and thoguht about them... particularily British American. But figured that there were other oportunities that could be just as proffitable. I hate Smoke... give me instant heart burn. Had a life time of blue collar jobs with co workers constantly puffing in my face.
GATMAN: i'd be inclined to say the volitility. This will be my first down trend of signifficance to whitness But I've noticed that downward moves tend to be more volitile. I think Tobydad is right. Don't stay married to the same Indicator settings OR wait it out a bit. I think the skill of a good trader is not that he can or can't be proffitable in any condition but that he sits out in conditions that are most likely to loose him/her money. (need to take my own advice) This way you are giving back less of what you made. So after things settle in a bit some of the volitility should drop a bit as the reality of the new trend sets in....it seems that Tops and bottoms have the most volitility to me Tops more so than bottoms IMO.... But bottom volitilty can become Velocity which is a good thing... Volitility bad thing. Actually I guess the same is true in it's inverse with tops... but perhaps the velocity hits first and then slows as the bottom is forming then becomes volitile into velocitious untill the trend begins to slow .. into volitility of a top leading to velocity into a trend down... till the trend slows into the bottom. Never thought of it quite like that. Perhaps some more experienced traders are more familiar with this cyclical flow.
|
|
Registered User
Joined: 3/1/2005
Posts: 34
|
Several years ago, when I was doing a lot of options trading (for me) I found the settings needed to be trimmed for each stock of interest and the backtesting had to include up trend times and down trend times. I know, this takes a lot more time in set up, but after I had done the due dilligence my options trading sucess on the vetted settings for each target stock was much improved. Remember, the technical trading strategies are a good guide, but no skeme is 100%.
The best tool of all is still your judgement after you have read the outcome of your model.
|
|
Registered User
Joined: 2/2/2005
Posts: 27
|
You know, guys, (are there any gals in here?) I do better in my paper trade account than I do in my real one. I find myself evaluating the few indicators I use, reading the press, evaluating the chart and making the trade without any second thoughts. In my real account I do the same, but then I am too hesitant to pull the trigger when all my signals tell me to. I also become attached to some of my holdings where I am totally detached in the paper account. I have come a long way since i started in the fall. All of you have been enormously helpful in the development of my trading strategies. Keep up the discussions, especially in the trading strategy area.
|
|
Registered User
Joined: 10/7/2004
Posts: 2,181
|
Some good points made in this discussion; let me focus on one particularly; individual backtesting. One of the tools that always makes sense before finally pulling the trigger is to roll back the timeline on any chart and see how a stock responded previously to whatever signal you might be seeing now that you think is saying to you, "Go!". Not all stocks respond the same.
One more thing, gatman, you've touched on an important issue for many traders: yes, paper trading is easy, going live is much different. This is why you must gain real confidence with your system and, as I have said until everyone else is blue in the face, put it all in writing! It will be much more clear to you when you put your trading system in writing.
You'll find that there are regular scenarios for which you have no plan because you haven't thought it through. It's difficult to do that much systematic thinking without recording your thoughts. Putting each thought on paper frees up cranial RAM to think more clearly about the next item
|
|
Registered User
Joined: 4/18/2005
Posts: 4,090
|
ha aha ha "cranial RAM" That's great .. I love it ! Perhaps I could get an upgrade !
|
|
Registered User
Joined: 3/21/2006
Posts: 4,308
|
Gatman08, In this type of a Market I suggest that you rely more on Stochastics and ADX DI + and DI- crossovers for trend indicators. Also I would have an arsenal of Volume based indicators to give early warnings of the change in price trend.
This market is giving a lot of bouncing price action oppertunities. these indicators with the proper settings will help you find the set-ups but you also have to play the trade correctly.
All just my opinion.
Apsll.
|
|
|
Guest-1 |