M6 - Man, Mind, Money, Markets, Method & Madness

[anuragmunjal]

anuragmunjal

Thanks for your input.
Can you specifically guide how to add positions?
In which timeframe,which scrip,etc ?
By posting charts if possible.

hi

posting charts wd be difficult for me as I am not well versed in uploading charts. it becomes very time consuming for me.
the tf does not matter.. stick to the tf you are comfortable trading with. (preferably higher). once you have identified that the breakout is 'valid'.. shift to a lower (preferably much lower tf). you can use breakout of pivots on lower tf to add, or even failure of breakdowns (which are on the opp side of your trade) again on lower tfs to add.
you may use any other way, which you are comfortable with, to add. the idea is to milk the maximum out of a good move.

regards

 

[anuragmunjal]

last two years I have traded every breakout in usd/inr, euro/inr, copper, lead, nickel, NG, crude, gold, silver, zinc and aluminium. and I mean each one.. apart for the one month or so when mcx seemed to be in trouble due to Nsel crisis. I do not see any problem in trading all breakouts, managing one's trade I believe is more important.

regards

 

[DSM]

Anurag, just posting my comments.

I find so many parameters to be confusing
This is the cause of the problem. Trading is simple, don't complicate it.

there is a lot of ambiguity.
There is no ambiguity when you have seen the chart in the higher timeframe.

I believe too much emphasis on entry is not right.. entry is but a small part of the 'trading process'. there is much more to trading than mere 'entries'.
True. Entry is one part. Being clear about reason for going long or short is just a start. Next is understanding the RR to the trade. Knowing the SL at the time of entry will give you an idea if the trade is to be taken. Next is to trail SL, and understand where to book profits.

I think the point that I made was missed by all.... keep on testing waters with one or two lots, giving small losses here or there and capitalize big by increasing your qty. Again, have a different view. As a means of analogy it is like taking an axe to chop wood. After sometime seeing it is not working, using different angle of axe, swing, force to chop more wood. It still will not work. What will work is to be disassociated from your trading, and check your trades. Where did the market turn? What were you thinking then? This can be the most important and insightful discovery you make about yourself and your trading method. Did you take the entry.? How far did you ride it? Did you exit early? Why? Did you trail your SL? What if you got stopped? What did you do thereafter? What way did the market move after your SL was hit? Do this a few times, and this will change the way you trade and turn your PL around or for the better.These two points itself will help you to know your thought process and understanding what you are doing right or wrong. It is like being detached from chopping wood, and realizing the ah ha moment - that the axe needs to be sharpened and not your swing corrected.

***

If you look at the chart posted, you will surely understand that as per the strategy you state is not to be applied after an upswing. I have posted a similar chart of Nifty a few months back, where Nifty trended strongly, and then was rangebound for about a week. The same scenario is repeated now. Understanding past charts, and reviewing them, will reinforce learning. Much more is learnt by self study than with reading intellectual knowledge, as this learning comes from experience. My 2C. Trust this helps.

 

[anuragmunjal]

hi Dsm

you have firm beliefs.. they may work for you. but what I see is an endeavour to be correct 'most of the time'. I believe being correct and making money are two different things altogether.

give you an example to prove my point. I believe collectively the 'dabba operators' or 'bucket shops' would have raked in a sizeable amount in trading, worldwide. the 'entry' is not even in their hands. someone, after doing all homework , takes a trade. the 'dabba operator' just stands opposite to it. he has no say whatsoever in 'entry' or 'exit'.. but he still makes money...where is his edge.....
whenever his client will make money, he wd make on one position size. generally taking small profits, and more often than not average down his loosing position and generally blow up his account in one or two bad trades.
this is precisely what I have advocated.. give a small loss in one or two positions, and once you get a good one, milk it to max. there is no confusion, no ambiguity.

regards

ps. I do respect your point of view, just sharing mine.

regards

 

[jamit_05]

A trader should not take all breakouts that come by, he will not gain out of this discipline. Instead, he could strive to become able to gauge the importance of the breakout. And sieve out the ones that do not seem to fulfill the purpose. As a result, he will reduce trades and expenses, and improving avg returns per trade.






I find so many parameters to be confusing.. there is a lot of ambiguity.
I believe too much emphasis on entry is not right.. entry is but a small part of the 'trading process'. there is much more to trading than mere 'entries'.
I think the point that I made was missed by all.... keep on testing waters with one or two lots, giving small losses here or there and capitalize big by increasing your qty. once you are in a good move. that to me is the essence of trading well.

regards

Sure, making adds is a proven successful approach. But, what i didn;t mention was that I trade 15min on nifty intraday and hence do not get enough candles to make adds.... but i do see that if i were trading hourly then making adds would be a suitable thing to do.

In fact, Turtle traders made a name for themselves trading all breakouts.

 

[jamit_05]

@anurag

I understand why you might say that you do not like to look at too many parameters. You see that as confusion and counter-productive. You trade so many counters making it difficult to track. It makes sense for you to catch a breakout, with part qty, if it proves its mettle, add to it... else let the Stop Loss do its job.

 

[jamit_05]

last two years I have traded every breakout in usd/inr, euro/inr, copper, lead, nickel, NG, crude, gold, silver, zinc and aluminium. and I mean each one.. apart for the one month or so when mcx seemed to be in trouble due to Nsel crisis. I do not see any problem in trading all breakouts, managing one's trade I believe is more important.

regards

In what timeframe do you trade these 11 counters?

 

[DSM]

Thank Anurag. Yes, I now have firm beliefs, because I know what works for me. Am not rigid, so try to be open to learn new things, gain insights. I don't worry about being right or wrong. Every trade can fail. A strategy that has made me good money trading commodities, failed 4 times yesterday. EOD, I reviewed each candle, and trade, and analysed my thought process, what was on my mind. I realized that twice I was a bit early into the trade, and twice the trade was right on all my parameters. I learnt from the experience and I am clear what I will do next time. I keep a note of my thought process, trade setups, and other factors that will impact my decisions.

In trading, I believe the market can do anything, and even with the best strategy we can expect a string of losses. However, what I lay emphasis is on being able to analyse the RR of each entry and the ability to take the trade without question if the criteria is met. Even if it comes after a string of losses. However, if I have a few consecutive failed trades and don't feel up to it, I feel its o.k. to take a break and be away from the market for a while.

Re. what others do, should not influence our thinking. I am only concerned on setups that work for me, my RR ratio, my SL, trailing SL, and exit levels. And anything that I can learn or improve upon is important.

hi Dsm

you have firm beliefs.. they may work for you. but what I see is an endeavour to be correct 'most of the time'. I believe being correct and making money are two different things altogether.

give you an example to prove my point. I believe collectively the 'dabba operators' or 'bucket shops' would have raked in a sizeable amount in trading, worldwide. the 'entry' is not even in their hands. someone, after doing all homework , takes a trade. the 'dabba operator' just stands opposite to it. he has no say whatsoever in 'entry' or 'exit'.. but he still makes money...where is his edge.....
whenever his client will make money, he wd make on one position size. generally taking small profits, and more often than not average down his loosing position and generally blow up his account in one or two bad trades.
this is precisely what I have advocated.. give a small loss in one or two positions, and once you get a good one, milk it to max. there is no confusion, no ambiguity.

regards

ps. I do respect your point of view, just sharing mine.

regards

 

[anuragmunjal]

In what timeframe do you trade these 11 counters?

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I take all mechanical entries for my initial trades. I do not look at any TF for initiating a trade.

regards

 

[jamit_05]

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I take all mechanical entries for my initial trades. I do not look at any TF for initiating a trade.

regards

It seems you do not refer to charts.

You might be looking at important levels like previous week's high or low for entry and doing the follow up with adds.