Is spread betting for fools?

[nit2wynit]

53 minutes ago, Caseynotes said:

You don't have a system unless you have a set of rules that govern every step for every trade. Most people's system actually comes down to 'I'll pull the trigger when I think things look right', that's not a system, you are instead relying on emotion to make consistently correct decisions, when the decisions become inconstant self doubt creeps in and then the fear, you may as well stop right there.

As I said further back, you need to get scientific, otherwise you are shooting from the hip at shadows.

Develope a rule based system, test it to prove it's validity and then trial it live. If you are not doing this you are wasting your time.

I see what you're saying Casey.  What I mean is the fear got me first therefore the system failed .  Not the system itself but the process.

 

I have a checklist.  My problem again today was an old one.  Anticipate the drop instead of riding it.

 

So what I mean is I failed to apply the system.

[dmedin]

1 hour ago, Caseynotes said:

You don't have a system unless you have a set of rules that govern every step for every trade. Most people's system actually comes down to 'I'll pull the trigger when I think things look right', that's not a system, you are instead relying on emotion to make consistently correct decisions, when the decisions become inconstant self doubt creeps in and then the fear, you may as well stop right there.

As I said further back, you need to get scientific, otherwise you are shooting from the hip at shadows.

Develope a rule based system, test it to prove it's validity and then trial it live. If you are not doing this you are wasting your time.

 

What should those rules be?

[Caseynotes]

41 minutes ago, davidbrister said:

@nit2wynit It is dangerous beast to train and control, and even with the strictest rules set in place, (type type them up and print them out, stick on PC side or wall above monitor) once you press the Go Button, doubt and 2nd guessing yourself turns you into a monster. 

Even now with my Auto Trading, im analyzing the open trades too much and get that fear of should i adjust something instead of just let it go. I dont touch it, but by god do i want too, lol.

 

😂

[Caseynotes]

21 minutes ago, nit2wynit said:

I see what you're saying Casey.  What I mean is the fear got me first therefore the system failed .  Not the system itself but the process.

 

I have a checklist.  My problem again today was an old one.  Anticipate the drop instead of riding it.

 

So what I mean is I failed to apply the system.

I was just making general comment rather than referring directly to your system, what you say is experienced by almost everyone at some stage. People think they should develope a 'feel for the thing' and once they get that all will be fine but the reality is that you need to expel emotions from the equation because they will always be inconsistent and it's the inconsistency that causes the failure. Having a playbook of rules means the on the spot decision making is excluded and is the only way to the constancy you need to succeed. A bit like programming an algo to trade for you.  

[dmedin]

What if your well-planned rule-based system results in losing lots of money?

[Caseynotes]

15 minutes ago, dmedin said:

 

What should those rules be?

The rules for a system don't have to be extensive because really there are only so many ways a trade can play out.

Before that though you must decide what type of trading system the rules are to be applied to, the broad basics, swing or reversal or day trading, that list I posted recently in the Technical Analysis thread covers it.

So you have already decided type, time frame, time to trade, amount to risk etc well before looking at the charts.

Then it's just a list of simple rules to govern the actual trade, if this happens then I do that, that are applicable to the type of trading you have decided on.

For example,

I will enter long if ?MA crosses above ?MA when both are above the upward sloping long term ?MA.

I will set a stop loss at the most recent swing low.

If the trade progresses the ?MA will act as my trailing stop and I will exit when price closes below it.

It really can be as simple as that, if it works on demo over 20 trades (has a risk/reward ratio and win rate plot on the profitable portion of the graph (ask if you want to know more about this)) then go ahead and trial it live at minimum size. 

So with rules in place all you need to do is act the robot, follow the rules and keep the emotional wreak you really are well away from the decision making process 🙂

 

 

 

 

[Caseynotes]

27 minutes ago, dmedin said:

What if your well-planned rule-based system results in losing lots of money?

If you are losing lots of money stop what you are doing because you are doing it wrong and start on a new plan 🙂 

[Caseynotes]

On 17/06/2019 at 07:21, Caseynotes said:

This is a good article, 20 questions you need to be able to answer;

20 Questions For Help Building a Trading Plan

System

1. What type of trader will I be? Swing, trend trader, trend follower, day trader, Elliot Wave, Fibonacci, CAN SLIM, option trader, another, or a combination?
2. What time frame will I be trading on?
3. What are my trading rules?
4. What signals my entry?
5. What will signal my exit?
6. Do I use a trailing stop or a price target to lock in profits?
7. What will I be trading?
8. Will I trade long or short or both?
9. What is the probability of my trade working out based on historical data?
10. What has to happen to invalidate my trading system and make me look for flaws in my thinking?

Psychology

1. How big of a position size can I mentally and emotionally handle trading?
2. Does my chosen trading method fit my personality for activity and risk tolerance?
3. Do I truly believe that my method will work and be profitable?
4. Do I enjoy trading?
5. Do I have the mental strength to persevere until successful in trading?

Risk

1. How much of my trading capital will I risk per trade?
2. How many losses in a row with this level of risk will lead to blowing up my trading account?
3. How much will I lose at one time if all my open positions go against me at the same time?
4. How correlated with each other are all your open positions and your potential trading vehicles that are on your watch list?
5. Do you fully understand the potential risk in what you are trading?

http://www.newtraderu.com/2014/01/07/6072/

The list mention was posted in this thread not the Technical Analysis thread, here it is again.

[nit2wynit]

****!!!

Went out with a Trade running.  Stop in place but not Guaranteed.  Weekend.

Should I be concerned?? :O

 

[Guest davidbrister]

10 hours ago, dmedin said:

What if your well-planned rule-based system results in losing lots of money?

@dmedin,  Change it!!! because theres a fault that you havent realised yet. 

Find yourself a trading partner, some one u trust, that you can bounce ideas off and discuss plans strategy, get them to read and go over your plan, maybe you missed something, a 2nd pair of eyes and a fresh brain might pick it up.

I would have hoped that this sort of forum could be that trading partner, but maybe its too open, depends like myself sharing my Auto Trade Program im putting it out there for the experiment, but for some who are more sheltered 1 on 1 or a small group may be better.

best of luck. 

Edited June 22, 2019 by davidbrister

[Guest davidbrister]

7 hours ago, nit2wynit said:

****!!!

Went out with a Trade running.  Stop in place but not Guaranteed.  Weekend.

Should I be concerned?? :O

 

@nit2wynit, the market is closed now, so you cant do anything till it reopens monday morning, but watch out for opening crazy ups and downs before it settles in for the day.

[dmedin]

6 hours ago, davidbrister said:

@dmedin,  Change it!!! because theres a fault that you havent realised yet. 

Find yourself a trading partner, some one u trust, that you can bounce ideas off and discuss plans strategy, get them to read and go over your plan, maybe you missed something, a 2nd pair of eyes and a fresh brain might pick it up.

I would have hoped that this sort of forum could be that trading partner, but maybe its too open, depends like myself sharing my Auto Trade Program im putting it out there for the experiment, but for some who are more sheltered 1 on 1 or a small group may be better.

best of luck. 

 

I had hoped someone would pick up on my JD Sports idea (I have an active short on that) but I guess it isn't interesting enough

 

[Guest Jd sporting goods trade]

9 minutes ago, dmedin said:

 

I had hoped someone would pick up on my JD Sports idea (I have an active short on that) but I guess it isn't interesting enough

 

Put it in the shares forum

[Guest davidbrister]

20 minutes ago, dmedin said:

 

I had hoped someone would pick up on my JD Sports idea (I have an active short on that) but I guess it isn't interesting enough

 

What was your JD Sports idea? i must have missed that sorry

 

[Caseynotes]

22 hours ago, nit2wynit said:

****!!!

Went out with a Trade running.  Stop in place but not Guaranteed.  Weekend.

Should I be concerned?? 😮

 

If it's a UK company keep an eye on the Weekend FTSE, it doesn't appear to have moved much so far but if it looks like taking off in the wrong direction you might consider a taking out a hedging trade on it.

[nit2wynit]

1 minute ago, Caseynotes said:

If it's a UK company keep an eye on the Weekend FTSE, it doesn't appear to have moved much so far but if it looks like taking off in the wrong direction you might consider a taking out a hedging trade on it.

Thaks Casey, but this was just a Test to get Live again.

I've never left a Live trade open over a weekend before.  Worried it'll spike up ten million points and wipe me out.

It's not a Guaranteed stop.  What will happend it it was to open 100 points in either direction of my Limit or Stop?

[Caseynotes]

25 minutes ago, nit2wynit said:

Thaks Casey, but this was just a Test to get Live again.

I've never left a Live trade open over a weekend before.  Worried it'll spike up ten million points and wipe me out.

It's not a Guaranteed stop.  What will happend it it was to open 100 points in either direction of my Limit or Stop?

You will suffer or be rewarded with a 100 points of slippage as @Foxy points out in the other thread. Looking on the bright side if war breaks out you are likely to gain so keep your fingers crossed 😳

[dmedin]

At least you won't end up with negative balance.

[nit2wynit]

On 22/06/2019 at 21:06, dmedin said:

At least you won't end up with negative balance.

It was OK, I stopped it out at -£2.50, but I think the weekend charges are £13 lol, just checking thru the statement now :O

[WallStFoxy]

On 22/06/2019 at 08:09, dmedin said:

 

I had hoped someone would pick up on my JD Sports idea (I have an active short on that) but I guess it isn't interesting enough

 

@dmedin

OK I'll bite, Looks like a great one to short just need to keep an eye out for a bounce of 590 otherwise just hold short till it changes. I didn't realise you use a program, is it your own on proreal?

[dmedin]

3 hours ago, Foxy said:

@dmedin

OK I'll bite, Looks like a great one to short just need to keep an eye out for a bounce of 590 otherwise just hold short till it changes. I didn't realise you use a program, is it your own on proreal?

 

It's the in-built ProRealTime one.

 

[WallStFoxy]

4 minutes ago, dmedin said:

 

It's the in-built ProRealTime one.

 

@dmedin

I didn't even know they had one, must take a look. 👿

[nit2wynit]

Hi, figured I'd give you all an update.  I posted here last night but hadn't logged in so lost in the Guest ether I suppose.

The Fear well and truly has me.  I've decided to pull most of my funds out leaving only £550.  I simply must get this under control.  I'll shoot back and forth to the Demo, but wean off the Demo entirely eventually.  If i don't see a return on this £550 then I'll need a serious rethink about my Future as a Day Trader.

Feel better already.

Wold love to hear from you all regarding the chart below.  This is a typical chart I would anticipate a drop soon as it reaches Resistance.  Share price been dropping a lot and recent news suggests even more to come.  What do you all see?  As you mentioned earlier @Caseynotes,  I have now lost my Trust of what I'm doing.

 

 

[dmedin]

I've also had one of those days where I realize how futile and pointless all of this is.

Take heed from the pros and experts who quit day trading and make their money from selling courses, books, seminars, training etc.  If even the 'best' get out of day trading hell as soon as they can, what does that mean for those unfortunate punters still trying to make it work for them?

Edited June 25, 2019 by dmedin

[nit2wynit]

Ironically, FOLO got me today.  Even with a £550 account size.  I didn't place the Bet.  Just missed out on £70 quid lol.

You see.  I can spot them.  but now I don't suffer FOMO, just FOLO  ****

 

 

 

[WallStFoxy]

32 minutes ago, dmedin said:

I've also had one of those days where I realize how futile and pointless all of this is.

Take heed from the pros and experts who quit day trading and make their money from selling courses, books, seminars, training etc.  If even the 'best' get out of day trading hell as soon as they can, what does that mean for those unfortunate punters still trying to make it work for them?

@dmedin

Don't get so down on yourself, follow your picks up and down don't just look for a quick short, if a share price trend turns up go long in fact long is safest with shares because unless you get yourself a Northern Rock or something the price will come back sooner or later but that is not true about a short. 👿

[nit2wynit]

55 minutes ago, nit2wynit said:

Ironically, FOLO got me today.  Even with a £550 account size.  I didn't place the Bet.  Just missed out on £70 quid lol.

You see.  I can spot them.  but now I don't suffer FOMO, just FOLO  ****

 

 

 

....but at least I'm not down lol

[WallStFoxy]

Why You Should Never Short Sell Shares.

https://www.marketwatch.com/story/why-you-should-never-short-sell-stocks-2015-11-19

Everybody should read this before they short sell. 👿

[Caseynotes]

15 minutes ago, nit2wynit said:

Ironically, FOLO got me today.  Even with a £550 account size.  I didn't place the Bet.  Just missed out on £70 quid lol.

You see.  I can spot them.  but now I don't suffer FOMO, just FOLO  ****

Picking tops and bottoms is a tough game, maybe they will maybe they won't, that's where the fear comes from. 

Have to ask though, what are your indicators doing? They don't really match what you are looking for.

If you are looking to react fast your MAs are not really going to help, the volume in this case is not doing much and MACD, though it did show divergence, is slow and great for trends but not for fast turns.

Stand back and look at the chart, there were a couple of good moves there and if you had matched the BBands to something fast like Stoch you have something that is telling a story.

The first move down didn't offer any pullbacks, they are hard to jump on, you always think they are about to end and of course if you do jump on they inevitably will. The following pullback ( to first oval) was a bit too strong (big candles) but worth a look as it bounced off the band with the stoch turning but never really took off to continue with trend, the second oval had the bounce off the now upturned B band MA, the stoch turn and the candle reversal pattern for a long entry and turned out to be the best opportunity of the day.

So try to match the tools for the job you are wanting to do whatever that may be.

 

[nit2wynit]

@Caseynotes I'll be quite honest here.  I don't even know how to use MACD, or most other indicators for that matter.  

I simply look down the shares list for anything under £20, has moved 5% and has a minimum of 50pts moved, then look to the chart, notice the volume and whatever the red green histogram is.......I only saw that at 4pm, literally at the point I posted it and anticipated the drop, which it did, but I lost my nerve even after it turned.

I'm cool with still being £550 for today.  At least it's not a loss.

Edited June 25, 2019 by nit2wynit