ProchargedMopar's Trading Trilogy

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TheRumpledOne
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Postby TheRumpledOne » Sun Jan 24, 2010 4:04 am

prochargedmopar wrote:Well, I blew out my practice account on the big e/j drop. Why oh why?
$275 allowance money down the tube.
But what does my grandpa always ask.........DID YOU LEARN SOMETHING.

If I did then it was a VERY inexpensive lesson.


Do I need to put you in TIME OUT again?
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Postby razorboy » Sun Jan 24, 2010 4:32 am

I assume you mean that your biggest win is always ahead of you..........

and if so, then indeed it is.

I just started trading equities on a one minute chart at a prop firm using the same system I used on daily FX charts.....everyday I get a year's worth of opportunities in 6 hous and 10 minutes (I never trade the first 20 minutes after open......I'm just not that quick and the price action is like there was just a major new release)

PTG wrote:
razorboy wrote:Does this chart set up give you a positive mathematical expectancy?

Peter Crowns gave you everything you need to know...stop with the silly bounces, crosses or whatever. Work one signal and back test, back test, back test - this is the only way you will get the confidence you need to keep putting on trades. Use a signal that keeps your losses short and let your profits run........take a trade, put in a stop loss and walk away. The worst you will do is lose, which is exactly what happens when you cut a trade short. You need to build up the discipline to let them run, which if you look at this logically, should not be too hard given your results (and my early results) by cutting them short.

You are not the limiting factor(I assume you are a fully capable being and able to turn on a computer, launch your software and enter trades), the ability not to function like a casino is the limiting factor. Do you understand the probabilities behind a blackjack or roulette wheel?


That is absolutely spot-on. Even better, you don't have to invent your own system. Pick any system with a proven edge. They're all over the place.

Take a system with an edge, ANY edge, and apply it ruthlessly. Stick to it. Do NOT modify, or you will be punished for it as I was. The picture below is from a statistical system that I run (a volatility breakout system) and I had the desire to specify taking profit at a point according to pre-defined rules. This bit me in the a$$ big time. I could have been up a whopping 9% on my account had I stuck to the rules. I need that badly to compensate for the bad days.

But look at the profits this simple system can achieve ! Simply by applying the rules on a daily basis; put in your orders, move the s/l the following day if still in trade, done. Walk away and let the market do its thing. No sweat. Unless you don't stick to the rules that are the basis for the edge; see below. I learned a lesson (again). No more modifying. Stick to the rules regardless of drawdowns (and the biggest one is always ahead of you).

Try it and see if you can do that. See if your head doesn't fook you up and test yourself if you really can stick to a system with a known, proven edge and continue to stick to it.

Remember trading is a means to an end, not the end itself (well at least not for me).

Image
Ya, I manufacture clear shoe boxes.....http://www.clear-shoe-boxes.com.............who would have thunk!

http://thejoshkerbelproject.com/

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Postby MightyOne » Sun Jan 24, 2010 6:02 am

Enough with the Atomic Wedgies, PRO has had enough :oops:

It is easier to make money trading than it is to dial for pizza (fewer buttons to push).

Repeat after me:

1. Trade the breakout

2. Trade the breakin

The breakin could be your stop loss from the breakout trade...

Now trade the bare minimum required to add another zero to your account by the end of the year via returns that are compounded monthly.

If you had $400 to your name it could look like this:

yr1. $4,000
yr2. $20,000 + $20,000 check
yr3. $100,000 + $100,000 check
yr4. $100,000 + $900,000 check
yr5. $100,000 + $900,000 check

If you happen to blow up $100,000 it will only be ~11% of your annual income (It would be like making $45,000/yr and losing 5k)

-----------------------------------------------------------------------------------

You will notice that you only need to make ~ 20% per month.

Your main focus is not blowing up so you trade just enough to reach your long term goals and not a penny more.

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Postby prochargedmopar » Sun Jan 24, 2010 9:27 am

MightyOne wrote:Enough with the Atomic Wedgies, PRO has had enough :oops:

It is easier to make money trading than it is to dial for pizza (fewer buttons to push).

Repeat after me:

1. Trade the breakout

2. Trade the breakin

The breakin could be your stop loss from the breakout trade...

Now trade the bare minimum required to add another zero to your account by the end of the year via returns that are compounded monthly.

If you had $400 to your name it could look like this:

yr1. $4,000
yr2. $20,000 + $20,000 check
yr3. $100,000 + $100,000 check
yr4. $100,000 + $900,000 check
yr5. $100,000 + $900,000 check

If you happen to blow up $100,000 it will only be ~11% of your annual income (It would be like making $45,000/yr and losing 5k)

-----------------------------------------------------------------------------------

You will notice that you only need to make ~ 20% per month.

Your main focus is not blowing up so you trade just enough to reach your long term goals and not a penny more.


What tha?
yr2 for a $20,000 check.
F that!!!

I don't understand. 2. Trade the breakin


15 straight trading days without a losing day.
Default bal. $47.00, current balance $176.10.

I'm sticking to the PLAN.

My trading log 1/2 way through first round. 2.5 rounds to go before scaling back to 2% risk a trade.

Default Bal. 47.00 - Target 460.10 round 1 (30 trading days)

Day/Date/pips/P-L/Bal/lot size

1-4 +52 $8.00 Bal. 55.00 (2)
2-5 +32 $6.70 - 60.96 (3)
3-6 +50 $9.00 - 69.96 (3)
4-7 +32 $6.38 - 76.34 (3)
5-8 +18 $5.49 - 81.83 (3)
6-11 +41 $7.30 - 89.13 (3)
7-12 +22 $9.19 - 98.32 (4)
8-13 +18 $7.04 - $105.36 (4)
9-14 +19 $7.20 - $112.56 (4+)
10-15 +22 $8.80 - $121.36 (4)
11-18 +22 $10.88- $132.24 (5)
12-19 +21 $10.60- $142.84 (5)
13-20 +16 $8.12- $150.96 (5)
14-21 +22 $13.72- $164.68 (6)
15-22 +19 $11.42- $176.10 (6)
#1BODY in direction of profit #2INCREASE lot size Obsessively
My Losses cause me Great Laughter!
Trading Bible here> therumpledone/the-ideas-that-i-trade-by-t3256/page1670

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Postby PTG » Sun Jan 24, 2010 10:23 am

No that wasn't a typo - your biggest [highlight=red]drawdown[/highlight] is ahead of you.

Let's say you have your account of 400$ to your name and the Kelly number is such that it allows you risk x% and you lose 20 times in a row, which isn't impossible. Your account will have had a little haircut the size of 400 times (1-x*1/100) to the power 20. Fast forward, you didn't commit suicide and weren't discouraged by this slight setback, your account is up to 40.000$, and you run into a losing streak of 20 times. This time, the haircut is a bit bigger.. :lol:

You have to be mentally prepared for events like these or you will be looking at the Cuckoo's Nest from the inside out.

razorboy wrote:I assume you mean that your biggest win is always ahead of you..........

and if so, then indeed it is.

I just started trading equities on a one minute chart at a prop firm using the same system I used on daily FX charts.....everyday I get a year's worth of opportunities in 6 hous and 10 minutes (I never trade the first 20 minutes after open......I'm just not that quick and the price action is like there was just a major new release)

PTG wrote:
razorboy wrote:Does this chart set up give you a positive mathematical expectancy?

Peter Crowns gave you everything you need to know...stop with the silly bounces, crosses or whatever. Work one signal and back test, back test, back test - this is the only way you will get the confidence you need to keep putting on trades. Use a signal that keeps your losses short and let your profits run........take a trade, put in a stop loss and walk away. The worst you will do is lose, which is exactly what happens when you cut a trade short. You need to build up the discipline to let them run, which if you look at this logically, should not be too hard given your results (and my early results) by cutting them short.

You are not the limiting factor(I assume you are a fully capable being and able to turn on a computer, launch your software and enter trades), the ability not to function like a casino is the limiting factor. Do you understand the probabilities behind a blackjack or roulette wheel?


That is absolutely spot-on. Even better, you don't have to invent your own system. Pick any system with a proven edge. They're all over the place.

Take a system with an edge, ANY edge, and apply it ruthlessly. Stick to it. Do NOT modify, or you will be punished for it as I was. The picture below is from a statistical system that I run (a volatility breakout system) and I had the desire to specify taking profit at a point according to pre-defined rules. This bit me in the a$$ big time. I could have been up a whopping 9% on my account had I stuck to the rules. I need that badly to compensate for the bad days.

But look at the profits this simple system can achieve ! Simply by applying the rules on a daily basis; put in your orders, move the s/l the following day if still in trade, done. Walk away and let the market do its thing. No sweat. Unless you don't stick to the rules that are the basis for the edge; see below. I learned a lesson (again). No more modifying. Stick to the rules regardless of drawdowns (and the biggest one is always ahead of you).

Try it and see if you can do that. See if your head doesn't fook you up and test yourself if you really can stick to a system with a known, proven edge and continue to stick to it.

Remember trading is a means to an end, not the end itself (well at least not for me).

Image
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Postby razorboy » Sun Jan 24, 2010 12:54 pm

I see what you are saying.......as a trend trader I just tend to look at the glass half full (I've already accepted the whole massive drawdown possibility with my approach, which is always outweighed by the triply massive profit possibility)..........so yes, my biggest win is always in front of me :)


PTG wrote:No that wasn't a typo - your biggest [highlight=red]drawdown[/highlight] is ahead of you.

Let's say you have your account of 400$ to your name and the Kelly number is such that it allows you risk x% and you lose 20 times in a row, which isn't impossible. Your account will have had a little haircut the size of 400 times (1-x*1/100) to the power 20. Fast forward, you didn't commit suicide and weren't discouraged by this slight setback, your account is up to 40.000$, and you run into a losing streak of 20 times. This time, the haircut is a bit bigger.. :lol:

You have to be mentally prepared for events like these or you will be looking at the Cuckoo's Nest from the inside out.

razorboy wrote:I assume you mean that your biggest win is always ahead of you..........

and if so, then indeed it is.

I just started trading equities on a one minute chart at a prop firm using the same system I used on daily FX charts.....everyday I get a year's worth of opportunities in 6 hous and 10 minutes (I never trade the first 20 minutes after open......I'm just not that quick and the price action is like there was just a major new release)

PTG wrote:
razorboy wrote:Does this chart set up give you a positive mathematical expectancy?

Peter Crowns gave you everything you need to know...stop with the silly bounces, crosses or whatever. Work one signal and back test, back test, back test - this is the only way you will get the confidence you need to keep putting on trades. Use a signal that keeps your losses short and let your profits run........take a trade, put in a stop loss and walk away. The worst you will do is lose, which is exactly what happens when you cut a trade short. You need to build up the discipline to let them run, which if you look at this logically, should not be too hard given your results (and my early results) by cutting them short.

You are not the limiting factor(I assume you are a fully capable being and able to turn on a computer, launch your software and enter trades), the ability not to function like a casino is the limiting factor. Do you understand the probabilities behind a blackjack or roulette wheel?


That is absolutely spot-on. Even better, you don't have to invent your own system. Pick any system with a proven edge. They're all over the place.

Take a system with an edge, ANY edge, and apply it ruthlessly. Stick to it. Do NOT modify, or you will be punished for it as I was. The picture below is from a statistical system that I run (a volatility breakout system) and I had the desire to specify taking profit at a point according to pre-defined rules. This bit me in the a$$ big time. I could have been up a whopping 9% on my account had I stuck to the rules. I need that badly to compensate for the bad days.

But look at the profits this simple system can achieve ! Simply by applying the rules on a daily basis; put in your orders, move the s/l the following day if still in trade, done. Walk away and let the market do its thing. No sweat. Unless you don't stick to the rules that are the basis for the edge; see below. I learned a lesson (again). No more modifying. Stick to the rules regardless of drawdowns (and the biggest one is always ahead of you).

Try it and see if you can do that. See if your head doesn't fook you up and test yourself if you really can stick to a system with a known, proven edge and continue to stick to it.

Remember trading is a means to an end, not the end itself (well at least not for me).

Image
Ya, I manufacture clear shoe boxes.....http://www.clear-shoe-boxes.com.............who would have thunk!



http://thejoshkerbelproject.com/

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Postby PTG » Sun Jan 24, 2010 1:12 pm

Yeah absolutely. At the end of the day it goes hand in hand. The issue is how to get the glass completely full..

It's also interesting to note the basics of the Phantom of the Pits guy who's basic point is not that you enter into a trade with a positive expectation ("this trade is profitable until the market proves me wrong") but with a negative expectation ("this trade is not profitable until the market proves me right"). It creates a different mindset and is supposed to make you more vigilant w.r.t. cutting off unprofitable trades. Something to ponder on the Sunday afternoon perhaps..


see what you are saying.......as a trend trader I just tend to look at the glass half full (I've already accepted the whole massive drawdown possibility with my approach, which is always outweighed by the triply massive profit possibility)..........so yes, my biggest win is always in front of me Smile
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Postby razorboy » Sun Jan 24, 2010 3:11 pm

until i learned to think in probabilities, i never really knew hot to apply the phantom of the pits approach...........now its like a blind flash of the obvious


PTG wrote:Yeah absolutely. At the end of the day it goes hand in hand. The issue is how to get the glass completely full..

It's also interesting to note the basics of the Phantom of the Pits guy who's basic point is not that you enter into a trade with a positive expectation ("this trade is profitable until the market proves me wrong") but with a negative expectation ("this trade is not profitable until the market proves me right"). It creates a different mindset and is supposed to make you more vigilant w.r.t. cutting off unprofitable trades. Something to ponder on the Sunday afternoon perhaps..


see what you are saying.......as a trend trader I just tend to look at the glass half full (I've already accepted the whole massive drawdown possibility with my approach, which is always outweighed by the triply massive profit possibility)..........so yes, my biggest win is always in front of me Smile
Ya, I manufacture clear shoe boxes.....http://www.clear-shoe-boxes.com.............who would have thunk!



http://thejoshkerbelproject.com/

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Postby razorboy » Sun Jan 24, 2010 3:17 pm

I trade equities via direct access using hot keys - (no on chart trading) so technically, its easier for me to order a pizza.....

but your point is well taken.......


MightyOne wrote:Enough with the Atomic Wedgies, PRO has had enough :oops:

It is easier to make money trading than it is to dial for pizza (fewer buttons to push).

Repeat after me:

1. Trade the breakout

2. Trade the breakin

The breakin could be your stop loss from the breakout trade...

Now trade the bare minimum required to add another zero to your account by the end of the year via returns that are compounded monthly.

If you had $400 to your name it could look like this:

yr1. $4,000
yr2. $20,000 + $20,000 check
yr3. $100,000 + $100,000 check
yr4. $100,000 + $900,000 check
yr5. $100,000 + $900,000 check

If you happen to blow up $100,000 it will only be ~11% of your annual income (It would be like making $45,000/yr and losing 5k)

-----------------------------------------------------------------------------------

You will notice that you only need to make ~ 20% per month.

Your main focus is not blowing up so you trade just enough to reach your long term goals and not a penny more.
Ya, I manufacture clear shoe boxes.....http://www.clear-shoe-boxes.com.............who would have thunk!



http://thejoshkerbelproject.com/

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prochargedmopar
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Postby prochargedmopar » Sun Jan 24, 2010 7:34 pm

MightyOne wrote:
prochargedmopar wrote:Only way it will change is if there is a deletion of lines, squiggly or other, NOT an addition.

Last 10 days of trading log.

Actual starting balance 598.50
Default Bal. 47.00 - Target 460.10

Day/Date/pips/P-L/Bal/lot size

1-4th +52 $8.00 - 55.00 (2)
2-5 +32 $6.70 - 60.96 (3)
3-6 +50 $9.00 - 69.96 (3)
4-7 +32 $6.38 - 76.34 (3)
5-8 +18 $5.49 - 81.83 (3)
6-11 +41 $7.30 - 89.13 (3)
7-12 +22 $9.19 - 98.32 (4)
8-13 +18 $7.04 - $105.36 (4)
9-14 +19 $7.20 - $112.56 (4+)
10-15 +22 $8.80 - $121.36 (4)

Doubled money in 10 days.

My money management trading plan: "Pro's 20 pips to $Freedom$"

For the impatient the first 2-3 levels will be the hard part, after that the ball starts to ROLL.

Starting balance based on increments of 3.
$30.00, $300.00, ect

First Go round is using 10 cent pips to prove to yourself and to build confidence that you can succeed in your quest for freedom. A Dry Run.

New balance/Lot size/Daily profit/ # of days trading
Phase 1:

$30 - 10cents - $2per day - 15 days
$62 - 20 -$4 - 8
$92 - 30 - $6 - 5
$124 - 40 - $8 - 4
$154 - 50 - $10 - 3
$178 - 60 - $12 - 2
$234 - 70 - $14 - 2
$262 - 80 - $16 - 2
$294 - 90 - $18 - 2
$330 - $1 - $20 -2
$370 - $1.10 - $22 - 1
$392 -$1.20 - $24 - 2
$440 - $1.30 - $26 -1
$466 - $1.40- $28 - 1
$494 - $.50 - $30 - Time to go to FREEDOM Level

Start with $494 and use $2 pips!!!
Do it all over again but move Decimal one place to right..

Phase 2:

$494 - $2 - $40per day 3 days
$614 - $3 - $60 5
$914 - $4 - $80 4
$1234 - $5 - $100 3
$1534 - $6 - $120 2
$1774 - $7 - $140 2
$2054 - $8 - $160 2
$2374 - $9 - $180 1
$2554 - $10 -$200 2
$2954 - $11 - $220 2
$3394 - $12 - $240 1
$3634 - $13 - $260 1
$3894 - $14 - $280 2
$4454 - $15 - $300 PER DAY INCOME!!!

You add up the days....

20 pips a day baby.......I won't write up Phase 3 BUT.

START WITH $20 PIPS...... and finish with $3000 a day income...HEHEHEHE


It is better to do something similar to value averaging with your money management.

Lets say that you have $400 and wish to be a millionaire in four years:

You do the math and see that 20% compound per month will get you there.

At the end of the first month you have made 160% and you reduce your position size by 87.5%

At the end of month two you show a profit of 13% and increase your position size by 54%.

If you decide to stick to this goal that would mean that you are making $250,000 per year even if you can't pocket it just yet ;)

If you do not want to fall below your goal during any month then you could aim for 30% compound and adjust your position size accordingly.


After re-reading this today it makes perfect sense.
I've got 2.5 cycles to go first.
Plan your trade/Trade your plan
Last edited by prochargedmopar on Sun Jan 24, 2010 7:42 pm, edited 1 time in total.
#1BODY in direction of profit #2INCREASE lot size Obsessively
My Losses cause me Great Laughter!
Trading Bible here> therumpledone/the-ideas-that-i-trade-by-t3256/page1670

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