Most books on computerized trading suggest using one formula that typically has about a 60% success rate, money management and stop loss orders. Isn't it better to have ALOT of information (i.e. more than 15,000 formulas based on over 30 indicators)? Why limit the trade amount if the trade is likely to be profitable? Why use stop-loss orders since they ensure a loss? If you have the strong stomach of an iceboater, then you can use Elliot Wave perspective to figure out if any trapped positions will be re-visited (and subsequently exceeded in price). This takes the place of the stop-loss. Reasonable profits are usually taken as soon as they occur, since the market never goes straight up. This results in a rotation of the numerous accounts managed (each one, except the largest ones, is usually fully invested). The account rotation also serves as a money management vehicle. Weighted dollar cost averaging is utilized within the largest account when the position is down and poised to go up. Day trading utilizes 5 min Heikin Ashi, 5 min CCI, 5 min HA Diff, 1 min CCI, 1 min TSI, 1 min Klinger Histogram, 1 min Awesome Oscillator and 1 minute R-squared. The daily chart is also reviewed to gain perspective. Failed formulas for specific prints are regularly replaced.
Sunday, August 18, 2013
MY APPROACH TO TRADING TNA/TZA
Most books on computerized trading suggest using one formula that typically has about a 60% success rate, money management and stop loss orders. Isn't it better to have ALOT of information (i.e. more than 15,000 formulas based on over 30 indicators)? Why limit the trade amount if the trade is likely to be profitable? Why use stop-loss orders since they ensure a loss? If you have the strong stomach of an iceboater, then you can use Elliot Wave perspective to figure out if any trapped positions will be re-visited (and subsequently exceeded in price). This takes the place of the stop-loss. Reasonable profits are usually taken as soon as they occur, since the market never goes straight up. This results in a rotation of the numerous accounts managed (each one, except the largest ones, is usually fully invested). The account rotation also serves as a money management vehicle. Weighted dollar cost averaging is utilized within the largest account when the position is down and poised to go up. Day trading utilizes 5 min Heikin Ashi, 5 min CCI, 5 min HA Diff, 1 min CCI, 1 min TSI, 1 min Klinger Histogram, 1 min Awesome Oscillator and 1 minute R-squared. The daily chart is also reviewed to gain perspective. Failed formulas for specific prints are regularly replaced.
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