ONLY for those interested in Trading or currently Trading...The rest of you could just spare your time and get back to the sajha homepage as you'd just waste your time here.

 

Having seen the success of eminitrader's threads which pertained mostly to stocks and not much about strategy used, do any of you want to talk about your technical strategy, you charting system used and the financial product (your forte) you trade on a daily basis.  Don't know how many of you do it, but if you've backtested your charts you could see the winning percentages on your trades that would allow for a better understanding of getting into-out of the market (certain charting companies like CQG allows that but its mad expensive...paying about $1G a month on that alone for an intro packet but at the same time, its the best I've ever used so far).  Using CQG for backtesting certainly has made my understanding of the product and trading it a lot better as the emotion involved  (loving a stock too much or getting into it too early) have pretty much been eliminated or questioned.  BTW, I'm wondering if anyone else out there uses CQG too.  Or you could talk about your charting software and mention why you think its good.

So far, I've met a few Nepalese folks who are trading for various firms out there and they have been doing pretty well in the past few years but for some reason all of them prefer sticking to equities...Anyway, not my concern as I'm more interested in the strategy used.  The same strategy can be used in all markets as long as there's a price action charts on them and analysis could be done on it.

What are your strategies on range-bound markets (I use the RSI along with the Parabolics on Treasuries...wierd combo but its been going great so far)?  What about trending markets (been using ADX and Parabolics)?  And anyone trading spreads (these seem a lot more easier to forecast than solely trading the outrights)?  And any trading strategies you could talk about or if any you want to ask me about (butterflys, etc.).  And Most Importantly, I'd love to know your strategy for Risk Management and Wealth Preservation.  Keep the discussion going...Lets do it.

"Money never sleeps, pal": Gordon Gecko in Wall Street

 

PS: All ya academicians who think technical analysis is voodoo sciene, pls stay outta this one and spare me the "it doesn't work" theory.  Been doing it for a few years and have seen all others around me do it with success for the past few years, that if I met my Finance Professor again, I'd show him my PnL for the past few years and laugh at his face.  Traders on the Street live by it and feed their families off it.

 

 

Hey Samsara, I did talk about the strategy in my other thread but people seemed more interested in stock picks than strategy.

Here is one of my favourites; MACD Histogram, BBs and ADX for intraday futures. All three can be used to identify the strength of a trend. In a strongly trending market all three will show strength or weakness together, otherwise it is a range bound market where you use the Histogram divergence and BBs to fade the move.

After that 10% of the battle is picking the right time frame and 80% is the ability to manage risk. I will love to share what I know but I did not share futures strategy in my other thread because it is way riskier than stocks. With stocks if you can identify the macro trend, you can make money and the market is more forgiving but with futures you can identify the macro trend and still lose money because of the leverage.

I haven't done anything with Treasuries but know a little about ag commodities and spreads. Currently I'm reading Dynamic Hedging by Taleb. Do you have any suggestions for good options or forex books?

Samsara,

Thanks for creating this useful thread! I am sure people would love to read more stuff on this topic from ppl like you, eminitrader and other traders in sajha who can contribute. Please post more stuffs when you guys can!

I don't have anything to contribute at the moment, but hope to participate soon if I can concentrate on trading subjects. Right now I am just learning the basics just like many other eager to-be traders!

 

Hey emini, nice to see you here.  Yeah, your threads did have strategy but as you put it, "people seemed more interested in stock picks than strategy", so I guess it was lacking a little in that particular dept I was looking for.  However, I did get some very good tips from that thread.  As most of the folks who visited their site, I've always appreciated your good work here.

Moving from Market Making to Prop trading has indeed been an experience so far.  I've now added trading the spreads mainly on the treasury futures and cash (trying to add to my FX forte) for the past 2 months and the RSIs have been working well in these spreads mainly beacuse these are range-bound markets...I assume stochastics too may work really well for the rangebound trades (as one of my co-workers uses that ONLY along with the moving averages and has been making a killing lately!!).  Today I backtested the BBs (though not a fan of it) and didn't see it as successful as the other indicators were on these spreads at all.  However, for trending markets, ever used the ADX along with the parabolics?  It's pretty neat as the ADX I feel can give a good entry signal whereas the parabolics are perhaps the best indicators to jump outta a trade (as they're also a SAR signal).  Trading these indicators along with a brief fundamental analysis every morning when the economic data comes out (8:30am EST) has really improved my previous method of using Fibonaccis with MACDs...very unconventional but it worked well in FX Spots but not in treasuries.  However, as you said leverage in futures is the only drawback I feel can cut me dry as the institutional players in this market are huge and I've seen instances when these large players often create an artificial spike against the technicals to throw off the individual traders whose stops are triggered...After this, the market turns back to its original course.  As per the Street, many are speculating the current rise in oil prices being pushed by the oil companies themselves.  These companies have trillions at their disposal (more than all the major IBs and Banks combined) and could forcing a buy side bias and thats what their traders have been doing lately.  Would hate to be in oil (long or short) right now...Hey, was talking to another trader today and he talked about spreading oil and wheat.  Sounds like a good strategy as these markets have been correlated for the past few months now.  I'll backtest that and will let you know what I feel on that.

Also for FX books, I read Cornelius Luca's Trading in the Global Currecy Markets a few years ago and it was the best I've ever read on FX.  As for Options, haven't read much (mostly on the net) but Marcel Link's High Probability Trading was a great read and gave good insight for novies as well as the experienced pros.  And on Treasuries, am currently reading the Treasury Bond Basis by Burghardt.

Anything on Risk Management?  I feel that I have a lot to learn in that (the recent IB fiascos show how little that is taught here...LOLs).

Simple Life, thanks!  If you're starting in this field, I recommend books like Dr. Elder's Trading For a Living and Mark Douglas' Trading in the Zone to get your mentality set like that of a trader.  All the best and hope to hear of some of your strategies soon.

 

anyone know what to do ?

i got hit with PDT margin call...

they telling me to deposit 25k in cash... and i dont have that much in cash sitting around....

any suggestions ?

here is my account as of this morning..

Lato idiot, let me be nice to you since my trades today are going well and I'm in a real good mood.  BTW, don't tell me you didn't know that you'd be hit with a PDT if you continued day-trading like how we pros do it (but you do it on a personal brokerage account).

Ok, If you don't meet the margin call, then you have a 90 day restriction on all your trades and account.  You will have to end up withdrawing your money.  But the way around that is to trade somewhere else. Open another account now so that if you ever break the rules before you reach $25K again and can't meet the margin call you can just roll your money over somewhere else.  How can you get them to forget?  Continue reading:

BTW, if it is your first incident, then send them an e-mail or call and explain that you didn't know about this rule and beg them. They may forgive you as its up to their discretion.  You can still daytrade the same stock a couple of times in a week without getting a PDT margin.

Note, if you buy C on Monday, you can sell it on Tuesday morning then buy it again Tuesday afternoon, sell Wednesday, buy again later Wednesday, ad infinitum without a worry about getting a PDT at all..

Finally, A word of advice for all you novies, make a calendar where you mark any day you make a day trade.  As tedious as it sounds, it is better than losing access to your account for 3-6 months!

actually it is not my 1st time.. this has happeneed before.

then i got again yesterday.. so i wasnt able to buy anything...

because of the Margin call, i cant even withdraw cash .., i cant buy.. 90 day restriction...

i only can Sell what i have...

i think i better look into opening account IB or Scottrade....

also is it possible to get PDT call if u are using just cash account ?

or

does PDT only apply to margins account ?

If you make more than 4 trades a week you are considered a day-trader so you'll need at least $25,000 in your account. This is true whether you stay with your current broker or a new one.

Looks like you are buying options these days. Just one advice, stay away from thinly traded options like HIMX. If you are going to do options just do large cap stocks or ETFs.

You need to go with discount brokers like Interactive Brokers  or Scottrade. You paid $700+ in commissions, that is 3% of your portfolio. It all adds up.

Since, VIX has spiked you'll get good money for your puts. If I were you I'll start taking some profits here.

Anything new in the market?