Monday, September 17, 2012

FAT8023 4th Week


Trader Shorted the AUD which came down about 20 ticks, put a stop near to entry and got hit later in the night with 2 ticks profit to cover comm. But, he was not so fortunate with the GBP and suffer losses in both trades.

Trader uses multiple time frames, 5 mins, 30 mins, 4 hourly and daily charts and MACD as one of the indicators for entry. He was caught himself too when the short term indicators failed him, he tried to stop the bull from charging forward.

He blamed himself for not being patient enough and not following the rules and refusing to take smaller losses even when the indicators start to reverse. A little lost of confidence after the account goes under, very normal emotion for a trader. Told me he will go slow and be more patient.

Met up with a few former Nikkei floor traders last night at the wedding dinner of the daughter of a mutual friend, all of them have reduce their trading volume tremendously just like me, that's how tough it is to make money trading short term now with the Algos in control. The rabbits were all caught by the Algos while the human traders become the sitting ducks when there is any news announcement, we just can't react fast enough.

The older traders like us were extremely lucky that we have our golden years, our skill is no longer suitable for today's technology

45 comments:

coconut said...

how contras, i just went to a funeral of a relative last night. she died of a cancer at a very young age.

my whole family was there and almost half of the time, they were discussing IR, what a shame.

i don't want to throw salt on wounds but from my heart this is what i will say to myself.

stop thinking about the good times and the killings or big losses, they are all history. we have to move forward.

how to move forward if we keep having all the negatives thought in our mind. i certainly can't trade with negatives thinking. it has to be positive and confident.

i know its tough, but this is the only way to go for trading. change our negative thinking and our perception and things will start to change slowly on the positive side.

the feeling should be to same as though we are looking forward for a game or sport full of confident and ready to play at any time.

coconut said...

i know it sound quite rediculous, confident does not means we will make money consistently. ofcos.

but after so many try full of confident and we still making losses, then it is very clear that this game is not for us, especially we start getting very frastrated.

my point is (sound like jac in AFACT haha) have the confident first even before we look at the results or string of results. like making a putt in golf, having confident does not mean the ball will get in the hole, but it will help your game in the long run if you are still playing the game.

coconut said...

for the non golfer, making putts can be very excited and some time scary especially when the betting is big, at the same time, the golfer has to keep his body very steady to execute it.

its very exciting and it is why the game, like gambling, very addictive.

but unlike gambling, which is due to luck and chance, golf is like trading which need to control our nerves and stay calm and ofocs stay confident.

Fat88Trader said...

Sure, I agree we need to be positive and confident but then we must be realistic as well, if you can't squeeze blood out from stone, don't injure yourself.

Yes, change is needed, there are many contracts now that we can trade, don't stick to those half dead contracts without volatility and falling volume, the choice is yours.

Trading is a non level playing field favouring the big boys, accept it and move on or quit and look for a job.

It's a constant learning process, we need to catch up or be left behind.

coconut said...

haha, i never met a big boys before, i didn't know they exit.

but i know of big orders, if they put in one big order say 10million, that does not necessary means i will pull out mine.

if some big boys wanted to wash down the price, i will be very grade to take the other side of their trade.

they have the advantages of pushing the price, but they also have the danger of killing their own orders. i don't see they have any advantages at all.

in fact, it is the big boys that is creating most of the market volatility and chaos, which in turn creating mis-pricing where a trader can take advantage of.

coconut said...

one of the good things about trading, especially electronic trading is that, we don't need to see the faces of all our traders, not even the brokers haha.

who are the big boys, who are the little one and who are the "chew cheng" one. seems like everyone are the same.

the only thing that is not the same and are constantly changes are the prices and orders (volume).

Fat88Trader said...

Well certainly there are traders like Coconut who don't care a damn about the big boys, steady.

Will be away to China for a week, can't access to my blog or Facebook.

Good Luck, Coconut!

KAW said...

Welcome back FAT!
Has been a while since I last check your blog and was pleasantly surprised this afternoon seeing so many posts.
And as always, faithful and selfless coconut for sharing his views.
Cheers mates!

coconut said...

thanks, i need it.

i think you got me wrong. is not that i don't care, even if i want to, there is no way i can access to it.

so why should i be bother and worry about them if i constantly put myself in the market! right?

ok la, have a very nice and safe trip. and thanks to KAW.

coconut said...

haha big boys, if they wanted to swollow me, i don't think they will put a 10 million orders right in front of me.

i will be eaten up before i even realising they are there haha, again why bother.

coconut said...

funny thing is that when you want to tell the true,

like i don't care where the market is going, or when i'm going to die, or will it rain tomorrow...

i will simply say i don't care! cos i can't.

i don't don't why it is sound offensive??

coconut said...

i guess everywhere i go, i'll end up at the same place.

every time i mention about my IQ score, my daughter will say, ah don't boost la.

i told my friend i made 25k last month, he will reply "mite how lian"!

my wife beside me will always reminds me, be humble be humble!

how to tell the truth if i'm follow their advise? so must i put on a mast every where i go?

i just want to be myself.

coconut said...

markets is a big casino where everybody is trying to beat the odds.

if one do not know what is he or she is doing inside *beside trying to make money) and where do they stand and what role do they play, there is only one out come.

to be profitable, one must know where he is standing, what he is doing and what role he is playing in the market place.


coconut said...

and after knowing about the whats, you will roughly know what are your odds in beating the market (in the long run).

coconut said...

talking about china, i had invited my relatives from china to come to s'pore for home stay for 2 weeks. they will be here next month, 4 of them. it is also their first time travel that far, tipical "mountain turtle".

my dad can't travel anymore and this is probably the best i can do for him. he is damn excited!

you know what he suggested we can visit? our 2 casinos! $&@#*&@#.

coconut said...

soon i will be the host or embasidor of our nation casinos haha.

coconut said...

and you know something, even before i step into the financial markets, i already had experience in other fields of gambling. horse racing, jackpot, football betting (long before our s'pore pool take over)...but i woun't elaveorate more.

how the financial market works are very similar, you just need to know where you want to stand.

coconut said...

and as long as they (you know who) do not change the rules of playing and does not restrict the free movement of the market (prices), like what the casinos does with all their rules and restrictions, there will be opportunity to make money.

coconut said...

i feel like if i don't talk about my performance, i'm actually lying and all these talks are just bull shit.

ever since i restart my trading operation in april up until now, all were profitable except june that i break even. this month too will be profitable.

i woun't mention the figure but when i say i cherry picking the market, i mean what i say. ofcos when i lose or when i'm lost the way, i too will mention it.

coconut said...

i guess trading, after a long while, will show case the extreme of a person reality.

no doubt i'm boosting, i never denial it, so as my humbleness (haha). i want to face it with the market, no hiding.

if i win, i will boost and push my luck, if i am losing, i will run like rabbit.

KAW said...

Hi coconut,
There is no right or wrong in this business...
"If i win, i will boost and push my luck, if i am losing, i will run like rabbit."
If not now when? Put it this way, you have earned it through your own effort!
Cheers

GNY said...

In George Soros' words: “It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.”

hong twu said...

In Soros Egroeg ' words :

“It’s very important whether you’re right or wrong, why ? because if you are right (be it strategy, mindset etc) then you can make $. But if you are wrong, then bye bye $$$$"

As always, there are always 2 sides to a story in our life...

coconut said...

thanks guys for lending your ears.

coconut said...

ever play games, like squash or golf or any game you like to play, all by yourself?

thats how its feels like to me when i'm trading! money don't means everything (but something).

you wins, so what! who cares? except my wife haha.

coconut said...

the more money i make, the more harder for me to keep my bloody mouth shut.

coconut said...

last year while i was flying high feeling like i'm at the top of the world, i feel like i have to go faster and higher, took out 2 bulky object by the side of the wings and suddently my plane go nose dive!

wah lan, what a scary ride!

back on the ground, i realise the 2 objects was my plane stabliser!

coconut said...

if there was a co-pilot, who can fly in the cockpit, surely he will object the silly thing i did.

most of all, my journey would be a lot more fun but i'm not too sure about him though.

coconut said...

next time if i do a major modification to my plane, i'll make sure i do a lot of low risk low flying before i took it to the sky.

coconut said...

very free, so this is another senaro that i played out. i'm defending my palace, constantly at war with who i don't know.

at the east gate, there was some attack, i knew my army strenght, so without checking my enemy, i told my general to open the gate.

my general was in shock, i shouted "let them comes in and i'll strughter them all. OPEN THE GATE!"

my general open the gate, the enemy came in, one after another and they keep coming.

my general was killed, my east gate is lost, in a panic, i shouted "CLOSE ALL THE GATE!! CLOSE THEM ALL".

knn....

coconut said...

now, i'm just at the beginning stage of trying to get back my lost castle at the east, no opening gates ofcos.

coconut said...

oh dear, when fat comes back he will be in a shock.

"what did you do to my blog! this is a trading blog, not a place to play "masak masak" you know!"

"don't day dreaming and get back to serious trading business!"

"but.... but i'm serious"

coconut said...

"and stop playing that noisy songs"

http://www.youtube.com/watch?v=nU615FaODCg

KAW said...

Hmm...this is a nice song. Released 7 months after I was born. Sadly Davy Jones passed on end Feb this year, RIP.

coconut said...

ya, sadly one by one all these great artist are passing.

i view myself as an artist too, although my field is in trading/gambling (haha), (hahaha).

but seriously, all my trading are in a form of creation, the ideas, the strategies, art work (spread sheet) and trading itself. which is why i'm sharing, at least part of it.

can immagin a song writer who composing songs but no one is listening. thats me.

coconut said...

i remember i told fat the first time of my trading volume in stocks, i think he didn't believe me.

it is not that i want to boost that i trade a lot, but it is the strategy that required me to do so.

and if one knows how the probability/odds works, one will understand why. there is a limit but one has to stick to its optimium to increase the odds even further.

coconut said...

the odds of winning every month is actually very high in my case. with only june break even was due to a susdent serge in prices and lack of hedging. my itch hand again.

thats my confident level.



coconut said...

no time to think of the big boys haha.

coconut said...

many people believes that the odds of winning increases coresponding to the amount of winning, meaning, the bigger the profit, the better your odds.

so they come out with formula (ratio) that resember that believes. for example, 3 to 1 winning ration which is very porpular i think. in that case, why not 100 to 1 is even better.

there is no fix rule or optimium to that ratio, that will not gives you the edge if you fix it.

coconut said...

and if you believe market prices are random and no fix pattern, the optimium ratio like prices will not stay the same place.

in another words, optimium ration can range from positive even to extreme negatives (thats why toto works, accept 50c bet and you can lose 2 million and still come out ahead! but the ratio are fix).

my job is to capture that moving optimium ratio as much as possible and not get kill in the process.

coconut said...

and please no need to tell me to watch out, i know how dangerous it is if one is not careful.

KAW said...

Deng XiaoPing once said: It doesn't matter if a cat is black or white, so long as it catches mice.
There are way too many combination, as long as we found one that fit and mitigate risk and losses, we are good to go!

coconut said...

haha i got 2 cats at home, exactly one black and one white, swear!

coconut said...

i agree with you KAW.

Fat88Trader said...

So the dog is away and and cats are having fun.

Thanks for the song, first time again I am hearing it and the group.

It's great to hear that you are doing well Coconut, it gives inspiration to a lot of those who are struggling. Like in Kung Fu, you have reached the highest level of expertise.