Discussion On Stop Order Strategy

peterk · October 24, 2013, 10:27pm

By the way Marty Shwartz used the Simple Stochastic and the 10 period Moving Average as tools to make money. Adieu.

metaframe911 · October 28, 2013, 7:42am

hi PK I will have to look into the backtesting approach and see how i can approach using the Monte Carol and Gamma distribution in back testing “any books or links on testing approach would be appreciated from anyone” I have not touched on that personally although i did meet a stats maths professor recently who did mention Monte Carol , standard deviation and the bell curve in conversation , i will look through the Schwartz book and come back to this thread with some feedback to everyone thanks all & PK.

peterk:

Hi Meta - well I must say that you are getting close to the holy grail, that is, even there is one. You are the first who has made any decent comment regarding the art of trading. The truth and the holy grail about trading lies between the ears and how we use it. It is all about decision making and most people in their quest for the holy grail continue to search for that magic indicator or instrument. Secondly it is not about the charts and indicators or even the method - it is about making money. Two elements to trading: decision making and making money. That is it. Guess what? You can make money out of any indicator if and only if the indicator does not throw too many decision making points. I suggest that you read Marty Schwartz who turned 40,000 into 20 m. There are others who used indicators etc. When you said that the material was very useful you started to differentiate between the forest and the trees. Keep going and always think about how to make money. Secondly backtesting systems. I do not believe that the conventional methods are adequate tools for FOREX. There are serious issues regarding the distribution of prices and systems will collapse as quickly as they were developed. I have found that the distribution is closer to a Gamma distribution and the only testing process that suits that method is the Monte Carol method. 68Futura yes the opening breakout has been tested by everyone from retail traders through to big hedgefunds. I know quite a few that still trade FOREX using the opening breakout. Anyway Meta keep searching because the answers are in your own hand and probably sitting right in front of you. But always and I mean always think about how to make money and always see yourself as the casino with the edge and keep your feet on the ground. Pk

peterk · October 28, 2013, 4:55pm

Meta - Sorry it is Monte Carlo. Unfortunately I do not have any references. I learnt the techniques at Uni. Please find attached a trading opportunity in the GBPUSD that has been identified using the above material. I have attached a pdf file with two histograms with different lookback periods of 1304 days and a shorter 500 days. The gamma distribution of the GBP is obvious. Please observe the current price on both histograms. I reckon that we will soon see a sharp move back to the 1.5753 price.

nishaniqbal · November 12, 2013, 7:03pm

What a sad ending to what I thought to be a great start. I would definitely say after reading the books and other stuffs mentioned I do start to see things in a different way. I am determined to learn, if not here then somewhere else, the journey continues

metaframe911 · November 13, 2013, 3:09pm

I have had a look at the attached histogram and will be comming back with some comments as I want to provide some constructive feedback thanks