# Technical Trading Exercise (Pavilion103 and tech/a) Discussion



## tech/a

Back in 2012 Pav mailed me with a request for help.
His trading was erratic and he was dis heartened with his results.
So we ran a few charts of his to see how I could help.

Discretionary technical trading would in my view be one of the hardest
trading methods I know of to master. Yet one of the simplest.
This is where Pav was engaged---discretionary---VSA based.

It soon became clear that the easiest way to do this would be for me to
run a portfolio in real-time. Mark up charts on an as necessary basis and
send them to Pav so he could see the Setups/Trade/stops/Trade management/Trailing stops/
Watch lists/Pyramiding and of course Exits in a real-time running portfolio.
The practical application rather than chart theory.

So in Jan (13/1) that's what we started. Pav tells me he has had some light bulb moments.

There are a few Fundamental methods running on ASF but not a single Technical one.
The portfolio has been documented by Pav who keeps an up to date spread sheet of 
all past and present trades.

To now the portfolio is running at +50% on initial capital since inception in January.
87 emails and around 125 charts.Of course a heap of other interesting stats on Drawdown win Loss etc.


Ive had a chat to Pav and Joe and if there is enough interest we (Pav and I) are happy to run it a week behind real-time as the
Last time I did this ASIC was all over the website getting excited---I don't have a licence.

It takes a bit of work and Ill email Joe in R/Time for verification---You'll see it a week later.
We thought that there maybe some in the same boat as Pav was,and that in the future it could serve as a point of reference a place to ask direct questions and see the practical application of a technical methodology.

If you have an interest then let me/us (Pav) know below.


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## DJG

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I'm overly interested, when's it start? - _sooner the better_


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## 5oclock

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

G/Day TECH, I would like to register my interest!!!!!


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## WilkensOne

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Would be a brilliant educational tool, I'm sure all skill levels could learn something!


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## KurwaJegoMac

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Very interested in seeing this happen. I am a discretionary technical trader myself so this is dear to heart!


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## skyQuake

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

+1 tell us more tech/a


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## Gringotts Bank

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Last time I did this ASIC was all over the website getting excited---I don't have a licence.




ASIC??  No, they don't moderate web forums!! Where's the link to this so-called ASIC interference?? 

You can post the trades you are making in real time.  Plenty of others have done this without any problem whatsoever.  eg. Trader Girl.

Anyone can post up trades after the fact.  Means nothing.


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## prawn_86

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Gringotts Bank said:


> ASIC??  No, they don't moderate web forums!!




You have run a stock forum?


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## Gringotts Bank

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



prawn_86 said:


> You have run a stock forum?




Where's the link/


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## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Gringotts Bank said:


> ASIC??  No, they don't moderate web forums!! Where's the link to this so-called ASIC interference??
> 
> You can post the trades you are making in real time.  Plenty of others have done this without any problem whatsoever.  eg. Trader Girl.
> 
> Anyone can post up trades after the fact.  Means nothing.




Joe has the facts.
I've sent you a private mail--they are the facts.
If your going to jump on everything as soon as its posted.
Trust me I wont bother posting.

Pav and I have been going along fine without involving ASF and will no doubt continue.
We just thought it maybe beneficial to others.
Ive asked Joe to lock the trading chart thread and we will start a Q&A thread---so the chart thread doesn't get trashed--Joe has agreed.


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## fiftyeight

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

+58

I have recently decided to focus on tech/a approach, quite the task with 270 pages of past comments. Def looking forward to this.

Fiftyeight


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## Boggo

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Gringotts Bank said:


> ASIC??  No, they don't moderate web forums!! Where's the link to this so-called ASIC interference??
> 
> You can post the trades you are making in real time.  Plenty of others have done this without any problem whatsoever.  eg. Trader Girl.
> 
> Anyone can post up trades after the fact.  Means nothing.






prawn_86 said:


> You have run a stock forum?






Gringotts Bank said:


> Where's the link/




Many years ago on another forum tech/a posted up all the the trades on a very successful account that he multiplied in $ value.
From a learning perspective it was an excellent resource but it reached a point where ASIC took a slightly dim view of it.

I believe that something similiar would probably be really appreciated by the majority on here who are always willing to continue learning and looking at how successful traders operate.

If all the sciolists on here could just sit on their hands for a while and maybe actually learn something rather than inserting the usual nonsense I believe it would be appreciated - pretty please FFS 



tech/a said:


> Joe has the facts.
> I've sent you a private mail--they are the facts.
> *If your going to jump on everything as soon as its posted.
> Trust me I wont bother posting.*
> 
> Pav and I have been going along fine without involving ASF and will no doubt continue.
> *We just thought it maybe beneficial to others.*
> Ive asked Joe to lock the trading chart thread and we will start a Q&A thread---so the chart thread doesn't get trashed--Joe has agreed.




I know you have the best intentions tech/a and it would be beneficial to the majority on here, and in turn this forum in general but having said that, I sometimes wonder why you even bother.

I do hope that we can have a educational thread on here comes close to the one of old, that still stands out in my memory.

Cheers


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## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Joe has the facts.
> I've sent you a private mail--they are the facts.
> If your going to jump on everything as soon as its posted.
> Trust me I wont bother posting.
> 
> Pav and I have been going along fine without involving ASF and will no doubt continue.
> We just thought it maybe beneficial to others.
> *Ive asked Joe to lock the trading chart thread and we will start a Q&A thread---so the chart thread doesn't get trashed--Joe has agreed.*




Now you're cooking Tech!

Roll on!


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## chrislp

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Very nice of you to offer Tech/A & yes would be interested, thanks.


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## pavilion103

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I must say, sometimes in life it is a matter of being in the right place at the right time, although I guess sometimes those who ask create their own luck....

This has been an incredible educational period for me. Originally asking for a few pointers, and then to be given hundreds of analysed charts, updated daily with the opportunity to discuss anything trading related is probably (well definitely) worth thousands of dollars in terms of value. 

There have been some light bulb moments and I have learnt far more than in any book. Not just the setups, but the entire aspect of trading has opened my eyes to the enormous potential (and in this case realised potential) for great profitability. 

I am now profitable, taking a number of these trades, as well as a number of my own and understanding what it takes to make money in the markets. 

I went past Tech's place on Saturday morning and the opportunity to spend a few hours discussing trading and analysing charts was incredibly beneficial. Another level up. 

You will all benefit greatly from the generous information being provided by Tech and I must thank him personally for pouring unnecessary amounts of his time into my own education

Top trader, top bloke


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## merlinnn

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Would definitely be interested, thanks


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## Lone Wolf

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

To have access to hundreds of charts where someone who knows what to look for has confirmed that there actually is something there to see... And to see it actually applied... Just the knowledge that time spend studying isn't wasted is valuable beyond description. 

When you study a chart on your own, you're trying to look for signs of the move before it happened. What was this chart telling me before the move? But for all you know this particular chart might not be telling you anything. It may be a terrible example of VSA with nothing there to see, yet I'm looking for something. And so it goes, day after day, year after year, looking for patterns amongst the noise.

Hold on to those emails and charts guys. If Tech pulls the pin on this thread due to comments by people who don't appreciate his efforts, I'll be offering to pay the two of you to get a hold of that material. Whether you accept or not is a different matter of course.


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## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Will take a while to compile the information for you so you can get in my head as to what I look for and why.
Good news is that I trade very simply.
Right hand edge and decisively.
We have just been stopped out of this trade.
Here is the original trade and the chart with notations as we went along.
This is the sort of thing you'll be getting used to seeing.
Plenty of losses and Break evens along the way as well
Warts and all.

*Click to enlarge*







And the stop was well and truly executed.
But previously the question was asked and
answered.




We certainly got that reversal.
Anyway just an example.


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## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech I'll get in early and ask, do you just eyeball these patterns or scan for them with a coded scan? I'm sure there will be a few that will want to know...

Thanks in advance.

CanOz


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## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



CanOz said:


> Tech I'll get in early and ask, do you just eyeball these patterns or scan for them with a coded scan? I'm sure there will be a few that will want to know...
> 
> Thanks in advance.
> 
> CanOz




I'll go into a fair bit in the introduction which will be in the locked thread
But before I do ---

Both.
But here is a hint.
Patterns are definately what I'm lookin for ( in this discretionary method )

I want patterns that are Likely continuation patterns.
Small and compact are preferable.

To code specific patterns is terribly difficult if you've ever tried.
So I use my favorite scans for breakout trading ( I can easily identify a breakout )
And then add an alert function to the formula.
IE I'll have a 5 and 10 period look back. It will show what's happened 5 and 10 periods after a breakout has been identified in the scan.

Here I eyeball charts looking for patterns that in my view have potential.
There are many happening in the telecommunications sector.
One on our watch list last night is TLS.I'm sure you'll see it if you have a look.
So you can watch this for continuation or pattern failure.

This eyeballing takes me around 3 seconds a chart and about a minute if one looks a potential.
There are other considerations but will look deeper further down the track


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## Assasin

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

This is brilliant!  Thanks Tech/a.


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## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech/Pav

This is very generous of you both and you are right, there is people out here interested in this trading method.

Please register my interest in joining you.

Also, thank you so much for your thousands of previous post which has helped me along my journey without you knowing. As I said before, very generous indeed.

Cheers ... Debtfree


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## Chris.M

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Definitely interested tech/a, thanks.


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## 5oclock

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I would just like to ask those that already know everything there is to know about trading to ignore this thread and let the rest of us who dont know everything listen in peace to what TECH and PAV have to say. Thanks in advance for your thoughtfulness.


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## Buckfont

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



5oclock said:


> I would just like to ask those that already know everything there is to know about trading to ignore this thread and let the rest of us who dont know everything listen in peace to what TECH and PAV have to say. Thanks in advance for your thoughtfulness.




I have to agree. I have zero knowledge about technical analysis and it goes well over my head,but having been on this forum for several years now and having seen the effort that tech/a goes to to put in his wealth of understanding across, I have nothing but great admiration for his persistence despite all the knockers. Good on you tech/a.


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## Gringotts Bank

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Have any of you noobs heard about a little website called Amazon?

There's about 17 million books on trading chart patterns.  They're all pretty much the same idea:  1) Find pattern, 2) buy the break, 3) set a stop, 4) let winners run and watch for reversal pattern.

Tech's trick is to rubbish what "the books" say, then re-package it as something special and new.

You're welcome.


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## tinhat

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I'm looking forward to this because:

1. I was thinking about tech/a whilst lying in bed unable to sleep the other night. Actually, I was re-reading Nick Radge's "Unholy Grails" in bed and reading about tech/a.

2. I'm very interested to learn about tech/a  and pav's continuation pattern identification because, having started with a fundamental/value investing approach I've found it difficult to hop onto stocks which seem "fully priced" only to have missed out on them rising substantially more through the cycle. Examples are DMP, IVC, NVT, MTU, RHC - oh, it's a long list. Conversely, I have had a knack of picking stocks which are at "deep discount to value" and well, you can imagine some of the disappointments.

I took note of Pav's comment the other day in the TPM thread. In the past I wouldn't look at TPM as a potential trade because, although it is an investment grade company with sound balance sheet and business prospects, it is "over-priced". Rereading Radge's book the other night highlighted to me that I want to be riding stocks that are going up, not going down!


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## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

The worst thing about books is they don't answer questions....

CanOz


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## WilkensOne

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



CanOz said:


> The worst thing about books is they don't answer questions....
> 
> CanOz




Or make any money in the markets would be my assumption...


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## prawn_86

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Gringotts Bank said:


> Have any of you noobs heard about a little website called Amazon?
> 
> There's about 17 million books on trading chart patterns.  They're all pretty much the same idea:  1) Find pattern, 2) buy the break, 3) set a stop, 4) let winners run and watch for reversal pattern.
> 
> Tech's trick is to rubbish what "the books" say, then re-package it as something special and new.
> 
> You're welcome.




And you are welcome to provide your stats/trades in real time and see if they are profitable, oh wait, didnt you try and do that already... 

The theory of just about anything is fairly easy, the practice/application is a whol other ball game.

Once the trades are being posted feel free to pick them to pieces, but until then, without seeing any results, i dont see how you can say it wont work


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## Gringotts Bank

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



prawn_86 said:


> And you are welcome to provide your stats/trades in real time and see if they are profitable, oh wait, didnt you try and do that already...
> 
> The theory of just about anything is fairly easy, the practice/application is a whol other ball game.
> 
> Once the trades are being posted feel free to pick them to pieces, but until then, without seeing any results, i dont see how you can say it wont work




There's a lot of pressure posting your trades live.  What tends to happen is that you make a few good trades, and everyone starts reading and watching very closely.  Then you make a few bad ones and guys like tech and TH and waza jump all over it and trash the **** out of your thread.  This makes the pressure even higher, gets you angry, and then with a negative frame of mind, your focus and perception goes way off.

Trader Girl was exemplary in her handling of the trash-talkers like tech.  She profited in her live trades despite all the crap she was handed by all those who "knew better".

The ASIC excuse is just nonsense.  Anyone can post live trades, so long as they don't advise others what to do.

I can post all my good trades from last year if anyone is interested.  It won't help anyone one bit.


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## Country Lad

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tinhat said:


> ...........Examples are DMP, IVC, NVT, MTU, RHC - oh, it's a long list. ...............In the past I wouldn't look at TPM as a potential trade because, although it is an investment grade company with sound balance sheet and business prospects, it is "over-priced".




What all these have in common is that they are at all time highs.  This is of no interest to the inexperienced trader because of their mindset that when it is that high, the price will drop.  The opposite is likely the case.  Too many people look only for a price that is falling on the hope it will come back up.

I love those shares at an all time high and in fact this is one of my explorations.  When a share is at an all time high every single person holding it is in profit so there is no selling pressure.  We may see some profit taking but no selling pressure until it falls out of favour and that can be seen in the market sentiment.

tech's trade in MTU is an example.  It has been at or near all time highs and rising for the last 5 months and that is why I am also enjoying the MTU trade but in a different way which is shown  here .

Cheers
Country Lad


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## prawn_86

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Country Lad said:


> I love those shares at an all time high and in fact this is one of my explorations.  When a share is at an all time high every single person holding them is in profit so there is no selling pressure.  We may see some profit taking but no selling pressure until it falls out of favour and that can be seen in the market sentiment.




I cannot remember the name, back back pre 2008 there was a fund that specifically only traded in stocks that were making all time highs. At the time its performance was quite good. One would assume that this strategy would have a huge draw down when the bear market kicked in, if no stops were employed


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## kid hustlr

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Obviously this is a great idea for a thread and should be welcomed by all.

Can't understand GB's reaction at all. 

Play on I say


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## Country Lad

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



prawn_86 said:


> I cannot remember the name, back back pre 2008 there was a fund that specifically only traded in stocks that were making all time highs. At the time its performance was quite good. One would assume that this strategy would have a huge draw down when the bear market kicked in, if no stops were employed




I doubt that any successful, experienced trader/investor, particularly a fund, would not employ stops.

Cheers
Country Lad


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## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Buckfont said:


> I have to agree. *I have zero knowledge about technical analysis and it goes well over my head,*but having been on this forum for several years now and having seen the effort that tech/a goes to to put in his wealth of understanding across, I have nothing but great admiration for his persistence despite all the knockers. Good on you tech/a.




It is for people like yourself that I post about T/A.
For me and those who adopt it it is a very visual form of analysis of crowd behaviour.There are times to be with the crowd and times when not to be.
Technical analysis is portrayed by many as complex---in fact some do this purposely to make their method seem special or difficult to understand--continually coming up with the latest signal---etc.

ALL analysis is simple it will do only one of 3 things.
Succeed
Fail
Nothing.

Its what you do with your trade or portfolio and how quickly you react---or need to react--to the potential consequences of analysis which will go a long way to determining profitability. 



Gringotts Bank said:


> Have any of you noobs heard about a little website called Amazon?
> 
> There's about 17 million books on trading chart patterns.  They're all pretty much the same idea:  1) Find pattern, 2) buy the break, 3) set a stop, 4) let winners run and watch for reversal pattern.




This is true.
but very few can actually put the idea into a trading methodology--let alone a profitable one. we can all read and nod our heads at the perfect sense it makes and the un deniable logic---until we trade it. Many find that walking forward with methods to a profitable outcome often elludes them.



> Tech's trick is to rubbish what "the books" say, then re-package it as something special and new.




I didnt know I had a trick. But I can see how you think that the questioning of the methodology of many who post up methods can be seen as an attack. In fact it is questioning based upon 20 yrs of trading and the knowledge that OFTEN the basic premise adopted is simply flawed. It takes then time for that to come to fruition 
2 yrs in Ducs well documented case. I enjoyed Trader Girls Posts and was supportive I thought.---It was simple I actually use the principal myself (After being introduced by T/G) when trading the FTSE or DAX if it pops up.

We all have losing runs myself included---but its the ability to minimise drawdown/exposure/and TIME which I dont see offered up in Most books and seminars.





prawn_86 said:


> And you are welcome to provide your stats/trades in real time and see if they are profitable, oh wait, didnt you try and do that already...
> 
> *The theory of just about anything is fairly easy, the practice/application is a whol other ball game.
> *
> Once the trades are being posted feel free to pick them to pieces, but until then, without seeing any results, i dont see how you can say it wont work




Without doubt!


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## waza1960

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



> tech and TH and waza jump all over it and trash the **** out of your thread




 Honoured to be in such illustrious company 
 However I always try to be constructive and don't wish to contribute negatively 
(I'll have to re read GBs thread now)


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## pavilion103

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Gringotts Bank said:


> There's a lot of pressure posting your trades live.  What tends to happen is that you make a few good trades, and everyone starts reading and watching very closely.  Then you make a few bad ones and guys like tech and TH and waza jump all over it and trash the **** out of your thread.  *This makes the pressure even higher, gets you angry, and then with a negative frame of mind, your focus and perception goes way off.*
> Trader Girl was exemplary in her handling of the trash-talkers like tech.  She profited in her live trades despite all the crap she was handed by all those who "knew better".
> 
> The ASIC excuse is just nonsense.  Anyone can post live trades, so long as they don't advise others what to do.
> 
> I can post all my good trades from last year if anyone is interested.  It won't help anyone one bit.




Sounds like you could do with a little more work on your trading psychology....


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## skyQuake

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Country Lad said:


> What all these have in common is that they are at all time highs.  This is of no interest to the inexperienced trader because of their mindset that when it is that high, the price will drop.  The opposite is likely the case.  Too many people look only for a price that is falling on the hope it will come back up.
> 
> I love those shares at an all time high and in fact this is one of my explorations.  When a share is at an all time high every single person holding it is in profit so there is no selling pressure.  We may see some profit taking but no selling pressure until it falls out of favour and that can be seen in the market sentiment.
> 
> 
> Cheers
> Country Lad




Just a brief derail...

But this is so key. Ask the average punter how he trades and 90% of his repertoire are reversal or breakouts. (If any)
Few look for continuation signals. Just the regular oh wow this is down 60% where should I buy!


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## Gringotts Bank

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> ...but very few can actually put the idea into a trading methodology--let alone a profitable one. we can all read and nod our heads at the perfect sense it makes and the un deniable logic---until we trade it. Many find that walking forward with methods to a profitable outcome often elludes them.




Yes, and the same will hold true here on this thread.  People will read what you say, go to apply it and fail.  This is because you won't address the missing element, which is psychology.  To you, "psychology" is a dirty word, but you don't realize this is how and why you have succeeded.  It's not about "trade management" or "position sizing" nearly so much as you think.

Pavillion is a very unique case.  His success has only come because you have held his hand every step of the way on every single trade he's ever made.  He's also a guy who accepts things at face value without questioning, so long as the message is delivered with authority (which you provide).  Many find it hard to have that blind faith in something that amounts to basically nothing much - ie. 'buy the pattern, watch for reversal'.  It's evident on the religion thread how his mind works.  If you were to say "well his faith has served him well", I'd have to agree, since he's up 50%.  But this is my point - it all comes back to psychology.


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## pavilion103

tinhat said:


> I'm looking forward to this because:
> 
> 1. I was thinking about tech/a whilst lying in bed unable to sleep the other night. Actually, I was re-reading Nick Radge's "Unholy Grails" in bed and reading about tech/a.
> 
> 2. I'm very interested to learn about tech/a  and pav's continuation pattern identification because, having started with a fundamental/value investing approach I've found it difficult to hop onto stocks which seem "fully priced" only to have missed out on them rising substantially more through the cycle. Examples are DMP, IVC, NVT, MTU, RHC - oh, it's a long list. Conversely, I have had a knack of picking stocks which are at "deep discount to value" and well, you can imagine some of the disappointments.
> 
> I took note of Pav's comment the other day in the TPM thread. In the past I wouldn't look at TPM as a potential trade because, although it is an investment grade company with sound balance sheet and business prospects, it is "over-priced". Rereading Radge's book the other night highlighted to me that I want to be riding stocks that are going up, not going down!




TPM has been a big winner for me. I've added to the position since the initial entry and also have a current buy-stop order in place to add another parcel.

The trades produced in this thread will show the importance of moving the initial stop to break even as quickly as possible and trailing the stops to lock in profit. For me, this ensures peace of mind and as the stock continues to rise, I ride the wave of momentum, content that I won't have to give too much of my profit back to the market! 

I feel much safer swimming with the tide than against it!


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## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Gringotts Bank said:


> Yes, and the same will hold true here on this thread.  People will read what you say, go to apply it and fail.  This is because you won't address the missing element, which is psychology.  To you, "psychology" is a dirty word, but you don't realize this is how and why you have succeeded.  It's not about "trade management" or "position sizing" nearly so much as you think.
> 
> Pavillion is a very unique case.  His success has only come because you have held his hand every step of the way on every single trade he's ever made.  He's also a guy who accepts things at face value without questioning, so long as the message is delivered with authority (which you provide).  Many find it hard to have that blind faith in something that is easy to see through with a little bit of questioning.  It's evident on the religion thread.  If you were to say "well his faith has served him well", I'd have to agree, since he's up 50%.  But this is my point - it all comes back to psychology.




Hmm

Don't know about that GB

While the portfolio we will be putting up is mainly full of my setups Pavs actual portfolio has a spread on mine and those which he has included.
Some I haven't even passed my eye over.
He has also traded his stocks in some cases a little differently to me.

Strangely he is still profitable!
I dont think it *ALL* comes back to Psychology.
If you know what your doing you never question it---you just know.


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## Knobby22

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I'm interested. Thanks for putting in the effort.


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## pavilion103

Gringotts Bank said:


> Yes, and the same will hold true here on this thread.  People will read what you say, go to apply it and fail.  This is because you won't address the missing element, which is psychology.  To you, "psychology" is a dirty word, but you don't realize this is how and why you have succeeded.  It's not about "trade management" or "position sizing" nearly so much as you think.
> 
> Pavillion is a very unique case.  His success has only come because you have held his hand every step of the way on every single trade he's ever made.  He's also a guy who accepts things at face value without questioning, so long as the message is delivered with authority (which you provide).  Many find it hard to have that blind faith in something that is easy to unravel into nothing with a little bit of probing.  It's evident on the religion thread how his mind works.  If you were to say "well his faith has served him well", I'd have to agree, since he's up 50%.  But this is my point - it all comes back to psychology.




Bullcrap!

I am one of the most open minded people on this forum and I swim against the tide in that regard.

I have read over 300 books on psychology, trading, personal development etc. And I question EVERYTHING.

I am able to identify truths and when Tech speaks them I listen, not because he has been trading for 20 years, but because they make sense, having read a wide range of views.

Maybe the one advantage I have over others is that I've read hundreds and hundreds of books and psychology is hardly an issue for me now.

Your posts in here are utterly desperate, embarrassing and reek of jealously. Honestly grow up and let the rest of us enjoy this thread. Without spouting your propaganda and personal agenda!


----------



## Boggo

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> Your posts in here are utterly desperate, embarrassing and reek of jealously.* Honestly grow up and let the rest of us enjoy this thread.* Without spouting your propaganda and personal agenda!




Yes please.



Gringotts Bank said:


> I can post all my good trades from last year if anyone is interested. * It won't help anyone one bit*.




We all agree with that comment GB


----------



## pavilion103

In terms of psychology I'll ask this:

Which gives you more confidence:

1. Driving a new latest model car? or
2. Driving a beat up car that breaks down every week?

It's a lot easier to drive a car that you know works. You don't even stress about it breaking down (but you've got RAA membership incase).

Same with trading psychology.


----------



## pavilion103

Back on topic....


----------



## burglar

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> ...
> 1. Driving a new latest model car? or
> 2. Driving a beat up car that breaks down every week? ...




Hi pavilion,

3. I drive a beat up car that gives and gives and gives! :
(but I've got RAA membership just incase).


@ tech/a
Where and when can we see the chart thread, please?


----------



## Gringotts Bank

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> In terms of psychology I'll ask this:
> 
> Which gives you more confidence:
> 
> 1. Driving a new latest model car? or
> 2. Driving a beat up car that breaks down every week?
> 
> It's a lot easier to drive a car that you know works. You don't even stress about it breaking down (but you've got RAA membership incase).
> 
> Same with trading psychology.




That always comes up as a counter-argument, and while it sounds valid, I don't necessarily agree completely with it.  The question is: "Is confidence a primary or secondary phenomenon?"  I tend to think that the confidence factor is circular, meaning that confidence gives rise to good decision making, but that good decision making can also give rise to confidence.  However I'd say the former is far more powerful and more reliable.  It's difficult, though not impossible to prove, although i do have one snippet of evidence to go towards showing it's primary.  

Years back I had a work experience student with me, (I don't work in finance).  He was both fairly bright and reasonably suggestible, so i did a little experiment without him knowing.  He knew nothing about the stock market, which is perfect, so I basically taught him candles, price and volume.  Took 10 minutes and he understood a chart.  Then I induced some confusion so as to enhance his suggestibility and implanted the idea that he would find this easy and he would be a naturally good trader (I have studied hypnosis).  Then I pulled up all the sub $1 charts and asked him to scroll through them an find the stocks which were going to go up the most in the next day.  I left him to it while I went off to do other things.  Over the next two days he did the impossible, basically.  Had all his picks been traded, the total capital gain was around the 20% mark...in two days.  There were about 10 picks from memory, 5 on each day.  The losers were miniscule.  The winners were not ones you'd necessarily have seen coming.

Just a note to anyone reading, tech's chart thread will be locked, so there won't be any diversions from me or anyone else, but just let me have my say for a minute.  This is the missing element.


----------



## chops_a_must

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

There are already several threads on breakout trading and so on.

Not sure what the value is in this one.

BUT. My experience in being predominantly a breakout trader - the entries and setups are easy to enter and identify. It is the exits that are the hard part.

I'd really like to hear other people's strategies on the matter.


----------



## sinner

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



chops_a_must said:


> I'd really like to hear other people's strategies on the matter.




Short holding times: Time based exit
Long holding times: Technical based exit


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



burglar said:


> Hi pavilion,
> 
> @ tech/a
> Where and when can we see the chart thread, please?




I want to give a background at the beginning of the thread to help anyone who comes across it in future.
The background should set the scene for what I want to get across with the analysis and management of positions.
That I hope to have up and running within a week.
By then the week will be up and the charts and commentary I'm sending to Joe and Pav will be a week old and ill post them up a week behind.

Patience "B".


----------



## Kalaika

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Hi tech/a & Pav,

Count me in please, I'm v keen to have the opportunity to listen and learn.

Thanks.


----------



## Trembling Hand

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Gringotts Bank said:


> Yes, and the same will hold true here on this thread.  People will read what you say, go to apply it and fail.  This is because you won't address the missing element, which is psychology.  To you, "psychology" is a dirty word, but you don't realize this is how and why you have succeeded.  It's not about "trade management" or "position sizing" nearly so much as you think.
> 
> Pavillion is a very unique case.  His success has only come because you have held his hand every step of the way on every single trade he's ever made.  He's also a guy who accepts things at face value without questioning, so long as the message is delivered with authority (which you provide).  Many find it hard to have that blind faith in something that amounts to basically nothing much - ie. 'buy the pattern, watch for reversal'.  It's evident on the religion thread how his mind works.  If you were to say "well his faith has served him well", I'd have to agree, since he's up 50%.  But this is my point - it all comes back to psychology.



GB you keep telling everyone why they have the outcome that they do. Funny how no one has seen the outcome of your trading.

I would seriously like to see just how successful or other wise your ideas and application is.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



chops_a_must said:


> There are already several threads on breakout trading and so on.
> 
> Not sure what the value is in this one.
> 
> BUT. My experience in being predominantly a breakout trader - the entries and setups are easy to enter and identify. It is the exits that are the hard part.
> 
> I'd really like to hear other people's strategies on the matter.




*Chops* can you point me to one--perhaps I missed yours?

If it/they show how to manage your trade/portfolio and has all the numbers you need to know to monitor your viability then I agree it will save me a lot of time and there is no point duplicating something that has been already shown. I must have missed them as I haven't seen anything other than singular charts with no follow up.

Other strategies--what have you in mind ? I know people often speak of mean reversion methods
Id like to see one demonstrated as well.
Anything else?


----------



## chops_a_must

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> *Chops* can you point me to one--perhaps I missed yours?
> 
> If it/they show how to manage your trade/portfolio and has all the numbers you need to know to monitor your viability then I agree it will save me a lot of time and there is no point duplicating something that has been already shown. I must have missed them as I haven't seen anything other than singular charts with no follow up.
> 
> Other strategies--what have you in mind ? I know people often speak of mean reversion methods
> Id like to see one demonstrated as well.
> Anything else?




This one tech:

https://www.aussiestockforums.com/forums/showthread.php?t=20906&highlight=breakout

It's yours.

I meant strategies for exits.

For the most part I use outside reversals to exit. I've also used Stop and Reverse indicators previously, which is similar to what Sinner suggested above.

And for longer time frame positions I've used old fashioned lower lows to exit.

So that area is what I'm most interested in looking at.

Cheers.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Ah I see.

Basically we have been working with micro patterns and
Smaller patterns for entry as you will see. Technically to get an entry 
Price has to " breakout" of the pattern.

One aspect I use in this shorter term trading is an initial stop which generally 
Is used for position sizing and then a trailing stop to allow the market to take me out.
It's positioning is again technical and discretionary. I have used pivots,gap fills,resistance/another pattern failure during the trade-- as you will see there are many.

But one feature I like and so does PAV is moving the initial stop to B/E as quick as possible.
Sure we get taken out prematurely but we preserve capital very well.

Anyway I'll post all as time permits
Charts make it easier.
The main goal is to apply analysis to a number of trades to return a profit.

This is but one method and some features maybe adopted by others to add to their method.
It maybe a missing link or two as PAV found.

Off for a 10 k plod


----------



## Kalaika

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech/a

With the trading style you've described, it sounds like you have a fairly strong risk management mechanism (i.e. moving stops to BE as soon as poss).

How do you model the expected performance of this approach across a wider universe of stocks (other than your system real time performance?), to know that its better than, say, giving a little xtra breathing space with original stops (perhaps even shifting half way from original to break even) and potentially getting more run out of them?

More interested in your philosophy than anything else...

Thanks,
K


----------



## AlterEgo

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I'm also interested. Thanks Tech and Pav.


----------



## statmech71

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I'm also extremely interested. Good on you Tech and Pav - your generosity is much appreciated. Thank you


Paul


----------



## DJG

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

*I prefer this over a book because:*
- Some books might but you rarely see the bad trades. At least with this online forum method, you can see Pav's/Tech's losing trades, why they lost, what they got wrong, what was over looked, how it could of been a winner if analyzed differently etc. Books will usually show you the perfect setup, unfortunately for us the perfect setup doesn't present itself everyday.
- By watching reading this, many who know little about technical analysis can at least learn a foundation. Then if they enjoy it, they can go buy those hundreds of books available on Amazon and read even more. If they hate it, no wasted money on books/fire-paper in the end.
- A book won't answer a spontaneous question if the need arises.
- Besides, wouldn't you rather support an ASF member, especially when it comes to teaching others? 

I'm sure you could get an admin (perhaps from your control panel) you could block the thread so you can't see it, save's annoying those who wish to learn.

That's my two bobs anyway, bring on the charts and analysis!!


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Kalaika said:


> Tech/a
> 
> With the trading style you've described, it sounds like you have a fairly strong risk management mechanism (i.e. moving stops to BE as soon as poss).




Yes a cornerstone of the method I wanted Pav to get proficient in. there are methods of trading with NO STOP and no TRAILING stop---but for those starting the journey of technical trading this is NOT where to start in my view.



> *How do you model the expected performance of this approach across a wider universe of stocks (other than your system real time performance?), to know that its better than, say, giving a little xtra breathing space with original stops (perhaps even shifting half way from original to break even) and potentially getting more run out of them?*




This is an excellent and very important question Thanks for asking it.
Ive made the point time and again and will continue to make it---that most people trade on theory,a group of ideas stuck together in a "plan"--logic that has a sound theoretical basis for succeeding.
The market has a way of fooling the best laid plans with randomness.


*To your question specifically*
from 20 yrs of Technical analysis countless hrs of testing and countless hrs of trading it is crystal clear to me that.

*(1)* You can profit only if you have *more* wins with aggregate losses less than aggregate wins.
OR
*(2)* You have Much *large*r wins than aggregate losses.
OR
*(3)* A mix of* both*

There is one goal in this exercise and when I trade and it is centered around *BOTH (3)*
More in the Introduction to technical trading when I have a little more time.

.



> More interested in your philosophy than anything else...



Wise.




DJG said:


> *I prefer this over a book because:*
> - Some books might but you rarely see the bad trades. At least with this online forum method, you can see Pav's/Tech's losing trades,



Yes you will.



> why they lost,



That too.



> what they got wrong,



In every case it will be that the analysis which indicated a potential development in price action would manifest itself---didn't



> what was over looked, how it could of been a winner if analyzed differently



That wont be happening--your free to debate it but for us the goal is--and will remain to achieve a profitable method.We/I am not interested in reflection--I know I/we will get it wrong,I expect that.
Its what you do when your wrong and as RADGE says "How long you stay wrong" that will effect your 3 principals of long term profit.  



> Books will usually show you the perfect setup, unfortunately for us the perfect setup doesn't present itself everyday.
> - By watching reading this, many who know little about technical analysis can at least learn a foundation.




My hope is that it may open an alternative to some who have never considered technical analysis.
Those who see it as Voodoo.Those who have seen complex demonstrations that fill a chart with more lines than a cardiograph.

I want to cut through the mumbo jumbo and show the simplicity of profitable technical trading.
For Pav at least I think I have achieved this.

Believe it or not the very same principals can and *SHOULD* be used by Fundamental traders.Even the introduction of a few principals would be most helpful---in my view.



> Then if they enjoy it, they can go buy those hundreds of books available on Amazon and read even more. If they hate it, no wasted money on books/fire-paper in the end.
> - A book won't answer a spontaneous question if the need arises.




If they do I hope they understand which books are helpful and what in particular they should investigate.
Buying books without purpose and only curiosity is time wasting--join the two for results! 
Better still start trading your sim!!

Finally this thread has been* a great introduction* --anticipatory questions have helped me formulate the presentation. 
Thank you for all contributing and the obvious interest.

I will be opening 1 locked thread which Pav and I can open (through Joe)
Questions should be directed to this current thread.


----------



## Kalaika

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> *To your question specifically*
> from 20 yrs of Technical analysis countless hrs of testing and countless hrs of trading it is crystal clear to me that.
> 
> *(1)* You can profit only if you have *more* wins with aggregate losses less than aggregate wins.
> OR
> *(2)* You have Much *large*r wins than aggregate losses.
> OR
> *(3)* A mix of* both*
> 
> There is one goal in this exercise and when I trade and it is centered around *BOTH (3)*
> More in the Introduction to technical trading when I have a little more time.




Thanks for the perspective tech/a.

I've yet to start trading but have been working on my base knowledge for the past couple of months, and during this time have made plenty of scribblings around the elements i would factor into my system(s) when the time comes.

I have found myself placing more importance - for my personal style - on building a robust risk and money management mechanism (position sizing, initial stops, trailing stops, adjusting the later based on where the trade goes over time) *ahead *of getting the perfect setup.

What i'm hoping to develop from this mindset is a system which has an arbitrary (poor choice of words - say, "less relevant") percentage of winning trades, but a superior ratio of winning % to losing % - i think this is aligns to your point 2 above.

If i can develop something per the above with a satisfactory expectancy, and later improve the quality of setups themselves through experience and education, i should be able to increase expetency further.

_All good in theory _

The single hardest thing i've dealt with to date is having to stop myself from launching into "system build" mode without sufficiently having bringing my rambled notes into a more structured plan.

Dumb question but how do we see the locked thread when it gets setup?

Thanks again for info.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Kalaika said:


> Thanks for the perspective tech/a.
> 
> I have found myself placing more importance - for my personal style - on building a robust risk and money management mechanism (position sizing, initial stops, trailing stops, adjusting the later based on where the trade goes over time) *ahead *of getting the perfect setup.




Wise.



> What i'm hoping to develop from this mindset is a system which has an arbitrary (poor choice of words - say, "less relevant") percentage of winning trades, but a superior ratio of winning % to losing % - i think this is aligns to your point 2 above.




Difficult to do unless you have a known result (read R/R) from an exit mechanism which is used over and over.
*Suited best to Systems trading than discretionary.*
Youll be for ever in turmoil as to when to hold and when to fold---particularly after you've closed a trade.



> If i can develop something per the above with a satisfactory expectancy, and later improve the quality of setups themselves through experience and education, i should be able to increase expetency further.




The best way to incease expectancy is to LOSE LESS both at the initial stop end and the exit end of trades.
Rather than looking at expectancy of every single trade--think of it as an on going challenge of increasing reward while decreasing Risk.
Youll see in our model that the initial Risk isn't reflected in the overall risk average---its less!



> _All good in theory _



Where we all must start.



> The single hardest thing i've dealt with to date is having to stop myself from launching into "system build" mode without sufficiently having bringing my rambled notes into a more structured plan.




no no launch into it---You'll learn more here than in theory.



> Dumb question but how do we see the locked thread when it gets setup?




You'll be able to see it you just wont be able to post on it.
Keeps it from becoming disjointed.


----------



## Boggo

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> from 20 yrs of Technical analysis countless hrs of testing and countless hrs of trading it is crystal clear to me that.
> 
> *(1)* You can profit only if you have *more* wins with aggregate losses less than aggregate wins.
> OR
> *(2)* You have Much *large*r wins than aggregate losses.
> OR
> *(3)* A mix of* both*








Kalaika said:


> What i'm hoping to develop from this mindset is a system which has an arbitrary (poor choice of words - say, "less relevant") percentage of winning trades, but a superior ratio of winning % to losing % - i think this is aligns to your point 2 above.





For anyone who is confused by the Wins vs Losses element of this discussion then this extract from a TradeSim backtest of my weekly breakout system will hopefully demonstrate that *the number (%)* of losses can far exceed *the number (%)* of wins and still be profitable.
The way I think of it is that the number of losses are a reflection of the number of times the capital protection mechanism has been activated.
Chart example here https://www.aussiestockforums.com/f...t=9392&page=10&p=773175&viewfull=1#post773175

(click to expand)


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Wow, great example Boggo....that would be hard to trade for me. I'm a little partial to 40-50%, but if it was a part of a portfolio of systems it might be a ok.

Nice Win loss ratio

CanOz


----------



## Kalaika

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I'll have what Boggo's having!!

Although I'm not sure I'd have the pills to stick with a 20-ish % win rate, irrespective of back testing. Bravo!

Boggo, does the "minimum equity" being a negative number mean your max drawdown took you beyond your equity limit?


----------



## Boggo

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Kalaika said:


> Boggo, does the "minimum equity" being a negative number mean your max drawdown took you beyond your equity limit?




Its the dip below the starting capital and the maximum was the highest above the same.


----------



## DJG

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



			
				tech/a said:
			
		

> *Those who have seen complex demonstrations that fill a chart with more lines than a cardiograph.*




I view simple price action/VSA the best, less lines, crap and histograms and what not cludding the space! I'm sure majority are the same


----------



## Caveroute

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Hi tech/a & Pav,

Count me in please, I'm  keen to have the opportunity to listen and learn.

Thanks.


----------



## skc

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Boggo said:


> For anyone who is confused by the Wins vs Losses element of this discussion then this extract from a TradeSim backtest of my weekly breakout system will hopefully demonstrate that *the number (%)* of losses can far exceed *the number (%)* of wins and still be profitable.
> The way I think of it is that the number of losses are a reflection of the number of times the capital protection mechanism has been activated.
> 
> (click to expand)




The largest single winning trade accounted for 1/3 of the profit over 10 years. Can you look up what that trade is out of curiosity? 

Even if you exclude that largest win, the stats are still very respectable.


----------



## Boggo

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



skc said:


> The largest single winning trade accounted for 1/3 of the profit over 10 years. Can you look up what that trade is out of curiosity?




Will do, at the airport about to catch a flight so may be late tomorrow before I get back to the computer with the info.


----------



## dutchie

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Never too old or experienced to learn from others. I'm in.
Thanks for your offer gents.


----------



## aarbee

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I would be very interested in learning from tech and Pav. 
Looking forward to tech's detailed posts laying the background and methodology of this type of trading.
In the meantime, Pav, would appreciate if you could post the results of your trading so far, in terms of total trades, win/loss ratio etc, etc.

Cheers


----------



## spatiosus

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Count me in Tech. Thanks for your generosity.


----------



## Boggo

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



skc said:


> The largest single winning trade accounted for 1/3 of the profit over 10 years. Can you look up what that trade is out of curiosity?
> 
> Even if you exclude that largest win, the stats are still very respectable.




AMX, probably wouldn't have taken the trade sub 10c though had I been running this system then.

Back on topic now to the tech/a - Pav exercise


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Boggo said:


> AMX, probably wouldn't have taken the trade sub 10c though had I been running this system then.
> 
> Back on topic now to the tech/a - Pav exercise




Sad lack of suitable trade setups on scans since Friday
To kick things off then I'll run through some past charts 
Failure/success/pyramid and Breakeven to give some idea of method and management over this week


----------



## skc

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Boggo said:


> AMX, probably wouldn't have taken the trade sub 10c though had I been running this system then.
> 
> Back on topic now to the tech/a - Pav exercise




Well you'd hit one of these when you trade for enough years...

And thanks for the PM. Tried to reply but your inbox is full.


----------



## fiftyeight

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Great start to the thread, looking forward to what is to come.

Will there be hints and tips on the scans as well?


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



fiftyeight said:


> Great start to the thread, looking forward to what is to come.
> 
> Will there be hints and tips on the scans as well?




Yes

My apologies for delays as time is at a premium.


----------



## fiftyeight

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Haha just me getting ahead of my self as usual.

This has been asked before as I think I have read it, but think I can find it now?

What are some good free charting and data feeds that I can use to follow this thread?


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



fiftyeight said:


> Haha just me getting ahead of my self as usual.
> 
> This has been asked before as I think I have read it, but think I can find it now?
> 
> What are some good free charting and data feeds that I can use to follow this thread?




Yahoo
Stockness Monster.


----------



## pavilion103

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Out of interest, I was going over my trading stats prior to running this portfolio with Tech. 

I had a similar winning accuracy and then obviously a similar losing rate as the Tech/Pav portfolio (with BE+losers)


The main difference was that over (a small) sample size of 20 trades I had:
- 8 wins
- 12 losses
- 0 break-even

If we look at the Tech/Pav porftolio the avg distribution over 20 trades would be:

- 8 wins
- 7.5 losses
- 4.5 break evens


Enormous difference in the percentage returns.
I was profitable over the 20 trades but only by 5%
Profit on this portfolio is closer to 50% (but over 35 trades). 


One lightbulb moment for me when it comes to increasing expectancy is the impact of the breakeven stop. It had a HUGE impact on the expectancy of the system (also on the drawdown).


----------



## waza1960

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



> One lightbulb moment for me when it comes to increasing expectancy is the impact of the breakeven stop. It had a HUGE impact on the expectancy of the system (also on the drawdown).




 That's really interesting, I have found with systematic trading that Breakevens are of limited value perhaps the discretionary angle gives them an edge ?


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



waza1960 said:


> That's really interesting, I have found with systematic trading that Breakevens are of limited value perhaps the discretionary angle gives them an edge ?




Yeah, stops hurt systems...i wonder what it is about discretionary stops that are better? Better observation of volume perhaps?

CanOz


----------



## sinner

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



waza1960 said:


> That's really interesting, I have found with systematic trading that Breakevens are of limited value perhaps the discretionary angle gives them an edge ?




In a portfolio of instruments, break even stops can free up capital to take on more trades without increasing overall risk (as long as you believe the stops can be executed efficiently).


----------



## Boggo

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



CanOz said:


> Yeah, stops hurt systems...i wonder what it is about discretionary stops that are better? Better observation of volume perhaps?
> 
> CanOz




Not having them can hurt even more.
Example...
https://www.aussiestockforums.com/forums/showthread.php?t=16501&p=766395&viewfull=1#post766395

(click to expand)


----------



## waza1960

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



> (as long as you believe the stops can be executed efficiently).




 There's the punchline.


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Boggo said:


> Not having them can hurt even more.
> Example...




Yeah sure Boggo i understand that. Generally speaking i was saying that they hurt the performance of the system. They also have other positive benefits as well of course....

CanOz


----------



## sinner

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



CanOz said:


> Yeah, stops hurt systems...i wonder what it is about discretionary stops that are better? Better observation of volume perhaps?
> 
> CanOz




If you buy a breakout and it has been ranging +/-1% for 5 days, what are the probable returns for day 6, 7, 8, ... ?

If you buy a breakout and it's sitting +5% in 5 days, what's the probability price will retrace to your entry versus probability price has gathered some momentum?


----------



## Gringotts Bank

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



CanOz said:


> Yeah, stops hurt systems...i wonder what it is about discretionary stops that are better? Better observation of volume perhaps?
> 
> CanOz




To me it indicates that the trades taken are based on *good entries*.  A good entry would be one where the stop can be moved to BE only because the SP continues to move up immediately.  Otherwise you won't be moving any stop anywhere, let alone upwards!!  I also believe in getting a good entry, and contrary to most commentators, think it's just as important as the exit. Average entries with tight stops results in an extremely high % of losing trades, and will likely be unprofitable overall.

To say "move the stop to BE" simply means that the price has gone up from entry and allowed it.  In other words, you've picked a good entry.  That's what needs to be discussed.


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Gringotts Bank said:


> To me it indicates that the trades taken are based on *good entries*.  A good entry would be one where the stop can be moved to BE only because the SP continues to move up immediately.  Otherwise you won't be moving any stop anywhere, let alone upwards!!  I also believe in getting a good entry, and contrary to most commentators, think it's just as important as the exit. Average entries with tight stops results in an extremely high % of losing trades, and will likely be unprofitable overall.





But its a bit like everything else in discretionary versus systematic trading... we think its better to have good entries, but yet when tested they're no better than 50/50 anyway. Like BE and Trailing Stops. the 20% Flipper uses only a 20% stop and an index filter, yet this works better than a BE and a trail because it gives the stock room to run.

Anyway, a bit off topic...looking forward to tech and Pavs examples, i know how Radge used to move his stops (more or less) but i'm keen to see how these guys do it.

CanOz


----------



## Gringotts Bank

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



CanOz said:


> But its a bit like everything else in discretionary versus systematic trading... we think its better to have good entries, but yet when tested they're no better than 50/50 anyway. Like BE and Trailing Stops. the 20% Flipper uses only a 20% stop and an index filter, yet this works better than a BE and a trail because it gives the stock room to run.
> 
> Anyway, a bit off topic...looking forward to tech and Pavs examples, i know how Radge used to move his stops (more or less) but i'm keen to see how these guys do it.
> 
> CanOz




I think it's very much *on *topic!

Sinner asked if you want a small movement or big movement before breakout.  I want small movement, low volatility right near the trendline is best.  That would be part of my pattern.


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Gringotts Bank said:


> I think it's very much *on *topic!
> 
> Sinner asked if you want a small movement or big movement before breakout.  I want small movement, low volatility right near the trendline is best.  That would be part of my pattern.




Some would argue that time has more significance that the range size...

CanOz


----------



## Gringotts Bank

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



CanOz said:


> Some would argue that time has more significance that the range size...
> 
> CanOz




I base my time stop on a percentage of the size of the pattern in most cases.  eg. pattern size = 20 bars -> time stop 10 bars.  But this is for swing trading,not momentum.  I think this thread is only about momentum trades, not sure.


----------



## pavilion103

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Gringotts Bank said:


> I base my time stop on a percentage of the size of the pattern in most cases.  eg. pattern size = 20 bars -> time stop 10 bars.  But this is for swing trading,not momentum.  I think this thread is only about momentum trades, not sure.




Yes momentum trades for this portfolio. Mainly continuation patterns.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Gringotts Bank said:


> I think it's very much *on *topic!
> 
> Sinner asked if you want a small movement or big movement before breakout.  I want small movement, low volatility right near the trendline is best.  That would be part of my pattern.




Absolutely I agree.
I'll comment more on this
Very important topic when I have more time.

Excellent discussion guys! 
Very pertinent to what I'd like to get across.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Hi Tech

Do you have conditions of the overall market to be met before trading these trades? 

Long trades only or Long and Short trades?


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



debtfree said:


> Hi Tech
> 
> Do you have conditions of the overall market to be met before trading these trades?
> 
> Long trades only or Long and Short trades?





Great question...Nick, Jason Leavitt and i'm sure others as well often review the over market for trend once a week...

curious as to how these guys will handle this too, i'm sure they've got it in hand as Tech has already posted on the XAO thread....

CanOz


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Firstly I have posted in the XAO thread and I believe we are at an important cross roads right now.

So Yes I do look at the background market.

But prospects tend to dry up as well and we have noticed that 
in the last few weeks. To the point that those on watch lists aren't triggering.
We are having quite a few pattern failures.

To the main topic.
That where stops are questioned with regard to performance.

In a Systematic approach there are fixed entry/exit and stops. These don't float.
As such a value is returned for trading the system against your universe.
Its simply a repeat process which if adhered to should return something within the standard deviation of the results found when testing.




*Its not about being right its about being profitable.*


In a Discretionary trading method we have the ability to alter all 3
Entry/Exit and Stops. The single most important aspect of this form of trading---in my view.

Unlike a systematic approach we don't have to play trade after trade out to its known end.
We can move our Initial Stop. We can alter our entry and we can determine our exit with discretion.
To sit and wait for a stop to be hit as a stock reverses from well above---with clear signs of an impulse move 
during a topping pattern or stage of the life of the chart---would be less than ideal.

Initial stops give us a target for Reward for Risk.
That is 1 R
But if we can over a number of trades alter that 1 R to less than 1 R it can and does have a dramatic affect on your results.
Our results were improved immensely.
At the other end exit timing can also ensure you retain more profit.

In the exercise presented we are looking at very short term trades.3-8 days.
We want to be in trades moving in our direction. More of them and more often.
In the end it is and was my intention to show Pav that you *MUST* be proactive in your trading.
to sit by passively waiting for a result from your set (Plan) parameters is disaterous for profits.

*I want to make this clear.*

People spend hrs looking for the perfect entry or exit.
They keep copious notes and review how they could improve their entries/exits and even stops.

In my view.




*Its not about being right its about being profitable.* 

An important aspect in Technical trading.---In fact Id go as far as saying if your not trading a system trade to be profitable skewing your risk and reward as much as you can.
I hope when I post some charts that you'll not only see the achieved results but what you can do to make your trading more profitable.

If your looking for genius entries and exits and perfect stop placement--you wont find it here!
*But you'll find profit!*


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Either lots of readers agree whole heartedly
OR
Lots of traders have had lightbulb moments.

The silence is deafening.


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Either lots of readers agree whole heartedly
> OR
> Lots of traders have had lightbulb moments.
> 
> The silence is deafening.




Everyone is waiting for the pictures Tech...


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



CanOz said:


> Everyone is waiting for the pictures Tech...




Oh I see visual confirmation.


----------



## 5oclock

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I am still tuned in TECH, listening and learning, guess others are doing the same,thanks.


----------



## burglar

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Oh I see visual confirmation.




Yes, I am a visual person!


----------



## waza1960

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I thought I would add my 

 Keeping in mind that I am a systems trader first and foremost ..........



> In a Systematic approach there are fixed entry/exit and stops. These don't float.



They do in most of my automated systems 


> Its not about being right its about being profitable.



This really is a gem and I bet most will not even think about it. Of course a lot more books are sold on telling traders what is "right"




> In a Discretionary trading method we have the ability to alter all 3
> Entry/Exit and Stops. The single most important aspect of this form of trading---in my view.



agree


> Unlike a systematic approach we don't have to play trade after trade out to its known end.
> We can move our Initial Stop. We can alter our entry and we can determine our exit with discretion.
> To sit and wait for a stop to be hit as a stock reverses from well above---with clear signs of an impulse move
> during a topping pattern or stage of the life of the chart---would be less than ideal.




This is the detail I hope you show us as this is where the psychology comes to play and experience is needed


----------



## Des P

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I am very interested in this thread hoping i will learn somthing
Keep up the good work
Cheers


----------



## Mistagear

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Should a break-even trade even be considered a valid score in a Risk/Reward System ?

If you scratch a trade at break even (Zero R ) what you do next is take another trade, so in effect, within your system you have taken funds out of a Zero R, and placed it in the next trade, a 1R trade.
Thats sort of equivalent to having not taken the first trade.
Some people may consider if the original stop placement was justified as signalling a fail of the trade and that the entry was a suitable entry, why now is the entry point the place to signal a failed trade.

Why therefore, is not a 0.25 R or 0.5 R a better proposition than entering a new trade at 1 R ?
If you are not trying to be right, rather trying to be profitable, surely any risk less than you take for the next trade, remains a valid trade within the Risk/Reward System ?

I struggle with this concept, life was easier when trades were singular, since trading became a series of loops, deploying funds like employees in a business, it's become less simplistic...am glad others here have it sorted


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech/Pav

Aaaha - A light bulb moment for me, for sure.

From your previous posts I understood to be proactive and skew the results into my favour by lifting the initial stop loss (1 Risk) towards or to breakeven fairly quickly to reduce our initial risk.

I was skewing the initial risk BUT NOT the exit, doing both does make a big difference on results as you say.

I know the exercise I've done below is very basic but it does illustrates your point of being proactive both ends, start of the trade and end of the trade.

If I tossed a coin 2 times for 1 win and 1 loss (50% Win Rate)
Won $1 for the win and lost $1 for the loss (1:1 Profit Ratio)
That's breakeven trading putting all other costs aside for the time being.

If I could then skew the results by reducing that initial risk down to half, it would mean I only lost .50 cents and still had my $1 win. So Win Rate was still 50% but my Profit Ratio was now 2:1 because I'm now winning twice as much as I was losing. This now has me above the breakeven line.

But now, if I can skew the exit (light bulb for me) and improve this $1 win to say $1.50 the results are very good.
Win Rate still 50%, now winning $1.50 and losing .50 cents which pushes my Profit Ratio out to 3:1. 
A very good system indeed.

I know we probably won't get a 50% reduction on our initial risk and a improvement of 50% on our winnings as in the perfect world but I get the idea of skewing both ends and see that it does have a dramatic affect on the end results.

We might or might not get a 3:1 system but it does get us away from that breakeven line.

I get it! I look forward to your charts and ideas on skewing both ends.

Thanks again Tech and Pav, appreciate your work.

PS. Do you trade long and short?


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Some great musings here Mistagear----



Mistagear said:


> Should a break-even trade even be considered a valid score in a Risk/Reward System ?




I think so and below is why



> If you scratch a trade at break even (Zero R ) what you do next is take another trade, so in effect, within your system you have taken funds out of a Zero R, and placed it in the next trade, a 1R trade.
> Thats sort of equivalent to having not taken the first trade.




But you cannot deny that the trade was taken. Analysis anticipated a profitable trade and as you will see shortly the anticipation that momentum would continue allowed me or indicated to me that it was sfe to reduce my initial risk by moving the trade to a position of break even.



> Some people may consider if the original stop placement was justified as signalling a fail of the trade and that the entry was a suitable entry, why now is the entry point the place to signal a failed trade.



I would suggest that *THIS OBSERVATION* is widely accepted by most here.

Again you will see that the setup I'm looking for are at best continuation micro patterns and at worst continuation patterns. So there is a group of bars often coupled with other analysis which indicates a continuation of the current move in my direction.
This pattern has a set boundary which we can determine indication of success or failure. It is this boundary which we set our initial stop/initial trigger/and importantly our position sizing (Not with standing your comments below--will get to them). 



> Why therefore, is not a 0.25 R or 0.5 R a better proposition than entering a new trade at 1 R ?
> If you are not trying to be right, rather trying to be profitable, surely any risk less than you take for the next trade, remains a valid trade within the Risk/Reward System ?




Because we are letting each individual trade determine its own out come. *We are not limiting the profit potential of the next trade due to the outcome of the last.*



> I struggle with this concept, life was easier when trades were singular, since trading became a series of loops, deploying funds like employees in a business, it's become less simplistic...am glad others here have it sorted




Why cannot it be exactly as you describe?

So lets have a look at some examples we have traded.

*But before I do*

*Currently* Pav and I are not finding the continuation patterns that were prevalent earlier in the year. In fact where a market in general turns you will find many exhaustion and ending patterns. I can and do find that some of the patterns traded at this time as continuation patterns turn out to be ending patterns. In these situations *OFTEN* our pattern will trigger only to quickly reverse and fail.
Here 1R losses increase (At the end of longer term moves).

This is why there are no NEW setups offered up ---as they appear I will post them.
I will also post Current longer term general market analysis. this I posted this week in the XAO thread (it is actually a chart of the XJO)

Some great musings here Mistagear----



Mistagear said:


> Should a break-even trade even be considered a valid score in a Risk/Reward System ?




I think so and below is why



> If you scratch a trade at break even (Zero R ) what you do next is take another trade, so in effect, within your system you have taken funds out of a Zero R, and placed it in the next trade, a 1R trade.
> Thats sort of equivalent to having not taken the first trade.




But you cannot deny that the trade was taken. Analysis anticipated a profitable trade and as you will see shortly the anticipation that momentum would continue allowed me or indicated to me that it was sfe to reduce my initial risk by moving the trade to a position of break even.



> Some people may consider if the original stop placement was justified as signalling a fail of the trade and that the entry was a suitable entry, why now is the entry point the place to signal a failed trade.



I would suggest that *THIS OBSERVATION* is widely accepted by most here.

Again you will see that the setup I'm looking for are at best continuation micro patterns and at worst continuation patterns. So there is a group of bars often coupled with other analysis which indicates a continuation of the current move in my direction.
This pattern has a set boundary which we can determine indication of success or failure. It is this boundary which we set our initial stop/initial trigger/and importantly our position sizing (Not with standing your comments below--will get to them). 



> Why therefore, is not a 0.25 R or 0.5 R a better proposition than entering a new trade at 1 R ?
> If you are not trying to be right, rather trying to be profitable, surely any risk less than you take for the next trade, remains a valid trade within the Risk/Reward System ?




Because we are letting each individual trade determine its own out come. *We are not limiting the profit potential of the next trade due to the outcome of the last.*



> I struggle with this concept, life was easier when trades were singular, since trading became a series of loops, deploying funds like employees in a business, it's become less simplistic...am glad others here have it sorted




Why cannot it be exactly as you describe?

So lets have a look at some examples we have traded.

*But before I do*

*Currently* Pav and I are not finding the continuation patterns that were prevalent earlier in the year. In fact where a market in general turns you will find many exhaustion and ending patterns. I can and do find that some of the patterns traded at this time as continuation patterns turn out to be ending patterns. In these situations *OFTEN* our pattern will trigger only to quickly reverse and fail.
Here 1R losses increase (At the end of longer term moves).

This is why there are no NEW setups offered up ---as they appear I will post them.
I will also post Current longer term general market analysis. this I posted this week in the XAO thread (it is actually a chart of the XJO)

*Click on all charts to enlarge*

View attachment 52542


This is why we are seeing zero continuation trades and got hit recently with a number of completion patterns.
like this one with TLS 
You can see the initial setup and as momentum had already triggered the trade I placed the initial stop in the body of the pattern. I would had we taken the trade at the point of breakout moved the stop up *in line with momentum going our way*,as it was I found it the day of breakout.
Filled the next day you can then see how quickly and aggressively the trade collapsed.
Note how the patterns has been tested and has acted as resistance!!
1R loss.

View attachment 52543


The other chart in the Shot is *TPM* I miss labelled it.
This pattern failed to trigger.

Here are today's shots of both charts.

View attachment 52544


Here is one of our FIRST completed successful trades.
This chart was labelled as the chart unfolded and sent as an educational exercise to Pav each time a *management *of the trade took place.

View attachment 52545


*This is how Ill label all charts as they are traded in future.*


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech - In regards to your SWM chart

Your buy in date was Jan 16th
Buy in price was $1.86, why that price? Why not the top of the run up of Jan 10 or was it 1 cent above the first top bar of the first rush of momentum on the Jan 3?

What day did you move your stop loss to breakeven and the reason or if you have time the dates you moved all stops up and the reasons so I can see what makes you react and when.

On the Jan 21 we see a high finish with lower volume so does that mean no sellers? Same on Feb 1.

Very interested in seeing what your seeing and what makes you react on these days as the trade moves along.


----------



## pavilion103

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech can correct me if I'm wrong on any of this but below is a details analysis of the chart that I marked up for SWM. It shows where the stop was trailed each time and has a few explanations on the chart. 

In answer to the previous questions notice:
21st Jan - this was preceeded by a couple of very tight range high volume bars which could indicate potential supply. 21st Jan tests this on low volume which could suggest little supply. It needed a couple of bars to sort itself out and then away it went. 

1st Feb - Notice that this is preceeded by the pivot point reversal. We like to see price moving up on lower volume, with no resistance in the near background.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Thanks Pav
I will digest all that this afternoon, understood what you are saying and will go over this to make sure it sticks. I can see where you are going, very good.
Thanks once again.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Pav/Tech
Thanks once again for your charts and comments.

Pav - Your use of different colours for the circles and comments really are helpful and makes it easy to follow where and what you are talking about. Just that 1 chart and all the info in it has helped me understand previous charts posted a little better, so thanks. The student now becoming a teacher.

Forgive me asking questions as I don't presume I know things when maybe I don't, so I'd rather ask a silly question and know the right answer than going forward on a false belief. I'll ask them as they come into my head and if they need to be answered at a later date that's ok too. 

What is the ideal amount of open trades to have going at any one time, any thoughts?

So we're not really interested in getting in at the first breakout of a larger consolidation pattern (Base) but we are using that breakout to attract us to that share for our Watchlist, is this correct? 
And this does make sense when I think about it because it has not shown the upward momentum that you talk about at this stage beside the 1 day breakout.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Just to add to Pav's comments.
I also encourage Pav and others to type out your comments here---it helps to crystallize thought processes.



debtfree said:


> Tech - In regards to your SWM chart
> 
> Your buy in date was Jan 16th
> Buy in price was $1.86, why that price? Why not the top of the run up of Jan 10 or was it 1 cent above the first top bar of the first rush of momentum on the Jan 3?




All setups are found from a scan.These scans are looking for consolidation or continuation patterns. As such the prospects thrown up need to be eyeballed for suitability which is an experience thing. You can read up on patterns in many many books and on the net. What I look for in particular is a likely change of sentiment from consolidation or short term pull back to the resumption of trend.



> What day did you move your stop loss to break even and the reason or if you have time the dates you moved all stops up and the reasons so I can see what makes you react and when.




The break even stop on 25/1
The reason was that momentum proved that it had returned to the up trend.
The trailing stop then was placed on 1/2 with that being an up day.
Moved on 6/2 after a strong wide range up bar.
Finally 19/2 as price moved out of consolidation.



> On the Jan 21 we see a high finish with lower volume so does that mean no sellers? Same on Feb 1.




In both cases nothing remarkable about volume---either way so we need to wait for following bars to confirm price movement probabilities. lower volume rising bars certainly indicate lack of supply.



> Very interested in seeing what your seeing and what makes you react on these days as the trade moves along.




I get it wrong just like everyone.
*Mr Market is definitely a woman!*


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

SWM - I have spent a few hours reviewing your comments and this chart alone and the info you have passed on has been very beneficial so many thanks Tech and Pav.

Tech - In relation to your earlier post No:13,043 MTU Chart:
It broke out on the 10th April 2013
You waited for price to return to 5.14, why that price?
Were you looking for a lower risk entry? 
If so, were you looking at trying to get in very near to the half way mark of this bar?
Or was the volume of this bar not that remarkable that made you think it might pull back a little before running up again.
I do understand you are waiting for a micro pattern of about 5 / 10 days to exist to achieve a low risk entry and is that the reason you waited for this to little pullback?

Thanks for any feedback ... Debtfree


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



debtfree said:


> SWM - I have spent a few hours reviewing your comments and this chart alone and the info you have passed on has been very beneficial so many thanks Tech and Pav.
> 
> Tech - In relation to your earlier post No:13,043 MTU Chart:
> It broke out on the 10th April 2013
> *You waited for price to return to 5.14, why that price?
> Were you looking for a lower risk entry?
> If so, were you looking at trying to get in very near to the half way mark of this bar?*
> Or was the volume of this bar not that remarkable that made you think it might pull back a little before running up again.
> I do understand you are waiting for a micro pattern of about 5 / 10 days to exist to achieve a low risk entry and is that the reason you waited for this to little pullback?
> 
> Thanks for any feedback ... Debtfree




Yes right on all accounts.
Hard to see on the metastock chart but when volume is above normal
and range is wide it is very common to see price retrace 50% of the bar.
This gives a much better entry and far better R/R than buying the high of the bar.
Sure you will miss some that dont retrace.

But its about profit *NOT BEING RIGHT!*

This is a Tradeguider Chart

Note a very common signal in the pullback 
The *GREEN* triangle this is a 

No supply bar
With* volume lower than the previous 3 bars.*

Click to enlarge.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech, understood your points in the last post thanks.

Spent quite some time going through each day of the MTU trade from page 1. Naturally your lines and comments have help me understand the management of this trade to a certain extent and I was hoping you have time to run over my thoughts of what you were thinking as it unfolded.

By the looks of things there was 5 Stops used:
1 - Initial stop at 4.89
2 - Breakeven stop at 5.14 .... was this moved here on 17th April after close? Strong day, supply coming in and buyers accumulating resulting in moving your initial stop to breakeven very quickly.
3 - Looks like 5.38 ... was this moved here on 29th April after close? Good effort today, looks like supply is a little short of average but buyers are willing to pay more.
4 - 5.69 ... was this moved here on 8th May after close? Strong day, supply coming in and buyers accumulating and the next day as well which has a big spike. Did this mean maybe nearing the end of it's run?
5 - 6.09 ... which you explained in that post.

You also have 2 thin blue lines above and below days 18th to 24th, was this a potential area to add another position but passed for some reason or are the lines for something else? 
Seen the added position at 5.69.

Thanks for your time and chart.

Cheers ... Debtfree


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



> You also have 2 thin blue lines above and below days 18th to 24th, was this a potential area to add another position but passed for some reason or are the lines for something else?
> Seen the added position at 5.69.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Don't know if this will work as I have not added charts before.
No not those line I'm aware of those. I'm talking about the second graph which I hope will be inserted into this post when I reply.

The 2 short thin horizontal blue lines above and below those days mentioned and there is also a red thicker line in that area with a blue and white stop sign just below. Hope this clarifies.


----------



## pavilion103

They are the setups for pyramiding the trade (adding to our position).


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> They are the setups for pyramiding the trade (adding to our position).




I thought that's what it was about but thought I'd check rather than be in doubt, thanks Pav.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Nothing coming up on scans.
So we are in cash with the exercise.
When we have some some for the watch list 
I'll post them up.

No continuation patterns.


----------



## skc

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Nothing coming up on scans.
> So we are in cash with the exercise.
> When we have some some for the watch list
> I'll post them up.
> 
> No continuation patterns.




When you calculate your annual % return when are you going to make your start date?

Date of first trade? 

Or date when you started this thread / exercise?


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



skc said:


> When you calculate your annual % return when are you going to make your start date?
> 
> Date of first trade?
> 
> Or date when you started this thread / exercise?




Does it matter?

Being out of the market is a position---in my view.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Does it matter?
> 
> Being out of the market is a position---in my view.




Actually I'm happy to start again.
One thing I go on about is most traders are under capitalized.
This was clear to Pav and I during the exercise.
The ideal MINIMUM start up Capital in my view would be $50K
with a capability of trading on Margin where necessary. This
will allow a greater opportunity with Pyramiding and portfolio
sizing.

IB (which both Pav and I use) offer 2:1 so

I'm happy to reset using an ideal capital base if that's what people would like to see?

Ive also come up with a way to display the trades Real time without concern that
they could be seen as advice.

See below

Just as an example ill put more info on the ones offered up.




A week after the trade is taken or if it is closed in that time
Ill disclose the code.


----------



## satanoperca

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Does it matter?
> 
> Being out of the market is a position---in my view.




This was a position that took me a while to digest and implement. It has resulted in staying profitable.

As you have stated, all that matters is making profit.

Thanks for you dedication in providing insightful information in this thread and many others.


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech, can you explain how much ofthe account you are risking in each trade, how often do you update that if you are compounding, how you use the marginetc...?

Cheers,



CanOz


----------



## fiftyeight

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Can I go back to the real basic stuff, could you give a brief description of what each of the 3 lines are and why they were places where they are?

Cheers


----------



## skc

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Does it matter?
> 
> Being out of the market is a position---in my view.




Say your nominated start date is 1 May 2013. The market stays bearish and you have no trade until 1 Nov 2013. Then you start trading and by 30 April 2014, you've made say $15k on your $100k capital.

Your return for the year based on nominated start date would be 15%.

But if you use the start date as your first trade on 1 Nov, your return of 15% is achieved over 6 months instead of 12 months.

It's mostly academic but just wondering how you plan to deal with it.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



satanoperca said:


> This was a position that took me a while to digest and implement. It has resulted in staying profitable.
> 
> As you have stated, all that matters is making profit.
> 
> Thanks for you dedication in providing insightful information in this thread and many others.




Cheers




CanOz said:


> Tech, can you explain how much ofthe account you are risking in each trade, how often do you update that if you are compounding, how you use the marginetc...?
> 
> Cheers,
> 
> 
> 
> CanOz




Yes I will be doing that and more when we get going.
But basically we let the market disctate taking another position/Raising stops both initial and trailing.
Margin will be determined on the Risk calculation V shares that can be purchsed.
Best to wait for a real case to discuss.



fiftyeight said:


> Can I go back to the real basic stuff, could you give a brief description of what each of the 3 lines are and why they were places where they are?
> 
> Cheers




Yes thats my intention.



skc said:


> Say your nominated start date is 1 May 2013. The market stays bearish and you have no trade until 1 Nov 2013. Then you start trading and by 30 April 2014, you've made say $15k on your $100k capital.
> 
> Your return for the year based on nominated start date would be 15%.
> 
> But if you use the start date as your first trade on 1 Nov, your return of 15% is achieved over 6 months instead of 12 months.
> 
> It's mostly academic but just wondering how you plan to deal with it.




Yes understand if that did happen then that would be a characteristic of this type of trading (Continuation patterns).
Happy to re set it now seeing we are flat.
If Pav doesnt have an issue with it as we are in the middle of the exercise we started and it will take 6 mths for him to evaluate 6 mths of results.

Or we can simply see the result now and deduct that from any future result.
More to the exercise than just profit---although that is the ultimate aim.


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Maybe i asked this before...but are you guys trading short as well as long?


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



CanOz said:


> Maybe i asked this before...but are you guys trading short as well as long?




No

Futures of course yes.
We are trading FTSE in the meantime
both long and short.


----------



## pavilion103

CanOz said:


> Maybe i asked this before...but are you guys trading short as well as long?




We have only taken longs in this portfolio. Been looking at futures indexes for short trades.

Maybe Tech can elaborate on the fact that we've only traded long. I haven't discussed this with him in any detail tbh.


----------



## pavilion103

tech/a said:


> No
> 
> Futures of course yes.
> We are trading FTSE in the meantime
> both long and short.




Well there is the quick response. Ignore my post.

I've taken a few shirts myself but not as part of this exercise.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> Well there is the quick response. Ignore my post.
> 
> I've taken a few *shirts* myself but not as part of this exercise.




Were the trades that bad!!


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Were the trades that bad!!




No need to steal any shirts!

I guess it makes sense to trade the long side well before one trades the short side...timing can be tricky too...instead of getting whipped around with long you get whipped around long and short and lose twice...that was a hard lesson for me when i first started swing trading.

CanOz


----------



## pavilion103

tech/a said:


> Were the trades that bad!!




I must have typed in 10 contracts on the FTSE accidentally instead of 1.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



CanOz said:


> No need to steal any shirts!
> 
> I guess it makes sense to trade the long side well before one trades the short side...timing can be tricky too...instead of getting whipped around with long you get whipped around long and short and lose twice...that was a hard lesson for me when i first started swing trading.
> 
> CanOz




Try trading a position trade short and at the same time short term (a few minutes) trades long.
Get your head around that!


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Try trading a position trade short and at the same time short term (a few minutes) trades long.
> Get your head around that!





Yeah, tricky with your broker too...


----------



## rnr

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> We have only taken longs in this portfolio. Been looking at futures indexes for short trades.
> 
> *Maybe Tech can elaborate on the fact that we've only traded long.* I haven't discussed this with him in any detail tbh.




Would you elaborate on this please Tech?


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



rnr said:


> Would you elaborate on this please Tech?




Dont know what there is to elaborate on.
IB doesnt allow for shorting ASX stocks
so its a long only trading method.
Ive never traded stock short in 20 yrs.
If I want to trade short I trade Futures.


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Dont know what there is to elaborate on.
> IB doesnt allow for shorting ASX stocks
> so its a long only trading method.
> Ive never traded stock short in 20 yrs.
> If I want to trade short I trade Futures.





There is over 100 on the list, if there is inventory to borrow you can indeed short them....

CanOz


----------



## pavilion103

tech/a said:


> Dont know what there is to elaborate on.
> IB doesnt allow for shorting ASX stocks
> so its a long only trading method.
> Ive never traded stock short in 20 yrs.
> If I want to trade short I trade Futures.




Yes it does?  I'm short SXL at the moment!


----------



## rnr

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Dont know what there is to elaborate on.
> IB doesnt allow for shorting ASX stocks
> so its a long only trading method.
> *Ive never traded stock short in 20 yrs.*
> If I want to trade short I trade Futures.




That explains it!

Thanks for the heads-up Tech.


----------



## CanOz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> Yes it does?  I'm short SXL at the moment!





hmmm, nice


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> Yes it does?  I'm short SXL at the moment!




Always tells me its looking for stock.
Never been able to get on yet.


----------



## rnr

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> Yes it does?  I'm short SXL at the moment!




Any chance of posting a chart and sharing your thoughs on this SXL short trade?


----------



## rnr

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Always tells me its looking for stock.
> Never been able to get on yet.




DMA CFD's are an alternative to IB.


----------



## pavilion103

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



rnr said:


> Any chance of posting a chart and sharing your thoughs on this SXL short trade?




I'm no expert on shorts. In fact, I've done very few so far. So although I could give me thoughts in the SXL thread, they probably aren't as valuable as you may think. I'm spending a bit of time learning this at the moment. 

Much more valuable are my charts of longs. Even more valuable are Tech's charts that will be presented in this exercise. 

There will be plenty to learn from them. I know everyone is looking forward to it.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



rnr said:


> DMA CFD's are an alternative to IB.




Never interested me.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech 

Momentum stocks for a watch list. 
What is your requirement, is there a certain upward percentage move like say, 20% rise over a short period of time?
A shorter Moving Average above say a 50 day MA?

And what makes you throw some out - 
Low volume? What is the minimum volume criteria you require?

What else bring these candidates to your attention?

Cheers ... Debtfree


----------



## fiftyeight

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I noticed CanOz posted a scan he found in another thread and suggested that other people could post some up with no response.

Are scans one of things that are kept secret?

Cheers


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

No I don't think they are a secret but if we knew what to input into a scan so we can isolate these momentum stocks might get us off to a flying start.

I know Tech uses Yahoo to find biggest gains for the day, no secret there but for all other scans not quite sure how he and Pav construct them to build their watch list without going through each stock individually.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



debtfree said:


> No I don't think they are a secret but if we knew what to input into a scan so we can isolate these momentum stocks might get us off to a flying start.
> 
> I know Tech uses Yahoo to find biggest gains for the day, no secret there but for all other scans not quite sure how he and Pav construct them to build their watch list without going through each stock individually.




Firstly you need software to programme in a search.
I can post up some Metastock scans and I'm sure someone can convert them to Amibroker.
The trick for finding patterns ( well my trick ) is to have a search you like with a 5 day alert look back period.
Take a breakout search --- micro patterns will appear in --- up to--- 5 days later.
As one is emerging you place it in your watch list.

The other searches are proprietary which Tradeguider and Advanced Get have in their softwares.
So can't give them to you.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



debtfree said:


> Tech
> 
> Momentum stocks for a watch list.
> What is your requirement, is there a certain upward percentage move like say, 20% rise over a short period of time?
> A shorter Moving Average above say a 50 day MA?
> 
> And what makes you throw some out -
> Low volume? What is the minimum volume criteria you require?
> 
> What else bring these candidates to your attention?
> 
> Cheers ... Debtfree




Sorry just saw this.
I'll answer in detail later when I have some more time.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech, can we touch on the minimum volume needed to make a stock ok to put into our watchlist. 

Should we be looking at just volume (number of shares) or volume $$ (number of shares x price of shares)

Also many thanks Tech / Pav / Canoz and many others for your posts in other threads, very helpful and many apply to this thread as well.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



debtfree said:


> Tech, can we touch on the minimum volume needed to make a stock ok to put into our watchlist.
> 
> Should we be looking at just volume (number of shares) or volume $$ (number of shares x price of shares)
> 
> Also many thanks Tech / Pav / Canoz and many others for your posts in other threads, very helpful and many apply to this thread as well.




Been very tardy!

I like to use a filter of $300k minimum turnover
Many of my searches have $500k as the filter. Based on a 10 day average.
You need enough liquidity to see  crowd behavior in a chart.
If it's too thin you won't see patterns that are reliable.

They don't make the watch list unless a potential momentum pattern is evident or emerging.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Excellent, that makes sense. Thanks Tech


----------



## fiftyeight

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



debtfree said:


> Also many thanks Tech / Pav / Canoz and many others for your posts in other threads, very helpful and many apply to this thread as well.




+58


----------



## statmech71

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Nothing coming up on scans.
> So we are in cash with the exercise.
> When we have some some for the watch list
> I'll post them up.
> 
> No continuation patterns.




Tech,

with hints of bullishness returning to the markets, just wondering if your scans are getting any hits. If so, would you act on these hits immediately or are there other criteria to be triggered before engaging in this type of trading again.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



statmech71 said:


> Tech,
> 
> with hints of bullishness returning to the markets, just wondering if your scans are getting any hits. If so, would you act on these hits immediately or are there other criteria to be triggered before engaging in this type of trading again.




You must be reading my emails to PAV

There are a number of signals appearing.
I have posted around 10 to PAV

I also discussed opening this thread up again.
PAV is happy to start up a new spread sheet.
Will post up som in the coming days.


----------



## statmech71

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Thanks - really looking forward to it!


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

New post coming in locked thread once Joe opens it for me.


----------



## pavilion103

Well it looks like we are up and running again.

Tech wondering if you could make some reference to XAO conditions and the impact, if any, on our setups or more importantly trade management. Maybe we can periodically refer to this as we go?


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> Well it looks like we are up and running again.
> 
> Tech wondering if you could make some reference to XAO conditions and the impact, if any, on our setups or more importantly trade management. Maybe we can periodically refer to this as we go?




Yes was going to do that.
Having a good look at it---it appears inconclusive and somewhat contradictory---at the moment. (The XAO) 
As we know markets are dynamic and currently the market is altering on a weekly basis.

In times like this all we can do is follow the signals and manage all trades aggressively.
Once clear then we can relax trade management if in our favor.

But I will comment when I have some time.
Currently have parent problems which you all may have when they get to 90!


----------



## brty

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech,

I noticed one of the patterns you are following is the high and tight pattern of SHV, I bought the breakout today as I have been following this for a while.

 It often has very thin days in volume. Do you make an allowance for possible wide spreads when instigating the 2% stoploss rule? 
Would the corresponding position size be smaller for a thinly traded stock as compared to FLT, another one that instigated a buy today?


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



brty said:


> Tech,
> 
> I noticed one of the patterns you are following is the high and tight pattern of SHV, I bought the breakout today as I have been following this for a while.
> 
> It often has very thin days in volume. Do you make an allowance for possible wide spreads when instigating the 2% stoploss rule?
> Would the corresponding position size be smaller for a thinly traded stock as compared to FLT, another one that instigated a buy today?




Brty

You bring a valid point and one we (I) do consider.
Every now and again I have been caught where it turns quickly and Im left being stopped.
but in general volume is at least enough to trade when momentum kicks in.
The setups are meant to be in advance of Momentum.

My plan with this type of trading is to get to B/E as early as possible --- which Im sure will have people questioning the thinking.

Each I treat as the same.
I do have a liquidity filter in scans and have never had a problem with excessive slipage or not being able to be filled.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

4 Trades entered today.
Will post charts on the other thread.


----------



## pavilion103

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> 4 Trades entered today.
> Will post charts on the other thread.




Good work.Spreadsheet updated daily from now on. 

I'm not sure if I missed this in the other thread (not that it matters greatly), but what account size are we using?


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> Good work.Spreadsheet updated daily from now on.
> 
> I'm not sure if I missed this in the other thread (not that it matters greatly), but what account size are we using?




Say $100K 
that leaves another $100k for
use with margin if required.

Ill email you direct the Position sizing etc and will
post a fully marked up chart either a week later or 
if the trade is closed before.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech/Pav

When you scan for breakouts, what is your thoughts behind them in regards to the number of days for a new breakout. What is your shortest and longest scan?

I was thinking a longer breakout scan would probably have a big pattern under the breakout price indicating a possible big price move upward so if you can get a small low risk trade just above breakout level, excellent. 
Is this what you look for after a breakout appears in your scans, a larger pattern under breakout level?

Am I on the right line of thinking?


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



debtfree said:


> Tech/Pav
> 
> When you scan for breakouts, what is your thoughts behind them in regards to the number of days for a new breakout. What is your shortest and longest scan?
> 
> I was thinking a longer breakout scan would probably have a big pattern under the breakout price indicating a possible big price move upward so if you can get a small low risk trade just above breakout level, excellent.
> Is this what you look for after a breakout appears in your scans, a larger pattern under breakout level?
> 
> Am I on the right line of thinking?




No not really.

I dont want breakouts I want potential breakouts.
Among other things which are NOT breakout related.
I havent any of this sort up yet but will explain when they are.

I have criteria I scan.

Being an alert of various breakouts 5 days ago.
Along with a liquidity filter.
I have 4 codes which give me many prospects.

From there I then use the *discretionary filters* IE Visual filters.

These are in general terms.

The trade must be in an obvious trend or an obviously emerging trend.
There must be a clear and tight micro pattern (generally).
There must be signs of momentum gathering or in place.
There must be signs in the pattern that demand is not being swamped by supply.
Or a clear lack of supply.
I must be able to get a very tight risk parameter.

I also have a look for any clear Elliott count.


----------



## Trembling Hand

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> I dont want breakouts I want potential breakouts.




A lot in that. I suspect way way to hard for wanna beezzz


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Thanks Tech for you reply and further help, I appreciate it very much.

Your chart below triggered my thoughts in my previous post about a larger pattern below the breakout bar. That's all clear now with your detailed post. 

I do at the same time understand what you are saying in regards to wanting potential breakouts from the micro patterns. 

Thanks for the updates of the charts tonight, it's really good to see them being manage as we go along.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



> good to see them being manage as we go along.




Every day when necessary.
When your TRADING its not set and forget.

Cause if you do then it will bite you like my FTSE trade tonight!
Was an expensive meal!


----------



## pavilion103

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Brilliant. 

Risk already reduced considerably on a few of the positions.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech

Maybe asking a little too much but going to ask anyway.

I know you can't label live charts with ASX Codes but are you able to label them with a number say, No:1, No:2 and so on. I'm printing them out for my records and study.

Thanks for any consideration.


----------



## pavilion103

Are we taking slippage into consideration?

For example FLT just just gapped down below breakeven (only by a out 10 cents).

The same for trade execution?

Or does this not come under consideration in order to simplify this exercise? Whilst acknowledging that some slippage may occur?


----------



## skc

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> Are we taking slippage into consideration?
> 
> For example FLT just just gapped down below breakeven (only by a out 10 cents).
> 
> The same for trade execution?
> 
> Or does this not come under consideration in order to simplify this exercise? Whilst acknowledging that some slippage may occur?




It seems to make sense to run this exercise as realisticaally as possible.

Especially when you take trades in the likes of FLT (whose spread is always wide) and as you take on bigger positions - the liquidity won't always be there.


----------



## AlterEgo

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> I dont want breakouts I want potential breakouts.
> Among other things which are NOT breakout related.
> I havent any of this sort up yet but will explain when they are.
> 
> I have criteria I scan.
> 
> Being an alert of various breakouts 5 days ago.
> Along with a liquidity filter.
> I have 4 codes which give me many prospects.




Hi Tech,

Thanks very much for starting these threads. I'm following with great interest.

Would be able to elaborate furthur on specifically what you are scanning for? Or preferably, post the code you are using for your scans, if you are willing to share this info.

thanks,
AlterEgo


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

With position sizing 2% Risk on most and FLT being stated as a trade and that stock at mid $44.00 my thoughts it would consume over $100K of funds by itself as a risk of .80 cents approx. per share we would end up with about 2,500 shares.

I know we are using 2:1 margin with IB but would we have had enough funds for the 5 trades altogether?


----------



## pavilion103

debtfree said:


> With position sizing 2% Risk on most and FLT being stated as a trade and that stock at mid $44.00 my thoughts it would consume over $100K of funds by itself as a risk of .80 cents approx. per share we would end up with about 2,500 shares.
> 
> I know we are using 2:1 margin with IB but would we have had enough funds for the 5 trades altogether?




FLT
1724 shares - position - $77,431

An over site by me is that I had the risk per trade as $1,000 instead of $2,000 (because of the settings on a previous spreadsheet).

This FLT takes up 39% of our available capital.

This poses a couple of questions
1) do place a maximum % of account that we will use for one trade?
2) do opportunity cost considerations come into this?

I.e do we trade whatever ones on the list are triggered first until we are out of capital? Or do we carefully consider which pending orders we execute in order to provide the best opportunity cost of capital?


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Thanks for your reply and info Pav, it's no big deal really but I know they are things to think about indeed.

Thanks once again.


----------



## brty

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Pav,

77% of starting capital invested in one stock is an absurd position size, even if it is only 39% of available capital. Even though there is a theoretical risk of 2% (is this 2% of capital or available capital?), all positions are at the mercy of the sudden trading halt and an announcement that the financial controller has run off to the carribean with all the funds.

The other aspect is that if bull market conditions return, then lots of potential trades will become available. If all capital is tied up in 2-3 stocks only then there will be many lost opportunities. Murphy's law dictates that the few you are in will not perform as well as those  that you don't have the funds available for.

Personally, I would not be using any more than 10% of available capital in any one position, and more likely 5%. Be interesting what position size Tech suggests for this exercise. 

Does the exercise allow for additions to existing positions with positive price movement? If so then 39% of AC is way out of line.


----------



## pavilion103

brty said:


> Pav,
> 
> 77% of starting capital invested in one stock is an absurd position size, even if it is only 39% of available capital. Even though there is a theoretical risk of 2% (is this 2% of capital or available capital?), all positions are at the mercy of the sudden trading halt and an announcement that the financial controller has run off to the carribean with all the funds.
> 
> The other aspect is that if bull market conditions return, then lots of potential trades will become available. If all capital is tied up in 2-3 stocks only then there will be many lost opportunities. Murphy's law dictates that the few you are in will not perform as well as those  that you don't have the funds available for.
> 
> Personally, I would not be using any more than 10% of available capital in any one position, and more likely 5%. Be interesting what position size Tech suggests for this exercise.
> 
> Does the exercise allow for additions to existing positions with positive price movement? If so then 39% of AC is way out of line.




I agree.

Not even considering the opportunity cost, this is dangerous. 

Off the top of my head other position sizes included: 53,000 - 37,000 - 35,000

So ranging between 17-27% of available capital and 34-54% of starting capital.

We would really be only able to hold 3-5 positions max at this rate.

Not sure what Tech's thoughts are? 
Mine are reduce initial risk to 1% of capital.

This would still create positions sizes that seem risky to many, however seems much more practical than 2% and allows us to hold closer to 7-10 trades at a time.


----------



## skc

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> I agree.
> 
> Not even considering the opportunity cost, this is dangerous.
> 
> We would really be only able to hold 3-5 positions max at this rate.
> 
> Not sure what Tech's thoughts are?
> Mine are reduce initial risk to 1% of capital.




I thought you guys have been doing this since Jan?! Have you not come across this situation or have a rule for position size?



tech/a said:


> To now the portfolio is running at +50% on initial capital since inception in January.
> 87 emails and around 125 charts.Of course a heap of other interesting stats on Drawdown win Loss etc.




Is this +50% taking into account issues like you can't always take all the positions? Or is that actually a theoretical portfolio return?

I am just surprised that you seem to be nutting out some fairly important / fundamental issues that most traders come to face pretty early on.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Been out all day.
Will answer all questions tonight.

I trade equities like this all the time.
opinions I knew and know will be plentiful
I expect that and I also expect people wont 
agree or want to trade as I do.

Dont care.
All I care is if Im profitable.



> I am just surprised that you seem to be nutting out some fairly important / fundamental issues that most traders come to face pretty early on.




Im not suprised you are making judgements before I have an opportunity to comment!


----------



## pavilion103

Having a look through the previous exercise (since Jan), there aren't any the size of FLT.

There were also a number of the stocks which were sub $1-2 which provided a greater % gap from entry to initial stop, allowing us to take more positions. 

This allowed us to hold more positions. We would often have 6 or 7 at a time. Also, trailing stops aggressively ensured that the ones not moving were taken out, providing capital for new ones.


----------



## Trembling Hand

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Im not suprised you are making judgements before I have an opportunity to comment!




LOL. I think he learnt that art off you.....


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Trembling Hand said:


> LOL. I think he learnt that art off you.....




Ah thats why he does it so well!


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Firstly Keep the questions coming and SKC I apologise for being Kurt.
Without clarification and questions nothing is solved.

Risk is 2% on initial account. Thats $ 50K *NOT $100K*
So $1000.Max risk---and the most common we will use as our initial risk and position sizing model.
I have and do run positions with 1% risk and less and have done so with
PAV in some that we discussed which were not part of this exercise. These will often be very close stops where we can buy many 1000s of higher priced stocks that would place us way over margin requirements.
Ill make it known when I fill out the chart. Infact from here on Ill make a note on risk on each chart triggered.

THIS IS DISCRETIONARY trading---we--you can do what you like.
The point of the exercise is to (Hopefully) help people understand how to limit risk and maximise profit
trading technically.

Margin *ISNT* a loan to increase your initial trading capital.
Margin should be used in equities to finance positions that we wish to take
where our initial capital falls short.

As for amount in a single trade.

For *short term *trading I have had 50% on one position. 
These trades here will only run a few days to a week max---unless we get a bull run where they will then run weeks.
When they are running who cares--thats what we want.
If they are stagnant youll see me raising stops or exiting. 
I want to be on momentum in as many trades as I can and for as long as I can.

This current market is VERY difficult to find consistent performers where we can get a good run.
In the meantime I want the RESULTS to show low risk on those losses we have.
When we do get winning trades my aim is to be able to show excellent return for risk.
As PAV found out that can be out of the blue and dramatic.
Setting the foundation.

I hope this helps and *apologies* again SKC I enjoy your input!


----------



## Gringotts Bank

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Come as you are, 
As you were,
As I want you to be.... 

  :guitar:


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



> Would be able to elaborate further on specifically what you are scanning for? Or preferably, post the code you are using for your scans, if you are willing to share this info.




What I'm looking for are chart patterns.
Specifically tight small consolidations within a move.

I use up to 6 scans all of which will return different
prospects and only a very few pass the visual screen.

No I wont be posting code.
PAV hasn't got my code/s.

Sorry forgot to post up the risks on each trade.
Ill do it tomorrow night.
All are below 2%
Except for FLT 

All trades will fall within the capital available for trading.
If there isn't enough capital and a trade is triggered I will
post that on the chart.


----------



## Kryzz

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Great thread guys, have only just discovered it.

I have also been recording the initial stop when I enter any given trade, my current stop and the price I am stopped out at (obviously). However I haven't put too much thought into how interpret this info however.

My query is what insight does this provide? Knowing that my stop has moved up x% tells me what?

I can assume a few basic insights, i.e. looking at what trades are profitable vs not, and seeing how much my stop has moved may indicate whether or not I am moving my stop up too quick or not.

Any thoughts on the above line of thinking?


----------



## Country Lad

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



> Plus one for the watch list from PAV




I recognise that one - I have been watching it for a breakout again.  It has been a buy on half a dozen occasions and I have kicked myself for not buying it again after being stopped out the first time.  





Funny how we all interpret charts differently.  I saw the pattern thus:




Cheers
Country Lad


----------



## skc

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Im not suprised you are making judgements before I have an opportunity to comment!






tech/a said:


> Firstly Keep the questions coming and SKC I apologise for being *curt*.
> Without clarification and questions nothing is solved.




All good, Tech/a. No apologies requrired. 

I was surprised only because I assumed you would have discussed these issues during your 6 month mentorship with PAV. I assumed that because you are an experienced trader and would definitely have encountered this issue through your years of trading. I was genuinely surprised so thanks for the clarifications.



tech/a said:


> Risk is 2% on initial account. Thats $ 50K *NOT $100K*
> So $1000.Max risk---and the most common we will use as our initial risk and position sizing model.
> 
> As for amount in a single trade.
> 
> For *short term *trading I have had 50% on one position.
> These trades here will only run a few days to a week max---unless we get a bull run where they will then run weeks.




In my own trading I limit my position size to 15% of capital. As I trade mostly ASX 200 stocks, a major gap is probably around 30-40%. If I hit one of these I lose up to 6% of my capital which would really hurt but it'd be OK in a couple of months. The chance of me hitting one of these major gaps is only small... but they are real and must be managed.  

I guess that you may be comfortable putting 50% on one position because your trading capital is only a small proportion of your total assets, and you don't trade for a living. I would suggest any person looking to trade full time who plan to use a greater portion of their asset as trading capital, use a lower figure.

The right number may be limiting the loss to 4% of your total asset in the event of a 30% unfavourable gap. So if someone has $200k in assets and trading a $100k account, the maximum single position size should be $200k x 4% / 30% = $26.7k. If $100k account is all you got in terms of assets, then $13k is the limit. The number might be lower again if you are using debt to fund the account.



brty said:


> 77% of starting capital invested in one stock is an absurd position size, even if it is only 39% of available capital. Even though there is a theoretical risk of 2% (is this 2% of capital or available capital?), all positions are at the mercy of the sudden trading halt and an announcement that the financial controller has run off to the carribean with all the funds.




Agree... trade long enough and you are bound to hit one of them. I shorted MCC one afternoon and it received a takeover offer after the close on that very same day. Not to mention that it was exactly one day after the announcement of the carbon tax. Luckily for me the position was only 6% of my capital (I was just putting on the first layer and was prepared to go up to 10%). The gap up was ~40% so it was not too devastating. But that's only because I stuck with a conservative position sizing rule.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Kryzz said:


> Great thread guys, have only just discovered it.
> 
> I have also been recording the initial stop when I enter any given trade, my current stop and the price I am stopped out at (obviously). However I haven't put too much thought into how interpret this info however.
> 
> My query is what insight does this provide? Knowing that my stop has moved up x% tells me what?
> 
> I can assume a few basic insights, i.e. looking at what trades are profitable vs not, and seeing how much my stop has moved may indicate whether or not I am moving my stop up too quick or not.
> 
> Any thoughts on the above line of thinking?




Glad you raised the question.

Using a standard 2% risk is accepted as " normal "
In these markets I'm pretty aggressive
I want momentum and won't give a trade much room at all unless
It demonstrates that it's trading in the direction of my position .

By moving my stop aggressively ( when things get going you'll notice a less aggressive trailing stop placement ---- until the position shows signs of stalling or reversing at which time it will return to aggression to protect profit)
This reduces my ACTUAL risk on all trades taken.  
In reality closed trade results will show a far less % of capital at risk.
That is WHY I move stops.

Yes from time to time I'll be stopped and the trade will march back up and on.
But on far more occasions the trade WILL take out my 2% stop just as it took out my moved up and lesser stop.

It will become clear as PAV puts up some spread sheets and happy to go through it as we get a history.

SKC
PAV and I have discussed the very point you have raised. We are both aware of the situation.
I put up FLT as it was an excellent pattern. 
Anyway chances are that stocks over $20 will be very rare.

Small micro patterns are my choice here as purchase to stop is very small.
Most moves are pretty small and return on risk can be striking on the odd one.
As you'll see it's that " odd one " that slam dunks the portfolio.


----------



## qldfrog

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

just to say that I am following this thread with interest and it answers a lot of my questions and will influence the way I trade 

One question: I also use stop (automated ) 
if Share XYZ  equal or below let 's say 2$ sell at $2 (I am with bell direct)
Sometimes these fail (too quick a drop and I am left at the end of the day with big loosers),
I have also noticed that very often, my stop triggers, get executed but I could easily have set a sligthly higher exit price (still ok with the idea of exiting but may need to increase the sell at  value?)
How do you reconcile these two aspects???
ensure stop are activated and when decision is made to exit automatically, actually ensuring you do not get too bad a deal

These are only affecting a few percents that is what make me loose some money last year
And lastly, does the type of share affect your exit decision or do you just look at trends
example:
Thursday bought BBG, went 33% yesterday and having no faith in this company I existed; nice profit but could it be the case of not maximising my profit..
This was a pure emotive act so not a good thing but once I clicked during the lunch break too late to go back
Would you have raise your stop by 30%???


anyway, too many questions but once again, thanks for your input


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



qldfrog said:


> just to say that I am following this thread with interest and it answers a lot of my questions and will influence the way I trade
> 
> One question: I also use stop (automated )
> if Share XYZ  equal or below let 's say 2$ sell at $2 (I am with bell direct)
> Sometimes these fail (too quick a drop and I am left at the end of the day with big loosers),




I dont know if Bell do it but set a limit order.



> I have also noticed that very often, my stop triggers, get executed but I could easily have set a sligthly higher exit price (still ok with the idea of exiting but may need to increase the sell at  value?)
> How do you reconcile these two aspects???
> ensure stop are activated and when decision is made to exit automatically, actually ensuring you do not get too bad a deal




Its a cost of doing business you want out and a limit order will get you the best price available AT THE TIME.



> These are only affecting a few percents *that is what make me loose some money last year*And lastly, does the type of share affect your exit decision or do you just look at trends
> example:
> Thursday bought BBG, went 33% yesterday and having no faith in this company I existed; nice profit but could it be the case of not maximising my profit..
> This was a pure emotive act so not a good thing but once I clicked during the lunch break too late to go back
> Would you have raise your stop by 30%???




I analyse charts.
Its simply a business decision.
To your quandry.
If there is a large exponential move often I'll take the profit.
Generally these moves (unless they are a take over at x Value) will increase volatility.
If your out early enough best to sit back and watch the show with money in your pocket.
It will settle and if opportunity presents itself again (in the way of pattern and price action) then you are at liberty to take it.

*Highlighted section*
I suspect not enough profit in winners if your cutting losses.
This is the hard part!

There are a number of ways of "helping" with this with very short term trades.
*The best way is to be trading in a raging bull market!*

Failing that we need to be able to---at the best of our ability---
(1) Identify weakness (That will threaten our position) or simply a pause in any move that is likely to continue.
(2) Pyramid as quickly and as effectively as possible anything that moves quickly in our direction.
THEN see point 1


----------



## qldfrog

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Thanks a lot


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Good Morning Tech,

Is there any chance you can put a number on each live chart that becomes active so if we have a question we can refer to the numbered chart. I'm also printing them out each time there is a change.

Thanks for any consideration.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



debtfree said:


> Good Morning Tech,
> 
> Is there any chance you can put a number on each live chart that becomes active so if we have a question we can refer to the numbered chart. I'm also printing them out each time there is a change.
> 
> Thanks for any consideration.




As each chart is either stopped or reaches a week Ill place up the chart and code and entry exit details.
In the meantime ill allocate a number to each.
Will put up this weeks when Joe unlocks the thread.
Later this afternoon.
PAV should have the spreadsheet in a few days.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> As each chart is either stopped or reaches a week Ill place up the chart and code and entry exit details.
> In the meantime ill allocate a number to each.
> Will put up this weeks when Joe unlocks the thread.
> Later this afternoon.
> PAV should have the spreadsheet in a few days.




Excellent, thanks Tech appreciate that.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech - Just seen your update with all the charts in the lock thread. 

Thanks for the time and effort put in by yourself and Pav, very good of you both.


----------



## kid hustlr

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Very informative boys.

How quickly did FLT turn around!


----------



## skc

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech/a, what's the plan for the upcoming reporting season with this exercise? Continue to trade through it or stand aside?

P.S. It seems that the link on the bottom of your locked thread went to the ASF homepage instead of this thread.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Trade as normal 
Thanks I'll make sure the 
Correct one is up next time.


----------



## Lone Wolf

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Tech,

In another thread you mentioned one of your rules - always exit next open after a pivot point reversal bar. Are you using any rules like this for this exercise? Or are you just using an aggressive stop and letting the market take you out?


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



Lone Wolf said:


> Tech,
> 
> In another thread you mentioned one of your rules - always exit next open after a pivot point reversal bar. Are you using any rules like this for this exercise? Or are you just using an aggressive stop and letting the market take you out?




TRG ---Little volume so watching
TGG--- little range but volume so moved stop up.
8---Close just below Previous bar But strong volume The one with greatest risk.Will be watching carefully
but wont move stop just yet.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

I've not introduced any trades into the exercise yet
based around this setup.
I'm seeing quite a few so thought Id post it up for discussion with 4 charts which have gone on with it.




 I call it a volume exhaustion resistance/support set up.
Where we see clear very high volume exhaustion which acts as resistance.(A *down Bar*)
Often followed by a very high volume up bar showing renewed support.
This bar acts as support and is generally an *up bar.*
MML and NST are examples of a 2 bar setup and RSG SLR are more subtle as they rise.

You can see here in hind site some good entry opportunities and as we find some more will introduce some to the exercise.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Pav - Thanks for the spreadsheet containing the trades. 

Is there a reason for 2 Trade Managers in the 1 sheet?


----------



## pavilion103

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



debtfree said:


> Pav - Thanks for the spreadsheet containing the trades.
> 
> Is there a reason for 2 Trade Managers in the 1 sheet?





Only because I put the window in so you can still have all the headings at the top as you scroll down as we get more trades on the sheet.

Leave the top window as it is, and scroll down the bottom window.


----------



## Country Lad

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

tech, because of the way the market has gone there are many more with similar patterns such as PDZ, DRM, CPL and many of these, like yours have risen through the Guppy Countback line in the last few days.  Some are tiny double bottoms.

I am in 2 minds whether they mean anything or not as in all cases they are accompanied by a high SIROC.  I have found that in the past these run out of puff, however this is not a reason they won't go on with it.

Cheers
Country Lad

Edit: added last para


----------



## pavilion103

Another for people to look at is DTE using the original approach.

I took this one myself. Entry 19/7 stop now at BE. Looks like a breakaway gap.


----------



## debtfree

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> Only because I put the window in so you can still have all the headings at the top as you scroll down as we get more trades on the sheet.
> 
> Leave the top window as it is, and scroll down the bottom window.




Thanks Pav, I see where you're coming from now.


----------



## Country Lad

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> I've not introduced any trades into the exercise yet
> based around this setup.
> 
> You can see here in hind site some good entry opportunities and as we find some more will introduce some to the exercise.




Another oone with similar pattern I entered yesterday is EVR.

Cheers
Country Lad


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

Yes
PAV pointed out DTE.

While I agree that they can run out of puff all good moves start from a reversal
and a lot of good ones from a consolidation.
There are criteria to watch for 

(1) Clear Exhaustion Volume and very heavy relative to surrounding volume
(2) A low being made and tested.
(3) A clear break through the "Zone" of Heavy Volume exhaustion.
(4) Often and preferable a clear high volume buying bar.(Demand)
(5) Tests being supported.
(6) The chapter in this book showing a clear return to demand.

*C/L* as you say many have now broken away and it is *THESE* which I expect to supply some *good Continuation patterns* as wave 3s ---emerge--continue!

From here management of trades will determine profit over the long term.
Another reason to feel optimistic going forward. (Seeing lots of effort to rise in lots of charts).


----------



## pavilion103

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*

TRG has gapped down this morning. 

Opened at $8.01, stop was BE at $8.06. 

So a bit of slippage there. This one had such a wide spread. I was a little concerned.


ALL also taken out this morning.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> TRG has gapped down this morning.
> 
> Opened at $8.01, stop was BE at $8.06.
> 
> So a bit of slippage there. This one had such a wide spread. I was a little concerned.
> 
> 
> ALL also taken out this morning.




Nothing like a drawdown to kick things off.

TRG also only traded 3000
so take the lowest of the next trades to close us out of this.


----------



## skc

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



tech/a said:


> Nothing like a drawdown to kick things off.




Lol. That seems to be a universal truth for any trade journal! 

Plenty of good bottoming patterns and it won't take long before you catch a good ride on one of those.

Pav, thanks for putting up the spreadsheet. 

A couple of excel tips if you like that sort of stuff.

- On the display use "Freeze panes" may work better than split.
- Consider using conditional formating for your colour coding of win/loss/breakeven.
- Use auto-filters at top of the trade table columns so you can quickly find the rows you want.
- I have a column called "Active?" with Yes/No entries so you can toggle what trades you want to see.
- Put a summation row at the top of the sheet so it stays in the "freezed" panes

The commission column seems to be static $12, and I am unsure IB pays you 7.7% on your short positions.


----------



## pavilion103

Yes it is obvious that I am not particularly proficient with Excel. I made the sheet from scratch but I lack the polish to make it really good. I wonder if anyone else can do this for me?

Yeh some of those tables and interest calculations to the right are redundant. I'll take them out (except the ones used in calculations). This is just a basic template that I've used to record my trades in. 

Thanks for the input


----------



## pavilion103

One of the greatest points of interest for me in this exercise is how these setups/trades behave in this market compared to the one earlier in the year. 

One thing I noticed with the previous exercise was how they moved in our direction immediately and enough to move the stops to breakeven quickly most times. 

A combination of successfully anticipating momentum and also a strong market trend.


----------



## Country Lad

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> A combination of successfully anticipating momentum and also a strong market trend.




Yes pav, there is a difference with the current market and ones where "all boats rise".  This is very much a stock picking market and continually monitoring the particular share's momentum/market sentiment is even more important in this market.


----------



## tech/a

*Re: Technical Trading Exercise---Discretionary, (Pavilion103 & tech/a)*



pavilion103 said:


> One of the greatest points of interest for me in this exercise is how these setups/trades behave in this market compared to the one earlier in the year.
> 
> One thing I noticed with the previous exercise was how they moved in our direction immediately and enough to move the stops to breakeven quickly most times.
> 
> A combination of successfully anticipating momentum and also a strong market trend.




Yes will be making some adjustments.


----------



## pavilion103

tech/a said:


> Yes will be making some adjustments.




I look forward to your thoughts


----------



## qldfrog

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*

ERA and SDM exited today as well here.sadly, also learnt the meaning of risk when both SBM and MLB collapsed and went past my stop loss with a nearly 30% loss by the time I acted manually
far from ideal and a very bad day today for my system


----------



## skyQuake

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



qldfrog said:


> ERA and SDM exited today as well here.sadly, also learnt the meaning of risk when both SBM and MLB collapsed and went past my stop loss with a nearly 30% loss by the time I acted manually
> far from ideal and a very bad day today for my system




cheer up, MLB had a 25c special divvie today, only down 3c. (75% franking too)


----------



## Boggo

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



qldfrog said:


> ERA and SDM exited today as well here.sadly, also learnt the meaning of risk when both SBM and MLB collapsed and went past my stop loss with a nearly 30% loss by the time I acted manually
> far from ideal and a very bad day today for my system






skyQuake said:


> cheer up, MLB had a 25c special divvie today, only down 3c. (75% franking too)




You have to adjust your stop to cater for divvies


----------



## brty

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*

Isn't this the thread that is meant to be locked for only Tech/a's and Pav's charts? 

Coulld we take the conversation elsewhere?


----------



## Joe Blow

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



brty said:


> Isn't this the thread that is meant to be locked for only Tech/a's and Pav's charts?
> 
> Coulld we take the conversation elsewhere?




The locked thread is currently being kept open so tech/a can post at will, and I am manually moving posts across to this thread if anyone posts over there.

Was a bit slow off the mark this evening.

Just a reminder to everyone to please post any comments or discussion in this thread rather than the Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets thread. Thanks!


----------



## Country Lad

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*

tech, can I assume that your buy point for 12 would be a close of 84 or more?

Cheers
Country Lad :iagree:


----------



## Country Lad

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



brty said:


> Isn't this the thread that is meant to be locked for only Tech/a's and Pav's charts?
> 
> Coulld we take the conversation elsewhere?




I replied there by mistake as well.  Joe, might it be useful to have a change in heading such "Technical Trading Exercise (Pav & Tech) COMMENTS HERE".  Might make it more obvious when we are posting quickly and not paying attention as I did.

Cheers 
Country Lad


----------



## Joe Blow

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



Country Lad said:


> I replied there by mistake as well.  Joe, might it be useful to have a change in heading such "Technical Trading Exercise (Pav & Tech) COMMENTS HERE".  Might make it more obvious when we are posting quickly and not paying attention as I did.




Good idea. I have gone ahead and edited the thread title.


----------



## qldfrog

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



Joe Blow said:


> The locked thread is currently being kept open so tech/a can post at will, and I am manually moving posts across to this thread if anyone posts over there.
> 
> Was a bit slow off the mark this evening.
> 
> Just a reminder to everyone to please post any comments or discussion in this thread rather than the Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets thread. Thanks!



my mistake, apologies to all...

- - - Updated - - -



Boggo said:


> You have to adjust your stop to cater for divvies



Thanks Boggo, usually, bell direct conditional orders are reset automoatically for dividends dates, etc and while i knew about the dividend when i bought, I did not realise yesterday was the day...not so bad so..
Thanks


----------



## brty

Tech/A,

Looking at charts 10 and 13, I'm wondering why they are in your selections. They are both clearly in downtrend. Neither of them have passed a swing high in the current downtrend. They seem to be at odds with all the other pattern selections that are in uptrends. 

What is the reasoning for the inclusion of these 2 stocks compared to many others that are near lows with some type of similar pattern? Why the change from just patterns in uptrend?

Chart 14 for instance, is at 5 year highs and clearly in a long term uptrend. This will always have far greater odds of a successful continuation pattern than the same pattern in a downtrend with a tiny bump up.

On another aspect, will you be re-entering into stocks after failure? For instance the SHV trade was stopped with a small loss. However the price reversed, made a slightly higher high and is now in a tight pattern near the highs. A break above the highs would indicate a continued move to me and seem to be similar to some of the other entry points.


----------



## Lone Wolf

brty said:


> Tech/A,
> 
> Looking at charts 10 and 13, I'm wondering why they are in your selections.




I believe this is the "volume exhaustion resistance/support set up" that Tech mentioned  in post #211 of this thread.

https://www.aussiestockforums.com/f...=26799&page=11&p=785410&viewfull=1#post785410


----------



## tech/a

brty said:


> Tech/A,
> 
> Looking at charts 10 and 13, I'm wondering why they are in your selections. They are both clearly in downtrend. Neither of them have passed a swing high in the current downtrend. They seem to be at odds with all the other pattern selections that are in uptrends.
> 
> What is the reasoning for the inclusion of these 2 stocks compared to many others that are near lows with some type of similar pattern? Why the change from just patterns in uptrend?
> 
> Chart 14 for instance, is at 5 year highs and clearly in a long term uptrend. This will always have far greater odds of a successful continuation pattern than the same pattern in a downtrend with a tiny bump up.
> 
> On another aspect, will you be re-entering into stocks after failure? For instance the SHV trade was stopped with a small loss. However the price reversed, made a slightly higher high and is now in a tight pattern near the highs. A break above the highs would indicate a continued move to me and seem to be similar to some of the other entry points.




Thanks brty for the input/questions.

Yes I did mention that I would be looking for prospects in a bottoming patterns.
Currently there are very few continuation patterns presenting and there are quite a few
bottoming with possible continuation patterns forming.
They do have a criteria I look for them to meet.
10 has had a pattern failure so Ill comment on 13
Please see chart below.






Yes I agree they have less chance of continuation but a better R/R when they do.
When the market returns even to mild bullishness these boats will float with all others.

SHV and others like it.
Yes and thanks for pointing it out.
Ive often mentioned that a re entry should be considered both on a buy setup which fails and a sell which is exited and turns out premature.
There are technical aspects of SHV which I have marked on the chart.--Below


----------



## debtfree

Tech - SHV

In regards to those last 2 bars of SHV on your chart you say 'Supply gone?

Q: If supply is gone and price was wanting to go higher would you be expecting those last 2 bars to be closing at the highs of those bars instead of where they finished? Or is that not so important provided price does not fall too far?


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## tech/a

debtfree said:


> Tech - SHV
> 
> In regards to those last 2 bars of SHV on your chart you say 'Supply gone?
> 
> Q: If supply is gone and price was wanting to go higher would you be expecting those last 2 bars to be closing at the highs of those bars instead of where they finished? Or is that not so important provided price does not fall too far?




Hence the ? 

It's clear that it has waned
Yes it would be preferable for a clearer indication.
But I'd have found that indications can be as 
Accurate as text book setups.

We will know soon


----------



## debtfree

Thanks Tech


----------



## Shaker

Hi TechA

My first post so hope image shows. In regard to trade initiated in SDM @ 70c and stopped out. Can you explain the Trade Analysis please. I see a Support/Resistance level at 70c and also a recent open and close above 70c failed. I have had this on my watch list for a break out confirmed above 70c.




I am currently only paper trading so would love to get your perspective on what i am seeing

Regards
Shaker


----------



## tech/a

*Shaker.*
My entry was the break of the micro pattern.
Which Im sure youll see on the chart I posted.
It just poked its head up then fell immediately back
into the pattern. Effectively failing the pattern on the first day.
My entry was aggressive and in hind site too aggressive.

So currently the stock has been discarded as a prospect.
And is a loss in the trading exercise.


----------



## Shaker

tech/a said:


> *Shaker.*
> My entry was the break of the micro pattern.
> Which Im sure youll see on the chart I posted.
> It just poked its head up then fell immediately back
> into the pattern. Effectively failing the pattern on the first day.
> My entry was aggressive and in hind site too aggressive.
> 
> So currently the stock has been discarded as a prospect.
> And is a loss in the trading exercise.




Thanks for the reply Tech/a.
I only noticed as i have that stock on watchlist from late last week looking for a breakout of 70c. Thanks for the detail

Regards
Shaker


----------



## Country Lad

Tech and Pav, I must admit to not following this exercise as closely as maybe I should, but I do have some difficulty understanding the triggering of 12 and 13.

For 13, your notes on the chart seem to indicate it being triggered last Friday because the close was higher than the last 4 closes.  That’s fine but it had not yet shown a clean break from the flag, so do you not see that as a risk of that pattern failing?  Would you normally not wait for a better signal of the break?  Would the falling volume increase the risk of entering the trade?






Similarly, for chart 12, again, I would be interested in your comments about you seeing the trigger point on the micro scale compared to the close not yet breaking the pattern on the broader view as well as the falling volume as contributing risk factors for what I would see as early entry.

The other thing I notice in both of these are  that the price has not quite reached the CBL on both.  Close, but not quite.

So my queries really relate to apparent higher risk factors when looking at the charts more broadly than your trigger setup on a smaller scale.

I realise the P&F is irrelevant for this exercise, but I thought I would add it for interest.





Cheers
Country Lad


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## tech/a

Hi CL

Thanks for your inquiry.
The answer is very important in the context of
this exercise and as such Ill do up a long reply
in the Chart section due to its relevance.


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## Country Lad

tech/a said:


> Ill do up a long reply in the Chart section due to its relevance.




Thanks tech, look forward to it. No rush, in your own time.

CL


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## Country Lad

Thanks tech, but my query and your answer are a little distance apart. :nono:  I was mainly interested in where there is a conflict between your micro patterns setup and, in say the case of 12 and 13, the broader patterns not yet showing a positive entry.

I have no doubt your system works well, I am really asking for comment about my observation of that perceived conflict between the micro and broader pattern and why your micro is a better early trigger.

Cheers
Country Lad

PS I see that your chart 12 has now broken out of my macro pattern as well.  Logically, my broader triggers are likely to be later than yours, but I think more of a confirmation.


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## tech/a

CL

I dont know that we are that different?





Looks pretty similar to me.


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## Country Lad

tech/a said:


> CL
> 
> I don't know that we are that different?




Aha, having another good look at these and some of your other charts seems to explain the difference.  Your break is any part of the bar, so the high triggers a buy and the low can probably trigger an exit.  In my case, I work on the close, both buy and sell signals.

Cheers
CL


----------



## statmech71

Hi Tech,

One of the key features of this exercise seems to be the aggressive adjustment of stops. Can you please provide some explanation of the principles underlying your stop management. For example it's not clear to me why you moved the stop to $1.55 in the ERA trade when you did.

Thanks - Paul


----------



## Country Lad

tech/a said:


> CL
> 
> I don't know that we are that different?




Agree on chart 12 as I said in the previous post where you look at the top of the bar and I use close, but we are different on 13.  

You are looking at a micro pattern which I assume is only a few bars where I look at the flag as the whole pattern.  I would not go that early and would want a it more confirmation of the break from the full flag.  That one is probably more relevant to my query and is where our methods are different.

That is the reason I asked whether you pay any attention to the broader pattern such as the flag as a whole or say, the falling volume as risk factors.

Cheers
Country Lad


----------



## tech/a

*C/L *

I can see your point.
I didn't see it as a flag as such.
But concede that it could be a flag.
Again I don't see it in the broader context
as being a an issue.
But you and others may wish for further
confirmation on their entries.


----------



## tech/a

statmech71 said:


> Hi Tech,
> 
> One of the key features of this exercise seems to be the aggressive adjustment of stops. Can you please provide some explanation of the principles underlying your stop management. For example it's not clear to me why you moved the stop to $1.55 in the ERA trade when you did.
> 
> Thanks - Paul




Paul
Two reasons I'll move a stop
Before or to Breakeven
I sence weakness as I did with a
ERA
Or there is a clear show of strength
Momentum is on the move up
See tonight's charts for an example.

Once at B/E I relax stops and look for pivots to move up.
I will however exit at obvious weakness or a clear reversal 
Or after an outlier move up.

---discretionary!


----------



## statmech71

tech/a said:


> Paul
> Two reasons I'll move a stop
> Before or to Breakeven
> I sence weakness as I did with a
> ERA
> Or there is a clear show of strength
> Momentum is on the move up
> See tonight's charts for an example.
> 
> Once at B/E I relax stops and look for pivots to move up.
> I will however exit at obvious weakness or a clear reversal
> Or after an outlier move up.
> 
> ---discretionary!




Thanks mate


----------



## qldfrog

tech.a, Pavilion, 
thanks again for your effort,
I have learnt a lot from this thread and went thru a reread today.
I was spare making a few mistakes, [already done a lot in the last year or so since I started getting serious] but now i understand the mistakes, and react accordingly
so you guys are gems!!!

Question
Do you put your stop as soon as you buy or at close of business:
I tend to have a high ratio of buy/sell on the same day:
today for example RMD triggers a buy at 5.54, then sold later on at 5.4i; similarly MYR buy at 2.73 and onsold at 2.64 later on.
Is it just something you live with (actual cost is not that huge but still)
, or do you restrict your entries time wise (past 11AM or similar) to ensure market has stabilised??? 
Any past experience in this area you wish to share is welcome

For info:
I usually trade via conditional order a so my trigger buy/sell are predetermined every night


----------



## tech/a

qldfrog said:


> tech.a, Pavilion,
> thanks again for your effort,
> I have learnt a lot from this thread and went thru a reread today.
> I was spare making a few mistakes, [already done a lot in the last year or so since I started getting serious] but now i understand the mistakes, and react accordingly
> so you guys are gems!!!
> 
> Question
> Do you put your stop as soon as you buy or at close of business:
> I tend to have a high ratio of buy/sell on the same day:
> today for example RMD triggers a buy at 5.54, then sold later on at 5.4i; similarly MYR buy at 2.73 and onsold at 2.64 later on.
> Is it just something you live with (actual cost is not that huge but still)
> , or do you restrict your entries time wise (past 11AM or similar) to ensure market has stabilised???
> Any past experience in this area you wish to share is welcome
> 
> For info:
> I usually trade via conditional order a so my trigger buy/sell are predetermined every night





Initial stop is set with the order.
I have moved it UP intra day.

The buy stop is also set as a conditional order and it gets filled when it gets filled.


----------



## pavilion103

This has such a different feel to earlier in the year when our selections were taking off from the start and not looking back!

Some good lessons to be learnt here in this market. The importance of risk management is on display. Would be so easy to cop a large number of 1R losses at the moment but we are managing trades to reduce this.

Probably one of my biggest mistakes early on was thinking a 1R loss is ok and that that is why we limit the initial position to this much risk. I was wrong and it killed my expectancy. 

Some good proactive trade management so far. Hopefully we get to see some good wins too in this process.


----------



## tech/a

pavilion103 said:


> This has such a different feel to earlier in the year when our selections were taking off from the start and not looking back!
> 
> Some good lessons to be learnt here in this market. The importance of risk management is on display. Would be so easy to cop a large number of 1R losses at the moment but we are managing trades to reduce this.
> 
> Probably one of my biggest mistakes early on was thinking a 1R loss is ok and that that is why we limit the initial position to this much risk. I was wrong and it killed my expectancy.
> 
> Some good proactive trade management so far. Hopefully we get to see some good wins too in this process.




Many of the prospects are failing to trigger and the patterns are failing.
The astute would conclude that there isn't much in the way of prolonged momentum.
But will persevere while the index remains positive.


----------



## Country Lad

pavilion103 said:


> This has such a different feel to earlier in the year when our selections were taking off from the start and not looking back!




As I have mentioned before, I have an index/indicator made up of various data which I use to give me an indication of the strength of the market and likely direction.

It has not been looking good since March and has not been real strong since late 2010 and that's why I have been saying it is very much a stock picking market.  

You can see the difference between now and the beginning of the year.

My method of entry is slightly different now to when the indicator is positive but even so, there have some very good movers.

Cheers
Country Lad


----------



## pavilion103

Weekly spreadsheets to be updated on here every Monday night. I'm always trading then so easiest time for me.


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## qldfrog

today's feedback from your exercise will be interesting,
my stop losses were shouting all day and I got rid of 80% of my stocks as a result, not that happy especially if we have a rebund tomorrow


----------



## skyQuake

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



tech/a said:


> Tonight's Prospects
> 
> 
> View attachment 53743




How do you manage no.18 with such a wide stop? Risk reward doesnt look that good


----------



## qldfrog

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



skyQuake said:


> How do you manage no.18 with such a wide stop? Risk reward doesnt look that good




same question, I am following 18 as well -> got in on the 6/08 and was out on the 7th seconds after raising my stop intraday, 10% profit to see it shot up again yesterday.
Reluctant to plunge again if starting from 0, but basically putting my previous win in the balance I reduce my risk overall (one way of seeing things).
Not that the company inspire much confidence!
I am surprised that you did not have more stops activated on the 7th, they were triggered all day for my portfolio and most of them quiteabove from the overall loss of the day so ..
time will tell as we get to know more of each of these.
have a nice day trading


----------



## tech/a

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



skyQuake said:


> How do you manage no.18 with such a wide stop? Risk reward doesnt look that good




The initial stop is for calculating position sizing only.
The ONLY reward to Risk ratio I'm interested in
Is the one that my portfolio is recording as trades
Close out.
Currently many trades have been stopped or closed
My initial risk was on most 1%.
You'll note the portfolios risk / trade is close to half that.
Had I not moved stops pretty well ALL trades would have taken
Out the wider initial position size stop.

As I get some winning trades the importance of keeping losers small
Will become clearer.
The number and duration of winning trades to recoup drawdown will
Be far less.


----------



## skc

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



qldfrog said:


> Not that the company inspire much confidence!




How do you know what company it is


----------



## tech/a

18 Stop to B/E.


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## qldfrog

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



skc said:


> How do you know what company it is



just because I was following that one closely independently and I had been in and out the two previous days with a 2k parcel, the chart was really telling.
I do not try to find the matching codes...


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## tinhat

Hi Tech/a. Where did you place your stop loss on entering trade 27? A brief explanation would be good.

PS: I would place it at the low of four days ago, so interested to hear if you chose something tighter and why.


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## tech/a

tinhat said:


> Hi Tech/a. Where did you place your stop loss on entering trade 27? A brief explanation would be good.
> 
> PS: I would place it at the low of four days ago, so interested to hear if you chose something tighter and why.




#27 is a trade setup.
In fact today it has come off heavily.
So currently no trade and no stop.

I can see the "Late entry" being ambiguous
I meant late entry of a future prospect.


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## pavilion103

I will be onto that spreadsheet today or tomorrow.

I'm currently sitting in the recovery room after minor knee surgery. The week off will give me time to get around to a few things.


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## tinhat

tech/a said:


> #27 is a trade setup.
> In fact today it has come off heavily.
> So currently no trade and no stop.
> 
> I can see the "Late entry" being ambiguous
> I meant late entry of a future prospect.




Thanks tech/a. I went back and read the thread in its entirety and came to that understanding. I've not been active in the market for a few weeks so had to catch up on your posts and your method of marking up your charts for this exercise.

I recognised #27 because I bought it just recently. It's recovered somewhat this arvo but looking at the price/volume action of the last few days the price isn't moving up much compared to the amount volume (not much return for effort). It needs to jump up over that long red tick (the most recent high).

These charts you are putting up are great. I am sure I will keep referring to this thread over many times in the future. A chart tells a thousand words the way you show your set ups, entries and trailing stop losses.

Unless I have a lifestyle change I don't think I will ever trade in the manner that you do over the long run but understanding momentum and price/volume action and breakout identification is something I believe will help any investor time entries and identify opportunities and manage risk.

cheers.


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## pavilion103

Tech, we changed it from $50,000 margin to $100,000 flat.

Does this mean that when you say 1% it is now $1,000 risk 
Or are we going to make these 0.5% risk of $500 (i.e. 1% on $50,000)

I'll need to make the adjustments.


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## skc

Chart 4 trade PMC was stopped out on ex-div date so the 5c dividend should be included in your spreadsheet.

The stop probably should have been given more leeway allowing for that the expected dividend drop-off.

Plenty of ex-div coming up over the next month so something to keep in mind for other setups as well.


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## tech/a

pavilion103 said:


> Tech, we changed it from $50,000 margin to $100,000 flat.
> 
> Does this mean that when you say 1% it is now $1,000 risk
> Or are we going to make these 0.5% risk of $500 (i.e. 1% on $50,000)
> 
> I'll need to make the adjustments.




No I want to leave it as if we were trading margin.
but to do so we are going to supply our own margin.
IB will once again return to margin once the paper work is sorted.

Also check your email.


SKC

If PMC was stopped then it shouldn't be in there.
I don't have the charts here at work but will check tonight.
When was div day?


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## skc

tech/a said:


> SKC
> 
> If PMC was stopped then it shouldn't be in there.
> I don't have the charts here at work but will check tonight.
> When was div day?




Ex-div 5c on 16 Aug which is the day your stop was triggered. So you'd pocket the dividend.


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## tech/a

skc said:


> Ex-div 5c on 16 Aug which is the day your stop was triggered. So you'd pocket the dividend.




Yes thanks SKC
Position closed but Div. received.
So there is an alteration there PAV.


----------



## skc

pavilion103 said:


> 2) Number 22 (if I've done this correctly) has been left in the spreadsheet, but Tech I think this will have to be removed. It takes up a whopping $77,000 of our $100,000 capital, so I'm guessing this one is the one to be taken out?




Tech/a what's the resolution on this?

VRL's reporting tomorrow (or Friday) and it seems prudent not to carry such a large position into a potentially volatile event. VRL is pretty thin so with 3300 shares a stock triggered could easily get filled at 15c lower.


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## tech/a

SKC

Its something I've never considered in my trading
Perhaps something I should!

As we will be able to determine a stop price tonight then 
rather than take the risk of a stop being taken out with slippage
we will close on close tonight or at B/E and re evaluate after reporting.
If it was deep in the money I wouldn't worry so much.

Where can I get a reporting schedule?


----------



## skc

tech/a said:


> SKC
> 
> Its something I've never considered in my trading
> Perhaps something I should!
> 
> As we will be able to determine a stop price tonight then
> rather than take the risk of a stop being taken out with slippage
> we will close on close tonight or at B/E and re evaluate after reporting.
> If it was deep in the money I wouldn't worry so much.
> 
> Where can I get a reporting schedule?




If the position wasn't so big AND the stock so illquid, I'd have no problem holding it into the report. This reporting season has seen a few funny price action after the report... E.g. BLD today down 5% then up 4%. It's hard not to get whipped when that happens. HIL yesterday was another one.

There's a few calendars in the thread below. You might want to find an ex-div calendar as well...

https://www.aussiestockforums.com/forums/showthread.php?t=27167&p=786001#post786001


----------



## tech/a

tech/a said:


> SKC
> 
> Its something I've never considered in my trading
> Perhaps something I should!
> 
> As we will be able to determine a stop price tonight then
> rather than take the risk of a stop being taken out with slippage
> we will close on close tonight or at B/E and re evaluate after reporting.
> If it was deep in the money I wouldn't worry so much.
> 
> Where can I get a reporting schedule?




Actually seeing *I've never worried about this before *and I've carried it through with all the trades so far.
Ill leave it as it is.

No disrespect and I'm not ignoring your opinion.
I just don't want to add something I've never had before to the exercise.

I think the stops at around Dividend should be adjusted.
But will watch any at reporting and see what impact it has on the overall trade.


----------



## skc

tech/a said:


> Actually seeing *I've never worried about this before *and I've carried it through with all the trades so far.
> Ill leave it as it is.
> 
> No disrespect and I'm not ignoring your opinion.
> I just don't want to add something I've never had before to the exercise.
> 
> I think the stops at around Dividend should be adjusted.
> But will watch any at reporting and see what impact it has on the overall trade.




Your trading here has been strongly focused on managing risks and so I thought it's worth highlighting to others following the thread that holding 77% of the capital into a report doesn't really align with that principle. I would also say that this is not an opinion but a matter of fact. 

I don't know anything about VRL and what the market is expecting of the report, and for all I know 98 times out of 100 it may not matter... but I know I'd be getting a call from my risk desk around now to ask me if I really want to be holding that size overnight.

However, it's your exercise so obviously entirely up to you.


----------



## Trembling Hand

skc said:


> Your trading here has been strongly focused on managing risks and so I thought it's worth highlighting to others following the thread that holding 77% of the capital into a report doesn't really align with that principle. I would also say that this is not an opinion but a matter of fact.
> 
> I don't know anything about VRL and what the market is expecting of the report, and for all I know 98 times out of 100 it may not matter... but I know I'd be getting a call from my risk desk around now to ask me if I really want to be holding that size overnight.
> 
> However, it's your exercise so obviously entirely up to you.




Was going to comment if you ever blow up trading you would make a good risk desk jockey. of course you would have to get use to people hating you and abusing you.

Trader - "come on dude, don't be a girly wimp you know I can get it back, just double me up" 
Risk - "No"
Trader - "you are an aR$ehole and fool, no wonder you cannot trade!" storms out to pub.

just like running a methadone clinic!


----------



## skc

Trembling Hand said:


> Was going to comment if you ever blow up trading you would make a good risk desk jockey. of course you would have to get use to people hating you and abusing you.
> 
> Trader - "come on dude, don't be a girly wimp you know I can get it back, just double me up"
> Risk - "No"
> Trader - "you are an aR$ehole and fool, no wonder you cannot trade!" storms out to pub.
> 
> just like running a methadone clinic!




I have forward your post to the risk desk!


----------



## skc

skc said:


> Your trading here has been strongly focused on managing risks and so I thought it's worth highlighting to others following the thread that holding *77% of the capital *into a report doesn't really align with that principle. I would also say that this is not an opinion but a matter of fact.






tech/a said:


> View attachment 53922




Actually Tech/a, I stand corrected. I was going off on Pav's post and spreadsheet numbers but in fact the position size based on your chart is only worth ~$20k.

So I've exaggerated the risk concern by a factor of 3. 

I hereby resign from being your risk manager.


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## tech/a

No probs 
Appreciate scrutiny.
Keeps me / us honest.


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## pavilion103

Did people not read my post yesterday where I posted the spreadsheet?????

VRL was addressed. I wrote up there that it will have to be removed if it is in fact 77%. 

I'm not sure how this was overlooked?


----------



## debtfree

pavilion103 said:


> Did people not read my post yesterday where I posted the spreadsheet?????
> 
> VRL was addressed. I wrote up there that it will have to be removed if it is in fact 77%.
> 
> I'm not sure how this was overlooked?




Hi Pav

With the spreadsheet the initial stop loss you have in for VRL (#22 Trade) is 6.15 where in Tech's chart it was 6.05 which would mean the stop loss difference was .14 cents rather than .4 cents which would mean a lot smaller stake  than $77K roughly mentioned. Would this be correct or am I missing something here?

Thanks


----------



## qldfrog

and technically about stop slippage:
what do you guys use as a value:
if you have decided your stop loss is 1$, do you do a 
if less or equal to stop loss (1$)  then sell at (stop loss ie 1$
or do you give it a wide margin
for example sell at 80c?

the reason I ask is that in these results time, I got high slippage and ,my stop loss  are triggerred but go thru and end up selling for a lot less and this makes a big difference ultimately.
Thanks for the exercise and indeed the report time is challenging..


----------



## pavilion103

debtfree said:


> Hi Pav
> 
> With the spreadsheet the initial stop loss you have in for VRL (#22 Trade) is 6.15 where in Tech's chart it was 6.05 which would mean the stop loss difference was .14 cents rather than .4 cents which would mean a lot smaller stake  than $77K roughly mentioned. Would this be correct or am I missing something here?
> 
> Thanks




That is correct.
Tech posted the updated ones AFTER I put up that spreadsheet. 
As per my commentary, I did not have the exit and entries for that one and had to deduce it from the chart, which I did incorrectly. 
Will amend


----------



## pavilion103

qldfrog said:


> and technically about stop slippage:
> what do you guys use as a value:
> if you have decided your stop loss is 1$, do you do a
> if less or equal to stop loss (1$)  then sell at (stop loss ie 1$
> or do you give it a wide margin
> for example sell at 80c?
> 
> the reason I ask is that in these results time, I got high slippage and ,my stop loss  are triggerred but go thru and end up selling for a lot less and this makes a big difference ultimately.
> Thanks for the exercise and indeed the report time is challenging..




With the stop loss if it gaps the stop it will sell at the next available.  
So in you're case, $1 or less.

I had one in my own portfolio recently where I had a stop at $1.54 but it opened at $1.52 and I was taken out there.


----------



## debtfree

pavilion103 said:


> That is correct.
> Tech posted the updated ones AFTER I put up that spreadsheet.
> As per my commentary, I did not have the exit and entries for that one and had to deduce it from the chart, which I did incorrectly.
> Will amend




Thanks Pav, I understand and I appreciate your reply.

While we are on about the spreadsheet can I mention about the FLT trade. You risked $1,000 on this one and the initial stop loss difference was $1.23, as $1,000 divided by $1.23 = 813 shares whereas you have 1626 shares in the spreadsheet. Is this due to the use of Margin within IB at the time or should it be 813 shares.

I've been looking at it and I thought bugger it, ask the question. 

Thanks Pav ... Debtfree


----------



## tech/a

pavilion103 said:


> That is correct.
> Tech posted the updated ones AFTER I put up that spreadsheet.
> As per my commentary, I did not have the exit and entries for that one and had to deduce it from the chart, which I did incorrectly.
> Will amend




My fault entirely.

I had promised PAV a complete update each week.
Got way laid and to PAV's credit he gave it a go.
Hopefully all sorted in the update and PAV I think
that just do the updates when I've sent over all
the info.


----------



## debtfree

tech/a said:


> My fault entirely.
> 
> I had promised PAV a complete update each week.
> Got way laid and to PAV's credit he gave it a go.
> Hopefully all sorted in the update and PAV I think
> that just do the updates when I've sent over all
> the info.




No dramas this end at all. Enjoying the thread and learning from it so thanks once again to the both of you for you time and effort.

Debtfree


----------



## pavilion103

debtfree said:


> Thanks Pav, I understand and I appreciate your reply.
> 
> While we are on about the spreadsheet can I mention about the FLT trade. You risked $1,000 on this one and the initial stop loss difference was $1.23, as $1,000 divided by $1.23 = 813 shares whereas you have 1626 shares in the spreadsheet. Is this due to the use of Margin within IB at the time or should it be 813 shares.
> 
> I've been looking at it and I thought bugger it, ask the question.
> 
> Thanks Pav ... Debtfree




It's because we took 2% risk not 1%. Look at the column next to the company one. Then look in cell AA8. I've got $1,000 at risk, rather than $500. 

Tech chose to put a bit more on this one. 

No worries with the questions mate.


----------



## debtfree

pavilion103 said:


> It's because we took 2% risk not 1%. Look at the column next to the company one. Then look in cell AA8. I've got $1,000 at risk, rather than $500.
> 
> Tech chose to put a bit more on this one.
> 
> No worries with the questions mate.




Ahhh I see, thanks for the explanation Pav I understand that now.


----------



## fiftyeight

Any good books someone could recommend on the setups you guys are looking for? Flags, triangles, consolidation patterns etc. 

Might help me follow this thread and the "transition to futures" thread


----------



## CanOz

fiftyeight said:


> Any good books someone could recommend on the setups you guys are looking for? Flags, triangles, consolidation patterns etc.
> 
> Might help me follow this thread and the "transition to futures" thread




You could try this one...PM me if you want it, i may have access to a copy on sale


----------



## fiftyeight

Thanks CanOz, I think I might have access to that one as well. Going on holidays so Ill have a lot to get through


----------



## Country Lad

CanOz said:


> You could try this one...PM me if you want it, i may have access to a copy on sale




It is the best one around on patterns.

Cheers
Country Lad


----------



## tech/a

fiftyeight said:


> Thanks CanOz, I think I might have access to that one as well. Going on holidays so Ill have a lot to get through




Bulkowski's website will keep you in reading for about a year!

http://thepatternsite.com/

I do have another excellent pattern book at home which I have just purchased
very simple and very clear Ill post it up tonight.

Ah There it is on his site I knew he was involved in the book.
"Chart Patterns"

There is also another in the series on Elliott Wave (Not Bulkowski) For those who want to get their head around the concept.

The volume of work and research this guy has put out is *ASTOUNDING*!


----------



## fiftyeight

Excellent cheers guys.

Ill try and get through the Encyclopedia and some of the website.

I must admit I have only been reading and not studying but look forward to the quizzes to get me going in the right direction


----------



## skyQuake

tech/a when the portfolio is fully invested (esp now with Aus IB margins), do you still scan for potentials?


----------



## tech/a

skyQuake said:


> tech/a when the portfolio is fully invested (esp now with Aus IB margins), do you still scan for potentials?




Yes
For a few reasons.
(1) Good continuation/developing patterns pop up within a trend or at the end of others all the time.
You get a feel for a stock you are watching. 
(2) You can also get a feel for the general market from the number of prospects and the development within them
Or lack of!
(3) These prospects tend to perform better than those found on the exact day you need a new member for your portfolio.


----------



## tech/a

Current watch list.

Some are obvious others are in progress and others have potential setups not in the scope of this exercise.
but thought could be of some interest to some.


----------



## Shaker

Hi Tech/A and Pav

Are you updating anytime soon

Regards
Shaker


----------



## pavilion103

Shaker said:


> Hi Tech/A and Pav
> 
> Are you updating anytime soon
> 
> Regards
> Shaker




Once updates are put up I'll complete this week's spreadsheet.

A bit of a tough market at the moment!


----------



## skc

tech/a said:


> PAV
> 
> These are tonight's updates.
> 3 stopped at full boot!
> 
> You should now be able to do a spread sheet.




Don't you normally post the charts in the chart's thread?

HGG went ex-div by 3.73c today although the fall was outsized. VRL is going ex-div 13c on 4 Sept.

There are heaps of ex-divs going on in the next 2 weeks...


----------



## pavilion103

Ok ill so these up tomorrow night. Feeling sick tonight. Not good. 

I'll have to look at those dividends too and insert new columns in the spreadsheet.


Tough conditions at the moment. It will be interesting to see how many more set ups appear and what direction the market takes.


----------



## pavilion103

Here is the update guys. Let me know if there are any errors. Dividends have been put in for those two stocks. I will keep a watch on the others coming up. 

View attachment Techa and Pav momentum portfolio FY 2013-2014 Version 1.1.xlsx


----------



## Shaker

Thanks for the update Pav

Tech/A
Can you explain your MBN trade in relation to your stop loss. As the stock went to .13 cents last week.
If you had moved to breakeven the trade would have finished today or yesterday.

Looking forward to you rules or method of moving to breakeven

Regards
Shaker


----------



## Shaker

Hi Tech/A

You must be busy atm.

Of the open positions atm not counting your last buy, 5 are above breakeven, NST stopped out today and MBN rising 10% today although still below breakeven.

Shaker


----------



## pavilion103

Will update excel this week for you guys. Just need a free patch. But will do it!


----------



## ThingyMajiggy

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*

What are you guys doing to find potential plays in the first place? Using some kind of scan in a certain platform or?


----------



## tech/a

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



ThingyMajiggy said:


> What are you guys doing to find potential plays in the first place? Using some kind of scan in a certain platform or?




I use Metastock 
I have one specifically for sub 10c 
Stocks.


----------



## ThingyMajiggy

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*

Interesting equity curve there, I think I've been on that ride too! 

Keep it up gents


----------



## tech/a

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



ThingyMajiggy said:


> Interesting equity curve there, I think I've been on that ride too!
> 
> Keep it up gents




Not much of a ride.
Happy that its kept us in the game
without hurting the pocket.
Time will show that eventually we have
a number of in the money positions which 
get a wriggle on. The cost of finding
these and getting on board is to be minimized.

So far at least that has been achieved!


----------



## ThingyMajiggy

*Re: Technical Trading Exercise (Pavilion103 and tech/a) Charts and Spreadsheets*



tech/a said:


> Not much of a ride.
> Happy that its kept us in the game
> without hurting the pocket.
> Time will show that eventually we have
> a number of in the money positions which
> get a wriggle on. The cost of finding
> these and getting on board is to be minimized.
> 
> So far at least that has been achieved!




I mean't it looks a little like a rollercoaster I went on at the show  Is what is to be expected though from such a strategy I assume, hopefully it explodes and gets that wriggle on eventually


----------



## pavilion103

Interesting watch list Tech.

In my live trading I'm already in VOC and HVN. I think stops near BE on both.

HGG is already in my orders too waiting to be triggered.


----------



## ThingyMajiggy

Sorry guys didn't even realise there was a discussion thread, my bad!


----------



## tech/a

ThingyMajiggy said:


> Sorry guys didn't even realise there was a discussion thread, my bad!




No worries Sam  You weren't the first and wont be the last.


----------



## burglar

I've had a "Road to Damascus" moment.

I spotted a pattern in a chart.





Ok. I was wrong the other day about the cup and handle (AXE thread), coz I didn't understand it had to have certain volume characteristics.

And I'm still unaware of what constitutes the 'certain volume characteristics' for pennants.
I so want this SWE chart to be a pennant!!


----------



## tech/a

Sell GEM post tonight


----------



## skc

tech/a said:


> Sell GEM post tonight




They just did a placement @ $3.10, FWIW...


----------



## skc

pavilion103 said:


> View attachment 54761
> 
> 
> Updates




ATU was stopped out 2 weeks ago.



tech/a said:


> 26/9 Tidy up.




With ~30 trades under the belt, how are the stats compare to your expectations? Or is it too early to tell?

Obviously you are in a drawdown period but this is also the more important period as far as trading goes. Everyone can happily trade and internally compound when trades are going well, but it is the drawdown period that makes people do things perhaps they shouldn't.

Any comments / discussions on the trading overall? What went well and what hasn't gone as planned?


----------



## qldfrog

interesting in your respective thoughts:
did similar exercise since 1/07/13, lost money (more than Tech/a) but on many more trades loosing an average of $44 by trade so not good.
own stop and look revealed a lot of the loss on only a few trades which went straight thru my stop loss.
And too many entries before consolidated trends
But would be very interested by Tech/a feedback on this exercice so far


----------



## tech/a

qldfrog said:


> interesting in your respective thoughts:
> did similar exercise since 1/07/13, lost money (more than Tech/a) but on many more trades loosing an average of $44 by trade so not good.
> own stop and look revealed a lot of the loss on only a few trades which went straight thru my stop loss.
> And too many entries before consolidated trends
> But would be very interested by Tech/a feedback on this exercice so far




Sorry been meaning to answer this for ages.

Yes I am disappointed with the results.
Purely on a market basis.
Looking back at the larger majority of trades closed 
few turned and went on with it. In fact many kept falling.

I would think that had we had a buy and hold strategy we would
be worse off.
What I am happy with is the draw down being kept to reasonable levels.

The number of trades needed to turn a profit will not be great and I'm sure
we will have a few in the next couple of months before the FED need to face the same
problem again in Jan.

I've been terribly busy of late and haven't been able to invest the time I should into this thread
so back to it!!


----------



## pavilion103

Tech, I reckon the fact that you've been busy the last couple of weeks (through no fault of your own) has meant that we've missed some opportunities while the market has had a string of up days.  

In my personal portfolio I've found that the buys from 2-3 weeks ago are in good profit. Almost everything of mine has been going up.

 So I reckon if we had thrown a few of those in we would have been tracking ok.


----------



## brty

As my version of exel is too old to open the files supplied by Pav, I was unaware, and surprised the system is in drawdown.

I recognised many of the chart patterns, simply because I was long or was purchasing many of the same stocks. I have very good profits in such issues as TGR, MGX and SHV (sold last week). As I pyramid on the way up, and I thought the system presented was adding to the winners, where was the weakness?

Were the initial stops too close? Were stops raised too quickly? Was the portfolio spread too thinly? 

A set of results from a system is an excellent source of information too play around with. Now that all the stats are in, optimise them, then forward test the optimisation.


----------



## Country Lad

brty said:


> Were the initial stops too close? Were stops raised too quickly?




I think the issue is the use of arbitrary stops like break-even.  I have traded couple as well and use only technical stops which kept me in the trade longer.

I’ll see if I can find a couple of examples later – I am on a train at the moment heading into the CBD.  A novel experience for me, I haven’t travel this way for many years.

Cheers
Country Lad


----------



## tech/a

pavilion103 said:


> Tech, I reckon the fact that you've been busy the last couple of weeks (through no fault of your own) has meant that we've missed some opportunities while the market has had a string of up days.
> 
> In my personal portfolio I've found that the buys from 2-3 weeks ago are in good profit. Almost everything of mine has been going up.
> 
> So I reckon if we had thrown a few of those in we would have been tracking ok.




No doubt.

*BUT*

The whole idea of trading and the ability to actually "Trade"
Is to have a methodology which allows you to trade when and where you can.
In reality this does happen to me---Particularly now when I don't have the time to manage my portfolio properly.
Id rather not trade than put my funds at risk due to poor management.

We will get into profit in time enough.


----------



## pavilion103

tech/a said:


> No doubt.  BUT  The whole idea of trading and the ability to actually "Trade" Is to have a methodology which allows you to trade when and where you can. In reality this does happen to me---Particularly now when I don't have the time to manage my portfolio properly. Id rather not trade than put my funds at risk due to poor management.  We will get into profit in time enough.




I agree.

And it can happen just the same on the opposite side where you happen to be too busy to trade and luckily it coincides with the market turning down and you end up not losing money you otherwise may have. 

I know with this exercise you have spent additional time posing and drawing up charts so it really becomes a lot more time consuming than usual.

I find I spend very little time at night updating my trades now. I do 2 scans (eye ball each chart for a couple of seconds), check my watchlist, update my trailing stop and set new orders. 
Usually 15-30mins, especially on the lower end of this when most of my capital is tied up and I can't be bothered looking for new trades!


----------



## pavilion103

Country Lad said:


> I think the issue is the use of arbitrary stops like break-even.  I have traded couple as well and use only technical stops which kept me in the trade longer.  Ill see if I can find a couple of examples later  I am on a train at the moment heading into the CBD.  A novel experience for me, I havent travel this way for many years.  Cheers Country Lad




Interesting point in regards to the break-even stop, particularly when not considered to be at a technically sound level that makes sense from a technical point of view.

But with these momentum trades the idea is to get on exactly that, momentum. If it doesn't take off initially then our initial analysis has not been validated and if it comes back to break-even it makes more sense to get out and put the capital to use in another setup which is about to take off.

I've definitely found when trading a momentum strategy that almost all the great winners take off straight away. I don't regret exiting at break even.
If I had a longer term holding strategy then it may be a different story.


----------



## tech/a

pavilion103 said:


> Interesting point in regards to the break-even stop, particularly when not considered to be at a technically sound level that makes sense from a technical point of view.
> 
> But with these momentum trades the idea is to get on exactly that, momentum. If it doesn't take off initially then our initial analysis has not been validated and if it comes back to break-even it makes more sense to get out and put the capital to use in another setup which is about to take off.
> 
> I've definitely found when trading a momentum strategy that almost all the great winners take off straight away. I don't regret exiting at break even.
> If I had a longer term holding strategy then it may be a different story.




My way of trading is to find momentum and go with it.
In this exercise there isn't much going---!!

Sure you can argue many variants in hindsight.
You can also apply many variants in real time.
But I have noticed many of the B/E trades went on to take out their initial stops.
So maybe not a great deal of difference---I don't know I haven't looked at it.

I want momentum to continue if it doesn't than I'm out.
Sure ill miss some good moves.
But in the end Ill get my fair share also without massive drawdown.

I will continue here soon.


----------



## Boggo

tech/a said:


> My way of trading is to find momentum and go with it.
> In this exercise there isn't much going---!!
> 
> Sure you can argue many variants in hindsight.
> You can also apply many variants in real time.
> But I have noticed many of the B/E trades went on to take out their initial stops.
> So maybe not a great deal of difference---I don't know I haven't looked at it.
> 
> *I want momentum to continue if it doesn't then I'm out.*
> Sure ill miss some good moves.
> But in the end Ill get my fair share also without massive drawdown.
> 
> I will continue here soon.




Agree entirely, no momentum move out and on to the next.
The timing of the commencement of this exercise has been the best test you could have had, in a positive sentiment market the rest should be easy knowing that capital protection works.

(click to expand)


----------



## pavilion103

Btw what so you reckon of my new avatar Tech? Good resemblance?


----------



## tech/a

pavilion103 said:


> Btw what so you reckon of my new avatar Tech? Good resemblance?




Thought it was a Photo.


----------



## pavilion103

tech/a said:


> Thought it was a Photo.




Haha


----------



## barney

pavilion103 said:


> Btw what so you reckon of my new avatar Tech? Good resemblance?




So you are really Torrance Coombs! ..... I knew you were a star Pav:


----------



## tech/a

PAV
HGO or any prospect is on he list 
Awaiting a buy signal.
From here stops and position sizing
Can be frmulated


----------



## pavilion103

Will update spreadsheets soon as we have some more activity again!

I'll see how I go. Big bday party at mine tonight! Plenty to prepare this arvo!!


----------



## pavilion103

FKP is a particularly interesting one which came up in my high volume scan also. 

Boy oh boy wowee. What happened on that day!


----------



## nulla nulla

pavilion103 said:


> FKP is a particularly interesting one which came up in my high volume scan also.
> 
> Boy oh boy wowee. What happened on that day!




SGP took up their entitlement and unloaded their entire holding (existing shares and entitlement) via Goldman Sachs. FKP are happy as they also reached an agreement with SGP for SGP to relinquish their entitlement to first right of refusal over some of the assets of FKP.


----------



## pavilion103

I'm thinking Saturday morning is likely the next update from me. I'll get this all together. 

Some thoughts from me, stocks worth checking out. 

BPT
SEA
BTT
CAJ


----------



## tech/a

pavilion103 said:


> I'm thinking Saturday morning is likely the next update from me. I'll get this all together.
> 
> Some thoughts from me, stocks worth checking out.
> 
> BPT
> SEA
> BTT
> CAJ




CAJ we are already on that?


----------



## pavilion103

Sorry my mistake. Didn't check!

Maybe a good consolidation before another break


----------



## skc

Boggo said:


>




Actually the first trade was placed on 15 Jul. The thread started in May and Tech/a wisely adopted a "no position as a position" stance for the first 2 months or so.

For reference, XJOAI on 21 May was 42073, on 15 Jul was 40621, today it was 44924. So market is up 6.8% since 21 May and 10.6% since 15 Jul.



tech/a said:


> Yes I am disappointed with the results.
> Purely on a market basis.
> Looking back at the larger majority of trades closed
> few turned and went on with it. In fact many kept falling.
> 
> I would think that had we had a buy and hold strategy we would
> be worse off.
> What I am happy with is the draw down being kept to reasonable levels.




The buy and hold equity curve (assuming all positions held until now, without considering dividends)... note that you wouldn't have been able to hold all these positions at the same time. So the actual buy and hold performance would be much lower, but probably still >$10k in profit which would have outperformed the market.




To me the main issue with the poor performance so far is that stops were too close. The stats so far showed avg win $833, avg loss -$297 and win% of 30%. So imo the avg win/avg loss is respectable, but the win% is on the low side. 

Risk = probability of occurance x consequence of occurance. With a tight stop, the "consequence" is kept small, but the "probability" of occurance is significantly increased. It would be an interesting exercise to look at how stops compared to the volatility (say in ATR terms) of the stocks traded.


----------



## Gringotts Bank

skc said:


> Actually the first trade ...




Where have you been lurking?


----------



## skc

Gringotts Bank said:


> Where have you been lurking?




Just came back from a 3-week break.


----------



## pavilion103

Speaking for myself, I like this approach.

I think it's easy in hindsight when the market is running up to think that it is best to just hold. What I particularly like about this approach is:
1) exit when the momentum is lagging
2) get in new stocks when momentum is identified. I.e. Good opportunity cost of limited capital.

Like you said, we wouldn't have been able to hold them all during the run up and who is to say which ones we would have held.

It is a fair question in terms of what is the optimal stop in a particular market. This exercise is certainly on the tight side.

I'd love to hear Tech's thoughts on this also.

Having said that VRL was probably trailed less aggressively than I would have done so and it was the most profitable, so letting this one run a bit was beneficial. However it did provide a period of consolidation that may have allowed re entry.

Some interesting considerations in your post.


----------



## craft

skc said:


> Just came back from a 3-week break.




Welcome back - hope you had a good time.


----------



## craft

pavilion103 said:


> Speaking for myself, I like this approach.
> 
> I think it's easy in hindsight when the market is running up to think that it is best to just hold. What I particularly like about this approach is:
> 1) exit when the momentum is lagging
> 2) get in new stocks when momentum is identified. I.e. Good opportunity cost of limited capital.




What has the price you brought at got to do with either of these points?

How does scratching a trade at a rather arbitrary number (your breakeven) help? 

The whole calculation for profitability includes opportunity x expectancy – each time you scratch at breakeven you effectively reduce your opportunity as that trade might as well never existed plus you have to reposition  by once again opening up at full risk.

For your approach it makes sense to reduce if momentum is lagging but do it on collective price information – your buy price should have nothing to do with it – it’s just one tiny piece of chart history – An exit on lagging momentum grounds should only occur at breakeven by coincidence.

Question – Is breakeven stops a psychological crutch or a valid means of maximising profitability or something in-between.


----------



## peter2

The expectancy (using the stats from skc) with a W% = 30% and AW/AL = 2.8 is only 0.14. 

IMO this is a poor edge extracted from the recent bullish market conditions. I would expect a value at least 0.3 to 0.7. Surprisingly the stats aren't very far from my minimum value of 0.3. If the W% was increased to 35% or the AW/AL was increased to 3.0 the expectancy's would be > 0.3. This would double the profit. 

I agree with skc in that the W% is too low rather than the AW/AL. The AW/AL might have been much better with the inclusion of only one good winner. Does your trade management allow for such an event or do you raise your TS higher than BE too quickly?  We all realise that selecting the right TS is an art form (unless you have back-tested results). IMO TS's should be very tight or very loose. In-between doesn't work out well. 

The basic foundation of this approach is to have a go but limit the losses. I agree with this approach but question whether you are letting your winners get big enough to compensate for all your work. 

Great question craft. (I like it when you hang around.) 
After the entry, the second most worrying time for a break-out trader is when price retests the original BO level. This tests the break-out traders' resolve while other traders who prefer to buy on support think this is an excellent low risk entry. A BO trader must expect the retest to happen and not exit near BE when it does. A successful retest (price resumes in the BO direction) is a high probability indicator for a winning trade (and a pyramiding opportunity).


----------



## pavilion103

You could just trade pullbacks. Look for different entry setups if the pullback to BE is so common. Do different scans. Take different setups.


----------



## tech/a

Thanks SKC and Peter for your (Your in the context of this reply---- below-- is not directed specifically at anyone but is used as a generic term for everyone else) comments.

In reply.

PAV originally came to me concerned that he wasn't making headway and his bank was being eroded quicker than he would like.

So I purposely traded in a discretionary manner with very strict management for a good reason.
Reason 1 was to show to PAV an on going trade management structure that was based upon a daily review of each trade. A habit that in my view should be adopted no matter what style you adopt for your own trading.

*This exercise has shown that.*

I wanted to show that you could use leverage safely without massive draw down.

*This exercise has shown that.*

I also wanted to show that recovery from a negative balance could and should be swift.

*This exercise has definitely shown that.*

I wanted to show that cutting losses short and letting winners run can be very lucrative.
While we only have 1 decent winner on the block.

*The exercise has shown that.*

I also wanted to show that once in a trade and the risk is mitigated then is the time to let the reigns a little looser.
A screaming bull market would definitely help all methods and demonstrate this premise far better---but

*I think the exercise has also shown that.*

Is it the method of methods---of course not.
Has it helped PAV--evidently.
Has it helped anyone else--unknown.

*One thing I do know* is that hind site evaluation will be correct 100% of the time.
But suggest that if you really want to prove to yourself --- you trade in the way you suggest is better than any one method shown here by any other poster who places up his real time trades.

*Do it here and in real time like this.*

You'll be surprised how completely different the results will be to your hind site evaluations.

In the meantime I will continue if there is the interest.

*However if the purpose has been served and is not seen as beneficial then I'm happy to stop.
I have plenty of other things to keep me busy.*


----------



## pavilion103

Would be keen for some of those guys to do a similar live exercise online. If it proves more beneficial then it will be a help to everyone and possible adjustments can be made.


----------



## Ves

Hey guys - is there any reason for the long-only bias so far?   I notice that the spreadsheet seems to indicate that "short" positions are possible for this strategy - but haven't seen any yet.     Whilst I don't trade technicals,  it is still interesting to see how others fare.  Thanks for sharing your journey so far.


----------



## wayneL

tech/a said:


> Thanks SKC and Peter for your (Your in the context of this reply---- below-- is not directed specifically at anyone but is used as a generic term for everyone else) comments.
> 
> In reply.
> 
> PAV originally came to me concerned that he wasn't making headway and his bank was being eroded quicker than he would like.
> 
> So I purposely traded in a discretionary manner with very strict management for a good reason.
> Reason 1 was to show to PAV an on going trade management structure that was based upon a daily review of each trade. A habit that in my view should be adopted no matter what style you adopt for your own trading.
> 
> *This exercise has shown that.*
> 
> I wanted to show that you could use leverage safely without massive draw down.
> 
> *This exercise has shown that.*
> 
> I also wanted to show that recovery from a negative balance could and should be swift.
> 
> *This exercise has definitely shown that.*
> 
> I wanted to show that cutting losses short and letting winners run can be very lucrative.
> While we only have 1 decent winner on the block.
> 
> *The exercise has shown that.*
> 
> I also wanted to show that once in a trade and the risk is mitigated then is the time to let the reigns a little looser.
> A screaming bull market would definitely help all methods and demonstrate this premise far better---but
> 
> *I think the exercise has also shown that.*
> 
> Is it the method of methods---of course not.
> Has it helped PAV--evidently.
> Has it helped anyone else--unknown.
> 
> *One thing I do know* is that hind site evaluation will be correct 100% of the time.
> But suggest that if you really want to prove to yourself --- you trade in the way you suggest is better than any one method shown here by any other poster who places up his real time trades.
> 
> *Do it here and in real time like this.*
> 
> *You'll be surprised how completely different the results will be to your hind site evaluations.*
> 
> In the meantime I will continue if there is the interest.
> 
> *However if the purpose has been served and is not seen as beneficial then I'm happy to stop.
> I have plenty of other things to keep me busy.*




I reckon any real time posting of trading is instrutioanl, particularly with regards to my bold above.

We could use such honesty in some of the option threads... well, one in particular.


----------



## peter2

I agree, this has been a valuable exercise. I'm a huge supporter of anyone that journals their trading as close to real-time as possible. I would suggest that all of the experienced forum members would be supportive of these journals. There would probably be more journals if it weren't for the restrictions on providing financial advice. I think this thread has helped quite a few readers with their trading attempts. Most people attempt to trade with insufficient funds and the only way to ensure their survival is tight risk control. This thread has done an excellent job of highlighting that aspect. 

The results are positive without any large winners. If you continue its highly probable that you'll get a few good results which will boost the return significantly. 

I hope you continue and I hope some of the less experienced traders who showed their enthusiasm at the start of this thread reappear and contribute more than they have during the thread. This exercise is a valuable real-time learning experience for the forum community and I hope it gathers enough support to rekindle the OP's passion for sharing.


----------



## skc

pavilion103 said:


> I think it's easy in hindsight when the market is running up to think that it is best to just hold. Like you said, we wouldn't have been able to hold them all during the run up and who is to say which ones we would have held.




I wasn't advocating a holding strategy. I was just putting numbers around tech/a's comment 



> I would think that had we had a buy and hold strategy we would be worse off.






tech/a said:


> Reason 1 was to show to PAV an on going trade management structure that was based upon a daily review of each trade. A habit that in my view should be adopted no matter what style you adopt for your own trading.




Agree with everything you've said. Plus all the other points of what you are trying to show in this thread...



tech/a said:


> *One thing I do know* is that hind site evaluation will be correct 100% of the time.




I'd call it performance review/improvement rather than hindsight evaluation. 

You mentioned some statistics in the first period of you and Pav's trading... and they were quite different to what has transpired in this exercise. So it seems reasonable to wonder why - and the reason could be the market, trade management, stock selection, general randomness or some combination of the above. 

I was just hoping to get you to show in this thread how you undertake performance review / continuous learning. But if that is not the main purpose of this exercise that's understandable.


----------



## tech/a

> I'd call it performance review/improvement rather than hindsight evaluation.




Ok 



> You mentioned some statistics in the first period of you and Pav's trading... and they were quite different to what has transpired in this exercise. So it seems reasonable to wonder why - and the reason could be the market, trade management, stock selection, general randomness or some combination of the above.




SKC I'm sure you have been involved in Montecarlo simulations as part of your analysis.
But for those who haven't --- results of say 5000 possible portfolios will give a range of results ranging from the mean to low to high ranges.

 This method has many many trades it COULD take but not enough capital to take them all and as PAV has shown the screening itself can also be different where I miss prospects and so can he.

The point is that the first exercise could well be at the very top of the possible returns using this method.
It certainly had many many more selections take off right from the get go.

This method hasn't been tested at all so I have no figures to work with other than the walk forward trading.
I have no doubt that over time there will be excellent profit and the equity curve is likely to be showing spikes up with flattish periods.

So it is highly likely that this portfolio is currently trading at the low end of possible results. Those who have worked with Monte carlo analysis like yourself---will know what I mean.



> I was just hoping to get you to show in this thread how you undertake performance review / continuous learning. But if that is not the main purpose of this exercise that's understandable.



*Well it wasn't but I welcome it as part of the process!!*

I think every process posted here (on ASF)  should be open to every sort of scrutiny available.
Otherwise there is no learning!


----------



## craft

tech/a said:


> SKC I'm sure you have been involved in Montecarlo simulations as part of your analysis.
> But for those who haven't --- results of say 5000 possible portfolios will give a range of results ranging from the mean to low to high ranges.





Monte Carlo simulation does not model serial correlations. This means the numbers coming out in each draw are random; there is no way to control what comes out in the next draw based on what was just drawn.  But the market is serially correlated – especially if you are playing it based on momentum. What happens today does influence tomorrow – and what happens to one influences others – we know this instinctively as bull and bear markets.

Using Monte Carlo which infers true randomness (ie coin toss randomness) on a serially correlated data set will underestimate the possible range.

Sure we have been through this – that's right, I don’t understand because I know FA.   

The questions I would be asking myself - Has the system got an edge or will it only work in a raging bull market when everything 'long momentum' does? Is the position sizing correct to see me through to the next bull market? or am I relying on a Monte Carlo simulation of drawdown that may be understated because MC doesn't take into account serial correlation? Am I using a market trend filter - Is that the primary importance and individual stock selection secondary to my expectancy?


----------



## skc

tech/a said:


> SKC I'm sure you have been involved in Montecarlo simulations as part of your analysis.
> But for those who haven't --- results of say 5000 possible portfolios will give a range of results ranging from the mean to low to high ranges.
> 
> So it is highly likely that this portfolio is currently trading at the low end of possible results. Those who have worked with Monte carlo analysis like yourself---will know what I mean.




Actually I've never worked with Monte Carlo simulations although I am aware of what it is. I think a relatively small set of results (i.e. only 30-40 trades) will no doubt experience plenty of randomness and easily swung by a single trade here and there anyway.



craft said:


> Monte Carlo simulation does not model serial correlations. This means the numbers coming out in each draw are random; there is no way to control what comes out in the next draw based on what was just drawn.  But the market is serially correlated – especially if you are playing it based on momentum. What happens today does influence tomorrow – and what happens to one influences others – we know this instinctively as bull and bear markets.
> 
> Using Monte Carlo which infers true randomness (ie coin toss randomness) on a serially correlated data set will underestimate the possible range.




Very insightful. Totally logical yet not something I've read before. 



craft said:


> The questions I would be asking myself - Has the system got an edge or will it only work in a raging bull market when everything 'long momentum' does? Is the position sizing correct to see me through to the next bull market?




I think the trading approach here has plenty of merits especially for a part time trader who's looking to put their capital to work, limit their downside while being exposed to the upside. If I can get my Mum (who's been in the market for 20 years yet doesn't even know whether she's ahead or behind) to trade like this it'd be a huge achievement already. It's perfectly OK (and probably preferrable) to make few trades and make no profit for months when the market isn't treating you well, but with an opportunity to make decent returns when conditions become favourable. I raised the question about performance as the conditions do appear quite favourable at the moment, but I also acknowledge that the results so far may simply be skewed by a bit of randomness.

On the other hand, if you are relying on trading as the primary source of income then you'd want something a little bit robust with more regular and higher levels of activity. Being a full time trader, I often find myself judging approaches with different prupose a bit unfairly at times.


----------



## tech/a

> Monte Carlo simulation does not model serial correlations. This means the numbers coming out in each draw are random; there is no way to control what comes out in the next draw based on what was just drawn. But the market is serially correlated – especially if you are playing it based on momentum. What happens today does influence tomorrow – and what happens to one influences others – we know this instinctively as bull and bear markets.




You could be correct I'm only Hypothesising.



> Sure we have been through this – that's right, I don’t understand because I know FA.




Are you incapable of refraining from inflaming a discussion?



> The questions I would be asking myself - Has the system got an edge or will it only work in a raging bull market when everything 'long momentum' does? Is the position sizing correct to see me through to the next bull market? or am I relying on a Monte Carlo simulation of drawdown that may be understated because MC doesn't take into account serial correlation? Am I using a market trend filter - Is that the primary importance and individual stock selection secondary to my expectancy?




Yes all valid questions and if I were designing a method to trade would ask and test.
This is however AN EXERCISE.


----------



## craft

skc said:


> It's perfectly OK (and probably preferrable) to make few trades and make no profit for months when the market isn't treating you well, but with an opportunity to make decent returns when conditions become favourable. I raised the question about performance as the conditions do appear quite favourable at the moment.




This is why I have asked the questions I have. 

If you are going to make your B/E some sort of arbitrary exit for momentum lagging then you are going to have to have a very strong and low volatile market for it to work.

The small cuts in-between time could be very agonising if you enter markets that are not strong enough. MC with its limitations is not necessarily going to paint the true draw down picture.

If you look at the market when things worked it was a fairly rare event with the overall market rising at 70%+ annualised for a few month period with very small ranges. The current up leg is half that speed with larger ATR’s. 

If the B/E stop is non negotiable perhaps the market filter need to only switch on in explosive strong markets.

Perhaps consideration could be given to smaller parcel sizes so that pushing quickly to B/E is not psychologically so imperative and retests of breakouts (normal action for a normal up leg) can be allowed to occur without discomfort.  Maybe the AW/AL comes down a bit but your W% is likely to more than compensate and your opportunity defiantly goes up because you are not scratching so many trades.





tech/a said:


> Are you incapable of refraining from inflaming a discussion?.




Probably -Sorry - I'll try harder.  [But you gotta admit it takes one to know one]



tech/a said:


> Yes all valid questions and if I were designing a method to trade would ask and test.
> This is however AN EXERCISE.






tech/a said:


> Ok
> 
> I think every process posted here (on ASF)  should be open to every sort of scrutiny available.
> Otherwise there is no learning!




??


----------



## peter2

craft said:


> ...
> If the B/E stop is non negotiable perhaps the market filter need to only switch on in explosive strong markets.
> ...




Or improve your odds (W%) by screening for trading candidates with a strong trend (ADX >30) with low volatility.

Or the top down FA approach, trade momentum in only the strong stocks in the strongest sector.


----------



## burglar

peter2 said:


> Or improve your odds (W%) by screening for trading candidates with a strong trend (ADX >30) with low volatility.
> 
> Or the top down FA approach, trade momentum in only the strong stocks in the strongest sector.




Is there a nice way to say this?
Clearly you are changing the way tech/a trades, to something you are more comfortable with.


----------



## fiftyeight

peter2 said:


> I hope you continue and I hope some of the less experienced traders who showed their enthusiasm at the start of this thread reappear and contribute more than they have during the thread. This exercise is a valuable real-time learning experience for the forum community and I hope it gathers enough support to rekindle the OP's passion for sharing.




I can only speak for myself as an inexperienced trader but I dont really have a lot to contribute. I learn a lot more when experience traders are discussing an issue as they are at the moment.

Cheers all involved


----------



## Gringotts Bank

burglar said:


> Is there a nice way to say this?
> Clearly you are changing the way tech/a trades, to something you are more comfortable with.




He is but it makes sense if the problem has been identified as low winning %.

Tech and pavillion may not be interested in my advice either, but here's one possible approach:

Identify a high trending, low volatility stock using ATR, Chaikin, ADX, ROC, long term trendline.  My preference would be trendline +  Chaikin.
Identify a flush-out bar (much higher volatility red candle with long lower wick).
Enter as soon as the volatility returns to pre-flush out levels.
Ensure the long term trendline is still unbroken.
Backtest the idea for tweaking.

The thing with high momentum low volatility stocks is that when they correct, they correct HARD and often in just one or two bars.


----------



## pavilion103

Happy to hear your thoughts GB when you're not trolling.


----------



## tech/a

Personally I'd like to see a selection of ideas posted here put together in a trading 
Method and traded in tandem.

The results would be good to reflect on in a few months.


----------



## pavilion103

Have been watching AGO in recent weeks. Tonight's prospect.

By the way. I'll update the spreadsheet this weekend and then I'll be in India for 2 weeks so it will be a bit of a gap between updates.


----------



## pavilion103

I have posted some analysis in the main thread. 

When reading it please remember that

*THIS IS THE THREAD TO POST COMMENTS IN   *

not the other one. 

Thanks


----------



## Country Lad

tech/a said:


> Personally I'd like to see a selection of ideas posted here put together in a trading
> Method and traded in tandem.
> 
> The results would be good to reflect on in a few months.




Tech, do you mean comments on the ones mentioned here like for example AGO..... 



pavilion103 said:


> Have been watching AGO in recent weeks. Tonight's prospect.




.......and if so, broke from my setup 7 trading days ago when it went to 110 for a buy for me at 112 that day.  I have a stop at 113, the previous high before the break. 

Not going on with it strongly, but going on with it.  I didn't want to comment like this previously because it may appear to be hijacking this thread.

This the sort of thing you had in mind?

Cheers
Country Lad


----------



## tech/a

Sort of.

There were/are all sorts of ideas to improve the basic method.
I'm suggesting a seperate thread with perhaps a method based upon the ideas mentioned in the thread as improvements---traded in tandem-------trade it however you want.

We should be able to see which improves and how the various aspects affect the method.
Do a discretionary systematic approach.

I'm introducing one of my own conditions I use when selecting a trade into the exercise.
I used it with DNA.
I find it powerful and very useful.


----------



## kid hustlr

Really strong results over the calendar year boys, nice to see the equity curve turning around lately as well.

Can't believe how well you picked the market top back in the middle of the year. Was turning to cash at this stage planned or did you just not receive any set ups at that time?

Should just short the future when the system is turned off!! Reminds me of a thread TH did with regards to hedging an equity portfolio a while back.


----------



## Gringotts Bank

This is the idea I posted above, backtested.  Basically you buy the dips of strong stocks.  Not optimized yet so plenty of room for improvement.

Strong trend = 280+ days of the last 300 are above MA (low lag MA based on the lows with a high period)
Flush out bar = cross below this MA in the last 10 days >1.
Return to normal volatility = ATR(1)<.05
Buy a $5000 lot every bar that is below the MA when the above conditions are met (price averaging the entry)
Sell when the price crosses above the same MA of the closes, or with a 10% stop loss.

The % return is low, but the CAR/MDD is ok.


----------



## tech/a

Gringotts Bank said:


> This is the idea I posted above, backtested.  Basically you buy the dips of strong stocks.  Not optimized yet so plenty of room for improvement.
> 
> Strong trend = 280+ days of the last 300 are above MA (low lag MA based on the lows with a high period)
> Flush out bar = cross below this MA in the last 10 days >1.
> Return to normal volatility = ATR(1)<.05
> Buy a $5000 lot every bar that is below the MA when the above conditions are met (price averaging the entry)
> Sell when the price crosses above the same MA of the closes, or with a 10% stop loss.
> 
> The % return is low, but the CAR/MDD is ok.




Excellent
Now trade it live.


----------



## pavilion103

Kid - setups did stop appearing at that time. But this simply confirmed the analysis of the XAO and other indexes at the time.

Tech, you seem to be the only one putting it on the line and trading this live. I respect input from all but am disappointed that none of the others are putting their balls on the line live!


----------



## CanOz

tech/a said:


> Excellent
> Now trade it live.




First of all I would have though you might say "test with more OOS" data, then you might say "walk it forward"...

Why would he test that live?

GB, was this system designed to do the same sort of thing Tech and Pav are trying to do? Is that why you posted it here?


----------



## tech/a

Kid
Your right there were less and less set ups
And more of this setups we did get didn't trigger.
That was a pre curser to the index analysis.

A very similar thing happened with T/T ( Tech Trader )
In 2008

PAV
As for live trading --- there is a vast difference between testing
Hypothesizing theory and trading live.


----------



## Gringotts Bank

CanOz said:


> First of all I would have though you might say "test with more OOS" data, then you might say "walk it forward"...
> 
> Why would he test that live?
> 
> GB, was this system designed to do the same sort of thing Tech and Pav are trying to do? Is that why you posted it here?




It's not something _anyone_ should trade live.  I'm just throwing around ideas and I'm probably on the wrong thread.  There are similarities in that it targets high momentum stocks.  It's different in that it buys when others are selling, or soon after.


----------



## pavilion103

Gringotts Bank said:


> It's not something _anyone_ should trade live.  I'm just throwing around ideas and I'm probably on the wrong thread.  There are similarities in that it targets high momentum stocks.  It's different in that it buys when others are selling, or soon after.




It's interesting GB. 

I definitely don't believe there is only one correct way. 

I enjoy discussing different methods.


----------



## skc

pavilion103 said:


> Tech, you seem to be the only one putting it on the line and trading this live. I respect input from all but am disappointed that none of the others are putting their balls on the line live!




Sorry to disappoint but since I trade someone else's money it would be rather unprofessional of me to post live trades and not give full attention to my own actual trading.


----------



## tech/a

skc said:


> Sorry to disappoint but since I trade someone else's money it would be rather unprofessional of me to post live trades and not give full attention to my own actual trading.




Bit lame.
Takes about 15 min
I don't  think you need to develope
A conflict of interests.

But each to their own--it's not easy.


----------



## skc

tech/a said:


> Bit lame.
> Takes about 15 min
> I don't  think you need to develope
> A conflict of interests.
> 
> But each to their own--it's not easy.




It's not just conflict of interest. It's demand for time, screen space and attention. It might only take you 15mins but it'd take me a lot more time to find various trade set ups, monitor the positions, and even read the company's fundamentals (so I know when they are going ex-div, for instance).

I also wanted to make sure, if I do post a trade journal I'd do it with plenty of details and analysis... an example was here in the pairs trade journal https://www.aussiestockforums.com/f...=14508&page=36&p=709183&viewfull=1#post709183. That took quite a lot of posting, but if I can't do it to that standard I wouldn't do it at all. Back then I wasn't trading for someone else, my size was about 1/10 of what it is now, and I didn't have a 2nd child. So I simply haven't got the same time to commit to a journal anymore.


----------



## Gringotts Bank

I might do one for a week or so, and just for a challenge eek see if i can make 10%.  Actually that's a bit high... maybe 5%.
The difficulty with public journalling is always the extra pressure to perform, because if you don't perform, everyone will delight in telling you what you should have done or where you went wrong.  But if pressure creates difficulty, then it's probably a very good exercise in concentration.


----------



## tech/a

skc said:


> It's not just conflict of interest. It's demand for time, screen space and attention. It might only take you 15mins but it'd take me a lot more time to find various trade set ups, monitor the positions, and even read the company's fundamentals (so I know when they are going ex-div, for instance).
> 
> I also wanted to make sure, if I do post a trade journal I'd do it with plenty of details and analysis... an example was here in the pairs trade journal https://www.aussiestockforums.com/f...=14508&page=36&p=709183&viewfull=1#post709183. That took quite a lot of posting, but if I can't do it to that standard I wouldn't do it at all. Back then I wasn't trading for someone else, my size was about 1/10 of what it is now, and I didn't have a 2nd child. So I simply haven't got the same time to commit to a journal anymore.




OK

I see your point its impossible to make time!!!


----------



## skc

tech/a said:


> OK
> 
> I see your point its impossible to make time!!!




Not impossible. But not worth it.


----------



## tech/a

tech/a said:


> Thanks SKC and Peter for your (Your in the context of this reply---- below-- is not directed specifically at anyone but is used as a generic term for everyone else) comments.
> 
> In reply.
> 
> ******PAV originally came to me concerned that he wasn't making headway and his bank was being eroded quicker than he would like.
> 
> So I purposely traded in a discretionary manner with very strict management for a good reason.
> Reason 1 was to show to PAV an on going trade management structure that was based upon a daily review of each trade. A habit that in my view should be adopted no matter what style you adopt for your own trading.
> 
> *This exercise has shown that.*
> 
> I wanted to show that you could use leverage safely without massive draw down.
> 
> *This exercise has shown that.*
> 
> I also wanted to show that recovery from a negative balance could and should be swift.
> 
> *This exercise has definitely shown that.*
> 
> I wanted to show that cutting losses short and letting winners run can be very lucrative.
> While we only have 1 decent winner on the block.
> 
> *The exercise has shown that.*
> 
> I also wanted to show that once in a trade and the risk is mitigated then is the time to let the reigns a little looser.
> A screaming bull market would definitely help all methods and demonstrate this premise far better---but
> 
> *I think the exercise has also shown that.*
> 
> Is it the method of methods---of course not.
> Has it helped PAV--evidently.
> Has it helped anyone else--unknown.
> 
> *One thing I do know* is that hind site evaluation will be correct 100% of the time.
> But suggest that if you really want to prove to yourself --- you trade in the way you suggest is better than any one method shown here by any other poster who places up his real time trades.
> 
> *Do it here and in real time like this.*
> 
> You'll be surprised how completely different the results will be to your hind site evaluations.
> 
> In the meantime I will continue if there is the interest.
> 
> *However if the purpose has been served and is not seen as beneficial then I'm happy to stop.
> I have plenty of other things to keep me busy.*





I wanted to post this back up for T/H's benefit.

Adding one other thing I was hoping to show and now have.

Recovery from draw down
From 8% down to 8% up in 3 winning trades in 3 weeks.
16% turn around so we have successfully mitigated risk.
And recouped draw down in a short time.

Now to T/H s comment about this being MY EDGE---OR LACK OF.

Ill say this again and type very slowly.
GO TO HERE ABOVE *****

It has and is serving its purpose. It does NOTHING ELSE but keep you in the game and gives you the best opportunity to be profitable---in the extreme.

Others have pointed out and rightly so that there are a million ways to trade a variant---which could be infinitely better. FINE.

But for those like PAV who needed a hand this is what it was and is about in the purest form I could think of.
If there is a better way please share it!

Anytime anyone including T/H wants to post up a live *SHARE trading* methodology which demonstrates a method of trading---I'm all for it.


----------



## Trembling Hand

tech/a said:


> Anytime anyone including T/H wants to post up a live *SHARE trading* methodology which demonstrates a method of trading---I'm all for it.




Tech as always good to make it about you....... again.

So,

Lets face you are the first to criticise others approaches in spite of having a woeful understanding of the market outside of a roaring bull run. Thats fine. Frankly if it makes yourself feel good to tell everyone how you made some money in the biggest bull market since the great depression well...... wherever floats your boat. 

But that was not what I was talking about. I was simply trying to point out to some poor sucker that trying to replicate someone's approach is a recipe for failure***. Unfortunately your ego loves to be stroked and you never considered that what Kid was asking you to do was the worst thing for his development as an independent long term successful trader. If he wants to trade short term *HE* needs to develop his own method or he has no frigging hope of his brain being able to deal with decisions on such a short timeframe. Let alone the confidence and resilience to adapt a method once the market changes.





***(admittedly with a good & deserved jab at you after the grief you gave me turning $800 into 15g in 4 days while you flop around with 100g for six months and make nothing!)


----------



## tech/a

Trembling Hand said:


> Tech as always good to make it about you....... again.
> 
> So,
> 
> Lets face you are the first to criticise others approaches in spite of having a woeful understanding of the market outside of a roaring bull run. Thats fine. Frankly if it makes yourself feel good to tell everyone how you made some money in the biggest bull market since the great depression well...... wherever floats your boat.
> 
> But that was not what I was talking about. I was simply trying to point out to some poor sucker that trying to replicate someone's approach is a recipe for failure***. Unfortunately your ego loves to be stroked and you never considered that what Kid was asking you to do was the worst thing for his development as an independent long term successful trader. If he wants to trade short term *HE* needs to develop his own method or he has no frigging hope of his brain being able to deal with decisions on such a short timeframe. Let alone the confidence and resilience to adapt a method once the market changes.
> 
> 
> 
> 
> 
> ***(admittedly with a good & deserved jab at you after the grief you gave me turning $800 into 15g in 4 days while you flop around with 100g for six months and make nothing!)




OK you win.


----------



## tech/a

The exercise has shown all the components I wanted to show PAV 
And now you.
I don't have the time or inclination to devote to a live trading exercise
In which I try to maximize profit.You can see clearly here that with such a small portfolio I'm struggling to update and add new prospects.

My thoughts are the same as SKC.

So I will now cease to update this exercise as it has for me----served it purpose.
I hope there are some who take something from this and develop a profitable strategy around
The basic premise.


----------



## skc

tech/a said:


> The exercise has shown all the components I wanted to show PAV
> And now you.
> I don't have the time or inclination to devote to a live trading exercise
> In which I try to maximize profit.You can see clearly here that with such a small portfolio I'm struggling to update and add new prospects.
> 
> *My thoughts are the same as SKC.*
> 
> So I will now cease to update this exercise as it has for me----served it purpose.
> I hope there are some who take something from this and develop a profitable strategy around
> The basic premise.




And my thoughts are also the same as you.



tech/a said:


> Bit lame.
> Takes about 15 min
> 
> But each to their own--it's not easy.


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## sval62

tech/a said:


> The exercise has shown all the components I wanted to show PAV
> And now you.
> I don't have the time or inclination to devote to a live trading exercise
> In which I try to maximize profit.You can see clearly here that with such a small portfolio I'm struggling to update and add new prospects.
> 
> My thoughts are the same as SKC.
> 
> So I will now cease to update this exercise as it has for me----served it purpose.
> I hope there are some who take something from this and develop a profitable strategy around
> The basic premise.




And so ends T/A thread No 653 , with no ending.


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## fiftyeight

Thanks to PAV and Tech for the time they have put in to this thread.

I am sure I will be using this thread as a reference resource for a long time to come.

Cheers


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## Trembling Hand

fiftyeight said:


> I am sure I will be using this thread as a reference resource for a long time to come.




It would be interesting to hear what, as a newbie, you think you found most valuable and what you hope to emulate?


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## Joe Blow

Let's keep this thread constructive please. I don't wish to see any personal attacks or attempts to derail the discussion.

I, for one, would like to see it continue. Whether that is now, or at a later date, is up to the thread participants.


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## Trembling Hand

Joe Blow said:


> Let's keep this thread constructive please. I don't wish to see any personal attacks or attempts to derail the discussion.
> 
> I, for one, would like to see it continue. Whether that is now, or at a later date, is up to the thread participants.




If that was directed at me for my comment to fiftyeight I don't know why!? I was generally interested in what he took from the thread.


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## Joe Blow

Trembling Hand said:


> If that was directed at me for my comment to fiftyeight I don't know why!? I was generally interested in what he took from the thread.




No, it was just a general remark directed at nobody in particular. I just felt that this thread had started to take a slightly negative turn, and I wanted to remind everyone to please keep it constructive for the sake of the discussion.


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## fiftyeight

As a newbie it was the first time I have seen a live trading journal.

I have read many of T/A past threads as well as a few of the books he has recommended it was good to see some of it in real time.

If anyone else takes the time to do something similar I will definitely follow it.

Not trying to emulate anyone but if somebody is offering advice ill happily take it.


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## qldfrog

as i started trading for real a portfolio on similar trend base detection at the very same time, I was able to compare my results and the trading of tech/a real time in parallel:
I am bad...
but can see where I was failing: stop loss ok in term of values  but often traversed straigh through and these few cases destroyed any profit;
As well too many trades
death by small cuts: loss of 60$ here and there and I end up with 5 figures loss in 6 month on a raising market..yeap bad!!!
often bought too high as well, my entry points could be lower, and what a big deal if I fails...another day tomorrow
but good lesson.
and force me to take a step back and analyse my errors and highlight my weak points
Thanks again


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## Newt

Thanks for all the time and trouble you put into this thread Pav and Tech.  I found it a fascinating read as whatever filters Tech was using was throwing up similar options to what I trade, but under quite different entry/exit conditions. Educational and thought provoking.  

On another note, it really does seem rare for people to "put it out there" as to exactly what they're doing.  Applause!  For those starting out, just seeing some proof that it is possible to stay in the game and even turn a small profit is so important IMHO.

Rob


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