Firstly, thank you for your post. I'd hope that there would be many more posts from others like you, struggling to get something going.
grah33: You've asked this question at least five times now. If you don't like the answers then it's time to figure it out for yourself. If you think it's hard to make a profit going long in a down market then for you it will. You're stopped, waiting for a push, without turning the ignition key.
Even though the overall market (index) has been going down there are >120 stocks that trade $200K/d and have their 10EMA>20EMA>50EMA. You only need to trade a few of them to create an overall profit. I've been doing it, Daffy's been doing it. What have you been doing? What is your favourite chart setup? Have you written your first trading plan yet?
I don't want the answers. Consider this a helpful kick in the pants. You've got to select something to start with and stick to it in every market condition. That's the only way to learn. Your experiences will be more meaningful than anything you read or hear.
The pattern that got me going in the ASX market was the Darvas box pattern. I've paper traded this pattern over one hundred times, then traded it live ever since. When the going gets tough I go back to this pattern. It gets me into the strongest trends. This pattern doesn't trigger very often in a down market (that keeps me safe). I can trade this pattern, short, medium and long term.
It always was and will always be, up to you.
ps: I mentioned that the next ASX trading game was due to start soon. Did you even consider having a go?
I wonder if kushi212 will try his "simple momentum strategy" in the game. I bet he won't.
Hi Peter,
Great work on the thread and I can confess to reading the content religiously but not contributing a whole lot so my apologies for not providing additional comments and posts.
Interesting you mentioned the Darvas Box System. It is simple and it is effective. The strategy I have been trading is a combo of Darvas, Wyckoff and Stan Weinstein and as you mentioned above, you need to trade to find what works for you.
I think many people can learn from this thread if they take the time to reflect on the lessons being taught (and shown) as well as trading for themselves. My own portfolio has been doing well this year despite the choppy market, the last few weeks have seen overall portfolio gains of 18%, 6% and 24% for each respective week and then this week I dropped 6%.
For all the newbies and those learning, what Peter is showing is that whilst it is nice enjoying the prosperous times, when the storm clouds start to form, it's time to risk manage and reduce the open risk for your positions. I can't encourage people enough to pay attention...
The hardest thing for people entering this game is the need to be "right". Watching a position go from profit into loss is gut wrenching when you are starting out and your emotions will play havoc. Trade your plan... It took a number of knocks before it got into my thick head but now I'd prefer to exit a position at a small loss and preserve my capital for the next trade. In the end, trading is a numbers game and you trade with the positive expectancy formed through the probabilities of your setups. What's better? To be right or to be profitable....
The ASX game now provides a pretty good platform to test your strategies out on. I will be participating using the same strategy as my real portfolio but this is more for entertainment (and hopefully prize money) value. The list of stocks available is fairly limited (in my opinion) but there will still be opportunities to take positions, plan your trade, position size, manage your exit/stop loss etc. I'd encourage those "paper traders" to play the game.... and commit to it as if it was your real $$$ on the line.
Anyhow, I'm starting to ramble and it's Saturday morning, so I'm outta here!
Thanks again Peter for your great work. Keep it up!