Serious newbie wanting to learn

[NewbieTrader1982]

All good.

You seem pretty methodical in your approach which is a good start .... good luck with your journey

Cheers @barney .

Are you an active profitable trader mate? Found any system that works for you?

 

[craft]

It's screaming all the signs..

@tech/a many newbies here seem to look up to you mate, any direction/feedback/ help you can offer would be most appreciated. You said in 2004 " I know of 2 here (probably more) doing this right now returning every week at least and often way more than a decent wage.From Under $20,000 capital base." That's something I'm interested in, not using leverage but just a small capital base to create similar CF as that to start. Really would appreciate some direction.
NT

Huge thanks to @tech/a, you've posted what looks like a GEM of a post at first glance

You got yourself a new fan Tech?

 

[Valued]

Momentum trading is risky though so if you do that you need to get your risk management sorted. You might still be in the trade when the ones who started the momentum are out. The worst is when the guys who started the up move are the ones selling to you when you go to buy. That doesn't mean you will lose necessarily since you could be front running people even more slower to the party than you but it's not a fantastic situation to be in and choosing when to exit is tough. It doesn't mean it isn't profitable but it does mean prices can come crashing down on you so where people get into trouble is they load up a CFD on say bitcoin/USD shove a few hundred backs in it, get a position worth tends of thousands of dollars, they see the price going to the moon and think it's fantastic then next thing you know it comes down harder and faster than you ever thought possible. Bitcoin is an interesting example because if you're long there is always a small chance something terrible and unpredictable is going to happen that can blow your entire account and then some (exchanges close, bitcoins stolen etc). The same can be said of penny stocks etc.

 

[NewbieTrader1982]

Momentum trading is risky though so if you do that you need to get your risk management sorted. You might still be in the trade when the ones who started the momentum are out. The worst is when the guys who started the up move are the ones selling to you when you go to buy. That doesn't mean you will lose necessarily since you could be front running people even more slower to the party than you but it's not a fantastic situation to be in and choosing when to exit is tough. It doesn't mean it isn't profitable but it does mean prices can come crashing down on you so where people get into trouble is they load up a CFD on say bitcoin/USD shove a few hundred backs in it, get a position worth tends of thousands of dollars, they see the price going to the moon and think it's fantastic then next thing you know it comes down harder and faster than you ever thought possible. Bitcoin is an interesting example because if you're long there is always a small chance something terrible and unpredictable is going to happen that can blow your entire account and then some (exchanges close, bitcoins stolen etc). The same can be said of penny stocks etc.

Thanks for the feedback mate. I don't know what kind of trader I will be at this point, still trying to get my head around different concepts/ideas ect to find a firm footing on the ground. I guess like anything else worth learning, there is a steep learning curve to start with. Was the same way with property.

Cheers

 

[NewbieTrader1982]

Dr Elder talks a lot about divergences with price and RSI etc. Just wondering if anyone utilises divergences as part of their trading repertoire? @CanOz @tech/a @Trembling Hand ?

Thanks guys

 

[CanOz]

I like divergence in the indices....from a daily as a potential precursor to a bottom or top.

I've tested divergence on its own, it fails miserably.

 

[NewbieTrader1982]

I like divergence in the indices....from a daily as a potential precursor to a bottom or top.

I've tested divergence on its own, it fails miserably.

So you mean you think its good for an index, for eg where there is a price divergence with the RSI, or something similar? Not for individual stocks?

So as a precursor to a bottom would mean if price is moving down but the RSI is sloping up?

Thanks

 

[tech/a]

Dr Elder talks a lot about divergences with price and RSI etc. Just wondering if anyone utilises divergences as part of their trading repertoire? @CanOz @tech/a @Trembling Hand ?

Thanks guys

No too slow. But can have its place in Context.

 

[NewbieTrader1982]

@tech/a what do you mean by 'too slow'?

Thanks

 

[CanOz]

Like divergence in the small caps vs the large caps.....or the eurostoxx vs the dax, or dax vs the ftse

 

[skc]

Woah. I wasn't expecting to come back and see some of the responses...quite startling and somewhat toxic to be honest. I started typing a whole lengthy response and then stopped... and asked myself...seriously? really?

NT, I hope my response wasn't toxic. I remain skeptical but open to your claims. It's like someone coming here saying he won the lotto or is dating <insert your favourite actor/actress/model/sports star> - I know it's possible, I know the probability is relatively low, I won't need proof (alright I'd probably ask for proof if you say you are dating Angelina Jolie or something) and I will remain skeptical. I will care a lot more if they start to sell the "how to win the lotto" here. So until then, I welcome you to the forum, I hope you learn a great deal and make awesome contribution to the forum.

This doesn't sound totally unbelievable to me. Yes it's an excellent record, but property has been on a tear for the last 6 or so years. Couple that with gearing and you can make a tonne of money in a bull market.

No.. in fact the numbers compute quite easily - with leverage the actual return on capital required (to achieve the claimed ROE) is not massive - certainly within the realms of recent market performance. But adopting the same rationale to say S&P 500 and you could turn a single contract requiring US$5.25k equity into many millions by compounding at every available opportunity. It's totally within the bounds of market return in the last 8 years, but I'd guess the number of people who achieved such is minimal.

 

[jjbinks]

Hi Newbie,
I'm a newbie too so know what you are going through.
This site has a lot to offer but I think it needs to complement your own reading. When I first read some of the stuff on the website several years ago I thought it would be no use to me at all but coming back to them know I realise there are some useful learning points/gems there to take away.

There are many different paths you can choose and all have there pros and cons. I am still reading, practising trying to work out what will work for me.
Unholygrails is definitely a good read. (changed my perspective about trading).
Read some books by Van Tharp.
Learn about risk management and try make sense how peter2 manages his trades in his tradebook.

If you are thinking of going down the line of futures there are some old trading diary type thread by pavillion aswell as more recent content by modest, canoz.

I think a few people have mentioned the chatwithtrader podcast also check out better system trader. I think there are some great interviews you can learn from.

Good luck

 

[NewbieTrader1982]

NT, I hope my response wasn't toxic. I remain skeptical but open to your claims. It's like someone coming here saying he won the lotto or is dating <insert your favourite actor/actress/model/sports star> - I know it's possible, I know the probability is relatively low, I won't need proof (alright I'd probably ask for proof if you say you are dating Angelina Jolie or something) and I will remain skeptical. I will care a lot more if they start to sell the "how to win the lotto" here. So until then, I welcome you to the forum, I hope you learn a great deal and make awesome contribution to the forum.



No.. in fact the numbers compute quite easily - with leverage the actual return on capital required (to achieve the claimed ROE) is not massive - certainly within the realms of recent market performance. But adopting the same rationale to say S&P 500 and you could turn a single contract requiring US$5.25k equity into many millions by compounding at every available opportunity. It's totally within the bounds of market return in the last 8 years, but I'd guess the number of people who achieved such is minimal.

Hi @skc,

I guess I can understand where you are coming from mate. The thing is, I am not trying to sell or flog anything property related whatsoever. In fact, I have mentioned that most of what I've learnt of real estate is free and readily available on the net and in books. So absolutely have no ulterior motive and really just want to learn about TA in trading.

With regards to how I have done in real estate, to be honest many of my peers have done even better over the last 8 or so years, mainly due to a larger starting capital and also a higher overall risk profile. The returns in real estate can be staggering, especially if you are able to do two things. 1. leverage and have the serviceability to afford the leverage (though once you get into commercial loans serviceability is much less important), and 2. utilise an active 'Add Value' strategy which allows you to do a feasibility that indicates profitability even before the property/site is bought, and therefore not reliant on organic growth or the B&H method to make money. That is pretty much what I had focused on, learning how to do thorough due diligence, buy Below Market Value, then Add Value. Also what boosted my returns were the bull markets I invested in. Partly luck, partly calculated guess re market movement, though I was not reliant on it in order to make a good margin. I would say overall for the strategy I chose and leverage used my risk profile was 7.5-8/10.

I am happy to contribute to anyone who has property related questions. I myself am here though not to sell or flog anything, just to learn from others who have gone before me how to gather the trading knowledge, then try to develop the skills.

Cheers

 

[NewbieTrader1982]

Hi Newbie,
I'm a newbie too so know what you are going through.
This site has a lot to offer but I think it needs to complement your own reading. When I first read some of the stuff on the website several years ago I thought it would be no use to me at all but coming back to them know I realise there are some useful learning points/gems there to take away.

There are many different paths you can choose and all have there pros and cons. I am still reading, practising trying to work out what will work for me.
Unholygrails is definitely a good read. (changed my perspective about trading).
Read some books by Van Tharp.
Learn about risk management and try make sense how peter2 manages his trades in his tradebook.

If you are thinking of going down the line of futures there are some old trading diary type thread by pavillion aswell as more recent content by modest, canoz.

I think a few people have mentioned the chatwithtrader podcast also check out better system trader. I think there are some great interviews you can learn from.

Good luck

Thanks @jjbinks for your feedback. I had a flip through unholy Grails at the book store, do you need software to put it into action?

Also how do I find Peter2's Trade Book? You're right there is so much great information on here it will take awhile to sift through it. Appreciate the direction.

Cheers

 

[tech/a]

You got yourself a new fan Tech?

What can I say!!
Charm
Witt
Guile

 

[NewbieTrader1982]

So update:

Been reading much of the night... long story short, at first glace - Systems Trading seems to be very interesting and makes a lot of sense IF it actually works.

Any opinions? Especially on Radge's turn key systems? Anyone use systems here and has been successful over a period of time?

Cheers

 

[barney]

Cheers @barney .

Are you an active profitable trader mate? Found any system that works for you?

Active? .. I was like a malfunctioning thyroid gland ..Over-active lol (I've curtailed that habit now!)

Profitable? ... Last 3 years yes. (Since I stopped over-trading on FX and went back to Specs)

System? Happy to share my "system"..... I look for low market cap Specs with "potential"

"Potential" includes the following qualities ..... good assets, good management, and a reasonable bank balance so they are not going to bleed the SH's dry in the short term with cap raisings.

I look for bottom reversals on increased Volume and try to accumulate large positions over time (ie Scale in) If its very Spec, sell a % into the news. If it looks the goods, hold on for the ride!

About as simple as it gets .... Slow motion discretionary trading

PS I always wanted to be a high rolling Futs trader like the 'T-man' but as Clint Eastwood said, A man has to know his limitations .... welcome back by the way TH.

 

[NewbieTrader1982]

Active? .. I was like a malfunctioning thyroid gland ..Over-active lol (I've curtailed that habit now!)

Profitable? ... Last 3 years yes. (Since I stopped over-trading on FX and went back to Specs)

System? Happy to share my "system"..... I look for low market cap Specs with "potential"

"Potential" includes the following qualities ..... good assets, good management, and a reasonable bank balance so they are not going to bleed the SH's dry in the short term with cap raisings.

I look for bottom reversals on increased Volume and try to accumulate large positions over time (ie Scale in) If its very Spec, sell a % into the news. If it looks the goods, hold on for the ride!

About as simple as it gets .... Slow motion discretionary trading

PS I always wanted to be a high rolling Futs trader like the 'T-man' but as Clint Eastwood said, A man has to know his limitations .... welcome back by the way TH.

Great stuff. Sounds like you also use a lot of FA and not purely TA?

When you say your a Discretionary trader, does that mean you follow a set of rules but have the discretion to follow or not follow the buy singals of your System? as opposed to accepting all signals of the System? Though what conflicts in my mind is, If PE is based on ALL 'plays' and not selective, then by being 'too' discretionary, wouldn't that affect the PE?

Thanks again

 

[barney]

Great stuff. Sounds like you also use a lot of FA and not purely TA?

When you say your a Discretionary trader, does that mean you follow a set of rules but have the discretion to follow or not follow the buy singals of your System?

95% Mining stocks, so FA to the point that I want to see something in the drill results before I'll stump up any cash. I know tech/a is happy to 'buy off the plan" (chart only) so to speak, but I like to know something about what the dudes who run the office have been up to.

My system is all in my head No concrete rules, all gut feel based on what I used to do wrong lol

PS I used to do a lot wrong so I learned a lot!

 

[NewbieTrader1982]

95% Mining stocks, so FA to the point that I want to see something in the drill results before I'll stump up any cash. I know tech/a is happy to 'buy off the plan" (chart only) so to speak, but I like to know something about what the dudes who run the office have been up to.

My system is all in my head No concrete rules, all gut feel based on what I used to do wrong lol

PS I used to do a lot wrong so I learned a lot!

Appreciate your input mate. And finally a term I am familiar with " buy off the plan" ..

Thanks again.