tech/a
No Ordinary Duck
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- 14 October 2004
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coyotte said:Was not referring to the Company.
Whilst undoubtedly TechTrader2 has been successful and will probably continue to be so --- the bit I find strange is:
Your own publicly posted views on TA appears to be that the "Entry" is Secondary to the "Exit" ---- most I presume would agree with that.
This statement is relative to SYSTEMS design. Profit comes from LONGTERM systems from the ability to gain high R/R ratios. This is achieved by finding the BALANCE between staying in a trade long enough to gain MULTIPLE R/R (Reward to Risk Ratios) and not giving back to much during the process.
The 180day M/A of the low is the best I have found so far.I have tried many others--ATR included.Remember BALANCE and SYSTEM design.
Yet in TT2 --- Yeah I know its only an example, but you do seem to be following its basic rules atm --- you seem to go off in the opposite direction.
Not following here the SYSTEM as discussed on Reef,doesnt and hasnt changed.
Detail is given to the ENTRY Setup.
Followed by a fair Initial Stop.
Then a wishy washy moving average EXIT.
Again not following its as above and never altered.
In another recent post you state that with your Long Term Portfolio your Stops are @ 20% loss (presume from high)
Coyotte you really do need to read and understand my posts god knows I try and make them as clear as possible.
So AGAIN The system (infact any system will if designed properly) have a set of NUMBERS returned during testing. In particular montecarlo testing will give Maximum and Minimum results (Numbers) from the average mean over the test period/systems design and universe chosen.
It is from THESE numbers we know in TechTrader that the MAXIMUM--- Peak to Valley drawdown of over 20000 portfolio tests is approx 20% Infact I think its 23% (without checking) if Techtrader EVER trades with a maximum peak to Valley drawdown of over the maximum % returned in testing I personally will be stopping trading the system---I'll exit ALL positions.
What will be happening is that the system will be entering trading territory not seen during testing---you would be trading BLIND.
This is completely seperate to the mechanics of day to day trading and ONE of the main reasons you test and have NUMBERS to go by.
Whilst on one hand you condemn MAs and Indicators as lagging -- here in the the most Vital part of the trade you recommend employing either a MA or some loss% picked out the blue.
The above should make thing crystal clear to you.
My comments on M/A's for discretionary trading are as you state---bloody useless---to slow.Most indicators are the same. Your not looking at APPLICATION of technical indicators and most (Possibly not yourself) have no idea of correct APPLICATION (When and how to apply an indicator into their trading.) frustration abounds with INCORRECT use,POOR application and incorrect application relative to a vast number of variables. Only experience can and will reward those who spend the time to learn---profit.
One would hardly call this TA --- as I stated it's more BHP.
This statement coyotte my friend only CONFIRMS my point.
Read the above you just DONT SEE IT
Its a long long road---Ive been 12 yrs on it and STILL honing skills learnt from experience.