Thursday 27 January 2011

The CP Hump

get a huge number of emails from traders that say they are almost CP, but can't seem to make it over that last hurdle. You also know I have been working on an HT(hybrid trading) system Flo. I think that this post could be most interesting for those of you who are trying to reduce the learning curve to CP. 

The vid today is a series of ES trades using what I call HT (hybrid trading).The computer acts as an expert system that has been back tested to oblivion by the trader. To that expert system, we add fixed and consistent context sensitive trade management rules. This allows the trader to turn the system on when the probabilities are in their favour, manage the trades and then turn off the system when their targets are met.

The vid is a lot more detailed and longer than usual, but I want to make my point.  If you have an issue with the vid (Youtube is having a problem today) then go here.

6 comments:

  1. EL, fantastic video. This is a great example of a private, individual bridging the gap between himself and the "big boys" with their supposed tech advantages. One question, I notice on that chart their are a few instances where you where stopped out on a few trades. Would it be possible to do a post/video where you discuss how you scratched those, if/when you moved stops, how you managed that position. Discussing these losing trades would be really beneficial I feel. This is a major issue for me at the moment, I understand NOTHING works all the time but my 30% losers are killing all my profits. Thoughts?

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  2. SpiBok, I turn the auto trader off and on a lot. I also have different algos I can turn on and off according to the context. This is very different to optimising a trading system and letting it run all day. I'll post about scratching trades.

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  3. Hi EL,

    I'm having the same problem as SpiBok. My 30% losing trades plus commissions wipe out my profits.

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  4. Tom, using the market profile seems more problematic when I apply the profile to the Euro; do you find the same patterns there on the Euro with the MP as well?

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  5. Gary, yes but splitting the Profile into distributions and timezones is how I approach it.

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  6. Tom, have you ever studied whether using the 3- v. 5-range charts work better depending on the Trin or the VIX?

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