Topic: Goomboo's Journal - page 24. (Read 281467 times)

I would gladly play this game, but just once, one roll win or lose. Live or die.
Not through greed and lust for money but for other more personal reasons.

Apologies if this has already been answered. Are you calculating candlesticks and SMA's based on bid prices, ask prices or traded prices?

Spending some time injecting a bit of drama into this thread, eh?   

For many traders, a key transition point in their career comes when they are able to separate their ego from their desire to profitably trade.  It has been my experience that the majority of market participants care more about the emotions associated from successfully calling market direction than consistently grinding out profits in their endeavor.

This mindset is embodied by the trader who will put on a position and will hold it until he is able to turn a small profit.  The trader finds a variety of reasons for holding his losing trade such as “It can’t go down forever; if I add more here it lowers my average price; I haven’t lost any money at all since I haven’t sold”.  All of these reasons are delusional.  Sure the trader may be right a time or two, but eventually, the market will deal a blow that will destroy him.  In other words, securities occasionally do go to zero, and chances are, if you have no method of quickly cutting your losses, you will eventually lose all of your money.

Ultimately, the greatest traders are the ones who are most “afraid” of the market.  I do not mean afraid as in they are experiencing literal fear, but rather than they respect its fickle nature.  Great traders know that the “impossible” happens quite frequently and they do everything in their power to ensure that their clients’ money isn’t destroyed.  It is when we are able to separate our desire of being “right” about market direction and actually focus on good trading techniques that we are able to thrive in this field.

Another way of thinking of it is this: would you play a game of dice in which you win $1,000,000 any time 1-5 is rolled, but if 6 is rolled you lose your life?  Of course not.   However, this is what the majority of investors and traders do through “dollar cost averaging” or other foolish methods of doubling down in risking endeavors.  You may have a high winning percentage of trades, but you’re flirting with destruction.

A key trait of the successful trader is the ability to take an honest look at his performance.  Specifically, this means that you need to examine your trading results to actually determine if you are earning a profit or a loss in this endeavor.  If you are claiming that you are earning a profit from trading when in actuality, you are just continuously depositing funds and trading your hard-earned money away; you are lying to yourself and will eventually wake up with a lighter wallet.

The successful trader lets his profits work for him by growing his account through trading.  This means that as time progresses, your account should be growing regardless of any capital additions.  If you are currently trading and losing money, you should seriously consider not adding funds to your account.  You have proven that you are currently incapable of earning a return and it is foolhardy to let good money chase after bad.

After discovering that he is consistently losing money through trading, the wise trader will exhaustively study his losing and winning trades to find out if he is adhering to his method or simply trading from the seat of his pants.  It is through this painful process of examining our mistakes that we gain wisdom in this field.  I have found that my most significant breakthroughs tend to come during periods of time in which I am losing money.  During periods of loss, we can gain much wisdom through carefully examining the decisions we made which led us to this point and figuring out what tangible steps we must take to improve.

Yeah, it's not too bad

Interesting. Are you recreating the indicators historical levels from price/volume levels yourself?

Microsoft Excel.

Goo - How are you backtesting?

  +1

If read you this journal very carefully, you will see something interesting: I am attempting to dissuade you from trading.  Even though I have posted backtests showing profitability and attempted to logically argue the merits of the field, I do not believe that trading is for the majority of the readers.  Simply put, trading is not for the casual participant.  If you are to succeed in this field, you must be willing to roll up your sleeves and work harder than you imagined.  The markets are always adapting and the casual, hobby-trader simply does not have the capacity to compete.

For those who are serious about trading, you absolutely must take a hard look at the chart above.  You have banked a 500% return on your money in the last 5 months with substantial volatility.  Is this acceptable to you?  Can you handle the volatility of earnings and uncertainty of results?  Did you even have the courage to stick it out after two months of stagnant returns?

Perhaps the most difficult aspect of trading is the emotional uncertainty of trading results.  Every time you move on an opportunity, you are exposing yourself to the psychological and financial uncertainty of your decision.  As we have seen through backtest, if you are attempting to follow the trend, you will lose 70% of the time.  This means that you will more than likely be wrong and lose money every time you make a decision.  In other words, a trader essentially exposes himself to a beating every time he enters the market.  Does that sound like a fun hobby?

To demonstrate my point: how many of the readers for the past 18 months actually earned a 500% return this year?  I'd bet fewer than 1%.  Isn't it ironic?  I post and demonstrate exactly what it takes to successfully trade the markets and 18 months later, most people simply cannot do it.  As the BTC markets mature, these simple strategy may experience a degradation in performance.  Do you have what it takes to innovate and continuously fight to improve your edge?  Do you even have an edge?



My genuine advice to most readers of this thread: allow a professional trader (or investor) with a strong track-record of success to manage your money.

The chart below shows the performance of the moving average crossover system assuming a .6% commission per side and trading on the hourly chart.



Welcome to the simple, yet complex world of trading.  You can be right in your market direction but ultimately lose money due to the cost of doing businesses.

PS, this doesn't even include the slippage of trading.

Quoted for emphasis:

Bingo.

^Well don't forget Goomboo only does daily trades now, specifically because commission rates are ridiculously high.

Goomboo is your graph implementing the fee's aplied by Mt. Gox or others when you do a transaction? I agree with you and your trading system but seeing you can lose 1.2% just by Buying/selling/buying at the same price make me a bit suspicious. Not about the trading method but about the profit you expose

Wrong topic I guess?^^

What I lack in the bot.:
I want to specify a purchase price and a sell price. a minimum
In trend: do not buy above that price. Or: do not sell below this price
I want to define a sideways movement. (eg 119 -123) in the sideways movement is to be bought or sold anything.
Or show me a popup with "sell?" "buye?"
Limiting the amount of money (USD Other)
Note the existing orders. It should always be money or btc for this.
Or just the next step
Pop for a High / Low. Period input field

But good work: so far I do not let it run automatically. My hand orders are even better. I mean. If the price is high, is a feeling and i take all what i know ... news, FED EZB. A low price is the feeling, have btc a change or not.

It's done.

Volume will be added as well in the future.
What other technical indicators are useful for traders like you guys?

Now you're talking! This is more in tune with the rest of this epic thread!