Should Trader System Developer Have Multiple Systems - page 2

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PennySeven: I did it in 28 months - 17 hours Demo trading per day. Outliers by Malcolm Gladwell  The 10 000 hours book. Tom Hoang said on this forum it took him 5 years of part-time trading. He now trades full-time for a living. 

Or you just do it until you start making a profit and not really worry about how many hours it was. That is after all, the main objective, is it not - to start being profitable?

 
Fernando Carreiro:

Or you just do it until you start making a profit and not really worry about how many hours it was. That is after all, the main objective, is it not - to start being profitable?


Exactly!

Profitability is the critical factor. 

I wish to be profitable daily.

It is also an undeniable fact that it is very wise and responsible and, in fact, the best way to only go live when you are consistently profitable on the Demo platform, however long or short period of time it takes - as you very correctly point out. 

I do admit that with 7 billion human beings there may be 7 billion different levels of acceptable profitability. 

Where us human beings are concerned, anything is possible. 

 
Fernando Carreiro:
  1. Yes. You should never rely on just one or two EAs. Just as Professional or Institutional Traders diversify their investments in many different types of assets in their portfolio, in order to diversify and spread out their risk, so should you do with your strategies and EAs. You never know when a particular change in sentiment or overall "personality" of a certain market or asset will change, and for which your EA was never designed to handle.
  2. You don't have to keep all of them running in "simulation mode", but you can do that for some of them. For most, you can simply run back-tests on a regular basis or if you are already experienced enough to know where and when they work best. For some EAs you can also build in a certain amount of adaptability or an ability to disable and re-enable based the type of conditions that are required. This however, can be a very complex and advanced area of a coders/traders expertise and skill.
  3. A good EA is normally (but not always) based on good solid manual trading strategies, and so a originated from the skills of a trader with the ability and experience to know and understand the markets in which one is trading, but I doubt you could ever program a single system that can adapt to all and every possible market type and condition. That would be a monster of an EA, that still resides in the realm of Sci-Fi Artificial intelligence. Traders and EA developers live in the real world and we tend to work in "compartments" creating smaller solutions for a set number of conditions. That is why there are so many different tools we use for many different types of tasks. It is not like we are Dr. Who with his "sonic screw-driver" that seems to be capable of doing everything he applies it to.

Thank you Fernando Carreiro for your detailed and simple response. 

I am day (intra day) trader and trade on the smaller timeframe 5 to 30 minutes charts and I have noticed two types of market conditions day-to-day.  One condition I see is a strong trend day. Another condition I see is range bound day, trading between a support or resistance or some trendline. 

Should I be able to identify day market conditions and seek edges for each market condition? So I am thinking a day system for trending days, and system for range days?

Thank you, 

 
PennySeven:


Yes, you are right: you need (1) rules for the short period market and (2) rules for the long move market. 



Thank you PennySeven for the advice and good response. 

Yes, I am putting in the hours day-to-day of starring at the charts 1. looking for edge to back test 2. manually back testing an edge 3. programming 4. Identifying the day to day market types I see. And i trade on Demo account for sure. 

What do you mean by short period market and  long move market?

Thanks

 
Ahmad Zuhairdi Noh:

Well, 

  1. Not really if your EA can "quickly" recognize a trending and sideways market. Please take note that I said "quickly" because of many available EA only able to recognize such condition only after it has established for quite some time.
  2. I've answered above.
  3. Yes.

If your EA can successfully able to quickly recognize the market condition. You can scalp the market with a help of martingale without worry. I just did even though it's not perfect yet.

Quoting your word there. Its because a manual professional trader usually depends on the news and market while most EA is depending on indicator and charts. Somebody needs to create something different.

Who knows, maybe you can come up with a special algorithm or something. That sure will change the world of trading games.

Good luck! :)


Thank you Ahmad Zuhairdi Noh for the good response. 

 

Example : 

Bot 1 with strategy 1 on Account 1 isn't productive the last quarter of last year.

Bot 2 with strategy 2 on Account 2 is.

 
goodoboy:

Thank you PennySeven for the advice and good response. 

Yes, I am putting in the hours day-to-day of starring at the charts 1. looking for edge to back test 2. manually back testing an edge 3. programming 4. Identifying the day to day market types I see. And i trade on Demo account for sure. 

What do you mean by short period market and  long move market?

Thanks


Yes, in my experience I found that there is a short period and long move mode in the day trading market for the Euro/Dollar. But, it is only my opinion. 

 
PennySeven:

I agree 100% that ´the "human brain" is not capable of being able to trade any market, on any asset, on any time-frame, under any condition, profitably all the time,` 

and that 

"Good retail traders select just a few markets, or assets and use only a few well defined strategies at a time with which they have the most experience and knowledge on, in order to trade successfully."

I suggest Goodoboy trades only the EuroDollar. It is the biggest and best market in the world. All trading dynamics play out best in this market.

For example: one simple long move rule yesterday resulted in a Euro/Dollar BUY at 5 am (GMT) and a SELL at 9 pm (GMT) producing 145 USD (118 Euro) Pip profit which resulted - at 50 leverage - in 59% profit - in one day. Who needs crypto-currencies?

I only trade the EuroDollar. 

I absolutely maintain that all that is required are (1) "an average human brain" plus (2) 10 000 hours on the Demo Platform plus (3) being consistently profitable on the Demo before trading on a live account.

Nº (1) is freely available. Nº (3) guarantees that I am 100% right. Thus, all that is required are the 10 000 hours on the Demo. 

So, that undeniably proves that the "monster EA" is the average human brain. 

Have you spent 10 000 hours on the Demo before you started trading live?

How many people do you know who have done that before they went live?


Hello PennySeven,

Do you recommend trader focus on 1 or 2 markets during the 10K hours? 

What timeframe do you recommend? I spent so far about 2 years starring at 5 minute chart only for day trading (trades closed before evening time)

Currently, I just stare at chart seeking an idea/edge. However, you have me a good idea to do, start identifying the daily market conditions and trading idea for that market condition. Right now, I am focus on the day trend ( market condition that occurs randomly. 

No, I am nowhere near 10k hours. 

What do you mean by "you need (1) rules for the short period market and (2) rules for the long move market. "  ? Do you mean short and long trade? Or do you mean trending day or range bound day?


Thank you

 
goodoboy:

Hello PennySeven,

Do you recommend trader focus on 1 or 2 markets during the 10K hours? 

What timeframe do you recommend? I spent so far about 2 years starring at 5 minute chart only for day trading (trades closed before evening time)

Currently, I just stare at chart seeking an idea/edge. However, you have me a good idea to do, start identifying the daily market conditions and trading idea for that market condition. Right now, I am focus on the day trend ( market condition that occurs randomly. 

No, I am nowhere near 10k hours. 

What do you mean by "you need (1) rules for the short period market and (2) rules for the long move market. "  ? Do you mean short and long trade? Or do you mean trending day or range bound day?


Thank you

Hi goodoboy,

Do you recommend trader focus on 1 or 2 markets during the 10K hours? 

I definitely recommend you only focus on the EuroDollar market. It is the biggest and best market in the world. All trading dynamics play out or happen or take place the best in this market, in all forms of technical analysis, be it indicators or market formations (triangles, etc). Tens of thousands - I don´t know how many,  but the most of all markets - of traders of all types as well as computer programs - algorithms focus on every second in this market every trading day. There is no better market in the world - for day trading using technical analysis.

What time frame do you recommend? I spent so far about 2 years starring at 5 minute chart only for day trading (trades closed before evening time).

I spent 2 years trying to trade the M1. Then I deleted it. I will never set it up again. Shortly after that I deleted the M2 which I will also never set up again.

Currently my initial chart is the €/$ M3. Then I have the following time frames - all €/$: M4, M5, M6, M10, M12, M15, M20, M30, H1, H2, H3, H4, H6 and Daily available to select any time on my screen. I still have the €/$ Weekly and Monthly off my main screen. 

Long Moves can require that I follow them from M3, longer time frame by longer time frame all the way to the H2, sometimes to the H3. 

Staring at the charts, you say. 

You can´t just stare. You have to start each day with your latest trading plan and live test it. Then you update your rules during the day, and repeat the next day. Till you are - honestly (no use bluffing yourself - you are only going to lose money if you were to bluff yourself) -  profitable daily for at least 5 days in a row. Then you can live trade, with a big enough monetary buffer to cover your initial losses without being unable to trade because your deposit is too low - even for a single trade. 

Right now, I am focus on the day trend ( market condition that occurs randomly.)

I know three economists got the Noble prize for stating that the market is random. The market is not random. If you hold the overall view that the market is random, then I cannot help you. 

I do not use the term "short" to mean SELL and I do not use the term "long" to mean BUY. I use UP and BUY meaning Bull and I use DOWN and SELL meaning Bear.

Short period is short in time - either UP or Down. Long Move is long in time - either UP or DOWN. Long, relative to the Short Period time. 

It is very much like training till you know how to fly the US F-35 fighter plane. :-)

It is certainly not the same as getting your car driver´s licence. 

Just like for the F-35, you have to be very fit, sleep enough and - no alcohol while you are trading. 

I may have - and most probably do have - a very different approach (e.g., I don´t back test as I explained above) compared to how you feel you have to go about learning to trade successfully. I can only tell you my experience.

Good luck!

I'll call back in two and a half year´s time to see how you are doing. 

 
PennySeven:

Hi goodoboy,

Do you recommend trader focus on 1 or 2 markets during the 10K hours? 

I definitely recommend you only focus on the EuroDollar market. It is the biggest and best market in the world. All trading dynamics play out or happen or take place the best in this market, in all forms of technical analysis, be it indicators or market formations (triangles, etc). Tens of thousands - I don´t know how many,  but the most of all markets - of traders of all types as well as computer programs - algorithms focus on every second in this market every trading day. There is no better market in the world - for day trading using technical analysis.

What time frame do you recommend? I spent so far about 2 years starring at 5 minute chart only for day trading (trades closed before evening time).

I spent 2 years trying to trade the M1. Then I deleted it. I will never set it up again. Shortly after that I deleted the M2 which I will also never set up again.

Currently my initial chart is the €/$ M3. Then I have the following time frames - all €/$: M4, M5, M6, M10, M12, M15, M20, M30, H1, H2, H3, H4, H6 and Daily available to select any time on my screen. I still have the €/$ Weekly and Monthly off my main screen. 

Long Moves can require that I follow them from M3, longer time frame by longer time frame all the way to the H2, sometimes to the H3. 

Staring at the charts, you say. 

You can´t just stare. You have to start each day with your latest trading plan and live test it. Then you update your rules during the day, and repeat the next day. Till you are - honestly (no use bluffing yourself - you are only going to lose money if you were to bluff yourself) -  profitable daily for at least 5 days in a row. Then you can live trade, with a big enough monetary buffer to cover your initial losses without being unable to trade because your deposit is too low - even for a single trade. 

Right now, I am focus on the day trend ( market condition that occurs randomly.)

I know three economists got the Noble prize for stating that the market is random. The market is not random. If you hold the overall view that the market is random, then I cannot help you. 

I do not use the term "short" to mean SELL and I do not use the term "long" to mean BUY. I use UP and BUY meaning Bull and I use DOWN and SELL meaning Bear.

Short period is short in time - either UP or Down. Long Move is long in time - either UP or DOWN. Long, relative to the Short Period time. 

It is very much like training till you know how to fly the US F-35 fighter plane. :-)

It is certainly not the same as getting your car driver´s licence. 

Just like for the F-35, you have to be very fit, sleep enough and - no alcohol while you are trading. 

I may have - and most probably do have - a very different approach (e.g., I don´t back test as I explained above) compared to how you feel you have to go about learning to trade successfully. I can only tell you my experience.

Good luck!

I'll call back in two and a half year´s time to see how you are doing. 


Thank you very much PennySeven for the detailed response. 

I am watching the charts daily to and writing down trading ideas to trade. Then I manually trade for about 50 trades to see the profitability of ease of the trade, then I program and back test to check for robustness. I have not find nothing, yet but I am getting lots of charting experience and day to day trading. 

I do not believe, in following 1 trading plan trading everyday without back test. What happens if X years from now I see the trading plan does not make any money. It is far more easier to program and back test an idea then waste time trading a strategy live hoping it works. 

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