Anticipatory v/s Reactionary Trading

trader111 · #31 15th April 2008, 10:50 PM

yes, seems now that I did

kgsirasangi · #32 17th April 2008, 07:32 AM

[quote=trader111;172478]

[I too trade a setup, and I know when to play my hunches, though you dont include me in we. I trade moreover in anticipation when I follow the trend, in the anticipation that the trend will continue.
]

I think if you follow trend it is as per rule and if you go against trend, as per your hunch, it is anticipatory.

If above is correct, it seems you are generally following rules and trading as per trend and only occasionlly, as per your hunches(anticipation).

Thanks.

trader111 · #33 17th April 2008, 06:08 PM

Thanks Kgsirasangi, that u took time to read that post and glad that u asked that.

See rules always ought to be there... whether the trading is on hunches or whatever.... but what rules? it's coneptually the risk/reward. A trade may be initiated on a hunch only if this ratio seems worthwhile. Now if a position reaches the tolerable risk level by showing loss, it ought to be closed immediately.

Yes I trade on hunches, but thats seldom, and none of the three consecutive trades posted were initiated on a hunch.

I mentioned in my first few posts:

Quote:

Originally Posted by trader111

Another good example of the above two: all trend following systems are reactionary while all trend exhaustion based systems are anticipatory.
One of my favorite intraday trades: anticipating the last leg of a parabolic move, i consider as anticipatory.

Quote:

Originally Posted by trader111

Also, some people consider counterintuitive trading as anticipatory.

IMHO anticipatory trading does not includes hunches alone.

Quote:

Originally Posted by trader111

Actually I want to add more but let us move gradually, without jumping into conclusions.

Again i refrain from making concluding remarks, because discussion (almost)always helps. As students of the market, 'See Ma! I am right' approach is worthless'

kgsirasangi · #34 18th April 2008, 06:55 AM

trader111,

Thank you for sharing your ideas and experiences.
I note that you are usually in profit as you usually follow rules.
In my case also, whenever I follow rules, I get profits and whenever I trade as per anticipation(i.e. trying to catch top or bottom, or going against major trend, etc) I usually end up in losses( market usually proves me wrong in such cases).
This reinforces my faith that we should follow rules--safe rules---trade in the direction of major trend, use stop loss, use risk control as per money management etc.

Thanks and regards.

trader111 · #35 18th April 2008, 05:50 PM

I mention again, I'd like to emphasize this several times that one does not loose money because of anticipating or hunches or any other psycho thing. It is only because of lack of knowledge.

There is nothing like trading against the trend, however trading on trend exhaustion makes much sense.

Those who are'nt well equipped will loose anyways. A wrong frame of mind can only interfere with a knowledgeable person

For eg. you argue with your wife at 6 am and sit on your trading terminal after 3 hrs. of nagging. Yes, in this case the psychology issue will be important.

sudoku1 · #36 18th April 2008, 08:21 PM

ALWAYS TRADE ON THE WINDS OF CONFIRMATION .....,RATHER THAN IN ANTICIPATION & GET DROWNED IN DEEP WATERS....

raosrinivas · #37 18th April 2008, 08:34 PM

Quote:

Originally Posted by trader111

you argue with your wife at 6 am and sit on your trading terminal after 3 hrs. of nagging. Yes, in this case the psychology issue will be important.

unmarried people have an edge in trading

sudoku1 · #38 18th April 2008, 08:43 PM

Quote:

Originally Posted by raosrinivas

unmarried people have an edge in trading

rao happy.....

shows that u r not married yet....

trader111 · #39 21st April 2008, 09:18 PM

Few excerpts from Kaufman's 'Trading System and Methods', third edition.

Quote:

Day trading requires extreme discipline, excellent planning, anticipation, and concentration. The need for a fast response to changing siruations
tends to exaggerate any bad trading habits; in other fields, the shorter the response time, the greater the chance for error. (Page 419)

Quote:

Accumulation and distribution are the beginning phases of a bull or bear market. Accumulation is the period in which the insiders begin to acquire a long position in anticipation of a bull move. (Page 216)

Quote:

Being completely leveraged is a tenuous position, requiring constant monitoring of the market; there must be a well-defined stop-loss at all times in anticipation of a premature reversal. (Page 619)

Quote:

The strongest argument against the random movement supporters is one of price anticipation. One can argue academically that all participants (the market) know exactly where prices should move following the release of news. However practical or unlikely this is, it is not as important as market movement based on anticipation of further movement. (Page 3)

PS: the views expressed in the quoted text belong to the original author, not me

SGM · #40 21st April 2008, 09:37 PM

Quote:

Originally Posted by trader111

PS: the views expressed in the quoted text belong to the original author, not me

we hold you accountable by virtue of quoting him

View Poll Results: Is trading your primary source of income? If yes, which style do you follow?
Anticipatory Trading	11	45.83%
Reactionary Trading	13	54.17%
Voters: 24. You may not vote on this poll