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The Best Trading System

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  #21  
Old 27th November 2016, 02:49 PM
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Default Re: The Best Trading System

Hi Tuna Bro

Thanks a Ton from my bottom of the heart and on be half of many newbies like me for all your efforts/Time and energy for sharing successful method with simple rules along with chart examples for better understanding.

Its really awesome that you have come up and sharing successful priceless piece of art.

I have blown up my account couple of times and searched for Holygrail method to recover all of loss with interest . Never happens as of now to recover my money without interest .

Realized after reading this thread and myths and how a small player thinks and how to overcome .


I am very layman level and still having couple of questions.
I am not able to trade in nifty for the time being but i would like to learn as lost my money in nifty options couple of years back.

I checked charts in kite and am yet to get pi software in my PC.

Q1) As part of SETUP 1. where exactly we take entry as n when it cross VWAP/VWMA(say +/- 2 points) or closure of the candle.

Q2) :-


In this first chart i see at both entry points CCI values seems to be near 50+ which doesn't satisfy rule no 3 to take entry as part of SETUP 1.Is my understanding incorrect as i saw CCI value at candle closure ?


Q3)


Any specific reason we didnt take entry around 10:45 as it satisfies setup 2 all rules. ?

If we take entry this triggered stop as cross over candle -2. Is my understanding correct ?

Also i am awaiting for CRUDE method as my time suites to sit in front of crude post 6:30.


I really wonder how you are managing WORK/Trading ? Are you a full time trader ?


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Last edited by crude begginar; 27th November 2016 at 02:56 PM.
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  #22  
Old 27th November 2016, 03:15 PM
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Default Re: The Best Trading System

Quote:
Originally Posted by crude begginar View Post
Hi Tuna Bro

Thanks a Ton .....
Q1) As part of SETUP 1. where exactly we take entry as n when it cross VWAP/VWMA(say +/- 2 points) or closure of the candle.



Q2) :-
................

In this first chart i see at both entry points CCI values seems to be near 50+ which doesn't satisfy rule no 3 to take entry as part of SETUP 1.Is my understanding incorrect as i saw CCI value at candle closure ?


Q3)


Any specific reason we didnt take entry around 10:45 as it satisfies setup 2 all rules. ?

If we take entry this triggered stop as cross over candle -2. Is my understanding correct ?




I really wonder how you are managing WORK/Trading ? Are you a full time trader ?
Q1. I don't wait for candle close, if there is wick or shadow showing proof of whipsaw I might enter. I reserve some flexibility here, everything can not be followed like robot. That's where your experience comes into play.

Q2: The dotted line you see on the CCI that is 34/-34 range. In this chart both entries were shorts and check, I guess CCI in that prescribed range for that candle where short was done. Little bit deviation is ok. Looks at the trend of CCI last 2-3 candles.

Q3: Not that is not valid. Added a short note (PS2) on the post of the system on the visual cues. See that the VWAP is above ST (bull), it should be below or overlapping

No I am not a full time trader. My work gives me enough time & flexbility for months which I spend on trading. But yes there are times (mostly 3-4 months every year) where I have to work my A$$ off for 14-16 hours a day and no trades are done for weeks or even months. Well , that's pretty much how it has been. But, I follow market everyday morning, plan my trade, and later in the night before going to bed I check if I would have traded, should I get any winner as per planned setup.

So trade or no trade, practice never stops.
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  #23  
Old 27th November 2016, 03:40 PM
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Default Re: The Best Trading System

Dear Tuna,Only a small word Thanks,but in my heart the GRATITUDE you are doing here without showing ATTITUDE.
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  #24  
Old 27th November 2016, 04:30 PM
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Default Re: The Best Trading System

Eagerly waiting for your Crudeoil setup.
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  #25  
Old 27th November 2016, 10:45 PM
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Thumbs up Re: The Best Trading System

Quote:
Originally Posted by Tuna View Post
Trading Psyops # 2

“If you can’t take a small loss, sooner or later you will take the mother of all losses.” - Ed Seykota

If there is anything in trading which is always correct, I believe this is the one. It took me years to program it on my psy-system, but trust me this belief is the best friend of yours on trading.

Loss-making is natural, but holding to losing trade with the hope of getting the trade back in your favor is deadly. It might come back to your favor 5/10 times, but the rest of the 5/10 times when it does not come back to your side, it will blow your account.

So it is better to get out of losing trade 10/10 times if set-up is invalidated.
Hello Tuna Bro,
Thanks a lot for taking time to educate/help new traders by sharing your successful strategies. Hope many will benefit from this thread. May god bless you.
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  #26  
Old 2nd December 2016, 09:24 PM
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Default Re: The Best Trading System

Nice written posts, Specially some beginning posts with dealing with trading philosophy.

Happy trading
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  #27  
Old 3rd December 2016, 03:14 PM
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Default Re: The Best Trading System

Trading Concept # 3


Let me share my 2nd of 3rd Trading system I follow for trading on Nifty (and use this one for Crude as well). Nothing new, except what most of the new traders don't do or don't know - how to use it with component 4.


This is a Divergence system with redundant Oscillators.

The Components are:
1. BB (20,2,SMA)
2. RSI (7)
3. OBV / CCI (10,100-100)
4. Confluence (Will go tangential here : more on Trading concept # 4, want a separate section on this)

You can use this for Positional Trading as well, I use RSI(14) for overnight position

If you followed my Trade Journal on Nifty, the Last trade on 2nd Dec on PE Option which Yielded good profit was done using this system. So let me do the chart analysis first – that will explain the system for new traders. Elders you please correct me if I went wrong or if there is something I need to be careful about

Chart 1




Now let see the Chart 2, you can see I drawn few extra lines:
1. Top Yellow One is PDC (Previous Day Close)
2. Next Yellow One is DH (Day High, first Session, I use Timeline of 11 am as the first session)
3. Blue ones are nothing but to show the level on RSI and OBV for corresponding candles




The Short setup (Long Setup will be opposite)
  • Identify the day trend and global trend (DJ Fut, Dax)
  • Let price goes to outer band of BB and

  1. The price climbs up to DH and look for divergence (RSI and OBV)

    Or


  2. Let the Price climbs to PDC or nearby-zone, visually, closure the better. You may also use (ATR(14) for 3 Min TF +/- PDC to determine the zone – In case you are still not confident on what you see with naked eyes and need an indicator)

  • See if both RSI and OVB making lows whereas price is marginally going up or holding levels (Stagnating)
  • Enter the short, with SL you are comfortable with (I use 16 point fix for NF, 3 points approx. for options)
  • Shall book 50% at VWAP and Trail the rest (if this is happening around 2:30, you are almost guaranteed to test DL, Shall explain the important of time on upcoming sessions)


In my case, I had a huge position (‘huge’ relative to my capital, it may be peanuts for folks who trades in crores of capital at risk).So I got out at VWAP – Though I had a conviction that it will go lower. It did.

Now, what if the PDC was also breached successfully, well the setup would have been invalidated for me – I would have skipped/scratched/booked loss on this trade.


So divergence is:

Price showing higher High + but strength slowing down, lower high on RSI or OBV : == shows a possibility of reversal. And if that happen in a level of the confluence with other traders – you are winning this trade.

The Long Setup will be opposite to all the above points :

You need Short-term UpTrend + Price hitting lower band of BB + RSI/OBV making Higher Lows.

My entry was risky, but I was ok to scrape it.

Defensive traders would have joined the Short Bandwagon when it breached the second Yellow Line from Top, I was almost 20 odd Pips in profit by then – benefit of my aggressive stance.

You would have seen on my multiple posts – “I don’t wait for confirmation candle most of the time, I am among the traders who creates the confirmation candle for others”.

Am I always right? Of course not – but I am ready to accept my defeat on those cases and scratch the trade. That’s why you will see many scratches (+/- both) on my scorecard.

But, the times when I am right I cover the ground of 10s of such Scratch trade in 1 winning trade.

One more example on Positional Trade (axis bank):




Sometime, one of your Divergence Indicators may not give clear signal

I follow this rule (based on exp):
  • While shorting down from BB Upper band – I am fine if there is clear signal from RSI but not from OVB.
  • While going Long from BB lower band, I give more reliance to OBV.


On trading concept 4 I shall discuss few related topics:
1. Power of confluence (continuance and conclusion of trading concept # 1)
2. Why Back-Testing is useless (or let me be polite and say ‘not that useful) for trade setups
3. What completes a trading system and increases its win rate

P.S- I intentionally skipped hidden divergence , as I use my SETUP1 & 2 for pullbacks (discussed last week).

P.S2- You may use CCI (10,100,-100) as well on 3 min TF instead of OBV to detect divergence


Last edited by Tuna; 4th December 2016 at 11:20 AM.
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  #28  
Old 3rd December 2016, 03:29 PM
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Default Re: The Best Trading System

Trading Psyops # 3


"The mistake is not being wrong. The mistake is staying wrong."


Regardless how experienced trader you are Or how much edge your overall trading system has over others - you will enter losing trades every now and then.

The only thing that will make your trading business profitable if you know what invalidate your current trade setup and get out of the trade instead of hanging on to it.

There are 4 type of trades:

1. Small Win (Scratch)
2. Big Win
3. Small Loss (Scratch)
4. Big loss.

Avoid the 4th one - and do this for 1 month

Last edited by Tuna; 4th December 2016 at 01:07 PM.
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  #29  
Old 3rd December 2016, 03:40 PM
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Default Re: The Best Trading System

Trading Myth Buster # 3


"Just have one trading system and follow it like a machine".

Wrong !! It is like - just learn Square Cut in Cricket and try joining the Team for World Cup.

You can not play the same shot if it is a yorker or a full toss or a Bouncer.

Similarly, market changes every now and then. Someday it is ranging, someday it is trending, it also can Gap up/Down later filling up the gap or not filling up - how (& why) would you want to build only one system to make use of all scenarios.

Well, you may say - you are ready to wait till the market comes to a stage for your setup. You have patience like a sniper - Kudos, you may skip this post.

I keep 3-4 systems handy (thoroughly tested and practiced) - and deploy which is the best matching one for the current market.

Yes, there are stages in the market you can not trade- but that is ok. But living with just one system - not my cup of tea.

Exception: Yes exists. Discretionary Traders, they can pull off winners in most of the markets. Refer to Subho Da's (Smart_Trader) Pivot Trading - that holds good most of the time.

Last edited by Tuna; 3rd December 2016 at 03:48 PM.
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  #30  
Old 3rd December 2016, 08:27 PM
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Default Re: The Best Trading System

And last post, Courtesy Steve Burns - why you need to improvise





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Last edited by Tuna; 3rd December 2016 at 10:17 PM.
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