Need Help to decide the future

#1
I have left the job and started trading in futures but everything happened against my plan :( I started trading on last monday in SBIN, moving average cross over but there was not trend from that day. And I lost around Rs.15000. As there is no trend I am getting many whipsaws, I know trend will come in coming days but now I hesitate to enter into the market because I dont when trend will come whether in next week, or mid week of the month or last week. Can you pls help me to overcome this. I have started to think to go back to job again :( I have 2 things to do one is to get capital back so I will have to follow the system and after that think about the future whether to stay with trading or go back to job again. With your experience pls tell me whether swing trading is good and how to identify the trend.... I request you to please give me some advise. How to minimize the whipsaws and false trades. I need some mentor to help me. I had done back-testing of system for almost 2 years 2011,2012 so after understanding the performance I decided to quit job and started trading. Now within 2 weeks I have totally lost the confidence can you guys pls help me. I use moving average cross over system and facing whipsaws. I keep positions open overnight.
 
#2
Dear tspact,

Please answer below Queries:
1. Did you think you were adequately Capitalized before you left your job ?
2. If no, why did you left your job first of all ?
3. If yes, why you are stepping back after just 1 week of trades that too with mere 15k loss ?

For positional trading, take trades with risk ranging from 0.5-1% on each trade. You should be in a position to take trades as per your plan even after getting 20 failed trades in a row. Still you are left with 80% of your Cap and can recover the loss with few winning trades.

Lets wait for fellow traders' and Seniors' Comments..
 
#3
Dear Neo_Trader,
I have kept 5L for trading only. I lost the confidence because of these whipsaws. Yes you are right I am taking 0.5% risk. But I seriously started thinking that I need to avoid whipsaws. I should give some more time for my system to show the results. But now scared about whipsaws. If you look at SBIN chart we had long rally from 23rd May which gave around 200 points moving average crossover, but after that all whipsaws, if I can manage to avoid 50% of whipsaws my confidence will boost. I feel I should take a look at eod chart and then decide whether to take moving average crossover signal in intra day chart. I used NR-7 technique but still it did not solve the whipsaws problem. I hope experienced traders like you will help me.


Dear tspact,

Please answer below Queries:
1. Did you think you were adequately Capitalized before you left your job ?
2. If no, why did you left your job first of all ?
3. If yes, why you are stepping back after just 1 week of trades that too with mere 15k loss ?

For positional trading, take trades with risk ranging from 0.5-1% on each trade. You should be in a position to take trades as per your plan even after getting 20 failed trades in a row. Still you are left with 80% of your Cap and can recover the loss with few winning trades.

Lets wait for fellow traders' and Seniors' Comments..
 

ashu1234

Well-Known Member
#4
I have left the job and started trading in futures but everything happened against my plan :( I started trading on last monday in SBIN, moving average cross over but there was not trend from that day. And I lost around Rs.15000. As there is no trend I am getting many whipsaws, I know trend will come in coming days but now I hesitate to enter into the market because I dont when trend will come whether in next week, or mid week of the month or last week. Can you pls help me to overcome this. I have started to think to go back to job again :( I have 2 things to do one is to get capital back so I will have to follow the system and after that think about the future whether to stay with trading or go back to job again. With your experience pls tell me whether swing trading is good and how to identify the trend.... I request you to please give me some advise. How to minimize the whipsaws and false trades. I need some mentor to help me. I had done back-testing of system for almost 2 years 2011,2012 so after understanding the performance I decided to quit job and started trading. Now within 2 weeks I have totally lost the confidence can you guys pls help me. I use moving average cross over system and facing whipsaws. I keep positions open overnight.
Dear friend,
First of all you don't have to leave the job to day trade in stock markets. You are not the first and last one who got lured by the glamor of the market. I was having same talk with one of my friend this sunday about similar incident. Its a big mistake as every trader has his own learning curve in the market and income is not steady, no matter how much you have paper traded or how much you've backtested some strategy.
BTW have a look at SBIN chart, it was a sell from 22nd may, which got fully confirmed on 23 by the gap down move, all the averages were down since then be it short or long term. Its already in a downtrend, don't know what you are referring to. With this incomplete knowledge, I won't encourage you to stick to markets. Just take it as a bad investment and go back to the job. Because if you try to overdo it, you'll finally get into big troubles. Take it as sincere advice as have seen fate of many people who have done this.
 

Taiki

Well-Known Member
#5
I have left the job and started trading in futures but everything happened against my plan :( I started trading on last monday in SBIN, moving average cross over but there was not trend from that day. And I lost around Rs.15000. As there is no trend I am getting many whipsaws, I know trend will come in coming days but now I hesitate to enter into the market because I dont when trend will come whether in next week, or mid week of the month or last week. Can you pls help me to overcome this. I have started to think to go back to job again :( I have 2 things to do one is to get capital back so I will have to follow the system and after that think about the future whether to stay with trading or go back to job again. With your experience pls tell me whether swing trading is good and how to identify the trend.... I request you to please give me some advise. How to minimize the whipsaws and false trades. I need some mentor to help me. I had done back-testing of system for almost 2 years 2011,2012 so after understanding the performance I decided to quit job and started trading. Now within 2 weeks I have totally lost the confidence can you guys pls help me. I use moving average cross over system and facing whipsaws. I keep positions open overnight.
Hi tspact,

I too have left my daily job to be a full time trader. I am just 1 and half year experienced in this path. but let me tell you the things that I have learned from my mistakes. And majority of newbie also do the same mistakes. We basically learn some basic technicals, create a system, and start trading. But we tend to neglect the most important aspect of trading and that is money management.

1. Define how much you are willing to risk on a single trade. Risk that you can afford to loose
2. Do not put all your trading capital in a single trade.
3. Have proper entry, exit, stoploss levels in mind.
4. Do not bring any second thought or excuses to stay once the stop loss gets hit. Exit and wait for next signal.
5. Gradually build your position. Lets say if you are trading 5 lots of a contract. Enter with only 1/3rd of it on 1st trade. Add your next 1/3rd position once you get into profit and the stock movement proves your decision right by establishing the trend. Enter with the last 3rd when the stock pulls back a little and start resuming its trend.
6. As you mentioned you are a swing trader, you should not be in hurry to enter at once.
7. The key to survive in the market is sticking to it. ANd for sticking you need money. So if you will loose more than half of your capital in a single trade, in no time you will be out of the business. So have a proper risk and money management plan.

Get some good book on money management and read them.
Best of luck dear
Good luck
 

Taiki

Well-Known Member
#6
And about the system and whipsaws, no system is perfect. Every system has some or more drawbacks. Just stay with the trend, and check bigger time frame for trend confirmations. On daily chart SBIN is still down. Today it got its first green candle after a 4 day's of red candles. So it was not a buy pick rather it was a sell on every rise.

On today it came out of the oversold region on hourly chart. But daily chart yet has to confirm this. So this can be a rally in formation, or it can be simply a bounce back from previous fall.

If you wish to trade this bounce then trade with strict stop loss, and exit as soon as you get a sign of danger.

Good luck :)
 
#7
Yes you are right no system is perfect...
I also feel that I should look for larger time frames I refer only to 15 min chart if signal comes I take signal with 0.5% as my stoploss. Which time frame should I check before entering into the trade? Should I look at stochastic indicator for the reference half hourly time frame?



And about the system and whipsaws, no system is perfect. Every system has some or more drawbacks. Just stay with the trend, and check bigger time frame for trend confirmations. On daily chart SBIN is still down. Today it got its first green candle after a 4 day's of red candles. So it was not a buy pick rather it was a sell on every rise.

On today it came out of the oversold region on hourly chart. But daily chart yet has to confirm this. So this can be a rally in formation, or it can be simply a bounce back from previous fall.

If you wish to trade this bounce then trade with strict stop loss, and exit as soon as you get a sign of danger.

Good luck :)
 
#8
Dear Ashu,
I looked at chart you attached. Which moving averages do you use?
I use 8-30, are there any other indicators you refer to.
If possible pls share your trading strategy. Thnx in advance.


Dear friend,
First of all you don't have to leave the job to day trade in stock markets. You are not the first and last one who got lured by the glamor of the market. I was having same talk with one of my friend this sunday about similar incident. Its a big mistake as every trader has his own learning curve in the market and income is not steady, no matter how much you have paper traded or how much you've backtested some strategy.
BTW have a look at SBIN chart, it was a sell from 22nd may, which got fully confirmed on 23 by the gap down move, all the averages were down since then be it short or long term. Its already in a downtrend, don't know what you are referring to. With this incomplete knowledge, I won't encourage you to stick to markets. Just take it as a bad investment and go back to the job. Because if you try to overdo it, you'll finally get into big troubles. Take it as sincere advice as have seen fate of many people who have done this.
 

Taiki

Well-Known Member
#9
Yes you are right no system is perfect...
I also feel that I should look for larger time frames I refer only to 15 min chart if signal comes I take signal with 0.5% as my stoploss. Which time frame should I check before entering into the trade? Should I look at stochastic indicator for the reference half hourly time frame?
If you are talking about swing trades then stick to hourly frame. Check the trend from weekly and daily trend. You can check for the stochastic for checking overbought and oversold region. Yes they confirm your decision. But all these indicators are lagging indicators today. They will respond after the stock has done some specific move. So learn the price action.

Good luck :)
 

ashu1234

Well-Known Member
#10
Sorry for being too critical of you, but as you've mentioned later that after 27th May you got problem as market was flat. You are right. From my experience once a big move is done, one should wait and watch, since you are using trend following method, what I see is volatility and range to enter or not.
I've attached chart, see atr is flattening, means market is taking a pause, i use other confirmations too which check market strength but my personal take is that its easy to say follow the trend but in reality you cant. Take this recent sbin example, you can't stay with the trend all the time as after fall at anytime it can shot back or continue its original down-trend. I enter on atr breakout and close the trade when it flattens or hold position of the original trade if the conviction is strong.

 

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