11-22-07 09:46 AMDisclaimer, the stuff I'm about to write is more an internal dialogue than anything else, Hope someone will find it helpful, ignore the awful English ;-)A few thoughts about AHG: So you were lucky enough to find a great guy (Anek), who in the spirit of sharing , wanted to teach you a system in other words he gave you for free his edge.Then how do you proceed in order to learn and become proficent with this sys?First the easy part (no disrispect Anek, you know as an experienced trader, I'm telling the truth).Learn to recognize a market structure HH HL & LH LL (MS)with a glance , at this stage it doesn't matter if your base chart shows a MS in a downtrend and your anchor chart shows a retracement of an uptrend, stick with your base chart and learn to spot the freaking MS, can you count to 4? End of the course...say what?Yup once you are gone through all the madness of trying to refine the basic system , because you are farking always looking for the perfect sys aren't you? Yup the one that never fails and gives you 100 winners out of 100 trades (c'mon make me laugh and tell me it's not true. I tell you what is true ,even if your head tells you it's not possible, your subconscious is always trying to outsmart the system), you' ll go back to lesson 1 and you realize it was really all you needed to know, but using this knowledge with discipline and truly accepting the concept of propabilities, is the difference between a winner and a loser. So the long journey is almost unavoidable.More about this later.Ok MS is now crystal clear, what's next , Supports and Resistances these are the core of trading , if you think about it each pattern each structure is the product of support and resistance, buying low selling high, shorting high covering low. Price action.A confirmed support or resistance is made by price rejected at the same area where it formed a previous pivot point.Once Resistance is violated it becomes possible Support, it becomes confirmed support when the price is rejected at the same area. Flip the concept for Support.DoubleTops, Double Bottoms and their failure, easy concept right? no need to explain further.W's and M's, very similar to DB and DT , ok good.Head & Shoulder and failure <---- you need screentime to recognize this powerful formation, it's well worth it.Triangles, Coils, Wedges whatever you name them, you know what they look like, we showed a lot here, you have seen how brutal they can be...kaboom :-)Congestion, Trading Ranges, Rectangular formation, you've seen them, you know you expect a breakout/down. Trendlines and Channels, a trend line is formed when you can draw a diagonal line between two or more price pivot points these alone give you an edge, I' ve seen traders making a living just by selling and buying trendline breaks,and I've seen traders making a living just by buying and selling trendline rejections, if you want to know how to draw channels with points 1,2,3 , I'll post a chart.Ok , now you know all the weapons in your arsenal, so you should be a winner , no problem....Slow down warrior that was the easy stuff.
11-22-07 09:46 AM
Disclaimer, the stuff I'm about to write is more an internal dialogue than anything else, Hope someone will find it helpful, ignore the awful English ;-)A few thoughts about AHG: So you were lucky enough to find a great guy (Anek), who in the spirit of sharing , wanted to teach you a system in other words he gave you for free his edge.Then how do you proceed in order to learn and become proficent with this sys?First the easy part (no disrispect Anek, you know as an experienced trader, I'm telling the truth).Learn to recognize a market structure HH HL & LH LL (MS)with a glance , at this stage it doesn't matter if your base chart shows a MS in a downtrend and your anchor chart shows a retracement of an uptrend, stick with your base chart and learn to spot the freaking MS, can you count to 4? End of the course...say what?Yup once you are gone through all the madness of trying to refine the basic system , because you are farking always looking for the perfect sys aren't you? Yup the one that never fails and gives you 100 winners out of 100 trades (c'mon make me laugh and tell me it's not true. I tell you what is true ,even if your head tells you it's not possible, your subconscious is always trying to outsmart the system), you' ll go back to lesson 1 and you realize it was really all you needed to know, but using this knowledge with discipline and truly accepting the concept of propabilities, is the difference between a winner and a loser. So the long journey is almost unavoidable.More about this later.Ok MS is now crystal clear, what's next , Supports and Resistances these are the core of trading , if you think about it each pattern each structure is the product of support and resistance, buying low selling high, shorting high covering low. Price action.A confirmed support or resistance is made by price rejected at the same area where it formed a previous pivot point.Once Resistance is violated it becomes possible Support, it becomes confirmed support when the price is rejected at the same area. Flip the concept for Support.DoubleTops, Double Bottoms and their failure, easy concept right? no need to explain further.W's and M's, very similar to DB and DT , ok good.Head & Shoulder and failure <---- you need screentime to recognize this powerful formation, it's well worth it.Triangles, Coils, Wedges whatever you name them, you know what they look like, we showed a lot here, you have seen how brutal they can be...kaboom :-)Congestion, Trading Ranges, Rectangular formation, you've seen them, you know you expect a breakout/down. Trendlines and Channels, a trend line is formed when you can draw a diagonal line between two or more price pivot points these alone give you an edge, I' ve seen traders making a living just by selling and buying trendline breaks,and I've seen traders making a living just by buying and selling trendline rejections, if you want to know how to draw channels with points 1,2,3 , I'll post a chart.Ok , now you know all the weapons in your arsenal, so you should be a winner , no problem....Slow down warrior that was the easy stuff. To be continued
11-22-07 12:23 PM
Part 2If you have been following this thread it should be quite clear that buying and selling a confirmed MS is really all you need to do to make money, yes there are refinements like pattern recogniton and tape reading, sure.Yes I'm pretty bold here and I challenge you, go back and look at 3 months of 1000v or even 1 minute charts and buy and sell every confirmed MS HH-HLx2 LL-LHx2 you see on your chart, heck give it some margin and apply1 point of slippage to enter and 1 points to exit plus commissions. (man your execution sucks ).Define a rule to enter a trade (engulfing bar, break of n ticks below/above previous pivot, choose one...) and stick with it, ALWAYS.Close your position only when the trend has confirmed a reversal with a MS on the opposite direction.Skip the dead zone(11:30,14:00), not compulsory though.Yup you have several small losses, several B/E and a few huge winners, in the end you are profitable (gee just like Anek said...)Ok now you start papertrading, because you need to internalize the system, your execution has to be flawless, but something unexpected happens. You are not able to stick to the plan, you are counting every tick like this was the trade of your life, you just experienced a streak of small losing trades and you are not able to click the T button again. You enter a trade and you see a few $$ in your P&L and you feel the urge to close the trade, you actually sell without a real confirmation of change of the trend. Sometimes you think you were smart, because you saved a few points, but when the real move comes you are out way to soon and all the points you saved now are just peanuts compared to what you missed.Jesus, so what do you do? You start again, you read everything you can about the market, you study market analysis with obsession, you add (god forgive you) a new indicator, heck let's make it 3 new indicators. "If i know everything there's to know about the market I won't experience a streak of losses, that's my goal. Losing is an awful feeling, I want to avoid that with all my strenght, I want to be right, that's what my parents, my friends, the freaking society taught me, I need to be right to be succesful." ( Dead of a trader)Man and this is only papertrading, think what will happen when money is on the line.So how do we shut down this internal voice?I'll try to define with the help of Mr. M Douglas what an edge is and the probability game.Let's start from the beginning.What's the market? At its basic level the mkt is a series of up and down tics that form patterns and MS.You recognize these patterns and you know that there is a higher probability the mkt will move in one direction over the other, this is your edge.But here is where the problem lies, a pattern in our subconscious implies a consistent outcome, but the reality is each pattern is a unique moment of the mkt, it may look exactly like other patterns you have seen before, but the underlying force behind a pattern are traders, and traders who contribuite to the formation of one pattern and their rational to enter a trade, are always different from the previous pattern.Remember it takes just one trader, just one to produce a failed pattern or a confirmed pattern, how can you expect to know what the outcome of that particular, unique trade is if just one trader can change everything, you can try to learn all the TA you like you can try to read the minds of all the traders in the mkt (good luck with that)You don't know what the outcome of one trade will be, nobody knows, you don't know if the next trade will be a winner or a loser, nobody knows.What does it mean? It means that the distribuition of winning and losing trades is random, it means the outcome of a pattern/trade is completely random relative to one another.You should start thinking like a Casino or a professional gambler, they know they have an edge even a small one (i think a casino has about a 3-4% edge, not sure about the precise figure), they don't try to predict or know in advance the outcome of each individual event, they know that given a large enough number of events their edge will work.Once you truly internalize this concept, the fear of trading will go away and you'll let the mkt tell you what to do, you 've entered the ZONE. (yes it sounds easy ehe, 5 % can make it, it's not easy)I'm not talking about you, you. I'm talking about the little sucker inside you, the one who tries to predict the future, the one who knows that the nasdaq is going to tank if it goes to 2100, the one who swear at the end of the day because it was scared to trade the never ending trend. You have an edge, trade the farking edge.geez I'm good
