Briefly highlighting some of the trading development work and meetings with various traders I got done over the last week (and a glimpse from my Halloween outing!).
The [bloody] week that was:
Saturday (a week ago) – Full working day with Trader Di: TraderDi has been trading since the 1980’s and is a consistently profitable trader – a great person to join forces with. We reviewed and studied the setups taken by my coding up of her trend-following strategy. We then brainstormed several trade management approaches.
More coding in EasyLanguage/TradeStation – coded up the trade management approaches on Monday & Tuesday, and began testing later in the week.
Pin-Bar based trading strategy development: thanks to more research and experimenting, I seem to have found some data supporting non-randomness, particularly on the daily timeframes.
Training/practice – manual discretionary trading: I then spent time in the latter part of the week trading the strategy manually in ForexTester3, chalking up around 30 trades. I have left out the engulfing price action pattern for now, to keep things as simple as possible.
Thinking about all these things – coding, back-test, probability analysis, optimization, trend definitions, manual/rule-based/discretionary/automated trading – pros & cons of each
Coffee meet-up with Simon C – Simon runs a small fund, issues regular trade analysis reports, and trades on the basis of technical patterns on higher timeframes. Great two-hour trading banter – listening to how well things are going for him. He feels he has been performing a lot better in his Q3 just because he took some time off in July/August and recharged his batteries. Not surprisingly, he works extremely hard starting at 5am most weekdays and is very selective and very patient with his setups.
Sunday morning – 2-hour “trader buddy” meet: with fellow trader from the Veterans Trader Project – my “trader buddy” is doing extensive research and study into the Market Structure theory taught by Voigt (see Das Grosse Buch der Markttechnik) and trying to apply the theory in real time by monitoring a number of instruments – he feels that he is progressing well and learning a lot – he keeps reminding himself that the importance is less on the knowledge & theory and more on the ‘doing’ and applying it. I found the market structure concepts very helpful in understanding the markets better – search on Voigt to find blog posts where I mention his material – also see Pepperstone for a 5-6 page summary of it (with tonnes of helpful graphs). As he was explaining some of the finer points, I was automatically comparing it to the approaches I am employing in the trading strategies that I am working on.
Last night – big Halloween Party
In coming days, the plan is to:
- complete further practice executing the pin-bar strategy in ForexTester3, focusing on the 4-hour timeframe. The automated strategy takes significantly more trades then I would like to. Am anticipating for the manual trading to help me strengthen the coding.
- Back-test and optimize the trade management approaches for the trend-following strategies. Currently working with 20 different FX pairs and only on the 4-hour timeframe.
- Practice executing the trend-following strategy manually in a discretionary manner in FT3 on the 4-hour timeframe. Again, there are some aspects that I cannot articulate into code for now. [Probably won’t get to this in the coming week.]
making it possible to draw some real blood…
From Monday (6th Nov), I am planning to trade both the pin-bar and the trend-following strategy live in the markets with some real $$$, focusing on the 4-hour timeframe. Am expecting this to take up 1-2 hours of my time each day, with the rest of the 10-hour day going on continuing with the automation work. Ideally that will be the status quo for each week in November.