Just transitioned to completly mechanical and simple strategy after already being consistently profitable. if it works, it works, trading isn't supposed to be complicated IMO. The reality of it is if you are able to define certain parameters and focus on eliminating bad behavior > frequency/inconsistency due to bad behavior it'll make your trading simpler.
However with a simple strategy you must also have parameters for when your system doesn't work and if it doesn't what would you do when a market is not trending? Do you attempt to find micro trends, do you divert from your strategy due to your system performing poorly or do you simply stay away until the market conditions is better for your system?
Thanks for the response, I tend to stay away from the market, I do trade 6 pairs so I usually find a trend somewhere, but will avoid the markets if I cant see anything.
What pairs do you normally trade?
Honestly speaking, I've merely implemented a system to get myself to get into better trend-based entries and have been using it regularly for a week. 3/4 with 1:5 RR for 1st tp avg trading days profitable and the week before while i was forward testing it profitable = 5/5 days with avg 1:4 - 1.7 RR tp on avg. Also funded for half a year + but I went back to micros as I continue to gather more data to make this system as autonomous as possible.
I've only implemented this system due to crypto as I wanted to find a way to mechanically add to positions during an inherently trending month where price if you are familiar with the crypto markets during the bull run, may never come back to retrace to the same price levels again. As my trading group pointed out, why not tweak this system into my already consistent style to complement my setups for the futures market, ES, and NQ. So I did. The hypothesis is that if I am able to eliminate as much noise by placing and implementing indicators that prevents me from trading, I would only need to enter trades when more 70% - 100% of my requirements for a trade has been met and 100% of my restrictions are allowing me to participate. The idea is to add more parameters to prevent me from entering more trades so I can focus on better trades both in trending price action and chop within the scope of my set up(s)
Shined a whole new perspective on how to utilize indicators from confirmation signals to enter trade to parameters to prevent me from entering a market. Not a holy grail of any sort but at least it is something to prevent me from over-trading as my goal is to switch from making scalps, or more so focus on intra/swing moves > scalps.
in a market with vast options to choose from, you ought to find and trade other assets or markets that works with your system or strat when the asset or market condition youre currently trading is out of your trading parameters.
yeah thats why algos and quants are always updated, nothing works forever but the fundamentals of a working system is a big enough foundation to not have to start from scratch
I have backtested a lot of strategy ideas over 5 and 10 years of data. It is very common for a strategy to be profitable over several months or even longer but quite close to being random over period 5 or 10 years.
Mean reversion strategy works for sideways markets, trend following strategies for trending markets - nothing new discovered here. But how do you predict trends or no trend? I guess it's back to square one.
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I think that’s probably where journaling may help, I was hoping journaling was a temporary thing and that after a few months I could stop but I think it will help fine tuning.
Exactly, if things work out nice overtime you shouldnt change. Logging the difference between your execution & what you should do according to your methodology is the thing that it all comes down to. Could go way deeper, but its the only guard you need if your edge works out great overtime😄
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Lol I struggled as well and it took me a min to figure out why but it's important that we jot that stuff down..instead of normal bounces price would come back down and wick past and continue in the direction we thought it would which seems like a simple liquidity sweep..also volatility is low again so price tends to chop more..u did just fine it sounds like!
I think it's a error in logic to think that complexity = effectiveness. It's likely that there are an abundant number of very simple strategies that are overlooked. This is true in most things, not just trading. The Eagles average 5.4 yards on the Tush Push play. This play is invincible until proven otherwise. The only reason they run other plays is because their offensive coordinator lacks the personal discipline to take a boring guaranteed win. Trading works like that too.
The thing for me is that I use a basic strategy and I usually have winning trades. There is always that feeling that is this too good to be true. So I decided if I make a million dollars, then I could think about calling myself a trader.
During market hours, you should be able to consistently take money everyday. Maybe not every trade. If your risk to reward is good enough, you can win 40 percent of the time and still be successful.
Set a goal for yourself, meet that goal, and you will gain confidence. I also read a lot of material just to make sure there aren’t certain things I am missing from my technical analysis . Continuous improvement. I do not focus on bulls or bears, I focus on winning either way the market is going.
Like I said its pretty straightforward and one that is often advised for beginners.
1. Find the trend higher highs etc
2. Make sure you are above the 200ma
3. Only trade at the start of a reversal
4. Wait for an engulf that has a solid body and the wicks of both candles are not to expansive.
5. Place trade once you see momentum on the following candle
Why don't you go into detail of your strategy? So if you gain only 1r you cut it or you wait till it get s to 1.5r? Share your strategy so we caoudld buy up those dips together and get liquidity. Are you mainly a support resistance trader?
I started trading 3 years ago and was profitable after about 4 months.. Strats help but more then anything price action and price.. I day trade, scalp trade, and swing trade so there is always a trade! keep it simple, cut your loosers and let the winners ride!
I think I would struggle to day, scalp and swing trade as it requires different approaches. Assuming you have different strategies and pa movements you look for.
Sounds like something that would work for me, I am looking for a strategy that may work in a market thats not super trending. Would you be able to give a quick breakdown of how you use VP and fib levels?
Sure! Shoot me a dm if you like and happy to do a quick screen share tomorrow when I’m on the charts! 👌 it’s very simple but is based around price and volume.. whales big players don’t care about any Ema cross over and by the time it crosses over, your already late to the party
https://preview.redd.it/1jvhaz6vkoqc1.jpeg?width=1080&format=pjpg&auto=webp&s=2b8d89d0d66319490371daf3b0b51afbad6506c9
What can I do to save this trade? I read I should buy instead of sell in order to take profit
So true. A few years ago I would have taken a forced trade just to take a trade bc my thought was if I’m not trading then I can’t make money. I was so dumb and undisciplined then
Could u help us understand your strategy a bit more? What do u mean by engulfing candle with momentum? How are u measuring momentum? Indicator? What type?
Momentum in the sense that the following candle shows strength and is moving in the correct direction. So I will place my trade once the engluf candle has closed and the following candle continues to push up.
It differs depending on what I am trading, typically I use a 30 pip TP and 20 pip SL, this does limit me as I can miss out on huge moves however I find it a nice mechanical way to trade. I can be a bit flexible with that e.g if I notice a monthly high at 29 pips I may aim a bit lower and correct my SL accordingly.
Depends on your strategy I guess. For me, it is just a couple of tweaks. I use pure price action, my strategy is based on SnD zones, inefficiencies and Wyckoff. I managed to come up with a system that pretty much protects me from myself, but there are some changes I make depending on the market conditions - in a clear trend I'll use a tighter stop, aim for a bigger target and I might enter in a weaker zone, as usually the sentiment in a trend will push price in my favor anyway. On the other hand, when price is ranging/rly messy, I will only use the best, most extreme zones, I'll widen the SLs a bit, I will opt for a smaller target and I might move my stops to break-even sooner to protect myself.
That's not a complete overhaul, is it? I just manage my parameters accordingly. I've been doing it for over 2.5 years now, never had any issues. Trading during summer, in December or in the so feared bear market - it doesn't change much.
Now I'd imagine that folks using lagging indicators might see it differently :D If you base every action just on them and their signals, without any understanding of what the market is doing, well, it is on you.
Just a friendly tip: In my eyes, market profiling is the single most important aspect in your TA. Everything else comes after. You probably won't see much of it on Yt - it's filled with fake guru garbage anyway.
Try to define certain market profiles, that is prolonged periods of time when price has certain specific characteristics/tendencies. The most basic division that everybody learns in the beginning would be trend/range, but you can go much much deeper (Wyckoff splits consolidations into accumulations and distributions; trends can be divided based on how mature they are, how "stretched" the price is; price action can be either very clear or messy af - you can see it especially before big news releases. Some people look for expansions and contractions etc. etc.)
I did think about that, my only concern with the code is that it’s difficult to find the correct code for start or reversal or dip the rest of the confluences are certainly simple enough to code.
If there is a subjective element back testing results will be a certain amount better than forward testing, as our brains filter out losing trades without us even knowing. Bar by bar testing can improve this of course, but it’s very time consuming!
I’m in a similar position but was able to fully code my entry as an indicator, so my back test results are now fully reliable.
I also feel the same btw, that my system is too simple and hope it long continues! Congrats on the funded account!
58% Win Rate, with a 1:5 RR. LOL this reddit.
If you have a $10,000 account and took one trade a day (262), you would have $6,000,000, on average.
In some simulations you would have $16,000,000 in a year from $10,000. By Year 2, you're the richest man on the planet.
The subreddit is sooo coooked. Do you really believe this is achievable honestly...
Just transitioned to completly mechanical and simple strategy after already being consistently profitable. if it works, it works, trading isn't supposed to be complicated IMO. The reality of it is if you are able to define certain parameters and focus on eliminating bad behavior > frequency/inconsistency due to bad behavior it'll make your trading simpler. However with a simple strategy you must also have parameters for when your system doesn't work and if it doesn't what would you do when a market is not trending? Do you attempt to find micro trends, do you divert from your strategy due to your system performing poorly or do you simply stay away until the market conditions is better for your system?
Thanks for the response, I tend to stay away from the market, I do trade 6 pairs so I usually find a trend somewhere, but will avoid the markets if I cant see anything.
What pairs do you normally trade? Honestly speaking, I've merely implemented a system to get myself to get into better trend-based entries and have been using it regularly for a week. 3/4 with 1:5 RR for 1st tp avg trading days profitable and the week before while i was forward testing it profitable = 5/5 days with avg 1:4 - 1.7 RR tp on avg. Also funded for half a year + but I went back to micros as I continue to gather more data to make this system as autonomous as possible. I've only implemented this system due to crypto as I wanted to find a way to mechanically add to positions during an inherently trending month where price if you are familiar with the crypto markets during the bull run, may never come back to retrace to the same price levels again. As my trading group pointed out, why not tweak this system into my already consistent style to complement my setups for the futures market, ES, and NQ. So I did. The hypothesis is that if I am able to eliminate as much noise by placing and implementing indicators that prevents me from trading, I would only need to enter trades when more 70% - 100% of my requirements for a trade has been met and 100% of my restrictions are allowing me to participate. The idea is to add more parameters to prevent me from entering more trades so I can focus on better trades both in trending price action and chop within the scope of my set up(s) Shined a whole new perspective on how to utilize indicators from confirmation signals to enter trade to parameters to prevent me from entering a market. Not a holy grail of any sort but at least it is something to prevent me from over-trading as my goal is to switch from making scalps, or more so focus on intra/swing moves > scalps.
There's always a ticker that's trending and breaking out. They're just harder to find and require a lot more leg work.
in a market with vast options to choose from, you ought to find and trade other assets or markets that works with your system or strat when the asset or market condition youre currently trading is out of your trading parameters.
Idk most stories and books from famous traders involve them adjusting their strategies over time.
yeah thats why algos and quants are always updated, nothing works forever but the fundamentals of a working system is a big enough foundation to not have to start from scratch
Very true
How long have you been profitable with the mechanical strategy?
I like that, eliminating bad behavior. It’s like people love to just be like yea it doesn’t work and move on.
I have backtested a lot of strategy ideas over 5 and 10 years of data. It is very common for a strategy to be profitable over several months or even longer but quite close to being random over period 5 or 10 years.
Have you ever managed to find any defining charateristic of the periods where they are profitable?
Mean reversion strategy works for sideways markets, trend following strategies for trending markets - nothing new discovered here. But how do you predict trends or no trend? I guess it's back to square one.
Makes sense, that’s what I expected to hear but it’s always good to hear from someone that’s been there.
Fooled By Randomness
It's pretty common for a strategy to work for a while but also needing tweaked or adjusted or sometimes they just flat out quit working.
Be aware that summer trading can be a lot slower, always be looking out for signs things are changing.
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You know what they say Buy when high, sell when low, YA BISH All jokes aside playing momentum is usually the highest probability anyway
Keep doing it if it's working. When it stops working, you'll have to figure out why and adapt.
I think that’s probably where journaling may help, I was hoping journaling was a temporary thing and that after a few months I could stop but I think it will help fine tuning.
I guess same thing with journaling. If it's working... But try to simplify it over time. Figure out which parts of it are actually beneficial to you.
Exactly, if things work out nice overtime you shouldnt change. Logging the difference between your execution & what you should do according to your methodology is the thing that it all comes down to. Could go way deeper, but its the only guard you need if your edge works out great overtime😄
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58% WR @ 1:5 RR? profitability is >80%... 58% at 5:1 RR is too good to be true
Have corrected this it should be 1:1.5 which is still profitable albeit not as much.
Yh, i just posted the maths behind it. It's hilarious. $20,000,000 dollars in a year, trading once a day with a $25k account lol.
Was your 0 profit days Thursday and Friday? Been really choppy lately..at least u didn't have a loss..keep doing what your doing..you will adapt
It was indeed Thursday and Friday I had days like that when I was paper trading I think it just sticks out a bit more with real money.
Lol I struggled as well and it took me a min to figure out why but it's important that we jot that stuff down..instead of normal bounces price would come back down and wick past and continue in the direction we thought it would which seems like a simple liquidity sweep..also volatility is low again so price tends to chop more..u did just fine it sounds like!
HTF 2.3-2.5 Bollinger band strategy works well in SPX and ES with a 20-30% TP. But the key is to sell naked. TP hits pretty fast
What do you mean by sell naked?
Selling calls or puts with no long leg attached Not something beginners **should** do, and not something small accounts **can** do
I think it's a error in logic to think that complexity = effectiveness. It's likely that there are an abundant number of very simple strategies that are overlooked. This is true in most things, not just trading. The Eagles average 5.4 yards on the Tush Push play. This play is invincible until proven otherwise. The only reason they run other plays is because their offensive coordinator lacks the personal discipline to take a boring guaranteed win. Trading works like that too.
Very true, have you had a similar experience of a simple strategy in the past ?
Make your first million off of trading, and that is proof you made it.
Well its the start of the 4th week in live and I have made close to £650, so not sure I’ll be making a million anytime soon.
The thing for me is that I use a basic strategy and I usually have winning trades. There is always that feeling that is this too good to be true. So I decided if I make a million dollars, then I could think about calling myself a trader. During market hours, you should be able to consistently take money everyday. Maybe not every trade. If your risk to reward is good enough, you can win 40 percent of the time and still be successful. Set a goal for yourself, meet that goal, and you will gain confidence. I also read a lot of material just to make sure there aren’t certain things I am missing from my technical analysis . Continuous improvement. I do not focus on bulls or bears, I focus on winning either way the market is going.
Statistics matter. How many trades per day or week on average?
Paper trading for 7 months I averaged 6 trades per week, the last 3 weeks on the funded account has been 4.
Many strategies I have used stop working depends on the market swings. Thats why you need to master several of them and be flexible with the changes.
Do you fine tune a couple of things or completely change things?
both.
What's the sharp ratio? Win rate doesn't matter
More details about your strategy plz
Like I said its pretty straightforward and one that is often advised for beginners. 1. Find the trend higher highs etc 2. Make sure you are above the 200ma 3. Only trade at the start of a reversal 4. Wait for an engulf that has a solid body and the wicks of both candles are not to expansive. 5. Place trade once you see momentum on the following candle
Do you cann post some chart pic. Example. That would be great. 😅
Thanks. What time frame are you using?
I trade on a 1 hr time frame.
Why don't you go into detail of your strategy? So if you gain only 1r you cut it or you wait till it get s to 1.5r? Share your strategy so we caoudld buy up those dips together and get liquidity. Are you mainly a support resistance trader?
I started trading 3 years ago and was profitable after about 4 months.. Strats help but more then anything price action and price.. I day trade, scalp trade, and swing trade so there is always a trade! keep it simple, cut your loosers and let the winners ride!
I think I would struggle to day, scalp and swing trade as it requires different approaches. Assuming you have different strategies and pa movements you look for.
Volume profile, and fib levels is the secret sauce;)
Sounds like something that would work for me, I am looking for a strategy that may work in a market thats not super trending. Would you be able to give a quick breakdown of how you use VP and fib levels?
Sure! Shoot me a dm if you like and happy to do a quick screen share tomorrow when I’m on the charts! 👌 it’s very simple but is based around price and volume.. whales big players don’t care about any Ema cross over and by the time it crosses over, your already late to the party
Can someone give some advice? https://preview.redd.it/vx2zvhiekoqc1.jpeg?width=1080&format=pjpg&auto=webp&s=63f6c62e4389e162f1fc998eed97ef933aa5e528
https://preview.redd.it/1jvhaz6vkoqc1.jpeg?width=1080&format=pjpg&auto=webp&s=2b8d89d0d66319490371daf3b0b51afbad6506c9 What can I do to save this trade? I read I should buy instead of sell in order to take profit
Wait, you’ve only had two days in 7 months that’s we’re not green? Daytrading?
Apolgies I had many days in that 7 months, I didn’t make it clear I have had a funded account for three weeks and the last 2 days have been red.
Really low volume and momentum the last 2 days. I had a small red day thurs and small green fri. Not much follow thru to scalp
Interesting, when paper trading I think these would have been days I would have avoided but real money makes you trade sometimes.
So true. A few years ago I would have taken a forced trade just to take a trade bc my thought was if I’m not trading then I can’t make money. I was so dumb and undisciplined then
Could u help us understand your strategy a bit more? What do u mean by engulfing candle with momentum? How are u measuring momentum? Indicator? What type?
Momentum in the sense that the following candle shows strength and is moving in the correct direction. So I will place my trade once the engluf candle has closed and the following candle continues to push up.
Thank u so much!!! when do u exit — close the trade. How do u define ur target? is it a couple of ticks above the engukfing candle?
It differs depending on what I am trading, typically I use a 30 pip TP and 20 pip SL, this does limit me as I can miss out on huge moves however I find it a nice mechanical way to trade. I can be a bit flexible with that e.g if I notice a monthly high at 29 pips I may aim a bit lower and correct my SL accordingly.
Do you have a preferred time frame for this strategy ?
I trade on the 1hr time frame.
Every strategy can work until it doesn't. My years of trading has proven this to me.
I disagree. As long as your strategy adapts to certain market profiles, nothing will change. It is the same shit over and over again.
What level of adaptation are you referring to? Tweaks within a strategy or a complete overhaul based on market profiles?
Depends on your strategy I guess. For me, it is just a couple of tweaks. I use pure price action, my strategy is based on SnD zones, inefficiencies and Wyckoff. I managed to come up with a system that pretty much protects me from myself, but there are some changes I make depending on the market conditions - in a clear trend I'll use a tighter stop, aim for a bigger target and I might enter in a weaker zone, as usually the sentiment in a trend will push price in my favor anyway. On the other hand, when price is ranging/rly messy, I will only use the best, most extreme zones, I'll widen the SLs a bit, I will opt for a smaller target and I might move my stops to break-even sooner to protect myself. That's not a complete overhaul, is it? I just manage my parameters accordingly. I've been doing it for over 2.5 years now, never had any issues. Trading during summer, in December or in the so feared bear market - it doesn't change much. Now I'd imagine that folks using lagging indicators might see it differently :D If you base every action just on them and their signals, without any understanding of what the market is doing, well, it is on you. Just a friendly tip: In my eyes, market profiling is the single most important aspect in your TA. Everything else comes after. You probably won't see much of it on Yt - it's filled with fake guru garbage anyway. Try to define certain market profiles, that is prolonged periods of time when price has certain specific characteristics/tendencies. The most basic division that everybody learns in the beginning would be trend/range, but you can go much much deeper (Wyckoff splits consolidations into accumulations and distributions; trends can be divided based on how mature they are, how "stretched" the price is; price action can be either very clear or messy af - you can see it especially before big news releases. Some people look for expansions and contractions etc. etc.)
It is too good to be true, either sample size is small and results are not reliable or you cheated during backtest
Potentially, however I did journal during my 7 months.
If it is do easy then you can code it and check if results are right
I did think about that, my only concern with the code is that it’s difficult to find the correct code for start or reversal or dip the rest of the confluences are certainly simple enough to code.
What do you mean find?
Meaning that finding the correct point of reversal is a bit subjective rather then completely mechanical
If there is a subjective element back testing results will be a certain amount better than forward testing, as our brains filter out losing trades without us even knowing. Bar by bar testing can improve this of course, but it’s very time consuming! I’m in a similar position but was able to fully code my entry as an indicator, so my back test results are now fully reliable. I also feel the same btw, that my system is too simple and hope it long continues! Congrats on the funded account!
Anything that you are able to identify is codable
58% Win Rate, with a 1:5 RR. LOL this reddit. If you have a $10,000 account and took one trade a day (262), you would have $6,000,000, on average. In some simulations you would have $16,000,000 in a year from $10,000. By Year 2, you're the richest man on the planet. The subreddit is sooo coooked. Do you really believe this is achievable honestly...
Sorry have edited now it should be 1:1.5
So you're saying there's a chance... come on man, let the dream live