My misconceptions (MC) cleared by Algo & backtesting (BT) on Intraday Trend following system (Cash Market)
MC-1: Algo trading is THE ONLY REMEDY to all trading issues and making money.
Realism vs MC-1 :
My Algo is merely a reflection of what you are up to till that point.
1/n
MC-1: Algo trading is THE ONLY REMEDY to all trading issues and making money.
Realism vs MC-1 :
My Algo is merely a reflection of what you are up to till that point.
1/n
Algo will not render holy grail strategy by solving RR, MM, DD and psychological issues.
Algo is Just a tool to outsourcing my clerical job of finding and executing trades as per my trade setups.
2/n
Algo is Just a tool to outsourcing my clerical job of finding and executing trades as per my trade setups.
2/n
So, I can avoid staring trading screen to work on other day to day activity.
I must develop better understanding about market, RR, MM, psychologically and continue to evolve with the market personally.
3/n
I must develop better understanding about market, RR, MM, psychologically and continue to evolve with the market personally.
3/n
MC-2: Finding THE BEST Technical indicator is KEY to successful trading.
Realism vs MC-2 :
Technical Indicator is like a language we are using to communicate each other.
Use one language (indicator) till you and market can understand the communication.
4/n
Realism vs MC-2 :
Technical Indicator is like a language we are using to communicate each other.
Use one language (indicator) till you and market can understand the communication.
4/n
Not to use different language every time.
Not to use multiple languages understanding phase.
Vital truth is ABLE COMMUNICATION BETWEEN YOU AND MARKET not the language itself. It is personal. That is why somebody’s best indicators do not work for others.
5/n
Not to use multiple languages understanding phase.
Vital truth is ABLE COMMUNICATION BETWEEN YOU AND MARKET not the language itself. It is personal. That is why somebody’s best indicators do not work for others.
5/n
MC-3: Getting into trade at the earliest possible will earns you more profit.
Realism vs MC-3:
You will win more and loose much more due to reversals predominantly. Give time to market to form a definite direction.
6/n
Realism vs MC-3:
You will win more and loose much more due to reversals predominantly. Give time to market to form a definite direction.
6/n
MC-4: Price Action is enough to select a winning trade.
Realism vs MC-4:
Price action alone will not give you successful trade selection. PA should be coupled with any filters like volume, occurrence, ranges etc.. to confirm the trade.
7/n
Realism vs MC-4:
Price action alone will not give you successful trade selection. PA should be coupled with any filters like volume, occurrence, ranges etc.. to confirm the trade.
7/n
Most of the time, ill liquid/fake BR stocks displays better price action signals.
8/n
8/n
MC-5: High number of trades will give you more profit.
Realism vs MC-5:
Few trades with high possibility of winning trades are enough.
9/n
Realism vs MC-5:
Few trades with high possibility of winning trades are enough.
9/n
If you have high number of trades, below components are against you
1)Number of trades is not directly proportionate to more profit.
2)High Brokerage / More Slippages
3)Low allocation on more number of trades
4)Need high win ratio to reach break-even and profitable
10/10
1)Number of trades is not directly proportionate to more profit.
2)High Brokerage / More Slippages
3)Low allocation on more number of trades
4)Need high win ratio to reach break-even and profitable
10/10
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