%% LOL WELL we understand the ''no magic numbers in trend following'' LOL Moving averages sure do not predict, but that's ok, because making money in capital markets is not about prediction. I use moving averages some [SPY benchmark, ETFs.......]; but its like weather forecasting. No one with sense, calls it weather prediction; its called a weather forecast.
%% Good points; I like + use moving a averages , they avoid trader drawn trend line bias. I dont use ma on some cash metals, not needed. The fact some hate moving averages , that's good. They lag-LOL Markets dont work if all try to do the same things. ''Less work + more returns?? '' What if one enjoyed his work??
If you spent a longer time, say lots of years, trying to trade Forex discretionary but failed, then I would say it does not make sense to continue here as it is incredible difficult to have a good consistent winning trading strategy here. If you did not spend time systematically researching trading ideas on Forex, then it might take at least a few years from now on to get something meaningful, and it can take one more decade too. There is still no guarantee here as it is really difficult also systematically to get consistent trading profits in Forex. You could also have a look on stocks, because I would say it is the easiest asset class to master because there are so many good strategies here, which you cannot find on Forex. Forex is more efficient and harder to achieve consistent profits. I would say discretionary it does not make sense for you to continue, as I see no real progress if you tried it already for a decade to try it again for another one or two decades here. A systematic approach can be different but still very challenging because you cannot program as you said yourself. So probably looking for good strategies on stock market can be a good advise for you and then when you start making money here you can still continue on Forex strategies also from a systematic approach. Sorry to say that, I do not want to discourage you totally, but you must know there is no easy path here at all.
Simple answer, no there is not, there are millions of people whose job is to make sure you do not succeed, and fund as many times as is possible to keep the whole show going, could you do this decades ago in the Buffett era, absolutely, today it is a different game. Technology runs the show, the consultants know have seen there is quantum computing in the markets because there are patterns even the fastest supercomputers could not process, people can still beat quantum with their consciousness but it is difficult, the average person would not stand a chance. There is a very long knowledge base but simply very few could ever make enough to live on the returns, like 0.01% and that would be generous, without investment grade capital to start being $1million. Between that and what everyone else has the markets have arbitraged every possibility out except one, sub minute timeframes, basically it's too complex for them. Have access to a hedge fund grade system with algos (running at HFT milliseconds) that pinpoint near 100% entries at 1sc and 10sc timeframes, the problem is after you enter the markets catch wind of what is going on and make life intensely miserable, then what about in the 15min, 60min timeframes, you are in the middle of a normal distribution, one of the consultants showed me this a few weeks back. Everything at and above 1min and in the past below 4hr timeframes was non-linear, today linear is still sub minute and now under weekly timeframes, yes hedge funds and institutions are also being taken out by Sovereign, but be aware of one simple fact in life and doubly so when dealing with the markets, everyone is faking it to make it. The consultants spent a decade designing the system which covered sub minute linear, non-linear trading/investing, and above 4hr investing/wealth management. Which raises the question, can anyone get access to it, Bloomberg'esque terminal at $2k/mth with 100ms charts and integrated algos across all assets, and the simple answer is they can't be bothered, to be successful at anything is a lifestyle choice, fail at that and you automatically fail at whatever it is you are doing. I know that because I was having to teach someone to use the system and they refused to adjust their lifestyle, obviously they blew up even though the wealth managers told them enough information to succeed. The fact the markets are about money makes the spread between success and failure even wider, the closest you will ever get to a public accessible trading platform is Elliott Wave via eSignal, it was added from the AGET software which was actually better without the 'padding', and that will only provide 80% probability, if you want above which is what I have access to you have to change they way you live life. Eat healthy, early to bed early to rise, daily exercise, low stress, and importantly low expectations of life or more humanity, meaning the world will do everything in its power to make you fail so they make one extra dollar, no matter it cost you $100 or $1million, truly they do not care and that will be true of basically all advice you receive. The summary is very simple, you are not supposed to succeed at any point in the markets, actually it's the same with life, keep working until you drop or did you think the current inflation was an accident, everyone's definition of success is that they are profitable to 1-2% per month which is great until you understand the entire financial system is built on fractional reserves and can implode at any moment taking your capital with it, or if they can just get away with it because you're low hanging fruit. Take a look at FTX, apparently Binance induced it saying they were underhedged, same happened to LTCM because they were providing 'public' 30-50%pa returns where only 15-20%pa hedge fund returns are deemed acceptable by the financial markets. Investments should be 20% of net worth, if you need $10k per month at 1% return on capital that is $1million capital available to invest, which is $5million net worth, hence anyone with less than $100,000s capital are basically just playing in the markets, unless they are scalping the markets and even then one of the Market Wizards said they don't make much profits on scalping, it provides knowledge in to the investment grade trades, which is true with futures at 50:1 leverage, but 500:1 forex it becomes a lot more interesting!
Thanks people for all the help and the time you spent writing long posts, I read all of it. Sorry for not replying to everyone individually, time issues. chappy, how is MACD related to trendline? I never believed in indicators incl. MACD, but I am not saying none of them work, I don't know. it's just that I have my own view of markets, like everyone else. For example, in FOrex I would never hold more than one position at a time because of correlations, the exception is pairs that are almost not correlated at all, such as EUR/GBP and AUD/NZD I do to a certain extent believe in trendlines in my own way (but not in a way where you have a trendline constructed using two peaks/troughs and you trade of the third bounce obviously, than would be waaaay to simple). ANyway, could you elaborate on the method? Those who suggest trading american stocks, I live in Eastern Europe, time wise it would not be ideal, but I could adapt to it if necessery. What are those trading methods then? Do you trade them in both directions? Is choice of brokers important for day trading stocks? Taking into account the volatility of stocks and the maximum leverage you can get on stocks, does the majority of the trading capital have to be in the broker account (assuming you use leverage) I am aware that stocks are a little easier, although have never seen direct proof. Is day trading stocks more seasonal than day trading FOrex? I noticed that on DAX for example the volatility can be very significant during certain periods, but then for very long periods of time it's just not there (I think mainly in the summer, but I may be wrong). Whereas in FOrex, this seasonal effect may also be there, but to a much smaller extent
Yes, there is a kind of "seasonal" tendency every day on US stocks. When NY cash market opens you can trade the Order Imbalance strategy, so when individual stocks move much more than their historical Beta Factor it can be used as a mean-reversion trade. I heard of some professional prop traders who trade this for years and take home profits EVERY MONTH. It is a well known and very good working strategy for stocks (which you cannot find on Forex in comparison).