Advertisement
If you have a new account but are having problems posting or verifying your account, please email Niamh on [email protected] for help. Thanks :)
New AMA with a US police officer (he's back!). You can ask your questions here

An amateur starts a thread

  • 20-07-2016 8:34am
    #1
    Registered Users Posts: 534 ✭✭✭ chompdown


    Hello all. I am starting a thread here which will most likely end in a balance of zero, but I want to give it a go and see how it works out.

    I will start with a balance of 1,000 and my spread betting positions will all be with a common theme of stock markets & commodities rising, and the dollar dropping.

    I receive guidance on trades from a very successful traders club I am a member of.

    The biggest killer of any amateur trader is a lack of discipline, and I am certainly guilty of that. Using boards.ie as a way to track my progress has been a great way to curb my over-enthusiasm on the gambling forum, so I will try it here also. Some basic rules for me to follow:

    Starting balance July 2016: 1,000
    Additional deposits: Max 500 per month thereafter
    Markets: strictly limited to the S&P, Dollar index, Gold, Silver, Oil.
    Positions: Strictly limited to one at a time.
    Limits: my first position will be in the dollar index and my max stake is 1 point per 1,000. Other limits to follow.
    Trades: Absolutely no day trading allowed. Buy and hold until I am advised to sell.
    Long/Short: If I am long and advised to close a position as it is about to turn, I will simply close the position rather than be greedy and attempt to short it.

    I receive guidance on trades from a very successful traders club I am a member of.

    These positions are 'old turkey' which means I want to hold them longer term. I am sticking to markets with no funding charges.

    I will post balance updates to this thread, and comment on any thoughts / challenges I have.

    This thread is an exercise to attempt to improve my self discipline.

    If my balance ever reaches 5,000 I may alter the rules slightly, but not before then!

    I will have no stops in place

    I will probably place my first this week!


«13456713

Comments

  • Registered Users Posts: 534 ✭✭✭ chompdown


    Quick update to say that my account is funded now and it looks like I will need to wait until next week before opening my first position. My guy says there should be further dollar strength until just before the FOMC meeting. Will wait until I get the nod.

    Just to add two more max position limits.

    Gold max 20 euro per point
    Silver max 15 euro per point

    I doubt I will be getting involved with the s&P or oil for a good while yet.


  • Registered Users Posts: 15,299 ✭✭✭✭ Francie Barrett


    I tried something similar to what you're doing around the time of the Dot-Com crash 15 years ago, trading the NASDAQ, S&P and Dollar (as well as Sterling and Euro at times). I managed to keep my discipline with stops, but I think they ultimately contributed to my slowly bleeding my capital, especially during times of high volatility where you could have a position stopped out within minutes of opening it. It seems to me like trading either ends up with a slow bleed if you stay disciplined, or else a spectacular blow-up if you don't bother with stop losses. Either way, it seems very hard to win and I don't know anyone who makes it pay.

    Sorry, don't mean to put a downer on your thread or anything :) It's just I don't know a single person who has paid their way trading over a long-term period. I think buying stocks and holding is the better proposition, but would be happy for you to prove me wrong. Good luck.


  • Registered Users Posts: 534 ✭✭✭ chompdown


    OK so today's report has been posted and my guy says that the intermediate cycle low for the Euro is very close and expected within the next week, so I have decided to short the USDX 0.2€ per point today, tomorrow, Mon, Tue and Wed. Only if I get the nod that the bottom is in before then, I will bring the trades forward. That will bring me to €1 per point and hopefully a decent average price near the low.

    Starting balance: €973.14
    First trade: Short USDX 0.2€ @ 97.070.


  • Registered Users Posts: 534 ✭✭✭ chompdown


    Hi Francie, thanks a lot for your comments. You're not putting a downer on it at all :) You're talking sense as the liklihood of this thread ending badly is very high.

    Funnily enough, your comments about stops were only recently spoken about in the group I am a member off. The main man said that we should not have tight stops in place for long term trades, but to mitigate risk by having smaller stakes. I have no stops in place, but my stakes are too high and hence I will have to time this trade almost perfectly in order to get out of this alive.

    If I am lucky and time the trade well and if my bank grows I plan to be disciplined not to increase stakes up to a point, and rather use that increased balance as a buffer against those high volatility days.


  • Registered Users Posts: 537 topper_harley2


    chompdown wrote: »
    OK so today's report has been posted and my guy says that the intermediate cycle low for the Euro is very close and expected within the next week,
    I think this is my dislike for trying this approach. What crystal ball is the source of the information.....


  • Advertisement
  • Registered Users Posts: 7,494 ✭✭✭ BrokenArrows


    When trading currency what is considered a point? One cent?


  • Registered Users Posts: 534 ✭✭✭ chompdown


    Trade 2 just executed.

    Short USDX 0.2€ @ 97.180


  • Registered Users Posts: 534 ✭✭✭ chompdown


    @Topper, agreed yes it's v high risk to try and time any trade so precisely but with a starting bank of 1,000 I do have some room for maneouvre.

    There is no holy grail of exact entries but I have been following one trader who has an extremely good record and now I am following him with his calls. He is a sentiment and cycles trader.

    @Broken Arrows, it is actually per one tenth of a cent.

    So at 1€ per point a move from 97.070 to 96.070 generates a €1,000 gain.


  • Registered Users Posts: 2,435 ixus


    Trading on some other "guru's" advice is a recipe for disaster. I am wary this is a sales pitch.

    You're short $, long commodities idea is essentially the same trade. If you don't know why that is you should figure it out.

    Do you know what important $ is next Wed?


  • Registered Users Posts: 534 ✭✭✭ chompdown


    Yes, there are a lot of clowns out there, even some criminals, and maybe this is not gonna work out, but I have outsourced my trades to someone who I believe knows more than me, and I'm tracking the success or failure of it here.

    I know the FOMC meeting is next week.

    And yes of course I know long commodities and short the dollar are basically the same thing, but you should also understand that they are not always correlated (positively or negatively), for instance the big move in gold this year came while the USD remained strong.

    Your post is very condescending by the way. I am not trying to big myself up here, the opposite in fact!


  • Advertisement
  • Registered Users Posts: 159 ✭✭ poeticjustice


    chompdown wrote: »

    Your post is very condescending by the way. I am not trying to big myself up here, the opposite in fact!

    Have to agree with this. No need to be condescending ixus.

    Good luck with it chompdown. You have the right attitude anyway, it may all go wrong but at least you're prepared. Will watch with interest


  • Registered Users Posts: 2,435 ixus


    As mod I am wary of you bigging up some random traders club punter and this being a way to recruit.

    Saying you are entering and exiting trades with no stops based upon the advice of others is possibly the worst thing to do. Forums and twitter are littered with scams and people whonhave lost significant sums of money.

    You had previously indicated no knowledge of anything related to a trade of a specific product other than the advice to enter or exit from someone else. I think it was fair to ask and warn you if you didn't.

    Two days ago, I witnessed a twitter account with a 4/800 following talk about being balls deep long dax at 1040. £500 a point. Next morning the dax traded as low as 9910,.£65k or so loss. The user deleted all his tweets and didn't reappear until the dax was at 1050 the next day. Multiples of his followers took the trades on his bravado and took a beating.


  • Registered Users Posts: 534 ✭✭✭ chompdown


    That's fair enough ixus. There are a huge amount of scams online for sure, even one I remember a huge pump on this very forum not too long ago, so I can see why you might be wary.

    Anyway, I was just trying to be transparent by saying that I am not a know it all, very green, etc.

    Here's my first update (which reflects that!).

    Week 1 update
    Starting balance: €973
    Position: Short USDX (Sept) 0.4€ @ 97.125
    Current price: 97.420
    P/L: -€118 / -12%


  • Registered Users Posts: 15,299 ✭✭✭✭ Francie Barrett


    ixus wrote: »
    Two days ago, I witnessed a twitter account with a 4/800 following talk about being balls deep long dax at 1040. £500 a point. Next morning the dax traded as low as 9910,.£65k or so loss. The user deleted all his tweets and didn't reappear until the dax was at 1050 the next day. Multiples of his followers took the trades on his bravado and took a beating.
    In fairness, [email protected] is an absolute cesspit of ramping and lies.


  • Registered Users Posts: 460 ✭✭ iainBB


    chompdown wrote: »
    That's fair enough ixus. There are a huge amount of scams online for sure, even one I remember a huge pump on this very forum not too long ago, so I can see why you might be wary.

    Anyway, I was just trying to be transparent by saying that I am not a know it all, very green, etc.


    Here's my first update (which reflects that!).

    Week 1 update
    Starting balance: €973
    Position: Short USDX (Sept) 0.4€ @ 97.125
    Current price: 97.420
    P/L: -€118 / -12%


    At least a screen shot perhaps that the standard way of showing actual results.


    Your first week with this magic voice that tell you future price movement got it wrong. ?


  • Registered Users Posts: 534 ✭✭✭ chompdown


    I can start adding screenshots if I ever get in the green. Not much point faking a 12% loss in week 1.

    Nobody knows the absolute perfect time to enter a position.


  • Closed Accounts Posts: 608 For ever odd


    DXY has had 2 weekly closes above historic 96.39 support /resistance level, also a weekly close above the 61.8% fib level.
    Traders would be targeting 98.3/6 zone to the upside, while 96.39 and 50% fib level should offer solid support in any move to the downside.

    Good luck.


  • Closed Accounts Posts: 608 For ever odd


    DXY has had 2 weekly closes above historic 96.39 support /resistance level, also a weekly close above the 61.8% fib level.
    Traders would be targeting 98.3/6 zone to the upside, while 96.39 and 50% fib level should offer solid support in any move to the downside.

    Good luck.


  • Registered Users Posts: 534 ✭✭✭ chompdown


    Cheers odd! When you put it that way, I need your wishes of good luck :)

    The intermediate cycle high for the dollar is now set for Wednesday or Thursday, so my plan to slowly add to the position until the day of FOMC is changing slightly.

    My max position before the FOMC announcement on Wednesday will be 0.5 per point (currently 0.4).

    The top could come sooner but if the Fed raises, I will be thanking myself that I wasn't in too deep and will also have some funds available to add.


  • Registered Users Posts: 2,435 ixus


    I don't expect the FED to raise but, if they did, adding would be the last thing you should do. The $ move would be parabolic.

    I see two scenario's; signalling for a move in Sept based upon current data and it staying on path for Aug or, dovish talk as they refer to Brexit and Geopolitical issues causing massive uncertainty. Given US data, they should to the former but then, Yellen....

    Your short $ trade is betting the FED are dovish and/or that Bank of Japan don't launch a massive easing program on Thurs. Basically, the opposite of what's expected.


  • Advertisement
  • Registered Users Posts: 534 ✭✭✭ chompdown


    I agree that a rate increase is unlikely. The Fed Funds Futures have a 96% of no rate hike. What is most likely imo is a hawkish version of no rate rise, a slight rise in the dollar leading to a high on Wed / Thurs and then that's it, the intermediate cycle top.

    Bold prediction: By Friday I will be 1 per point short and in profit :)

    Let's see what actually plays out!


  • Registered Users Posts: 534 ✭✭✭ chompdown


    Trade 3 just executed.

    Short USDX 0.1€ @ 97.470


  • Registered Users Posts: 7,494 ✭✭✭ BrokenArrows


    chompdown wrote: »
    Trade 3 just executed.

    Short USDX 0.1€ @ 97.470

    I must be missing something when it comes to spread betting but I don't understand what you're doing.
    You are placing the same trade again and again just at different rates? Are you closing out your previous position and then making a new trade?


  • Registered Users Posts: 534 ✭✭✭ chompdown


    Hey Broken, I'm planning to have a position of 1.0 Euro per point by Wednesday / Thursday.

    As I don't know when the dollar will start to turn downwards I decided to buy into my full position in bits and pieces.

    Now I'm holding 0.5 Euro per point and the remaining 0.5 will be added when it looks as though the dollar has reached its intermediate top and has started to go down.

    Like I said earlier, this will very likely end badly!


  • Registered Users Posts: 7,494 ✭✭✭ BrokenArrows


    chompdown wrote: »
    Hey Broken, I'm planning to have a position of 1.0 Euro per point by Wednesday / Thursday.

    As I don't know when the dollar will start to turn downwards I decided to buy into my full position in bits and pieces.

    Now I'm holding 0.5 Euro per point and the remaining 0.5 will be added when it looks as though the dollar has reached its intermediate top and has started to go down.

    Like I said earlier, this will very likely end badly!

    Whats the point in doing that?
    You're basically saying "im going to lose with the first .5 and then when i think im about to start winning ill invest the other .5".

    If you have the ability to recognize when the "intermediate top" is then why not just invest the whole amount then.


  • Registered Users Posts: 534 ✭✭✭ chompdown


    Because it is impossible to know for sure when the high is. It is most likely to be Wednesday or Thursday but could absolutely have been last Thursday, Friday or could be today.

    I know exactly why you mean and yes in hindsight yes it looks like a bad move, but the high could easily have been a couple of days earlier than expected.


  • Registered Users Posts: 15,299 ✭✭✭✭ Francie Barrett


    Tough crowd :)


  • Registered Users Posts: 534 ✭✭✭ chompdown


    Tough crowd :)
    Ah it's the Irish way. Healthy scepticism! Imagine I was trying to big myself up!


  • Registered Users Posts: 7,494 ✭✭✭ BrokenArrows


    chompdown wrote: »
    Because it is impossible to know for sure when the high is. It is most likely to be Wednesday or Thursday but could absolutely have been last Thursday, Friday or could be today.

    I know exactly why you mean and yes in hindsight yes it looks like a bad move, but the high could easily have been a couple of days earlier than expected.

    Of course its impossible.
    But your approach seems to be "keep betting on the same thing, its bound to turn around eventually".

    If you're not confident in your first bet then why did you place it at all. By placing any money on Trade 1 it means you thought that that was the correct time otherwise you wouldn't have placed it.


  • Advertisement
  • Registered Users Posts: 534 ✭✭✭ chompdown


    It's only week 1. I plan on holding these for at least a couple of months.

    I am confident in my first bet. I have a stake in mind, 1 point, and rather than going all in at one price I wanted to average in a different prices.

    I didn't expect the top late last week but I also didn't expect it to go much higher. I wanted to have some exposure to the Dollar already in case there was a drop.

    Also, mentally it's quite difficult to hold off on opening a position when you have your account funded and you expect a big move. Discipline is something I really suffer with (hence the thread) and maybe a more disciplined approach to wait for the most appropriate point and then go all in would have been a better. It's a learning curve.


Advertisement