Good afternoon everyone.
Today there will be an extremely useful article for many, especially for those who have not yet been able to make money in trading. I will tell you what methods and models allowed me to initially achieve results in trading and earn consistently. How the system has changed over time, what I have added, what works and does not work in the market. I have a lot of experience in this topic, for more than 11 years I have been consistently earning on trading, and I started at one time with a small amount, but this did not stop me from reaching the financial result that I could not even dream of at one time .
I post all my financial results on the site in the section about me. I’m sure many will find this information useful.
Strategies that I have earned for 12 years
So, I will miss the period of studying the market and my formation as a trader, I have already talked about this in separate videos, the link is in the tips. During that period, I tried many models, methods, various indicators, in general, I tried everything that existed. But he continued to stagnate for almost 2 years. I will start from the moment when I had the first results and, in fact, I formalized a trading strategy for myself, which was further improved, other models were added. And actually from that moment I began to show the first results. After a while, this allowed me to quit my job, which was very unloved at that time, and find the first investor, thanks to my good statement.
So, my very first models that I was allowed to earn were based on levels. Well, to be more precise, there were several different parameters in the aggregate. This is a correct level analysis, all this was based on an understanding of the market, mechanics, also with an analysis of vertical volumes, with the addition of the ATR indicator. An indicator for understanding when it is impossible to enter a position, when the paper is overheated, or when it is better to exit a position. Or at least as a kind of signal that you should think about exiting, if there are any other important conditions for this. I have already looked at the volume. Also, ATR can be used to place a stop, at least on this indicator, you can formalize the conditions for setting a stop for yourself.
Moreover, I always traded with short stops and used only trend trading and breakout patterns. That is, when a breakdown occurred, you need a level. Exactly necessary, I always selected rare strong levels, for the most part not like many, and so, when the level was broken, I waited for the formation of a buy or sell model if the trend was down. If the model was formed (it could be the necessary fixing for the level, etc., but these are the subtleties of the system), so, I considered the entry point. Most often on m60 or m5 timeframes.
And in fact, this trendy option worked great, and it was on it that I earned the first money. It is worth noting that, of course, it is extremely important to control risks, compliance with the conditions of the system, setting stops, and so on. In any case, there will be unsuccessful periods and there will be drawdowns. But with strict control of risks, I understood for myself that I would still be profitable at a distance.
I have never tilted or broken the system. And I have never analyzed the news background and so on. I looked at the calendar only in order to make a decision on time to exit the position or not to enter the market.
In general, fundamental and macroeconomic analysis is more important for an investor than for a trader. Although, of course, understanding the situation as a whole, and what to follow, will not be superfluous. However, technique is of the utmost importance. Without understanding the fundamental and macro, you can make great money. But if there is no working strategy and no understanding of the technical picture, then even if you are a super-economist, you will not be able to make money. At least speculative. For investments, of course, this is all extremely important.
And by the way, I didn’t use the glass at first, I started adding scalping techniques a little later. That is, the first time, about a year, only levels, in general, everything that I listed above.
And it is the breakout options. Often the mistake of many is that they try to trade when there is no activity, when there is a flat trend, or when there has already been a strong correction after the trend, which spoke of unloading positions. The point is that the probability of continuing the movement during such a period is lower, there is no activity, the stop will be large in size, the risk-profit ratio is worse, and most often you can wait longer for the movement, you will have to freeze the deposit for a longer time, and it is important for the trader that the capital worked and potentially enter those situations where the probability of continuing the movement is higher.
Therefore, otherwise it does not matter for the investor, but for a trader who works from short stops, understanding these points is extremely important.
After some period, I started trading not only breakout options, but also sideways. But not rebounds, but precisely when there was high activity, false removals on volumes or punctures, in general, those moments when there was an increased probability of a stronger movement, there was dynamics from large players, or at least an increased probability that it is there.
Naturally, when we are trying to catch a strong move with a large risk-to-profit ratio, there will be more stops. But at the same time, the profitability can still be high, it all depends on the ratio. Well, I think most people understand that trading is based on expected value.
Then, after a certain period of time, as I noted, I added a glass. Again, I think most try to trade the glass as it is not necessary to do it, trying to compete with trading robots, doing it too actively and so on. Scalping in general works great if done right. Despite the fact that I added scalping trades, I could be without trades for 2-3 days, then make 1-2 trades with holding for 20-40 minutes, then again there might not be an entry signal for some time.
I think too active scalping on the order book without understanding the big picture does not work on the market right now. Don’t even try. It is stupid to try to trade on the volume consumption in the glass, separation, rebound, no, this will not work now. There are many fake volumes, they are often removed, you always need to check the volume, whether the market pays attention to it, whether it is corroded or not. I mentioned this in a separate article about scalping.
Therefore, it is important to combine the glass with the same levels when there are large densities on them. And in general, the erosion of volume in such a situation confirms the dynamics of buyers and interest. Plus, if this is a strong zone and a clear level (precisely clear, not torn, so that there is an accumulation of stops), the impulse at the breakdown of this level can be extremely strong.
In general, I used both breakouts and rebounds for the glass, but again, in the presence of other signals, together with levels, understanding the big picture, and so on.
I traded very actively on non-liquid assets, these are not very liquid stocks. Various planks, etc. By the way, I traded only in stocks by the glass. And he was extremely fond of less liquid stocks, it always gave a very good percentage of profitability. The downside is that you can’t trade a large amount there, and naturally, with the growth of capital, you either have to trade a smaller amount of capital for them within their liquidity, or at some point simply not trade. Although lately many less liquid securities have been pumping well to good turnovers, and in general it is possible to speculate on more or less adequate volumes with a good potential profit.
Over the past year, let’s say, for me, once a month, according to my system, one model for a glass worked stably, connected with slats, it was possible to pour about one and a half million into each paper, this is not so much from the total capital, but each time this model made a profit under 200k. There was an entry with an overnight carry and an exit after a gap. That is, the capital involved is not large, the risks are low, and the time to hold the position is short. Therefore, scalping now works, but with the right approach.
Also, by the way, I traded arbitrage for a long time. Between ordinary and preferred shares, between shares and futures, the same Gazprom. The potential profitability there was small, but there were no risks, although the approach was rather dreary. A few years later, I stopped using arbitrage, because the profitability fell a little more, and for my psychotype, the trading option was rather dreary. And the money from this model was not so much needed, how much it was a pity for its time. Although, again, this can still work, but here it’s better to use advisers (customize it for yourself), it’s quite difficult to do it all manually.
I also use counter-trend models, I also started adding them in a year or two, approximately, at the moment when I started arbitrage. But again, an important note, this is not an attempt to catch some kind of global reversal, but an intraday trade with small targets. These models are also formalized in the system. In the video under the article, he told a little more about what their logic is.
I use slightly reversal patterns, but again, in my style, when there is strong dynamics and growth on the instrument, I could look for a reversal there within the day. The figures I mean, double top, triple, head and shoulders and so on. The risks of trading on such figures are always increased, so it is extremely important to find them correctly here. Many try to trade them sideways without understanding the picture as a whole. You can find many such figures, but all this will not work. Therefore, only on higher frames you need to look from m60, only when the asset is overheated, in the system it can be formalized after how many days of growth we look at what ATR, etc. Candlestick patterns can also work if found correctly, for example, bullish bearish engulfing, hammer, shooting star, etc.
Moreover, most models also work perfectly both in the Russian market and in the American or crypto. I have been trading crypto for a couple of years. But at some point it stopped, because there wasn’t a very large amount there, I got tired of playing, and I didn’t want to start big capital. The risks are still higher. At least from the point of view of the reliability of capital storage.
About options it is worth adding. I also added them, but after about 5 years of my trading. Although I traded options only in a direction (that is, in a simple way, buying calls or puts, that is, a bet on the growth or decline of the market) and extremely rarely during periods of high volatility in the markets. During periods of crisis, etc. On options, of course, you can build safer structures and quite steadily earn small percentages. But it wasn’t interesting to me. In periods of excess volatility, sometimes you can really make good interest on them. But it is only extremely important to control the risks, since you can merge there very easily if you do not have experience. Options are also interesting for investors in terms of risk hedging. In 2020, during the options crisis, we managed to make a very good day8 and earn.
Well, with the growth of capital, I go into more and more measured positional trading, with rarer transactions. Profitability targets are lower, but the risks are minimal. At the same time, he began to work out sometimes transactions in conjunction with technology and fundamental ideas. Some such variant of portfolio trading with adequate risks. And of course, most of the last 4 years I have been directing my income into investments. Any trader, sooner or later, must become an investor, you can’t focus on trading all your life, this is a rather complex psychological type of activity. Therefore, I consider the main task of a trader to earn as much as possible and, if possible, then begin to diversify, invest, including, possibly, in some kind of business. The more sources of income, the better.
I will end with this. Also watch the video below the article, there are examples of some of my other strategies and trades. All success.
Sincerely, Stanislav Stanishevsky.