It’s easy – just start predicting something. Definitely there will be some people who think you’re really great at this. It doesn’t matter if you really are – it’s just a feature of human psychology. Be as vague as possible, if you’re having some hits from time to time, you’re ok. The rest is just a matter of time. Kill negative comments, and your fans will do all the PR work for you. Finally, write a book. You’ll be rich. Just don’t ever try to follow your own advice.

There are many talks about heavy tails of price change distributions. This means the price sometimes enters highly correlated mode and produce extremely long shift, which is out of any expectations of a “normal” behaviour.

The question is how to research this effect. You can either measure autocorrelations as an underlying reason, or price change distribution itself as a product. There is even more convenient way: mesuring price shifts as a very final product.

Actually, this statistical effect is a basis of all trend following strategies. What is the trend as not the extremally long price shift?

The nature of the stock market is that it is a mix of two different components. One part of it is the randomness, and the other one is the order. And what you do with each part are comletely different types of activity. You can gamble the randomness or you can work the order. Not vice versa. The randomness cannot be used to build some liable strategy to make you money. It is completely out of its nature. You can only gamble it, and get some random results, that’s all.

But these components are so mixed, that you have to go really long way to learn how to distinguishe them one from another. Before that, all the order that you think you can see, may be just a glimps of randomness. You will gamble even if you will think you work. And most of the traders are really just gambling. It doesn’t necessarily mean they lose their money, gambling may give positive results too. Even worse, gambling results may be more impressive, than working results. Most successful gamblers always outperform good workers. It’s the nature of gamling, you take the risk and if you win, you really take it all. Really fast, really imressive. Until unpredictable randomness turns its back.

The only way to separate the randomness from the order is researching. But you should know how to do it.

You think I’m done with writing here? You’re wrong! I’m still keeping in mind the existence of this training camp for my ideas. The number of those ideas for almost five years is not very impressive, completely disappointing, to be honest, but who knows what it will become some day. That’s definetely not about lack of thoughts, because it was enough of them for me to finish the whole book. In Russian, sorry. May be it is time for some kind of improvement? I’m freaking writer now, am I not?

The very common reason for destroying your deposit is taking risks too high. There is a limit of risks your strategy can afford, and it is usually way too lower that you’d like to think. So when you’re taking leverage just 2 times higher this limit, you’re turning profits into losses. Even if your strategy itself is good. It may work fine on lower risks.

So don’t be greedy. It’s too expensive.

Some people believe that good trading strategy must show well on most of stocks. I disagree. Every stock has its own properties, unique combination of interacting groups of traders. So I can see nothing wrong if you have a strategy that works only on one selected stock and show bad results on others. It’s usual thing.

More trends. More insiders, so even more trends and less gaps on fundamental news! Limited choise of liquid stocks (about 10-15 if you want intraday). Iven more limited choise if you want futures. Options’ liquidity is just ugly. So better forget derivatives, spot market is the best choise.

Cheap comission, counted as % of trade volume, not fixed $ per contract. Good technical solution on MICEX, fast and reliable.

Morning gaps :( USA markets and oil futures are essentials for traders, but they mostly trade when russian exchanges are closed.

Market is the battle between different strategies, different ways how to take decisions. But this battle field is not a single whole. It’s divided into small parts called timeframes. One strategie may be a winner on one timeframe, but lose on another one.

It’s been two years I’ve started to write here, and two years since I’ve finished it. It was test drive, I guess. Had many things to do outside blogging and writing. But now I’m concentrated on it again. I’ve got many ideas about stock market, technical analysis and trading strategies. So now I’ll try to put it here one by one. Mostly about technical analysis, because I think this is the key to understanding price movement. Patterns and human psychology, prints of collective subconscious on visible reality. That’s all stock market is. But may be I’m just too dumb for fundamentals.

In ideal, effective market only fundamental information works. But in real market, where traders can be irrational with their decisions, things become more complicated. So when fundamental analysis deals with rational part of market, technical analysis deals with irrational part of market. Something like that.