One thing I always try to do with my trading journal is to be objective in terms of why a week went well or bad. For example, my stats on ninja trader this week (on CL alone) show I had a 73% win rate ..with 24 winning trades and 8 losing trades. I made about 150 ticks.
This is better than my usual weekly average. One of the reasons this week went well is that Cl was moving ,many days ,with a lot of directional momentum. This is the type of week where more opportunities present themselves and it makes sense to take as many of them as possible. Looking back, I probably could have been even more aggressive and made over 200 ticks on a week like this one..but overall I am very satisfied with my performance.
For less experienced traders who may have enjoyed success this week, it can also give them unrealistic expectations. They may believe ..they finally figured this thing out since most any trending/pullback setup would have worked if they had any sense of timing an entry. However, those same setups on an exceedingly choppy week would not bring the same results..and these traders would be left pondering, "What happened? I thought I figured this s..t out?"
I know this because I have experienced the euphoria of weeks like this in the past...only to be brought back to reality by having a horrible week soon afterwards. The difference now is..I am learning to discipline myself to absolutely say no to every type of temptation or entry that does not meet my criteria. Everything must be there...no obvious support or resistance blocking my path to the target..strong volume/volatility and momentum..low risk/high reward entry..etc. I no longer let the emotion of "I'm missing a great move..Oh my god..I have to get in this trade" lead me into late and risky entries. I wait until the optimum moment (some traders don't believe that optimum moments exist..but I disagree)...and if it doesn't show up..I don't trade. I know I keep repeating this point...but it's been the most important part of my progress in the last few months. I actually went back to SIM for a while just to form new habits and behavior.
Since I mentioned SIM, there is a consensus that SIM trading is basically useless. I would agree if it is not used in a productive or goal oriented manner. It can become very easy to be on SIM..and casually jump into trades...sit back and relax and watch them hit the target. Many of these wins can be pure luck..and it can be easy to delude oneself into believing they know how to trade well. For SIM trading to be effective, it needs to be goal oriented. You need to have both a weekly minimum tick goal and a behavioral process oriented goal. For example, you could set a goal of maybe 40 to 50 ticks a week for a month...and until you can average that..you stay on SIM. This, in a way, gives you some "Skin in the game". Because if you know you can't go live until you achieve your minimum tick goal over a period of a few weeks, you will have some form of pressure on yourself. No Goal= No pressure. Also, you want to keep a journal and write whether or not you completely followed your system and all of it's rules. If you find yourself constantly taking impulse trades or revenge trades, you are not ready. That behavior will lose you a lot of money. Trust me on this ! So, again for SIM trading to be effective, it must be goal oriented..or else you are wasting your time. And I do believe, if you can't be profitable on SIM, you probably won't live.
Failure is not an option
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After now having achieved my minimum weekly goal of 60 ticks a week for many consecutive months, I am now in the process of adding more contracts. I realize that to many, 60 ticks a week seems like a very modest goal and I agree that is is. I have some weeks where I make well over 100 ticks..but almost always I can make 60 ticks in a week. Here's how it adds up.
60 ticks at 1 contract= $600 a week $2400 a month $28,800 a year.
60 ticks at 2 contracts= $1200 a week $4800 a month $57,600 a year
60 ticks at 5 contacts= $3000 a week $12000 a month $144,000 a year
60 ticks at 10 contracts=$6000 a week $24000 a month$288,000 a year
60 ticks at 20 contracts=$12000 a week$48000 a month$576,000 a year
So, I like 60 ticks because it's not that hard to hit..Often I hit it by Wednesday. For me, it is all about waiting. I ignore every move that shows up except the one's that meet my criteria 100%. In other words there is basically no obstacles in the way of my target..(No major or minor support or resistance ), it is during what I call a "Hotzone" time of day..there is plenty of strong order flow occurring..I am able to take a high probability/low risk entry. Everything must line up according to my observations of Cl price action over the last 5 or 6 years of daily viewing and trading. If I don't like anything during an entire session, I have no problem staying out. On a great day, I may take many trades.
I always think in both directions. Crude Oil can often look like it's in an extreme trend and then suddenly reverse 100 ticks or more in a manner of minutes. So every setup I consider, I always ask..Ok, now what is the setup in the opposite direction. So many great trades often are the most uncomfortable ones to take..because they go totally against the momentary bias.
Before entering I always run through a quick checklist of reasons not to take the trade. For several years now, I have known what a great setup looks like and have frequently won those trades easily. My problem was always taking mediocre setups and suffering lots of losses. That is no longer happening.
Failure is not an option
The following 18 users say Thank You to lancelottrader for this post:
Lancelot, you should be proud of your success and I am very happy for you. It looks like you have been consistently profitable using basically the same system for over a year, from what I can tell. So that is truly an accomplishment!
Thanks again for the work you have put into this thread!
I have not achieved success in trading and am leaving trading for the time being. I am not sure if I will be a day trader again, it is hard to tell at this point.
I will check into futures.io (formerly BMT) every once in a while-- i wish you continued success!
The following user says Thank You to trvlntrdr for this post:
Thanks for the nice words. I don't really consider myself a success..yet. I think when I am trading at least 5 contracts and am able to build up my account and also fully support myself from trading, then I will be successful. But I am pleased with my results and I see no reason that I can't achieve my goals.
However, it has been almost seven years of trying and experimenting along with a lot of stress and lost money. I'm truly surprised I didn't quit several years ago.
Thanks again and good luck with your trading. If I can be of any help, let me know.
Failure is not an option
The following 2 users say Thank You to lancelottrader for this post:
Hi. I haven't really changed things in the last 6 months or so. The only difference is I have been much stricter in adhering to my rules and I reject way more setups that don't meet the criteria 100%. The result is that I take far less losing trades and have much fewer losing days.