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Finally Turning the Corner, tha "its 80% Psychology" thing...


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Finally Turning the Corner, tha "its 80% Psychology" thing...

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Vancouver Canada
 
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My first post - I'd like to give something back to this epic forum. I haven't spent a ton of time on here, but I've received some very valuable info/contacts. I've been feeling the huge value of this community and recently decided to buy an elite membership to show support. For those who can relate to what I'm about to share, I hope this helps at least 1 person. ;

Quick about me:

I got into trading in late 2008. I've been working on it since then mostly on a part-time basis (with a total of about 12 months full-time, a month here and there, etc) By now I've logged a ridiculous amount of hours and have investigated tons of strategies, methods, indicators, etc. I've had times where I grew my account 50% over a couple months and then blew it all up shortly after. There's been many times I've had a dozen plus trades in a row. However one thing remained constant: I kept blowing up accounts! Its really thrown me for a loop.Definitely traumatized myself a lot early on from losing money I shouldn't have been risking (not my rent/bill money, but a significant portion of my available resources, creating more cycles of needing to work on other things plus put a strain on many other areas - huge sacrifice. But I've been relentless, absolutely persistent, pick myself up from all the shitty moments. To me the thought of doing something else with $ potential, like internet marketing/starting another business after all the work I've put in, feels really lame and unattractive. My passion has always been short-term trading. I usually do 20+ "round-turns" per day. I'm in trades for 30 seconds -15 minutes usually, although I might leave a runner on for longer. I like to trade markets that have a huge range like NQ, FTSE and DAX. I'm using futures data on Sierra Charts and placing trades with my forex broker. (I don't think its worth it for me to trade micro-futures because of the commissions. I pay no commissions and have a 1-point spread during prime-times) In my opinion most forex brokers will f you over like its their mission. I've tried at least a dozen and have a couple I trust that have excellent conditions.

What "they" don't tell you:


Trading is a dangerous game and has huge opportunity cost. Very few people will tell you that after you get involved, especially when they're taking your money. The majority are selling us "gold-miners" defective equipment to take on our long journeys. Consider this for real, trading could drive you mad. That's legit. Everyone talks about Jesse Livermore but I don't hear them talking about his suicide.

It's of absolute necessity that we get our heads straight and keep em that way. One life to live. Excuses are for losers.

So, I finally admitted I was the problem (not the strategies) and for the last 2 years I've been working on my psychology. And for the last year I've doubled-down my efforts. Each day I spend on average 2 hours on pyschology. My favorite is listening to webinars, podcasts, audiobooks while going for long walks or having some down time at home. Its finally clicking and has helped me realize a LOT.

There are hundreds of ways to trade. Many of us get drawn to short-term trading because its a way to large success. Sure, if we already had a million, we could make 10% a year and live comfortably. That could be a few options, or swing trades or well timed buying of dips. I'm glad I don't cuz that would be really boring. Many people will tell you that its impossible to average 10% per week, but its not. The very word Impossible says I'm Possible. I'm sure there are dozens of members in this fine forum who can do that. I know that a few of my mentors have taught others to get to this level.

Ok, Let's Get Down to the Nitty Gritty Right now I have a large piece of paper with this beside my desk that I read before and multiple times during trading sessions:

TRADING MISTAKES THAT ARE BLOCKING MY SUCCESS AND EPIC DREAM LIFE:

1. Trading too big for account size
(creates fear and anger, excess potential)
2. Wanting revenge
(wanting to get my $ back blinds me from what's happening)
3. Ignoring risk limits
(you have to accept that some days you will be off or tilt and cannot keep blowing up. I will give myself enough trades so that I feel like I've had a big enough chance. Ex: I get to take at least 8 trades, as a scalper I am confident on the majority of days I will come out on top)
4. Not trading my planned trades
(you don't get smarter during the trading performance, you're way smarter when you're not trading and creating the strategy)
5. Not using good stop placements
(put stoplosses in clear "I accept that I'm wrong if it goes here" places)
6. Getting angry/upset after losses
(you lose your cool and then do stupid things. If you're using the correct risk size per trade, its ok to lose. Remember most days I can bounce back from a few losses)
7. Greed
(Greed is the fear of not enough, its for chicken-littles, not for pro-traders. I get paid from groups of trades, from groups of trades, not single trades!)
8. Catching Falling Knives, Selling into Squeezes
(I know its tempting monkey-man, this idea of catching a really big move, however betting against the trend is a 20% probability! Averaging down is for losers. In a strong trend move (staying below 34ema) wait for an impulsive move in the other direction followed by a pullback before considering switching sides. Or a well structured wedge, 2 tries only)


I see trading as a "highly specialized formula". Lots to consider including:


*The way you to choose to view "the market"
(one timeframe, multi-timeframe, one market, multiple markets etc, indicators or lack of)

*How you make trading decisions. (your strategy/strategies, 100% mechanical to full discretion and everything in between. Could you explain the method concisely to me in an hour with photos?)

*The amount of capital you have and how you use it
(per trade limits vs % of capital in your account, daily/weekly loss limits, your ability to honor those limits. Trading the last thousand dollars in your savings account or saved up for a "proper account" where you can risk only 1 or 2%)

*Is your strategy built to last?
(its working in which trading conditions and how do you identify when the correct conditions are present. How do you not trade when you have the urge but the conditions aren't right)

*Do you trade with a consistent approach? (at consistent hours, in a consistent mental/emotional state, repeating the same behaviours, ex: checking for high impact news and setting alerts)

*Are you always evolving? How are you evolving? Are you changing strategies every week and wondering why you're not consistent? (or markets) Are you actually learning from your mistakes?

*Are you neurotic or level-headed?
( good childhood? joking Do you freak (the f) out when crappy things happen in life? Are you able to recognize when you're losing your cool and do something to recenter?

*Do you have mentors? (are they 100% legit? Is it helping? It's unrealistic to think that we'll come into a highly competitive field and kick butt without a mentor. As trading is a performance activity, we're like athletes, most athletes have coaches and mentors.)

Example of an important risk management implementation:

I realized that my strength and passion is short-term trading aka scalping. I define scalping as taking some/all profits off between 5-10 ticks. Its been a huge help for me to trade a market with a large range where I can afford to take 8-10 trades before hitting my daily loss. Fool me once, fool me twice, but not 8 times (on most days). This gives me a strong chance to finish the day profitable or at least with minor damage.

--continued in next post


pss, here's how I choose to view a market:

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Vancouver Canada
 
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After investigating many dozens of teachers and strategies over the years, I feel so much gratitude for discovering those listed on this page. Many others have helped in small ways but each of these people have helped me hugely.


My favorite trading psychogist is Dr. Andrew Menaker. (I love Dr. Brett Steenbarger too, but I relate more with Andrew because he's a full-time trader) His webinars have helped me tons. I've listened to each one of these on youtube at least 5-6 times and will continue to listen often - plus I will take his paid course after I've earned the funds from trading and personal coaching one day when I'm hitting big goals.
https://www.youtube.com/results?search_query=andrew+menaker

My 4 Favorite Trading Mentors (alphabetical order)

Al Brooks (Price Action Trading)
Merritt Black (SMB Futures)
Morad Askar (aka FuturesTrader71)
Steve W (Paracurve)

Immense thankyou mentors. And huge thanks to Big Mike for this epic community and all of the effort to make this a ridiculously amazing forum.

Books that helped me bigtime:

*The Chimp Paradox (we also conveniently forget that we evolved from monkeys. when you get mad and revenge trade and blow up your account, its your monkey at work.. understanding this deeply really helps)

*Mindset by Carol Dweck (you can look on youtube for Mindset book summary to get the main points)

*Trading in the Zone by Mark Douglas (This is a very comprehensive book that I have listened to a few times and will continue to listen to every few months.)

*The Power of Habits and Atomic Habits (learning how to build consistency starts here imo)

*The Talent Code (get into the heads of peak performers, what really makes people great)

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Congratulations on the new journey! Learning more about psychology made a huge difference not just in my trading, but in my entire life.

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Market Wizard
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Well done @TropicalTrader. Really inspiring!
I'm looking forward to reading more.

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Big Mike View Post
Congratulations on the new journey! Learning more about psychology made a huge difference not just in my trading, but in my entire life.



Grantx View Post
Well done @TropicalTrader. Really inspiring!
I'm looking forward to reading more.

Thank-you!

Ok, check this out, I use the Emwave2 device which was recommended by Dr. Menaker.. It's got a little sensor that attaches to my ear, plug in into my computer with usb and comes with a software. You run programs that guide you on how to breathe with a little pulser that goes up and down. You can see your coherance levels going up or down (its a great way to measure your performance state without mental biases). Can also be a meditation tool..


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here's a lil demo:

1. just turned it on (2:48am)


2. notice the high level is moving up? that's coherance, I had closed my eyes for about 90 seconds and did deep breathing


3. a few more minutes of deep breathing, focussing on gratitude - boom! in the zone

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Vancouver Canada
 
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Posts: 89 since Feb 2016
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Emwave 2 Continued

Ok, so right after the last photo I put on a trade.

notice how my coherance dropped a bit


This is a wonderful device to help you stay in the zone and not that expensive either. I got mine on sale for 150..

I keep most of it hidden, and just keep an eye on the breath meter and high coherance level.. Excellent reminder to breathe deep.. The more we control our state, the less monkeying around we'll do. As soon as we start getting into fight or flight consciousness, energy moves away from our unbiased rational brain to the highly emotional/neurotic monkey brain... If you have "discipline issues", this is why.. Next we will start to see what causes us the least stress (bias), like oh, maybe it will turn around. I love Dr. Menaker's expression "the smoking hopium trade".

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Vancouver Canada
 
Experience: Advanced
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here's the trade I put on, divergent double top sell at key area. I thought it got rejected pretty hard before the previous high and a lot of eager sellers there based on the 6 brick impulse out of there, nice wick above the last high.. I'll take these all night long...

Dax using mt4 because I don't have eurex data yet. (next month). I'm trading NQ also using Sierra Chart but its lame tonight. I like these 2 because they're cheap to trade with my fx broker, 1 point spread, and they give a lot of moves. Dax has some beautiful impulses. Need to be disciplined and choose stop locations carefully and then don't f with them.. #RigidWithRisk


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bigger picture (zoomed out 2 min bar chart)

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