I have read a lot of this entire post and I totaly get where the orriginal poster is coming from. I think we have all gone through the fear phase, perhaps I am still in it. Early on I would strictly trade the ES and the ES only and would have my hiney handed to me on a daily basis. I'm not stupid and quickly realized that if I kept this up I would soon run out of dough so I hopped on the simulator. I simmed for about a week and would do great; first thing Monday I would go live and you guessed it, the cycle would repeat. Eventually I got to the point where I would have one small loser and I would run into the simulator for weeks on end.
I decided I was going to have to take a long hard look at myself and what type of trader I was, not to mention revamp the sub-par methodology I was using. I simplified my trading plan and decided that no matter what all I was going to do was trade my two top (high probobility) performers and nothing else in the simmulator for one solid month. Also, I discovered I had a greed problem and decided to step down to trading the cheapies like the NQ, YM, and the 6B; a full hit on those would only cost mr $50 - $60 as opposed to the three-pointers I was taking on the ES. I simmed the entire month with the afore mentioned instruments and was succesful so moved onto live. I have been back live for quite some time now and doing OK, my account is steadily growing.
I guess I still have some of the fear because I still trade the cheapies, ah-well, it's working for me and if I continue to work on myself I will step back up to the better paying contracts like the 6E when I am ready. I doubt I will ever do the ES again, I just don't care for it.
The following user says Thank You to Rayzor for this post:
IMHO, I think if NQ. YM, and 6B are working for you, then continue trading them, and just add more contracts, to increase your profits. Don't assume that the method that you are using on these instruments will automatically be successful on any other instruments. If you do want to switch to different instruments, I suggest you go back to step 1, back to Sim on the new instruments, until you verify that you can be successful trading them with your methodology.
The following user says Thank You to monpere for this post:
Thanks "Flux", I can't agree with you more. I am content w/ what I am doing now and I have added contracts to increase the reward. The lower loss possibility in dollars really helped me get through the inability to pull the trigger. I sometimes think that futures should have micros just like Forex, IMO I think it would help traders out in getting over the fear. "Real money" can change things when it comes to clicking that mouse.
I use a 4 Range chart. I enter at the close of a bar. My stop goes 1 tick behind my entry bar (which is actually 5 ticks, but gets moved to 4 ticks once I I get 1 tick profit in the direction of the trade. I do that because I see a good number of entries that trigger go back 4 ticks, and then go to target, but this happens less often when the trade starts moving forward, so I require it to move forward 1 tick before tightening the stop)
The following user says Thank You to monpere for this post:
Agreed. I had the same issue, so I started trading the YM, NQ, and 6B as well, and still do. The other thing I did, I initially tested my method with the ETF equivalent of the futures contracts. So, for instance, I would test with real money on the IWM eft rather then the TF (Russel) futures contract. That way I could buy 50 shares of the IWM and only loose $5 on a 10 tick losing trade with like $1 commisson. The object was not to make money, but to get used to trading real money, and also test my strategy. Obviously there are slight nuances in the mechanics of trading the IWM then the TF, like order flow, volume etc. But I don't use volume or order flow, I strictly trade chart patterns. And the etf's will generally give the exact same chart patterns as the associated futures contracts . The other major difference is that you need a minimum of $25K account to "day trade" stocks/etf's.
It doesn't say whether the losses were from one massive loss or a series of smaller losess...
anyway I have seen this happen with guys earlier on in my career... some of them got taken under the wing of older, more experienced guys, and they did exercises like:
Put on a trade and take profits as soon as you can - profits are not impossible to make
Put on a trade and set a stop / limit far enough away that you will probably be in the trade for an hour or so... and wait. Just wait - you will make money or lose money, but the markets are definately not out to get you.
Trade smallest size you can, but pick a period and ALWAYS be in the market during this time.
Of course these are not best practices for trading all the time, but they seemed to help these guys get around the sheer terror they had when forced to make a trade.
The following user says Thank You to cpi65 for this post:
OK, so... I've read through a bit of the thread and most of it seems to be along the lines of "trade on Sim until you are consistently profitable" or "don't risk more than yoiu can afford to lose" and all the usual bollocks. Most of my posts here seem to get deleted because of my abrasive nature so I'm not quite sure why i'm bothering, but well to hell with it!
You're live PnL is like your virginity. Don't just throw it away, but it doesn't get more valuable the longer you keep it. And even then, you can't get better at shagging (trading) if all you are doing is wanking (trading on sim).
Trading, like most things, requires more than one skill. If there is one thing that is letting you down, the answer isn't just to carry on until it gets better - the answer is to find some exercise that is specifically designed to improve this skill. For example, professional tennis players don't just train by playing tennis.
They put coke cans in the service box and practice their serves until they can hit them every time. They have a coach set them up for backhand shots again and again until they've nailed it.
Trading is the same. If you have a particular prolem, do exercises that work on it specifically. You won't get much better by just carrying on trading.
And that's what my post above is about. There you go, bet most of you thought I was a useless shit, eh, but that's shit hot advice even if I do say so myself.
The following 5 users say Thank You to cpi65 for this post: