What was it that made me take this trade?

I observed the previous days high, marked a level and when I got a confirmation candle I was ready to take the trade.

This was the trade I was talking about in the previous post

Although, I did take the MYM trade too.

Who I am as a trader

I've only been at trading this year, and the year's not even over. I wouldn't call myself a trader yet. I'm working on it, like REALLY working on it. To date in order to trade well I've made what some might consider great strides- I quit drinking and chewing tobacco. I started working out. I've lost a bunch of weight. For me, just the act of learning to trade has paid dividends. I do what I do because doing it IS discipline. By nature I have REALLY poor impulse control, but I also believe I have free will too. It may not happen overnight, it may not be conventional, but by God, I will be disciplined. For me this is the bed rock of what I am building my trading on.

I understand a lot more than when I started, but I know now is next to nothing with what's out there. What I know now JUST might make me some money in near future, time will tell. I recently started what I'm calling my first sprint sample. I had planned on 50 trades, but do to GROSS OVERTRADING this week that grew to over 70. Part of that is a discipline problem, the other part is I still don't know how to trade. Even with all that, The results of the sample were interesting.



Its interesting because even without a solid, well defined strategy I still managed to be somewhat profitable- even with a losing win rate. It shows the validity of the fundamentals, the importance of a good win/loss ratio. It shows how far I've come, and how far I have left to go before I start trading for real. It also shows that when I do have at it for real, that I have some wiggle room- I don't have to be the greatest, just good enough to start.

The problem I'm having is finding a strategy I believe in. There is so much information out there much of it good, much of it crap. Its been a chore sorting through it, trying to find what works. Where I'm at right now is price action, timeframes 15-60, and VWAP. What I noticed this week is that I haven't been paying attention to daily support and resistance, and it may be that those levels are really what I want to be trading. For instance, this week on the MES, resistance (2.) @4540 formed on Tuesday and held through the rest of the week, and support formed (5.) @4520 on Wednesday.



For the next 50 trade sprint sample I am going to really focus on trying to develop my strategy by working to identify these levels for the markets that I trade, and only trade off these levels. Not sure what that all entails, so I'll be making some of it up as I go. Also, to prevent over trading, I am now limiting myself to 10 trades a day. So it could be that I finish this next sprint sample next week.

michaelroth 

Who I am as a trader I've only been at trading this year, and the year's not even over. I wouldn't call myself a trader yet. I'm working on it, like REALLY working on it. To date in order to trade well I've made what some might consider great strides- I quit drinking and chewing tobacco. I started working out. I've lost a bunch of weight. For me, just the act of learning to trade has paid dividends. I do what I do because doing it IS discipline. By nature I have REALLY poor impulse control, but I also believe I have free will too. It may not happen overnight, it may not be conventional, but by God, I will be disciplined. For me this is the bed rock of what I am building my trading on. I understand a lot more than when I started, but I know now is next to nothing with what's out there. What I know now JUST might make me some money in near future, time will tell. I recently started what I'm calling my first sprint sample. I had planned on 50 trades, but do to GROSS OVERTRADING this week that grew to over 70. Part of that is a discipline problem, the other part is I still don't know how to trade. Even with all that, The results of the sample were interesting. Its interesting because even without a solid, well defined strategy I still managed to be somewhat profitable- even with a losing win rate. It shows the validity of the fundamentals, the importance of a good win/loss ratio. It shows how far I've come, and how far I have left to go before I start trading for real. It also shows that when I do have at it for real, that I have some wiggle room- I don't have to be the greatest, just good enough to start. The problem I'm having is finding a strategy I believe in. There is so much information out there much of it good, much of it crap. Its been a chore sorting through it, trying to find what works. Where I'm at right now is price action, timeframes 15-60, and VWAP. What I noticed this week is that I haven't been paying attention to daily support and resistance, and it may be that those levels are really what I want to be trading. For instance, this week on the MES, resistance (2.) @4540 formed on Tuesday and held through the rest of the week, and support formed (5.) @4520 on Wednesday. For the next 50 trade sprint sample I am going to really focus on trying to develop my strategy by working to identify these levels for the markets that I trade, and only trade off these levels. Not sure what that all entails, so I'll be making some of it up as I go. Also, to prevent over trading, I am now limiting myself to 10 trades a day. So it could be that I finish this next sprint sample next week.

Solid trading! Avg Win > Avg Loss & Largest Win > Largest Loss!

Hey Michael, as a new trader myself, I commend you on your journey, and wish us both the best of luck. It is truly refreshing to hear a personal story of another person's trading experience. What inspired them, how they started, and how it's going. I plan to keep following the story.

Putting together a rules based strategy

I am putting this video in my journal because I am thinking about using the strategy or another that's similar. I really like these Secret Mindset video's. I have it set up on my charts now and will journal how I am using it and how well it performs.

Finding confluence with my girlfriend

I've been busy this week and haven't had the time I wanted to journal. Its Thursday evening right now and I have to be up early for work tomorrow so I'll have to keep this efficient. The trading effort continues. Here is the latest version of my chart. I'm trying to focus on the 60 and 5 minute time frames, context and price action to develop trade ideas. I'm trying to keep trading fundamental and super clean. I'm trying to see the markets for what they are and not what I want them to be. That last part is hard for me and I'm not totally sure why that is. I think that the sooner that I can understand it, the sooner that I will become a consistent trader.



I'm still not sure of how I want to trade, but I think that I've now figured out enough to start trading live and small again soon. This week my girl traded with me. She's interested, but like a lot of people she has funny ideas about the markets, like its basically basically just gambling and rich person witchcraft. She's also super competitive so she sees me doing this and she just knows that she can do it WAY better than me, and who knows? May be she can. So I have enlisted her into the effort. Onboarding her means that I now have an extra set of eyes. She's no longer jealous of me trading. We have another activity we can do together, and if we triumph, we do so together. So I'm excited she's now a part of the team. Wouldn't that be funny if my best strategy was using my girlfriend to viciously attack the markets?

There's still a lot more to do, but I keep putting one foot in front of the other, I know where I want to go, so I expect that I'll get there regardless. I haven't started the next sprint sample because there was so much to improve. I, I should say we, will be starting that again next week. I have a lot of other stuff I want to put in the journal, but it will have to wait for another day.

These are here to be used later.

Stalking trades

This wasn't bad for a days work, and I feel I really turned a corner last week. I think that I finally found a way that I like to watch the market develop and might be developing a strategy that I like. Today I placed 3 trades, 1 loser, 1 winner and one basically break even. I found a level in the market were I it looked to me that the momentum might shift to the upside, which it did, but not for as long as I thought it might. The end result was a net profit for the day of $49.94 which according to my current trade plan is an ideal day. The bonus for the day is that I usually get wrecked on Mondays and I didn't today. I'm thinking this is because my discipline is getting better and I am qualifying WAY better trades.

I think its just a matter of time before I kick it up a notch and go back to trading live. Now what I'm looking for is a strategy set in stone. Right now its just starting to form, but I think its defiantly price action based where trades are triggered on a break/retest or pullback, I'm starting to really feel for it. Some more work needs to be done here. Here's what I was looking at, the time frame and how it performed. What's not included is the higher time frame context, but right now times too short.

I would like to remind myself to enjoy the ride. Enjoy the learning, and enjoy the other benefits that I have derived from taking on a challenge that was beyond my station. I think right now there is a WAY better chance that I will succeed at trading than I would at winning the lottery. Right now I think and feel better than I have in the last 20 years, and I think that's pretty freaking cool.

michaelroth 

Deep in my brain its possible that admitting you are wrong is the hardest part about being human, and also the number one reason that people have difficulty trading. I think its the reason that I have held on to bad positions for too long.

The sheer speed of watching your development and insights unfold is pretty dizzying to behold !!!

I totally agree with what you said, humans aren't hard wired to accepting losses, it just took me many more years to learn that particular lesson than it took you.

IMO that is really the most important lesson to be learned to making it as a trader, learning to leave your ego that has a vested interest in being "right" on individual trades out of the process in a probability game such as trading or poker or starting an insurance company for that matter. (Good idea in pretty much most other areas of life as well hoho...)

Where many get confused is not making a difference between the individual trade, whose outcome is always going to be random.

And the edge your method can provide you with, but only over a large number of trades.

All a market is after all is the sum of the activities of all participants at any given moment in time, and what with speculators, hedgers, differing methods and time frames, and any number of those market participants entering or exiting positions for any of those reasons at any moment in time, there simply can be no method that exists that will be able to tell you what is going to be happening next.

Nothing will ever be able to tell you what happens next once your method gives you a perfect signal to enter say an uptrend in a pullback, if after that the market is going to embark on a large move, proceed to move sideways and start ranging for an eternity, or you're presented with a sudden reversal stopping you out, only for the market to then proceed in your originally anticipated direction after all.

The only thing you have control over is if you are positioned to benefit from a move your method anticipated if it does happen, or that you will be limiting a potential loss if the market moves against you.

Because your edge is over many trades and not the one you just put on it can be pretty damaging to peer too much at winning percentages, and not total expectancy, which adds size of average winners and average losers into the entire equation.

What helped me was understanding that I should see the individual trade as completely irrelevant in the huge number of trades I'd be putting on over my career, completely accepting uncertainty as a cost of doing business as a trader.

What also helped me was eventually understanding that there simply is no holy grail out there consistently giving me winners 5 times the size of my losers while almost never losing, so a forever search for just that was simply a huge waste of my time, and taking away from what really counted on my road to net profitability, consistent application with patience and discipline of one simple method aligned with the ebb and flow of market moves coupled with positive reward / risk ratios of 2 / 1 which guarantees net profitability at over 33% winners.

Anyway, I wrote way to much !!!

But everything you've written here really makes me think you've totally got what it takes, the mental attitude to do what needs to be done, so absolutely best of luck on your journey mate !!!

:-)