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Usually I put several minutes of thought into a post that details where I am at with my education. However, I thought I would try something different this time around.
First, I am getting a lot from reading Dalio's Principles. It is motivating in a calculating way. It has helped me to remove obstacles and reminds me a bit of The Obstacle is the Way in that regard. His Life Principles, rooted in evolution and a down up and back down philosophy (he relies a lot on knowing thyself and interacting with an other and knowing thyself again, etc), I have found useful in everyday activity.
I have learned a lot over the past year other about building a system to get trading done, I have several forms I use to help get through the trading day and have attached them here. The self talk is ideas from Mark Douglas, Brett Steenbargar, Marcel Link, John Grady, FT71, et al. I put it together to have something to get me switched over to a trading mindset after having finished the prep work for the day. It hasn't really proven to be effective as by the time I have my prep work done it is time to trade. The idea is like mediation. I found a while back (year or so) I would get ready for trading for the day and after watching FT's Trader Bites I would have had my mind clear and prepared for what the market offered. It seems what is key is that there is an opening bell for the S&P and not for treasuries, for me at least since I like to trade the pre 7:20C time. This is something to work on. The Daily Routine and Eval stuff is from FT71 and John Grady. The other pages seem pretty obvious.
It really seems the next stage of the game is screen time and honing my procedures and learning more about my psychology. It seems like with any pursuit it is about information selection. Which info is key to me? How do I get to that info? Is it reliable info? What info does not matter? There is a lot of info about trading out there and I am starting to feel my way through it with a sense of confidence as I set things up.
It has been month since I traded. Looking forward to tasting ideas, hopefully soon. Busy season has had started at work and having the TIME each morning and later in the day to trade is not possible. I really want to have a routine that includes 5am-at least 10am trading each day to get to know the ZN and other treasuries. Any other way would be unproductive. I hope to get some time this coming month.
I am wondering if anyone who has tried both automated and discretionary trading can comment on this dichotomy. Which has worked better for you and why?
It seems, after some review of the posts in fio, the choice turns on factors such as possibility of evaluation, thought, and results; for instance, the challenge is to be able to record and evaluate trades consistently with the applicable metrics and that how much time one wants to spend time thinking whether at the start or during a trade.
Perhaps, the question is more like which elements of trading does one want to systematize? Personally, I try to automate my morning process that occurs right before I trade, while trades are contingent upon an instinct that my set up is present and I have to pull the trigger each time to take advantage of the odds inhering in such set up, evaluation of my trade time is automated and distcretionary. I keep track of a lot of data points and then evaluate the legitimacy of my instinct to take the set up and then draw lessons from that action.
Ultimately, it is all about an idea, ie a choice that emerges from a unique situation. So, maybe the actual kernel for the trade is something that is inherently discretionary as it is unique, but like a lot of other life endeavors it requires some, maybe a bunch, of automation so there is a predictable a regime in place that can exploit opportunity consistently.
Attached is my most recent update to the sheet I use to record the day. Couple of notes: First, I do not have a good reason for wanting to "grade" the type of day, that is, was the day conducive to trading my style. It seems incongruent with trade what the market gives you - as though I am saying by evaluating the opportunities the market gives on a daily basis that the market is "wrong" or "right" and that is hogwash. However, I do want to know historically when there is a day that just doesn't seem good to trade, but I have pretty solid guidelines for these already.
Just hashing that out, I think I'll stop trying to "grade" the market.
Also, I do keep track of news and number releases and will for a certain time till I have a good grasp of what may happen with given news and numbers.
I also keep blank sheets handy to write notes as the day progresses so when I review the recording (thank you @matthew28) I can do so efficiently.
The only other paperwork I have is the calendar. Each day I write the time I traded, number of trades, net ticks, and if there is any extra market movement from numbers or releases (something like, "#s moved M" or "#s=ømvmnt)
Other topic: GETTING TO WORK
I am working on somehow getting out of bed at 5am and trading by 6am. I had a system that worked for about two weeks and last week it crashed and burned while I just crashed. I would wake (without hitting snooze) eat same breakfast (organic frosted flakes and POM and a Flip (yogurt), get dressed, shave and brush teeth then prep for the day then get some diet mountain lightning (Walmart Diet Mountain Dew). That worked great.
This last week I was eating something different and hitting snooze. So, this week no snooze, same food as those good weeks and coffee right when I go to trade but not drink it till 30 or so minutes. Hopefully this will keep me up and going. Also, just hashing this out may help also.
I had time to go over the last 8 trades of mine, 6 losers and 2 scratches. This is tough to deal with since I was eight in the hole and got up to positive six in about a week, then went live and got my ass handed to me again. But, I feel this is all learning and if it was so easy that I could be profitable in a month, then everyone would be doing this. These losses can also be attributed to general fatigue and changing me methods from one tick shots to going for 3-5 ticks a trade.
I wrote down the kind of trade each was, i.e., the general idea that would lead to profit, and then wrote a short note or two to understand any error. I came up with the idea of two categories to hone in on over the next trading sessions: context and trade management.
Regarding context: I need to consider the global and the local context. Global context being the the day's bias ascertained from the five minute and daily chart and the local context being the time leading up to entry (this should be enough to time to ascertain what is going on with buyers and sellers given where they have recently been and where they might go) as well as what is going on during the trade, i.e., has my trade entry idea for the local context been negated? One of my eight trades had me in a bullish position which was the global context, but the local context was bearish - so why the hell did I go bullish. Well, I was caught up in the day's bias.
The other category of trade management includes three areas: entry, exit, and stop adherence. I saw I had made errors in these different areas. I had exited trades too early, i.e. not letting my stop do its job. I entered in less than ideal spots. Some of my exits, ones where I lost one tick or scratched, could be considered good exits.
There are probably other ways to evaluate trades, but this way is helping me to see my errors. Going forward I know that there are high probability enter spots and those are the only ways to take. I need to be more disciplined about writing down on my DOM Journal the bias for the day and keep in mind it can change. Also, I got to develop some perseverance and feel so when price goes against me a tick I don't just go in panic mood and do my best for a one tick loss or scratch.
On a side note, I had to change my bedtime from 10:00pm to 9:30. I will see how that goes and move it out more if need be. Good luck this week to any traders reading this, and anyone else trading as well!!
I made entries to this thread for the last two Sundays, so thought I would keep the trend moving along.
This past week had its highs and lows. High was starting off the week with three winning trades and then the low was trading Wednesday morning as some kind of out of my trading mind cockiness. I made some bad trades - no real set up and I was without the necessary mental tact to even be trading, ie I was tired.
The other high for the week was the only about 70.00 loss as compared to last week's about 140.00 loss, and only one less trade! I was pretty happy about that, but it ain't going to my head tomorrow morning. Another high was getting a better grasp of congruence among the products so my ZN trades are more likely.
Another high is my approach to the computer/trading organization seems to be at a good place. My routine has evolved to: up at 4:50a C, at the computer for level discovery by 5:30a, start trading at around 5:45a, done trading around 9:30a. Then I type critiques of the day's trades and/or missed trades on a Word doc that ends up stapled to my DOM daily sheet. Then I get the next day's DOM sheet and write out what numbers are being released tomorrow. Then after saving my recording of the day I leave for some work. Then around 3:40 I prepare to get the levels from the day off the DOM and do so at 4pm. Later in evening I try to review day's trades and/or watch No BS Day Trading videos. Then on Saturday it is time to review trades of the week for lessons. Sunday I just seem to make an fio entry. So my question, want do other traders do on Sunday to get ready for the week?
Another lesson I am learning is focusing on the trading and not the PNL. Yesterday was the first time I looked at my account balance since I have been live. The biggest difference this has made is alot less anxiety. Other than the cockiness from doing well for a bit, fatigue seems to be the biggest mental issue. Also, I am slowly letting go of my 5 minute ZN chart as I learn more and more about using the DOM to know price history.
Simming is like riding a bicycle around a track while racing other bicyclists and live is like riding the same bicycle around the track with 3 dozen Dale Earnhardts. Your emotions and actions are completely different. But with time you figure out your way, figure out where you belong, and eventually, hopefully, make it around and around with minimal bruising.
It's like playing Frogger at the arcade versus crossing an 10 lane highway on foot, Frogger can't come close to preparing you for what is in store.
And, actually, it is like that with each new bit of risk. I am trading a 1 lot live, probably will be for a while, and today I accidentally entered into a trade with a 2 lot. That was a bit of rush, but I kicked in my error plan and gratefully I scratched. With that one lot I am learning a heck of lot each session. For me, learning on sim just sorta has this 'this is not real, aka this is where I am not" specter. There really is an existential difference.
So, if one could, I would spend as little time as possible on sim. Treat a one lot like sim, because after all it is sim for a 2 lot, etc.
I have gotten my regime pretty solid since I got off the diet soda. I wake up and slam a bottle of water instead. And I found a sleep calculator at runtastic.com and now I know the best times to go to bed. And I only have one cup of coffee in the morning. All this is allowing me to have a great amount of energy (so much more than when I was pounding caffeine) as well as better sleep.
I have made 59 trades and am down 39 ticks. This has been a growing phase as I am learning so much each day. Only challenge is assimilating all that info and distilling it into something manageable and useful.
Quick shout out to Adrienne Toghraie from Trading on Target. Each time I watch one of her webinars I get much useful information. I haven't purchased anything, so I can't speak to that, however he webinars are worth the hour or so.
A while back I wrote the No BS Day Trading is an endgame. For me, trading treasurys with the DOM, it sure is.
I have followed many 'gurus' in the past. Finally, I discovered Gavin Holmes and Tradeguider.com .
This site is based on Richard Wyckoff's work (from the early 1900s).
Tradeguider expertly explains HOW the Market Makers are able to take our trades, and how Volume Spread Analysis (VSA) works. Market Makers sell when most are buying and vice versa.
IF this sounds interesting, check out their many videos on Youtube.
PS: Gary Dayton at tradingpsychologyedge.com also does a good job of explaining how it all works.
