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What approach did you take to make progress in trading?
The concept is actually unlearning my mistakes -- my mistaken ideas, really. For instance, my early successes taught me to always go big and hold on in a strong move because it was going to go to the moon. This is what made me money when the market acted this way. It has lost me lots more money when I kept applying it under all market conditions, because it isn't always true.
So successes taught me lessons that worked then, but I thought they would work always.
Failures taught me things like take tiny profits quickly no matter what before they vanish, or to wait until I was sure before getting into a move.... all of which work sometimes, but I thought they would work all the time. (They're also sort of the opposite of what the successes "taught" me, which didn't do my consistency any good....)
Simple, obvious errors that I thought were true, that I had learned about the markets because they had worked once. So my point was that I had "learned" the wrong things, and that I had to unlearn them before I could make progress.
I did start learning to trade when I started thinking about why something didn't work, and noticing I was doing the same things again and again, but conditions were not the same.
So it was about unlearning some wrong lessons, and in the process being able to learn some right ones.
This is a continuing project.
Bob.
When one door closes, another opens.
-- Cervantes, Don Quixote
That's a good question, but I think I gave enough examples to convey the gist of it.
I do hope that beginning traders can get something from my mistakes. I also think that we all make our own mistakes, and that the best thing to know is that we will make them and that working oiur way out of them is how we can improve.
It's taken me a long time and I'm not going into the blow-by-blow description of everything. I hope my general point was clear. If not, I think I've said it about as well as I can.
Bob.
When one door closes, another opens.
-- Cervantes, Don Quixote
No I'm still confused. I think the general point is that nothing works all the time. I'm not clear on what to do to combat that.
You gave examples of learning the wrong things. How did you get from there to learning the right things. I assume trial and error. If you had to give a beginner just one piece of advice on how to learn from their own mistakes, what would it be.
"The days when I keep my gratitude higher than my expectations, I have really good days" RW Hubbard
What I would tell a beginner about how to learn from their mistakes is a different question. I suppose I would tell them to learn from them... what else could anyone say? People learn from mistakes, or they just repeat them until they do. I don't have the advice you are asking me to give, I guess.
But giving advice is another question, not what I was responding to -- which is "what approach did you take to make progress."
So I will leave it that we have not had a meeting of minds here, and will move on. Sorry I couldn't satisfy you.
Bob.
When one door closes, another opens.
-- Cervantes, Don Quixote
One of my mistakes was using stock indicators that are nothing but lagging price.
I had to learn to think in terms of price action in a statistical behavior. Same with Volume. Those two things alone will give you all you need. It does take a lot of number crunching with trial and error. Its not easy at first and will take some time to focus in on...but once you find something, you will keep building off that. A lot of approaches will also work in similar markets. I stayed with NQ for some time and really learned that market...then I moved on to learn others though.
So I guess you could say one thing I also learned was to stay with one market and make it yours. You then can move on and find the similarities and differences with other markets.
I get where @bobwest in coming from... Its hard to pinpoint all your learning curves, there is lots and most seem so trivial Now.
But if I had to sum it up. That's the main ones other than what I mentioned before.
Even though I'm not really consistently a profitable trader (I mostly trade sim), I improved a lot when I realized that its a probability's thing. I mostly realized that after reading 'trading in the zone' a book I had 2 year home but didn't read because the title didn't seem useful to me
After that a started to realize more and more that you don't know why the market moved and even better you don't have to know. Now I can stop after a losing day and trade the next day with good mood . Also I slowly got rid of trading mistakes like violating the rules
So much of my anguish in the past was directly a result of the need to be doing something. Forced patience - instead of practised patience - created rising levels of frustration which led to forcing trades and the inevitable poor trade performance.
If there's a "revelation" that I could share it would be this.
Contrary to popular belief, trading is not about following other people. The key to success isn't in following a guy on TV, or buying someone's course. It's not even about watching orders on the tape and following them. Charts, volume, price action, these are all just elaborate ways of basing your decisions on other people's decisions. Ignore what everyone else is doing and analyze the market yourself. That means looking at news, fundamentals, positioning etc. If you understand what is going on then you will be able to identify informational asymmetry and find profitable trades. Be the decision maker, and let the crowd follow you.
Most of the profitable strategies I've seen either rely on breaking news and understanding fundamentals, or swing trading without worrying about outperforming the index.
