- Never, under any circumstance add to a losing position….ever!
- Markets can remain illogical longer than you or I can remain solvent
- Exits when support becomes resistance
- Be patient with winning trades, be enormously impatient with losing trades
- All rules are meant to be broken
The first two trades entered well and took my profits. The third trade I felt was turning against me, and got out for 1 less tick target. 2 days to go in the contest. Many more days to go trading and journaling. Concentrating on one setup, and just entries, and journaling has restored my confidence and improved my trading. Learned alot form Perry and his threads. Learned as much or more about me.
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This month, this journal, has restored my confidence, replenished my emotional capital, renewed my commitment to trading, focused me to learn a new trading style, and offered the structure for more in-depth evaluation of myself, my trading, and a new methodology. I had blown out my account ans had stepped away. This is the best way to step back in.
What I've learned....
1) Journaling is not a one-time, one month task. It's as integral to a trading career as selecting a broker, trading, and filing taxes. It's more important than the rules I've committed to. It should be every trader's first rule. I had gotten out of the habit, and never kept one this honestly. It's the only way to track your true performance, not just your bottom line. It's harder to be honest with yourself, your demons, your performance, than you think. A journal removes all gray areas. Journaling improvements I'd like to make as I move forward include a) adding a column for feelings/emotions experienced during trade, b) a column for pre-trade checklist completion, c) a column for exit quality score, as I add contracts and trail, and d) perhaps some more analytics tbd.
2) I was trading blindly. I thought I had a setup, a plan, a methodology. That I was too experienced for sim. Even if I could never find the P in the P&L. Discipline starts with a journal commitment.
3) The PerryDigm is a pretty damn good setup. I have confidence in it, look forward to making it more my own, practicing back end trade management, and making it even more profitable. Next week, going to add a contract, as a trailer, that goes to plus 1 after the first target gets hit, and follows tick by tick. No extra heat. The probability discussion on the future71 webinar showed me the sensibility of scaling.
4) I showed real growth from the first "half" of the month. I improved a) in taking less less trades, b) less heat, c) higher profitability, d) higher rule compliance, and e) doubled my $ per trade. How would I know that without a journal? And able to quantify some of my known and unknown demons....
5) Demon Impatience - I knew I have that one, but seeing that I can fight it, in black and white, with a good journal and a good setup and good numbers, makes it that much more conceivable that it is not insurmountable.
6) Demon Rum - took a day off when could not pass the checklist and was not up to trading.
7) Demon Adding to Losers - I've still got it. Improving though. Added even in the second "half" of the month, but not uncontrollably.
8) Demon Not Cutting Losses Early - It's a tough one for me, you see, I'm always right. I'm letting the ATM do the heavy lifting on this one, staying off the DOM. The chart trader is just that much harder to move things around, it helps. Use tools.
9) Demon Trading Too Much - I will need to remain vigilant on this one, even though my numbers improved, it was primarily because some other commitments did not allow a full trading session. Adding a daily stop loss will be the cure of going off the deep end.
10) Demon Reckless Funding of Account - I've set up a plan and going to stick with it. Never will blow out another account. 1 and 2 contract trading is my M.O. from now on. When my account gets too big - withdraw, remove temptation to trade more contracts, add to losers, etc. When it dwindles - it's back to sim for me.
That about sums it up for now. My plan next week is to make some improvements to my tracking sheet, work on the 2 contract (one with a trailing stop method), and take the time to look a little more into the adx/dm confirmation of the PerryDigm. If all goes well, I'm going to dip my toes into the water again with some live trading days starting April 9. So a revisit to the trading plan rules will be in order.
Thanks everyone, readers, visitors, commenters, thankers, Big Mike, and everyone that I've borrowed freely from on the forum.
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In the spirit of our March Trading Journal contest, I am asking everyone to spend a few minutes and share their journaling experience.
A) What are the top five benefits you have seen as a result of regularly posting in this journal?
B) What are the top five problem areas you have identified as a result of regularly posting in this journal?
C) Were you initially reluctant to start this trading journal? If yes, why?
D) How do you feel, overall, about your journaling experience?
E) Would you recommend to others that they should also start a trading journal?
Thank you for taking the time to answer my questions. I appreciate your posts, and I hope you have benefited from your journal. I also know that others will benefit as well, just by reading about your own experiences.
Enjoy your weekend,
Due to time constraints, please do not PM me if your question can be resolved or answered on the forum.
Need help? 1) Stop changing things. No new indicators, charts, or methods. Be consistent with what is in front of you first. 2) Start a journal and post to it daily with the trades you made to show your strengths and weaknesses. 3) Set goals for yourself to reach daily. Make them about how you trade, not how much money you make. 4) Accept responsibility for your actions. Stop looking elsewhere to explain away poor performance. 5) Where to start as a trader? Watch this webinar and read this thread for hundreds of questions and answers. 6) Help using the forum? Watch this video to learn general tips on using the site.
If you want to support our community, become an Elite Member.
Experimented with a second contract today. To get the ATM right. Testing the idea from the Risk Mgmt webinar by future71 that additional contracts scaled out, or trail stopped out actually improve your probabilities (and profitability, if working with a winning setup). I'm actually going to watch that again, to see if the trailing stop is the best way to achieve that, or to go 2 contracts, with one 2 and one 4 tick target. If anyone reading has any thoughts, pls share. I hate missing the runs, but trying to be as mechanical and unemotional about it, maybe going for 6 ticks is safer and more probable.
I have the ATM designed to enter 2 contracts, both with a 4 tick stop loss. The first target at 4 ticks, and the second contract goes to break even plus 1, when the first target hits, and then trails current price by 3 ticks. I took me a few trades to get it right.
Since the PerryDigm is a momentum based play, my theory is I may catch quick runups, worth more than the 3 tick trail that I will be giving up. Hesitant run-ups may stop out with 1 tick profit if no slippage.
Going to work with this this week. Plan to go live again next week, with 1 contract, 2 to 3 trades per day, $100 daily goal. With consistency. Achieved much better than that in Sim, but I know the Live trading demons can be cruel. Working on a more thorough tracking sheet this week too.
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Wanted to take the new ATM out for a spin on the live sim market. During an extremely flat spot in the market. Bad behaviors - added to a losing position, lowered a stop. But learned an issue/feature with the ATM trailing stop I have set up.
The stop moves up on the second trailing contract when the current price hits target even if the trade did not occur. At first this annoyed me, but I realize if it does take out that new breakeven plus 1 stop, its a good indication your trade does not have the momentum needed, and might be a good time to bail on the initial contract as well.
Also, in another trade, as planned, the trade goes up 3 ticks, but falls back to stop out, where you would have if you just set both targets there. This is a little demoralizing. Will study in replay if the runs outweigh the initial grab.
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