Losing BIG is a normal part of trading. When it happens, decide if you did something wrong or not. If not, what can you do other than trade smaller? Or not trade at all. And if you did something wrong, figure out why. Not "what" so much, that is a lot easier to answer. Why.
A lot of times it is not that we don't know better. It is that we are wired in a manner that it is hard to listen to what we know. And resolving that issue is the critical element in this game.
Max down day/week/month are there not just to preserve your account, but to break the spell. It never hurts to take a week off, come back and trade very small the next week. Or a month off. Or a year. Would your world end if you simply stopped trading? Of course not, but if it ever feels like it would, you are headed for trouble. Trust me.
It is one of the toughest games in the world, and it is won one day at a time... by learning the market, and learning yourself. To pursue the path of trading shows a competitive spirit, and that same energy is often what takes us down.
Relax, be flexible, have patience.
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I have been trying to make sense of the ES move for awhile now. Tried to find a confluence target but am missing it for some reason. It's hard not to watch though.
One thought that comes to mind, have not repeated for awhile, is "early shorts get slaughtered".
Rambling. Drinking a 4th beer tonight for some reason. Obviously not trading.
Last month was pure intensity, dealing with projects in one status or another in Austin, DC, Baltimore, Jersey, East TX, Dallas, Tulsa. Plus Melissa had the flu and I had to take care of everything, my sister came to visit, a tornado ripped the boat and dock apart and we had to deal with a load of downed trees... And learned SC. lol!
This week, "balance". Went to the mall today before this ES rocket took off.
But sitting here finding the analysis, the observation, the mystery, very consuming.
I actually did short this at 51 , though I got out before it got too out of hand. At the time of the trade, it was very good location and IMO the premise was sound, but I should have cut it sooner, as the momentum just said "up."
I was also dumbfounded by the extension. All I could figure was AA earnings related stuff (a nice exclamation point to kick off the earnings season when all the headlines are saying earnings are going to weight heavily and "the correction is coming") but I do not know what the catalyst was. I posted here regarding the complete lack of liquidity on the move up. In short, only about 500K+ volume to go 15+ handles. Insanity.
Were you looking over my shoulder today, and did you read my mind and write just what I needed to read? Thanks dude.
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And because I have no idea where psychological things really come from, even though I may think at times that I do, and sometimes I do. I think this is journal-worthy.
My wife is nearly dead-set on getting a torso tattoo. I am not that into it, for her, because she is my wife. Not that I have not seen them on other women and thought they were sexy, but I do not require that my wife compete in order for me to love her. And so I accept her as she is, even to the point of wanting to defend it.
But, I accepted the fact that if she wants it; let it happen.
And have moved to a role of supporting and trying to discuss it deeper. Looking at images from internet searches and talking about them, what we like and don't like. And then I file them in folders marked things like "better". I bought a magazine called "Inked" in an airport recently, and then had to deal with a weird feeling related to and happening as I read it in the middle seat between two strangers for two hours.
So the timeline is; that I am accepting change. Uncomfortably maybe, but that is expected. But not just accepting, changing the response to getting excited about it.
That is what the market does.
That is what the market does.
The idea that a profit can be engineered in an environment that is not engineer-friendly... requires that we look inside. And I see that I am nowhere near as ready to change my mind as the market is. And I see that if I can bring the two thoughts closer together the more of an advantage it gives.
Jim Dalton mentions "nuances" . They are so rare to find and so priceless when you do. If you don't throw them out the first time or ten. But the ability to accept change at the same rate as the market in my opinion is one of them.
Last edited by GaryD; April 8th, 2013 at 10:32 PM.
Reason: I really like this post. That is very accurate.
I got booted out for some reason. But before that I laughed so hard. I agree, a skull and crossbones is not pleasant to look at. Horrible marketing campaign. What will I do without a career as a writer or poster on futures.io (formerly BMT)?
But when I wear the shirt I am not looking at it. And that is what the market does.
Polite? Reasonable? Predictable? Sane? Is that what trading is?
Not that it is not identifiable, or classified. Those are different words. But the market is pure natural energy.
I read somewhere, being in the construction world, that we still do not truly understand what electricity is. We have learned to use it regardless. And the national electrical code is prooof that it is to be respected. And to me the markets are similar. With respect we can learn to use the energy for benefit, but never once think it can't knock you on your ass if you don't follow every code.
And, that reminds me of the best thing I ever heard from a planning official. "Necessity is the Mother of Interpretation."
Last edited by GaryD; April 8th, 2013 at 10:47 PM.