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iqGod's Own Country

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  #201 (permalink)
 bobwest 
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iqgod View Post
Day 10 ends at +$105 with account now at $30,540.

I traded the ES today because of two reasons: 1. saw a proper setup ; 2. wanted to have it as a permitted product as a LTP / funded trader because you only get the products which you have traded in a combine.

Two good trades, though it was just one trade really (exited and rentered at same price, more of a psychological comfort thing).


Very good strategy, looking forward to an LTP.

Also, very good that you had a good setup and a good trade....

Good going on the Combine.

Bob.

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  #202 (permalink)
 iqgod 
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  #203 (permalink)
 iqgod 
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Account is down -$99 and the current balance has decreased to $30,441.

What was the day like - unmindful and I was a bad boy:

1. I was very near DLL at one point

2. Not in the combine but in my real NSE account I took two huge losses today - reason: wanting to be right, unable to take a small loss.

My demons are back and I need to get into my act.

I do not have my thoughts, my thoughts have me.


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  #204 (permalink)
 iqgod 
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  #205 (permalink)
 iqgod 
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You decide to start a restaurant so you chalk out a plan - soon the hurdles are cleared and you are in business!

Its going to be lunch hour soon. You have actually started setting out the buffet but you are ready.

The first few customers who walk in have to wait for about five minutes as you get into your act. You did not anticipate them but you still manage to keep them happy by chatting to them while keeping an eye on Joe who is getting the steaming rice and tandoori dishes into their places.

Soon you are ready! Guests trickle in at a regular pace. You start tossing out the rotis and parathas only when they are needed so that the guests get them hot. Not a moment soon. Not too late either so as not to displease them.

Ditto scalping. You seem idle staring at the screen but you are ready. Its a different kind of idleness compared to being lazy. You enter only when the setup is to be served. Never too early. Not late so you never chase. You also do not enter without a setup, just as you would never place steaming hot food in front of empty tables.

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 Big Mike 
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Nice job journaling @iqgod.

I want to let you and all your readers know that in October futures.io (formerly BMT) has a Trading Journal contest w/prizes. The contest runs October 1 to October 31, and the three best journals (as decided by futures.io (formerly BMT) members) will receive a 150K combine from TopstepTrader.

The contest thread is here:



That thread will be open for posting starting Wednesday, October 1. As the author of your journal, you need to make a post in that thread linking to your journal, and then ask users to press the "Thanks" button on that post if they want to vote for your journal to win the contest.

Members can vote for as many different journals as they want. Votes are cast in the Contest thread only, and only on the first post made by the author of the journal that contains a link to their journal. This is done so I can easily count the "Thanks Received" by author/journal, and award the three prizes.

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  #207 (permalink)
 iqgod 
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Day ends at +$94 with the account standing at $30,534.

As you can see from the charts:

1. Entered early (to that effect allowed too much drawdown)

2. Exited early (to that effect missed all trends)



In effect I keep reaching my 'burnout point' and ending without the number of gold nuggets I had anticipated - mostly because of impatience and fear. See the clustering of entries and exits - it is a lack of courage and lack of belief.

Herein I again renew my promise to myself.

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  #208 (permalink)
 iqgod 
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I took a last trade which was a one tick winner hence the day end profit was $103

Account is at $30,543 instead of $30,534 as seen in the report.

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  #209 (permalink)
 iqgod 
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On Day 13 the account currently has a profit of +$130 and stands at $30,674.

Allowing the natural way of trading does not come natural (to me, and all strive with with this "letting a winner run" I suppose) i.e. take a trade and allow it to reach target or to hit the stop which is kept moving (a "tipping point" beyond which premise is shaky).

First trade - the target point was moved two ticks.



Second trade - the target point was moved five ticks (was scared of a double bottom getting printed - a clear case of "no faith in method")


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  #210 (permalink)
 iqgod 
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  #211 (permalink)
 iqgod 
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  #212 (permalink)
 bobwest 
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iqgod View Post
On Day 13 the account currently has a profit of +$130 and stands at $30,674.

Allowing the natural way of trading does not come natural (to me, and all strive with with this "letting a winner run" I suppose) i.e. take a trade and allow it to reach target or to hit the stop which is kept moving (a "tipping point" beyond which premise is shaky).

First trade - the target point was moved two ticks.

...

Second trade - the target point was moved five ticks (was scared of a double bottom getting printed - a clear case of "no faith in method")

You're showing very steady progress and consistency, as evidenced by the latest trade report.

I would say that, while it is good to be aware of one's mistakes and work on them, you really are more self-critical than the evidence of the actual account performance supports.

Why don't you just say something like, "Hey, this is starting to look pretty good" -- it is, you know.

So I'll say it: this is starting to look pretty good.

Keep it up.

Bob.

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  #213 (permalink)
 iqgod 
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Day 14 is a small loser of -$14 and the account stands slightly down at $30,659.

I had two winners and two losers. The winners and losers were of equal size. The losers happened because the platform became sluggish and because I tried to trade even though I sensed that the platform had become sluggish - thus the losers are in a way my responsibility.

By a twist of fate the winners were the same size thus the account was $0 : the $14 is simply the commissions.




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  #214 (permalink)
 iqgod 
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  #215 (permalink)
 iqgod 
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There are two major hurdles I am struggling to overcome:

1. Having come this far, there now is a pestilent force inside me that can be identified as the 'need to be right'.

2. The urge to do self-inflicted damage. (have discussed about it in detail earlier)

So the effect was that what had reached an awesome $30,763 came to zero and then down by -$105 and now stands at

All one lotters:

The first trade was a $87.50 winner;
followed by a $50 winner;
and the final trade (where I got this clawing need to be right) was a -$187 loser (and another saner and smaller loser in between).




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  #216 (permalink)
 iqgod 
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  #217 (permalink)
 Itchymoku 
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iqgod View Post

Nice, It looks like you're able to make a lot of good base hits. It's very inspiring to see someone do this successfully.

R.I.P. Joseph Bach (Itchymoku), 1987-2018.
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  #218 (permalink)
 iqgod 
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The One-Week Scalper's Vacation

So you are a scalper.

You are doing good, on a winning streak and as a scalper you need to stay glued to the screen, because that is its only similarity to a pay-by-the-hour job.

I am sure just thinking about it makes you overwhelmed by the prospect of this one-week vacation.

What to do during this vacation? (and, more importantly, what NOT to do?)

Should you spend this time for introspection about your recent performance? Study your winners and losers?

Or should you just forget about the markets and give undivided time and attention to your family?

My unequivocal advice is, obviously, to do the latter. There is no better time to ground yoruself and check your equation with your own family.

This does not mean taking them on a grand vacation- rather it can be done better by staying at home - and I mean really staying at home.

Some rules about this vacation: The purpose of this small exercise is checking out your family's perceptions about your trading and obsession with the markets and also thinking about where this obsession has brought you. Do these two things:

Use the week to "rediscover" the family.

The point I want to make is please don't underestimate the power of the obsession with the markets - and even if it is your profession there is a point to consider it as an obsession as anything is if you lose ground with reality. This week could be your chance to really get to know your own family again. While this may sound trite - what is their state of mind?, what are the likes and dislikes (your scalping might turn out to be one of the dislikes, be prepared for that!).

Devote time to get a hold on your current financial scenario.

Think hard and be truthful about these questions:

Do you own your current home? Chalk out a plan to be the home-owner.
If you have investments, are you sure they will ensure a decent future income?
Can you increase your ability to earn more income?
Are you saving enough - minimum 20% of per month's salary?
Are you budgeting to live effectively with the remaining part of salary?
Are you sure you are pursuing scalping as profession and not gambling on impulse? Do you study?

So whenever you decide to take a vacation, choose a time when you aren't on a losing streak, and I hope you can use the above tips for a fruitful vacation.

Disclaimer: I did take a few long-term positions instead of scalping.

Dis-disclaimer: I did take a few scalps twice or thrice - to keep my clicking finger in shape, you know!


If you like this journal please click the link below and hit the thanks button on that post:


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  #219 (permalink)
 iqgod 
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So I rolled this combine ending at $30,410 and completing 20 days. I do not believe in gunslinging the last few days to make profits anymore so I thought it would be better to start a fresh rolled-over combine.

The last combine for me personally was my "most successful ever" not on profit terms by in terms of how I approach everything. It is important to be consistent. Small progresses eventually add up and make one successful.

@matevisky has passed a combine after lot of hard work and had valid concerns which I attempted to address in his journal.


matevisky View Post
Sorry for my english in advance, maybe it will be to hard, or not right, but this is not my first language. I have been recieved an email, which looks for me a template, and not a tailored email to personally me. Of course I do understand than @TopstepTrader has a right to do their best to the investors and the equity partners, to gain as much as they can with a minimal risk in place, but still.

So the situation is the following:
- I have to complie a Live Trader Preparation. It is fine in one hand if we are knowing that I have been tried 18 times to do combine, and only the last one was successfull. On the other hand my last attempts was 92% winning days, with a one day looser of 500USD. But it is still oke for me. I have been spend more than 4000USD on the combines, and they are asking one more for free, with 3000USD profit target in 10 days. Looks pretty easy. If you are not able to do it, than you can say that you are not fit to the team right? Right.

But here is the twist:
- They are asking me to use T4 platform instead of NinjaTrader. ?!?!?!!!! ooo Why? Of course I can apply for a Ninjadata feed, and to the trading on T4, but after 18 combines money, why dont I have the right to continue to use Ninja? It is looks a bit pity for me....
- They are asking me to use different scaling methadology... Why? I do understand in one hand for scalpers it is not an issue, but I like to call it a day after one day. In 50% of my trades are 1-3 trade in the first 30 minutes of the market open. I really dont like to trade or push more, because my edge is here. Now I have been forced to use 2 lots instead of my 7 lots. Really. I have been tailored this strategy to have 10 tick SL with 30 tick winner on YM. I have been analyzed a lot to have my edge on YM, now they are asking me to do lot more. Of course it is doable, but this is different. In my lasts combines I was always using 10tick SL with 7 lots, shooting for 30 tick winning. If I had my first 1-3 trade, I really didnt change the plan and I was shooting for 30-40 tick winning, than call it a day. Now I have to trade more time with 2 lots, which is out of my comfort zone, and my plan. I do understand that it is not an issue for scalpers, but this is very inconvinent for me. If you are checking my track record you can see that, I was more than happy to call it a day after 1 winner trade, or 1 looser and 1 winner trade, becuase I have know that, if I am risking 0.3% of maximum capital, and I am winning more than 0.5% of maximum capital, I am more than good. Why should I push more?
- There are some other comments, which are fine, and I dont have argue points (trading YM, not trading during economic news - I did not trade them at all anyway). So I dont have issue here.

So right now I feel that a bit of left alone. In one hand I do understand that @TopstepTrader have the right to ask only those traders who fits their profile, but on the other hand I thought that, If I invest money for the combines, and time to learn to trade with them (not using any of the training product what they have been offered) they will really look what I am doing, and taking some risk (which is not real risk) and understand me better.



Anyhow. I have been wrote them a letter about my consern, They will unerstand it or not, than we will see what happen. Either way I have been learnt a lot thx for them, and we will see how I will move forward (with or without them)


I can feel your pain after working so hard. I myself have done 13 combines (I rolled one over yesterday).

But if you see their business model, you might understand why they have to do it this way.

Firstly the platform.

Why T4 now? Because as a junior funded trader they will ask you to trade during US office hours only - because they want a live person to monitor your risk. Makes sense because they will have real money on the line.

T4 platform allows them finer risk control - in fact it is designed for prop shops where the pit boss can pull a trader out if he is risking too much or not controlling losses.



The reason they want you to start with lower size is also because they have real money on the line and they want to reduce their risk. Note that the LTP and junior funded trader rules are designed to test if your risk profile is low.

Essentially staying a funded trader has an unwritten rule of you be low risk to them while producing profits, gunslingers need not apply is what they are getting at.



Somebody posted an analysis of TSTs business model somewhere, I have the text but do not remember where I got it from:

TST's profit split plus commission markup is still less then total operating expenses. The combine fees need to make up for it. The formula for the combine fees is complicated as they pay out $35 to the exchange for the data. So on a 10 day 30k combine that grosses $150, their net alone on this is only 115. This means if a trader earns a rollover, TST actually loses money on the combine fee the 2nd time around. Or let me put this a different way. If a trader does the combine that cost $150, and gets 4 free rollovers, TST will actually lose $25 net on the total 5 combines.

Assume the rollover ratio is 40%. So we can do some basic math here. For every 10 combines, 6 pay, 4 roll. The 4 roll generate a loss of 4 * 35 or 140. The 6 that pay generate a net of 6 * 115 or 690. That leaves a net of $550 for every 10 combines. I think their payroll is 30k a month. Not counting office space, utility cost, legal cost, marketing cost, etc that gives us these numbers:

30,000/550= 54.5

54.5 * 10 = 545 combines. That's how many combines they need a month just to breakeven.

Say of those 12 live traders, 6 of them pull out 1k a month in withdrawals. That is fair, half probably are not making anything and the other half are probably trying to build their cushion but will take out 1k. That is 6k coming out in which TST will get 2400.

They are certainly not making millions. If they count all the losses they had to sustain from the traders who passed and went live and flamed out which might be about 1500 on the cheapest combine but that could include 50 to 100 traders over the last 4 years. That's 75k to 150k in losses for them.

The math has to be looked at.

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  #220 (permalink)
 iqgod 
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So I rolled over this combine.

However, recently I had serious drawdowns. So while I semi-pat my back I also gave some serious thought to why this happens, what I did right, and mainly the stuff that pulls at my strings so that it does not come out of the blue and affect me again.

I visualized what I was doing - When I would see a setup forming at that time my plan incorporates allowing price to move in my direction before it becomes a signal. Once it becomes a signal, I need to hit the mouse and enter on a market order with attached OCOs.

After analysing many hundreds of my trades, I saw that there were three things that I always kept doing wrong:

1. Entering early - predicting the move - this is a discipline thing. The reasons why I used to do this (needed some 'discovering' of me) were because

a. I wanted to be intellectually right.
b. I wanted to market to love me. The 'orphan'(a defined psychological part) in me needed some validation.
c. When on a roll, this would happen from a state of feeling invincible - I could do no wrong.

2. Exiting early - not waiting for the target to be reached or the trade to be invalidated. For this the same reasons apply as a,,b above. Add to that the reason that I was afraid I would lose what I already 'have'. Earlier I used to tightly trail stops but do not do that any more.


3. Holding onto losers, sometimes moving my stop and causing losers to be bigger than winners. This can be attributed to:
a. Thinking that I was 'knowing' what would happen. As Mark Douglas says, a trader needs to truly embrace 'Anything can happen.'
b. Not wanting to be wrong. Again the same 1 (a), and just as flawed.

4. Not entering, (and then sometimes entering late). This was:
a. Risk aversion, staying safe to overcome this I developed courage, backed by faith in what worked for me. Faith in my setup. Faith in myself - by building a history wherein I acted responsibly and 'correctly' and thus my actions built my faith and this turned into a positive feedback loop.


Let me analyse further why I stopped short: Waiting for the setup had not 'cost' anything. Before I would had entered the trade I 'knew' where I would place my hard stop. Once filled, and after seeing a few ticks profit my minds wiring would switch from 'protecting capital' to 'protecting profits'. That was the basic flaw that I had to set about correcting. The thinking that would help me was that the stop loss had nothing to do with the entry point. Thus now the thinking is 'enter a trade only if the stop loss is reasonable for the reward (target)'.

To prevent this I now ask myself these questions: When I move the stop to protect profits am I forgetting to protect my setup that got me into the trade in first place? (Honor, integrity) Why am I cutting that amount in half when the trade is actually working?

Being a good trader to me is 'letting go'. My profits need more breathing room than do protecting my entries. Once the trade setup starts to show profits I assume it has attracted other traders who might believe the move and I must not chop the winner off at this stage.

The principle , again, is: Let the trade work relative to the price action instead of relative to the entry - and if nervous just ride it with the original setup visualized till proved wrong (the stop moves in the direction of the target, never the other way).

To allow the principle to take deep hold of the mind, the following are prerequisites for me:
1. Pick my trades carefully. Be patient.
2. Do not skip trades.
3. Risk no more than 1-2% per trade.

Its hard to fail if you follow these rules, but it can be a huge effort reaching the point that you can follow them.

Thus, to summarize, take all valid setups, let my winners run, and never let a previous trade's outcome or my the P/L display affect the management of the next trade.

Controlling the 'I' in me: Missing out, Losing, Trying to Win:

Another important thing is my accumulated emotions: I can't make a living if I follow my rules for a week, then wipe out the gains in one day by violating one or more of my rules.

This works havoc as follows: say I take four $50 losses in a row, then if I catch a winner I close it at +$50 instead of +$125 because, whew!, I'm now getting back to even, thank God!

The problem comes when after that I actually watch it move $350 more in my favor without me. Therein lies a fierce trigger which unleashes past hurts, missed opportunities, life going by and that sort of rot. Because rot it is. To counter this I always stay grounded, mindful of my breathing and ask myself: Where can I live other than the present?

There are days when I am positive but my biggest 'loss' is actually a massive winner that I cut short because I bolted from my trading plan without a compelling logical reason for doing so. I write in my journal each day that the trade reaches my pre-planned target and I am out it was the usual day and I chickened out. Such winning trades would've covered all losses times over, but at that moment it is a battle.

Any large drawdown earlier blinded me to the new price action picture! I just wanted to take some profit and run to the bank before it 'turns' on me again. Sometimes if I would've given just 20 seconds more of my reserves of patience, which was nothing but adherence to the plan, I would've pocketed an additional 5 ticks.

These are the moments that tried me: In a trice I would've had doubted my plan and didn't want to lose, if the stop was hit, I'd have no one to blame but myself. Nothing about the markets had changed. Only my perception had changed. There came a moment when I realized that trading is nothing but taking responsibility and being responsible for my actions and the whining ceased automatically.

The question should always be: (besides what setup you will use) is how much are you willing to lose on the trade. And: How many trades in a row can you handle getting stopped out in a row without triggering an outburst of emotions?

The only thing standing in the way of making $500+ every single trading day is me. By continuing to tell myself what a tremendous edge I have by trading small size and sanely I am sure I am getting to the point that I can comfortably achieve this.

Several times after a solid string of positive days when I sized up, I incurred relatively large losses. I believe that this happens a lot to traders. If I size up and then take a loss that's now larger than several of my 'small size' winners put together - this places me into a different mental state. What then needs watching out for is this turning into getting it back / do or die attitude. Instead of sticking with the proven winning strategy and waiting patiently for the next setup and taking a brand new unrelated trade and following all rules, the need to 'get it back' overwhelms me and I start overtrading violating my rules.

I feel frustration when I miss a strong move and that might add a slice to the emotional quota that encourages me to break a rule. Even recently I kept trying to fade a huge move, - I had thought I've come a long way from trying to jump in front of a freight train, but it can happen on the next trade. I am slowly learning to quickly jump on the freight train now.

Another frustrating thing is when I've stared at price action that is ranging during the doldrums and I've spent hours watching it, sometimes a good part of the day, and the breakout occurs without me. All it takes is a click which would set the buy stop and sell stop automatically, but then in that moment I haven't done it.

To solve this I just accept things. To everything, I say 'yes'. And I find peace.

There was a day when after I blew something like half of my profits with a ridiculously large stop loss placement, I vowed to myself not to repeat it again. My stops are hard stops and there must be no compromise there. We all know the adage: Honor your stop loss WITHOUT FAIL. The trick to implement is to keep thinking of the bigger picture and being a mere executor of your business plan instead of a market wizard. Simply honor your plan's wishes, as if doing things written on a will of a loved deceased relative, never doubting his sanity, never questioning the beliefs, simply DO IT. That works for me.

The market direction supports my trade. All I have to do at that point is put on the trade, place the stop at the invalidation price and wait for price to reach my target. I am out of the picture for now.

Then there are days when I say to myself 'No trading today' (perhaps I'm not up to it that day, or there are other problems I've to tackle, or I'm just too exhausted). And suddenly in a hole I find myself thinking : hey, I wasn't going to trade at all today. At that point I actually I know everything I did wrong, and I need a good laugh, only it isn't funny. I find myself asking: Is it difficult to stick to one's plan? This is a game of razor sharp awareness. There have been things going on outside my awareness that have caused my actions to deviate from my written plan.

Thus the thing is, I do have a solid strategy. I need to simply wait patiently for the setup to grow a bit and become ripe: it always sets up even though till that point you never are sure it would.

Another final point is: There are days when I start extra cautious and then when I missed the best moves of the morning, I'd try to 'get back' what I missed by trading the mid-day chop, trying to scalp here and there, going both long and short at various places though this is the time of day I'm supposed to stop trading as written in my plan!

And finally I answer the question: What is the greatest cause of large losses for me? It's personal bias. A belief that I ALWAYS KNOW what will happen next even when I'm seeing evidence to the contrary. Thus my confidence and conviction becomes my undoing. This thought has an younger brother who goes by the name of 'average-down' who keeps saying "This has to happen eventually" as if it were written in a rule-book somewhere.

And finally I keep telling myself to hone one skill at a time and not be so hard on myself, perfection is natural and not something that can be forced. And a small cautionary note that confidence is good, but too much of it and I start having opinions, and then an ego based on validating those opinions. I tell myself, why bother and why not let the market do the talking?

I, and each one of us create our own reality, a reality defines our trading. Because how far we progress, we always remain tethered to the truths that we have created. And therein lies the solution to all the problems that one will face, as a trader and in real life as well.

Thank you for reading this rather long post which enables me to improve and hopefully helps you.





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 iqgod 
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I remember that day almost exactly eight years ago when I first logged into a trading platform and experienced the thrill of making 'easy money'. A whole new world had opened...

... fast forward to now and I have overcome many bad habits - going from a reckless gunslinger, compulsive gambler who would bet the house on stocks, who would shimmer with excitement when trading and brood in dark despair during weekends when the markets were closed (more so because I'd usually lost a lot of money) to a disciplined, knowledgeable, curious, calm, composed and self-introspective state which can finally be called 'trader'.

How did I achieve this?

1. I set definite goals. My goal earlier was: Making money, quick quick, big big! Now the goal is: focus on the process of pragmatically doing things correctly, instrospect and assume responsibility.

2. I fortified my commitment: Earlier bad things would 'happen' to me. In reality I was compulsive, irresponsible, trading all over the place, and was too lazy to do hard work. Losing money gave me lot of commitment and motivation to study my mistakes, in an honest and open way - but such motivation dos not last long and another hole could be dug very easily and mindlessly. Journaling here meant I was corrected very quickly, and could no longer pull wool over my eyes. In short, by being accountable, I have my priorities right.

3. I took action and stayed in the now. Earlier I sought trading as a means to make money. My relationship with money was not healthy. A losing trade was a threat and winning trades were all lifestyle changers. Both made me miserable in a way. Now I make decisions differently - there are no urges and temptations and guilt and regret in my decisions. I execute in the now, using the information to the left of the chart and putting faith in my abilities. I also realize that giving is more important than taking.

4. I monitored and tracked my thinking. Earlier patterns are embedded in me and still plague me such as I feel I know how to avoid losing, how to win with surety, the illusion that I will succeed even if I make random shots, or that God will protect me. I still struggle in this area. Because these patterns sometimes seemed to work they still exert their influence over me. However I now identify them and track them and am able to classify them. Sometimes I can act on them in real time. Sometime not so much.

5. Healthy Perspectives. Earlier it used to be just me me me. When a habit gets out of control, the person who acts in not usually the only one who suffers. Now that I know the power of love and the value of relationships, I have become somewhat immune to compulsion and do not have fits of anger, mood swings, euphoria of large winnings or belief in magic. I analyze my trading, discard what isn't working, summarize what is working and keep strengthening it.

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 matevisky 
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So I rolled over this combine.
1. Entering early - predicting the move - this is a discipline thing. The reasons why I used to do this (needed some 'discovering' of me) were because

a. I wanted to be intellectually right.
b. I wanted to market to love me. The 'orphan'(a defined psychological part) in me needed some validation.
c. When on a roll, this would happen from a state of feeling invincible - I could do no wrong.

I do remember this feeling. I used to be a gambler, I havent done it more than 3-4 years from now, but I do remember in the begining I loved this kind of trading. The worst side was that, after 2-3 trial of loosing, to spotting the perfect trade, the market turned, and I didnt had the guts to hit the button, because the position was worster than I had before. And than ofc the market is shooting like a star, and I am not in, but I have 2 looser already.

I made the following things to change this:
- I am using a bigger StopLoss. Not because to in the trade earlier, but to having a safty feeling, if I hitting the button a bit late. Today trade is a great example, I am using 10tick SL, so it looks great, even if a missed a bit the turn
- Ofc I love to trade in before, but the question is why do we take this trade? The answer is usually because we are at the right level right? So my observation is here, I am only considering to hitting without comfirmation (any kind of reversal pattern) is the following:
- We are at a perfect level (not a good level, a perfect level!)
- The picture has to look awsome. Meanig, if the next candel is a reversal, than, it will be a perfect picture, what I would trade anyway. Mentally I am preparing, myself for a loss, and I repeat myself, if it is not working, than I will not hesitate to make a trade later, with a worser position, but I stop cherrypicking
- And last but not for least, I love to see the trade at the perfect time. Yes time. If it is at the perfect time, for example after market open at 9:45, than I love to trade a reversal trade

With these observetation, I do not overcommit myself, to not to take the trade with my feeling, but I have other kind of comfirmation factors, which is not price action. If you intrested in, I can find some example, but the meaning behind, I would not be angry on myself, to take some trade based on feelings

Máté
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 iqgod 
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One very important thing is to allow yourself to ignore your weakness and not focus on them.

What I mean is as traders we must never put ourselves into a position of weakness - never allow things that pull your trigger to happen - simple way to put it is that never trade large size, never more stops, never have huge drawdown.
Dr.Steenbarger talks about this here:

Drama Creates Trauma: Position Sizing and Risk Management in Trading

I listen to this EVERY SINGLE DAY:






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 iqgod 
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Apps For A Calm, Focused Mind


Online Apps for Better Focus

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 iqgod 
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A dream is just a dream.

A goal is a dream with a plan and a deadline.


First, The Roadblocks.

By the time a person has tried to achieve something he has been through so many upheavals, failures, stress and priority changes that the lack of drive becomes the all-consuming factor that causes defeat.

Having gone through all of this, I do not aim for hail-Mary rides that erase my losses and make me 'whole' again (remember: I am still NET negative, considering the money I poured down the drain in the first few years).

So no distant goals for me: my focus is on achieving small wins with some level of consistency.

It is energizing and sustains me. One day I will be setting bigger goals; that day will be when I truly get into positive territory.


Here is what Dr. Steenbarger has to say on his esteemed blog:


Quoting 

Where traders often fall short is not in goal setting, but in the feedback process following the pursuit of goals. If a goal is not reached, something went wrong. It is important to figure that out and make corrective efforts to pursue the goal in a new way. Goal setting with feedback provides deliberate practice, because the feedback hones our efforts to reach goals. It is very common in my experience that, when traders keep a journal, they write about their problems, but do not take the next steps of translating problems into challenging, specific goals. Even when they do outline such goals, it is rare that the goals are revisited with concrete feedback that is used to guide future efforts.

Too much of life occurs in auto-pilot mode. We take life--and markets--day to day, without an overarching plan and with no deadlines. We act as if experience itself will teach us all we need to know, when it is guided experience--experience informed by goals and feedback--that gets us where we want to go. One of the most important functions of a trading journal is as a chronicle of our goals, feedback, learning, and achievement. We deliver our best efforts when we're on the path to becoming our very best.

I have already identified my problems in an earlier post, in the next post I will share my trading screen snapshots to celebrate my successes and analyze my failures and look upon them as a tool to improve.

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 iqgod 
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As with trading:


How a team regulates mood, stays positive and resilient, handles unfair ups and downs, remains even-keeled, and deals with unpredictable misfortune without losing grip

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 Underexposed 
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A dream is just a dream.

A goal is a dream with a plan and a deadline.

I never thought of it that way but it is so true... I have been accused of being a dreamer many times and I will revisit those dreams often. But I rarely translate them into goals...

My father had great advice.


Quoting 
When traveling, always have a destination planned.
But if you see something interesting on your route,
Don't be afraid to investigate.
It may be interesting, it may have made your whole trip worthwhile,
You may stop there and go no further.
But if it doesn't work out, it doesn't matter,
Because you weren't going there anyway....


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 iqgod 
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It was a Saturday morning. The trader was breathing in the scents of a fading summer before starting his weekly review.

A stream of thoughts appeared out of nowhere. He had put in thousands of hours into this, perhaps more than 10,000 hours if he could've had them counted correctly. But real money still eluded him. All he had to show was that his capital had now stopped eroding (There was that painful day when he had been forced to sit down write out his trading plan...), and here and there he made small profits barely enough to cough out the rent. That's why he still held on to his day job. He knew he had potential, but... the results were plain - he was not living out his potential.

A gentle tug at his swivel chair jolted him out of his reverie. He peered down to find his two daughters teamed-up with serious looks on their faces, well serious enough for their 9 and 5 years!
They burst out in unison: "Sara wants to know why we are not rich!". That was the younger one naming the elder one as the culprit of this little scene.

He considered, but questioned: "Why do you feel we aren't rich?"

They both ad the answer ready,the one which caused them to have visited him in the first place. "Because once you had said that when we would be rich you and mom would not have to work ever again. You would stay at home, play with us and take us to Disneyland, beaches, and many other places. But all you both do is work work and work away day and night. So we know we aren't rich yet."

He knew he was cornered - a child can do this with a straight line what years of self-delusion can hide. He thought hard in stunned silence, thought after thought after thought hitting him, painful realizations parading before him.

His answer came out slowly: "Well, there have been times when we could've been together vacationing, and there have been times when I felt I could finally be at home, but we are still not rich because I sometimes make these mistakes...." his voice trailed off.

The little voices persisted: "What mistakes did you make, father?"

He already had them flashing before his eyes so answered easily: "Well sometimes I bought things that were going down, and did not sell them before they went down further. Sometimes I bought more of those things when they were even further down... I made these mistakes many times."

They looked at each other, wide-eyed now. "But you always say went you help us with the homework: never repeat the same mistake again! Find a new one! So why did you do that?"

What can an adult do against the flawless logic of two kids?



.... PART 2 FOLLOWS (recounted from the future, dated 18th October, 2015) ...

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 iqgod 
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..... this is PART 2 .....


It was Sunday, 18th October 2015.

He stood by the patio of his South Mumbai bungalow located at on of the most expensive residential streets in the world, gazing contentedly at the grey Arabian Sea sipping tea and looking forward to finalizing the Phantom at Rolls-Royce Worli.

He recollected - it was the same day on the calendar last year when he had that conversation with his daughters that had set the course for all of his trading from that moment onwards.

He knew that finally he did not have any excuses to not do things that he should be doing.

He decided that he would take every valid trade that his system was confirming without hesitation and would hold the position till the target was reached or until the conditions indicated that the trend had changed.

He decided that he would be courageous enough to achieve his dream.

Every single day he visualized the enormous benefits of being a successful trader. He envisioned the bungalow, the Rolls Royce and the sea view. He visualized the free time which was truly free to spend with his daughters, further hobbies, and the causes which his wife could now dedicate herself to selflessly without worrying about her kids future. He mused how earlier he had put on a cloak of frugality to cover up his shortcomings - not that he wasn't frugal now (he did not give lavish parties or splurge on showing off, except his childhood dream of a South Bombay house and a Rolls!), but he could generate wealth and distribute it better than anyone else in his residence.

His fear of losing no longer held him back and he did not cut his profits until his target was reached. He no longer hesitated on trade entries because he had gently conquered that same fear. He now played to win, and put odds in his favor. He took the 'I' of his life and dedicated his trading to achieving his and his family's dreams. He simply played his part as a great trader and started becoming profitable, consistent.

He increased size slowly, and his scalping methods allowed him the luxury of using scaling in a very wise manner.

His life became more meaningful as he grew in his own stature. His self-worth was made up on principles and not his net-worth. He would not be afraid to jump in into a trend again if logic so demanded it. The fear of the market was replaced by respect and his method became a map that propelled him on to greater heights of confidence and account balance.

And his humility was evident in his demeanor.

"I owe my success to my two sweet daughters." he would say whenever questioned about his good fortune!

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 Traderwolf 
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Setting your mind to your goals very powerful.. Great stuff.. You gotta believe in yourself.


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 iqgod 
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This is the first time I have been considering scaling into winners.

Here is how it played out, with the day ending +$138 (+$119 post commissions)



The first winner was closed at 80 and the other at 84.

Also I noted that I closed my sell too early, because countertrrend stuff makes me nervous.

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trademaniac
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Good posts iq, but lately i have observed, your journal has completely turned into a collection of emotions & psychology. Its more about you & nothing about the markets at all. The trading journal now looks like a personal diary.

I guess a mutually beneficial journal would be one where we discuss about your insights of markets & your trading (not just the end results). Emphasis should be on the solution not the problem. And you have mostly blamed your psychology for bad trades, but as Brett points out in his blog, problem could also be Fluid Reasoning.

Regards,
TM

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 PandaWarrior 
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trademaniac View Post
Good posts iq, but lately i have observed, your journal has completely turned into a collection of emotions & psychology. Its more about you & nothing about the markets at all. The trading journal now looks like a personal diary.



I guess a mutually beneficial journal would be one where we discuss about your insights of markets & your trading (not just the end results). Emphasis should be on the solution not the problem. And you have mostly blamed your psychology for bad trades, but as Brett points out in his blog, problem could also be Fluid Reasoning.



Regards,

TM


Journal what's important to you....I did much the same.....and as time had gone on, journaling is less and less about market specifics and more about mental and emotional preparations as well as edge development and maintenance.

This is a necessary part of the journey.

Don't let anyone distract you from the pursuit of what's important.

Brett's article is pertinent but take it for what's it worth and nothing more than what it's meant to be....an article detailing what we know to be true.....make decisions based on context and not on rigid rules.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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 tturner86 
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trademaniac View Post
Good posts iq, but lately i have observed, your journal has completely turned into a collection of emotions & psychology. Its more about you & nothing about the markets at all. The trading journal now looks like a personal diary.

I guess a mutually beneficial journal would be one where we discuss about your insights of markets & your trading (not just the end results). Emphasis should be on the solution not the problem. And you have mostly blamed your psychology for bad trades, but as Brett points out in his blog, problem could also be Fluid Reasoning.

Regards,
TM


PandaWarrior View Post
Journal what's important to you....I did much the same.....and as time had gone on, journaling is less and less about market specifics and more about mental and emotional preparations as well as edge development and maintenance.

This is a necessary part of the journey.

Don't let anyone distract you from the pursuit of what's important.

Brett's article is pertinent but take it for what's it worth and nothing more than what it's meant to be....an article detailing what we know to be true.....make decisions based on context and not on rigid rules.

@PandaWarrior is correct. You journal is meant to document issues that you need to change. If you have your method down, but have issues in your head. Continuing to journal about your method will not help. In the beginning you need to document as much as possible about how and why you are doing what you do as you trade.

Then after a while it is important to step back, assess yourself through your journal. Pick some areas to work on, and get to work. When you do that you start to turn ideas into actions. And that is how you make progress. When you start to focus on those items, you may focus on them more to ensure you are documenting what you need to evaluate.

I have changed the way I journal multiple times. The key is to keep it working for you. That may require you to post, or record different things at different times.

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 iqgod 
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This is one of the trades that I learnt early in my trading career and it still gives fantastic results if you are careful about the location.



The real problem with this method is that the stops are huge i.e. they reside beyond the pinbar extreme, which is quite a hefty stop.


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 iqgod 
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Bob Volman's classic Block Break:



The exact moment of the break cannot really be always timed, but the stops can always be set tight.


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 iqgod 
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Remember the basic principles:

A diagonal pullback in a freshly started trend, a bar that breaks above the last bar of this string of pullback bars near the EMA and viola you should be in!



Sadly I chickened out on this long a tad early, but apply the principles and you have the 10-tick target easily within reach.


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 iqgod 
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Observe how the sellers got squeezed slowly and steadily setting up this long for any observant scalper:



Again, I've covered way too early!


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 iqgod 
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The trade premise is easy: Wait for the pullback to reach the EMA. If it is not a smooth diagonal pullback then do not take the First Break. Wait for price to breakout the second time and get in at that break.

This is the same as the H2 setup of Al Brooks.



I was in early, the really correct place to enter it is just as the huge bar started to break the earlier tiny bull bar in the EMA.


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 iqgod 
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A couple of range breaks. Easy to trade if patience is applied. Add patience to the mix and many trading strategies become viable and even profitable.



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 iqgod 
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I was too scared to enter into the Range Break long above the box, even though that pinbar was screaming get long. However the first pullback allowed me to get in and simply hold the trade for a relatively giant number of pips since there was only vacuum above those prices.




This trade illustrates that you do not need to chase price if you miss a trade but simply continue being patient.


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 iqgod 
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This range was easy to trade if you keep in mind the trend equal trend phenomenon.

Price was in a markedly bearish trend and once you had your box it was highl probable that the bear would resume once price dipped below that range:




Note that I exited to early leaving half the profits on the table.


On the other hand if there is impatience it may cause lot of stress and worry as price whipsaws around and you are in early, as in this trade! Also that is the reason for my hurried early exit instead of allowing it to reach target.



These two trades also illustrate the two issues where I keep vigil: impatience-based early entries and fear-based early entries. Both are fear's different forms (even greed is a form of fear). Courage and patience are more important than setups.


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 iqgod 
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Here are some trades that I missed because even though the market was screaming 'short' I was thinking about 'countertrend - no!' and hence missed a giant opportunity. The stop would have been small and easily placeable too!




I, however, do not regret it post-facto. To everything just say 'yes' - peace of mind is also your trading capital.


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An early entry is sometimes acceptable, as in here but still it wasn't in tune with my method:





It is not the early entry here that is the problem, it is deviation from strategy that is the problem. Do it once and you will be doing it all over the place and end up hating yourself everytime it backfires.


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These early entries are kind of hard to explain, but never hesitated taking them.



I keep reminding myself that the underlying emotions of the trader cause these - sometimes it is wanting to be whole again after a losing trade and sometimes it is wanting to be right on direction:



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In this trade I hesitated on the first Second Break but a second Second Break came along very soon and nothing of significance was lost:



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There are always trades I should swing instead of scalping, so I do them in different accounts to keep my head clear.

However I tend to cover the swing trades when I cover the scalps negating such probable highly profitable trades.

If you see the previous post, it is the same day and had I held on to this first short below instead of rushing to cover it I would have done better:



Also 'you never know what will happen, so cover!' takes over and has to be fought everyday.


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If there is one thing that needs to be kept in the forefront of consciousness it is this: since this is a game of trapping and trampling, it is wise to avoid these obvious tease breaks to which we can succumb due to fear of missing out as happened here:




The net outcome may be positive, but mental capital truly gets exhausted in such cases.


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Here we have an excellent range formation, but the silliness of my exit is obvious - I essentially succumbed because I entered early and then those mental reserves got depleted.



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Since someone asked, and since it is my belief that even if this journal helps one person it would truly serve its purpose I have freely shared the method (its not my method, but remember that every method has to be made 'my' by the trader)


So here is a summary guide to understanding method, while remembering that after the essentials are grasped the inner battle still is there to be conquered:



Pinbars:





Block Breaks:



First Break:



Second Break:



Range Break:










Tease Breaks, Traps:






The Inside Range Breaks and Advanced Range Breaks I will reserve for the future because they are more demanding by their very nature.


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Since someone asked, and since it is my belief that even if this journal helps one person it would truly serve its purpose I have freely shared the method (its not my method, but remember that every method has to be made 'my' by the trader)


.... and by one person, I also mean myself. Journals are primarily meant to be tools, just like TA or biofeedback or meditation or counselling.

For more complete journalling check out @PandaWarrior's journals - he is a wordsmith to the core and can flush out his thoughts and arrange them so that it seems that the written word is speaking to you personally.


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 Scalpingtrader 
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As for you "intuitive" early entries on breaks - can you find one thing that the most of them, if not all, have in common?
(I'll reveal later, but I want to check if you come to the same conclusion, first)

Great journal btw, keep it coming - both psychology and execution, as they go hand in hand imo.

ST

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Scalpingtrader View Post
As for you "intuitive" early entries on breaks - can you find one thing that the most of them, if not all, have in common?
(I'll reveal later, but I want to check if you come to the same conclusion, first)

Great journal btw, keep it coming - both psychology and execution, as they go hand in hand imo.

ST

.... that I jumped out way before the profit target was reached?


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 Scalpingtrader 
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.... that I jumped out way before the profit target was reached?

for sure, but I was thinking more about a possible quantification of the entry ie. what do they have in common when looking at the chart setup?

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for sure, but I was thinking more about a possible quantification of the entry ie. what do they have in common when looking at the chart setup?

I pored over them and...


Sherlock Holmes Quotes

'You see, but you do not observe. The distinction is clear.'
-A Scandal in Bohemia

"The world is full of obvious things which nobody by any chance ever observes."
-The Hound of the Baskervilles

'It has long been an axiom of mine that the little things are infinitely the most important.'
-A Case of Identity


"I am afraid," said I, "that the facts are so obvious that you will find little credit to be gained out of this case."
"There is nothing more deceptive than an obvious fact," he answered, laughing.
- The Boscombe Valley Mystery


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 Scalpingtrader 
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C'mon, a bit more effort, please!

Take the one that occurred around 07:03 , you posted it around two hours ago (blue background):

Would you describe the range and the development of the chart up until the break for me as detailed as you possibly can?
Note everything that is on the chart and how it looks in relation to the other components, please.

Think like a Sherlock!

If you think that's nonsense, just don't but then I guess I got to keep my observation to myself

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Take the one that occurred around 07:03 , you posted it around two hours ago (blue background):

Would you describe the range and the development of the chart up until the break for me as detailed as you possibly can?
Note everything that is on the chart and how it looks in relation to the other components, please.





iqgod View Post
Here we have an excellent range formation, but the silliness of my exit is obvious - I essentially succumbed because I entered early and then those mental reserves got depleted.


Okay here goes....

Price was in a marked downtrend but still range bound. The buy at around 5:33 was mostly due to FOMO because there was no setup and no down trendline had been broken yet. This act meant that the tightly ranging market had to be tolerated till at about 6:16 I covered it at breakeven with Thank-you-God and promise-I-won't-do-that-again.

At that point the down trendline had indeed broken, however what we had was a typical false break i.e. price came right from the bottom of the range and overshot the top of the range without pausing. The early bulls who got in there were trapped hence the falseness of the break.

However the bears were thwarted once price reached the 20 EMA and the titans clashed in the barb-wire zone where the bulls slowly took control and steadily heaved the price above the 20 EMA.

The buy at 6:42 was slightly premature, as in, it was a tease break which originated from the 20 EMA and had to be proven yet, since the market could still go either way.

However the three compressed bars just before 7:03 showed that the shorts were being squeezed and the only way they could avoid painful losses were by covering their shorts for a small loss or be thrashed. Essentially the concept of double pressure where sideliners could now go long with the .50 level offering support and no clustering price action to the left of the chart meant that they could achieve a 10-tick target without price having too much trouble to reach that zone.

The long was then easy and the stop could have rested below those three compressed doji bars yielding a low risk scalp with a 10-tick profit.


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Okay here goes....

Price was in a marked downtrend but still range bound. The buy at around 5:33 was mostly due to FOMO because there was no setup and no down trendline had been broken yet. This act meant that the tightly ranging market had to be tolerated till at about 6:16 I covered it at breakeven with Thank-you-God and promise-I-won't-do-that-again.

At that point the down trendline had indeed broken, however what we had was a typical false break i.e. price came right from the bottom of the range and overshot the top of the range without pausing. The early bulls who got in there were trapped hence the falseness of the break.

However the bears were thwarted once price reached the 20 EMA and the titans clashed in the barb-wire zone where the bulls slowly took control and steadily heaved the price above the 20 EMA.

The buy at 6:42 was slightly premature, as in, it was a tease break which originated from the 20 EMA and had to be proven yet, since the market could still go either way.

However the three compressed bars just before 7:03 showed that the shorts were being squeezed and the only way they could avoid painful losses were by covering their shorts for a small loss or be thrashed. Essentially the concept of double pressure where sideliners could now go long with the .50 level offering support and no clustering price action to the left of the chart meant that they could achieve a 10-tick target without price having too much trouble to reach that zone.

The long was then easy and the stop could have rested below those three compressed doji bars yielding a low risk scalp with a 10-tick profit.

An additional observation:
When the second breakout occurred, price was caught directly between the ema to the one an the range top to the other side, with no room left for movement to either direction.
So to speak, the ema started pushing price out of te range & into the stops that we're hanging above it.

If you want, go back & check for yourself if that scenario matches your other samples

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An additional observation:
When the second breakout occurred, price was caught directly between the ema to the one an the range top to the other side, with no room left for movement to either direction.
So to speak, the ema started pushing price out of te range & into the stops that we're hanging above it.

If you want, go back & check for yourself if that scenario matches your other samples

Hi,

Yes that was so ingrained in my mind that I did not say it!

I alluded to it here

... However the three compressed bars just before 7:03 showed that the shorts were being squeezed ...

The illusion of the bars nestling in the EMA and the EMA literally pushing out the bars out into the breakout can be a powerful and beautiful one to note - of course it is not the EMA that has such magical powers but it can literally appear so!

Thanks @Scalpingtrader for the exercise!


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.... and by one person, I also mean myself. Journals are primarily meant to be tools, just like TA or biofeedback or meditation or counselling.

For more complete journalling check out @PandaWarrior's journals - he is a wordsmith to the core and can flush out his thoughts and arrange them so that it seems that the written word is speaking to you personally.

@iqgod, I appreciate the kind words, however I must insert here that a journal serves it purpose if it helps you. If it helps someone else, that is a side benefit. Helping someone else should not be the primary purpose of a journal.

So journal in a manner that is beneficial to you. If someone else finds value in it, then so be it...but help yourself first.

Good luck on the journey....

Brian

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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 iqgod 
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+$105 today. Single trade.



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 iqgod 
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There was a time early this year when I used to be frustrated with the huge gap between my knowledge and my execution.

There came one day when there was a click moment about what correct trading is all about and I closed that gap that day; ever since I've oscillated between good execution and less than desirable, but thankfully have had very few relapses into bad execution.

One more thing is this 'prediction' or 'making calls' that directly feeds the ego. Post your trades in real-time and you can observe its grip even more. You stand to lose face and that may be enough to cause hesitation while executing to miss trades, entering too early or exiting early. (or worst, entering without any confirmation from the market at all).


But once you are in the flow, there is this problem that you have to always tackle. It is the past performance affecting the present moment I'm talking about.


When I have scratched trades due to mismanagement or have left money on the table in a ride that was finally "obvious" but fear kept me out, I start trading dumb because I feel that I need to generate a profit every day and "get back" what I left behind.

For example, the fear occurs when I have caught myself thinking when have taken a lot of heat on an earlier trade whose foundation was shaky, and now the market is returning to that price but has a valid setup - there I find myself on trial by fire. Or when I'm profitable and don't want to "give back".

My problem is thus that I let my experience of either euphoria or frustration with the i-1 th trade affect the i th trade.

So the problem was and is trusting a trade to work fully, i.e. giving it a chance to do so.

That problem deserved this starting advice: narrow the setups down to very few, even one or two - but feel comfy with them and go in with proper risk-managed size that is also worth your while.

By doing this you will trade far less, and you will go for quality trades (and ALL quality trades) instead of quantity of noise. That's where the higher number of VALID samples will start pay off. The higher number of VALID samples will show the power of the method and allow the trader to play a better game.

Other professions have a well-defined playbook to follow, all that is demanded is perfect repetition of doing the same thing over and over.But we fight hard just to be daytraders. Here life is never fair, we have to deal with it.

However trading is extra-hard because in it we need to not use the method we learned in the past about how to learn something new. The learning about learning is different.

In trading I found that doing small things correctly and avoiding small mistakes leads to great success - e.g. I've been making mistakes and then deciding if correcting the mistakes is worth the challenge or will I end up worse than my earlier curve. Correcting them is not enough, eliminating them is the thing to be learnt. Once they become habits its cycling that can never be forgotten.

The much touted advice of "doing what you plan to do inspite of yourselves" or in other words, simply, discipline is valid but not trivial. This 'discipline' challenge comes immediately once the mechanics and the foundation is in place.

For me what helps to stay disciplined is undoubtedly humility. The knowledge that nothing is certain or knowable and the smallness of us but the vastness of our purpose.

Mechanize the process as much as you can - treat each and every trade as afresh and each one basically the same.

I stop 'thinking' and pretend I am "Action Jackson".

Pre-determine the level you want out. There is much to be said about letting a trade run on a confirmed setup in a confirmed trade but for me the 10-tick winner is currently the mentally acceptable target.

Pre-determine where you are wrong and will bail. For me 10 ticks is the level.

I go all in and get all out. Its only recently I've started adding to winners.

For me a good trade is the one that gives you many clues to bail before the final 10-tick stop is hit. A bad trade is one which does not warrant an entry but I'm 'inadvertently' in it and then I can make excuses why the stop was hit. That is a bad-bad trade. That bad trade also told you something. All trades tell you something.

Losers never get past the fear factor. Some money manager said 'this is not a game for eunuchs'.

Profits will happen, do not worry about profits.

Conflicts get in the way of my trading because trading requires a clear head. So I take lot of 'rest' and do not trade if something off is happening e.g. I was not trading for the biggest days in the ES because it was festival time and I had my priorities which would be a guaranteed hijack to my trading.

Distractions are the bane of many a trader. I know i am easily distracted and do not want to believe any different.

Thinking is a distraction that clutters your mind. Thinking remembers and brings up the fear factor. This where mechanization helped me. I'm a completely discretionary mechanized trader.

But once your trader muscles and skills are developed, you will be able to collectively refer to them as 'intuition'.

The story does not not end there. Some psychologists call it 'fear of success' or it may be not wanting to keep doing this forever - but there is that something that can get to you easily, right to your core foundation and everything can go poof.

That is what had happened to me once. I got stubborn and sat and watched ES go 35 handles against me on one lot in my real account. That was the perfectionist turned off by the self's behaviour saying "Go on, have fun, chew me up, let me die now." I actually was asleep snugly in my bed, with a tired given-up attitude when my broker called me up to remind me that I do not have margin for overnight and the market's closing in 3 minutes.

I will never forget that day - it was too hard a lesson.

Yes, meditation does increase your awareness, but you must still stay focused on trading while trading. You cannot mix it up with life's other problems and hope to come out unscathed. You also must have an edge, if you have an edge, meditation does improve your trading. The key is to meditate every single day even if you don't notice any improvement in your trading.


That was when I realized that even when I have everything I need to succeed, I failed because I was searching for something more; the something more was certainty, perfection or even love. Trying to be right was my biggest weakness and one that I have to fight ALWAYS.

The trader's job is of knowing what he is doing and WHY he does what he does i.e. to think the trade through before entering and then actually entering.


Tip
"The most important rule of trading is to play great defense, not great offense. Every day I assume every position I have is wrong. I know where my stop risk points are going to be. I do that so I can define my maximum possible drawdown. Hopefully, I spend the rest of the day enjoying positions that are going in my direction. If they are going against me, then I have a game plan for getting out." - Paul Tudor Jones



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 iqgod 
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 cejstrup 
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Nice ,keep it up

Have you though about the continuous combine ? I'm considering going that route

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Nice ,keep it up

Have you though about the continuous combine ? I'm considering going that route

I hate subscription-based stuff. Mental drain is greater, but probably that's just me!


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I hate subscription-based stuff. Mental drain is greater, but probably that's just me!


iqgod View Post
I hate subscription-based stuff. Mental drain is greater, but probably that's just me!

I know what you mean. Me too.
But it does take the pressure off to feel one have to perform since the target doesn't have to be reached in a fixed amount of time.

I'm still pondering what to do,but I think I'll give it a shot

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 iqgod 
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GaryD
New start, back in the groove of making good money... but not enjoying it. I don;t want the same things today. I drove a $60k vehicle, not a big deal. I lived in three separate $1M+ homes, not a big deal. I am not willing to sell myself into slavery again for those things. They do not matter. The only part of having money that sticks with me today, is that I came and went as I pleased, did what I wanted.

So many times I have typed here about issues like, how to size up while not thinking about money, or, how to set a household budget with no guarantee of income, or, how to have trading as an occupation and still not care about the outcome... Meanwhile, if I truly did not care, if I approached it from the creative and artistic side that is still buried within, if what mattered was freedom and not money... I could walk away from my career today.

And yet, having ramped back up a new business so intensely, due to necessity, and finding myself in greater demand each month, making money, feeling a sense of accomplishment for making such a strong comeback from where I was not so long ago...

It may no longer be for the same motivating factors, but it feels good, and is weird to consider letting go of, even if I am not happy, even if I have no life because of it. All the while, clinging to the concept of letting go. But unless I am ready to do so, it would not work. And to find out I need a lapse in other work, almost hoping it will come, and thought it was about to happen starting this month. But now I see that there is no end to it, as long as I do a good job, deliver on business commitments, I have never had a hard time finding work. I have a harder time avoiding it.

@Big Mike made a leap of faith, and found what he was looking for. So far, much braver than I am.

There was a trader on this forum who was a creative wordsmith and a great Oil trader who went by the name of @GaryD.

When I read his battle about going full-time vs continuing working his corporate business and I am finding myself working to death balancing trading and the IT job it seems the job is getting in the way but it can still be managed by working smarter and avoiding time wastages.

The same battle thus rages in my head, and as @PandaWarrior had adviced him then, there comes a moment when bridges have to be burnt.

Rings true:

“The man who chases two rabbits, catches neither"

- Confucius


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 iqgod 
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That said, many people find it difficult to chase just one rabbit. They set too many goals, or they try to execute too many projects simultaneously. It just makes it impossible to be productive, let alone effective.

Successful people know when to say NO.

As Steve Jobs said, “People think focus means saying 'Yes' to the thing you've got to focus on. But that's not what it means at all. It means saying 'NO' to the hundred other good ideas that there are. You have to pick carefully. I'm actually as proud of the things we haven't done as the things we have done."


Quoting @GaryD's journal again:

But for the act of trading, the ability to let go of any specific goal, or specific outcome, or any sort of guarantee of anything... and just, be... just allow something else to be in charge...


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 iqgod 
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GaryD

For a guy who is wired as a workoholic, trading teaches a tough lesson. Learning that making money is easier when I do not care

and


VinceVirgil

No one really wants to be a multimillionaire. People want to live the life of a multimillionare...to have the freedom from the drudgery of a 80 hour workweek at something you don't like.



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 iqgod 
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The wise ones say that to solve your problems you are facingtoday I must go back and look into more history books instead of thrashing it out on my own Some instructive books:



@Big Mike speaking:

People posting on futures.io (formerly BMT) and trading are probably not living in poverty. They are probably more educated than average.

Let's just say they make 75,000 a year at their "day job" on average. They work 60 hour weeks, aren't crazy about their job. They have a wife and 2 kids.

It is my opinion that taking this persons income from 75k to 150k isn't going to make them happier. They will buy fancier cars, a bigger house, spend more money going out and on entertainment, buy a new plasma tv, some new toys, a new set of golf clubs, buy a new boat, whatever... all of those things provide brief moments of happiness, but overall for the long haul will likely not solve any underlying problem if you are already unhappy to begin with.

It is very difficult to explain. I can still very clearly remember how I felt in my day job prior to me quitting and turning to trading full time. I would not have classified myself as unhappy. I had all kinds of toys, big house, cars, bought whatever I wanted, etc. But it turns out, I was not happy. It was not due to lack of money. Thus, money does not buy happiness.

It was only because I am able to look back and compare my happiness both before and after that event that I am able to say I was definitely not happy before the change. But like I said, if you had asked me at that time, I would have answered "yes, I am happy" simply because I did not have proper context to compare to.

I simplified my life. Changed my life, really. Changed the kind of person I was. It was not easy. Decided what was important, and what wasn't.

The only thing that was truly important was being happy, and I can assure you that the Corvette, big house in expensive neighborhood, and etc was not contributing to my overall happiness - but quite the contrary. Making big bucks at my day job where I was VP and could do anything I wanted, most people might say they would love that job. For a while I thought I loved it. I was wrong, and the more distance I put between that job and that way of living, the more I realized it was not making me happy - but in fact, the exact opposite - it was making me sick.

Once I simplified - got rid of everything, even my cell phone - and decided that trading was it for me, then I really started to see the path of what true happiness was about. And it has nothing to do with money or material things.


The important part, best I can figure out, is the feeling or sense of complete freedom. Even if you are small business owner, you have less freedom than you do with trading. There are employees to look after, there are maybe retail storefronts to manage, and then there are customers.

With trading you really cut those ties and are completely independent, aka freedom.

For me, it was just an enormous relief off my shoulders. Which is odd, since I replaced a steady paycheck with a questionable one.





And more of @GaryD's thoughts:

I just got off the phone with my wife, explaining how ridiculous it was, that with what I am making now, in something I have done for over 20 years, and am extremely good at (not going for ego, but for definition), but do not enjoy...

When I take a project today, I know 99% of the time what I will make the day I sign on. That is the biggest difference in belief.

I can make money almost every day trading, IF, (and if it were not just silly that word would be huge) 1) I do not care, and 2) the trade size is relatively small.

And at that level, what I know I can do, is about $50k a year. 1-2 contracts. Sounds absurd, I know. Sounds so easy also, to just multiply. But it does not feel easy, and for me, as crazy as it sounds, when the feeling is gone, I do not make money.

So, yes, I can burn the bridge, and I am considering it more each week. Thought I was there; my jobs were ending and my main account went to another PM. Have enough to eat for a few years, a wife who supports me, friends here that encourage me...

And then another offer comes up.

I have not missed a delivery schedule since 1996? I am opening franchises for various businesses across the country, and that one attribute makes what I offer attractive. They need to deliver on schedule, I am almost like an insurance policy. I do not fail. And because of that, it takes a few jobs and I have a new loyal client. Easy. But relentless, unforgiving, in a constant race, time of day means nothing.

Trading works on it's own schedule. Some trades are quick, and those are the best, but most, the overwhelming majority, work on their own schedule, and give plenty of chances to decide they are not going to work out. I know that, and with one contract, it is almost a game. Price can move against me, ok I give. Not that it matters.

But I know, with almost absolute authority, I will find the trade, and I can maintain profitability even at a 50% win rate, because of the way I trade... with one or two contracts. I could be net DD $1k, so what? And hit the next opportunity with zero baggage, 100% belief.

I could survive trading, there is no doubt in my mind.

But in the depths, somewhere there was this positive reward system in what I have done in the past, more psychological than financial, that has a deep knowing of what I produce on an annual basis, and yet that math will not transistion into trading, for some reason that I do not completely understand.

My solution; be willing to accept less. And yes, that works. And so many times recently I find myself thinking, make more, for what? Stuff? Toys? Ego? Proof that I can? And having already been there, none of that seems to matter.




@PandaWarrior's advice:

I know your problem intimately...there is only one solution. In the end, you have to decide what is GREAT for you and your family and what your sense of destiny is, then sacrifice the GOOD to obtain it. At that point, there is a bridge to burn. Its a reality both in the physical but more importantly in the heart. Without burned bridges, there is no emotional commitment to making a thing work. You know this better than most. Success requires total buy in. You cannot leave anything on the table. And being torn between two competing ideas, two competing paths will only lead to stress and eventually burn out.

Somewhere along this journey, you'll reach the point at which you know you must commit to one or the other. The Good Book says that "a double minded man is unstable in everything he does".






And @josh:

I once left a career as a software developer to pursue a full time career in a field which gave me true passion. Since then, I have woken up with "the Mondays" like everyone else at some point or another, but I have never regretted my choice to do something that I LOVE.

The money was not as good, and I basically stepped out of the nest and had to learn to fly quickly, but since making that shift 7 years ago, I have always been happy with my work, even on the tough days.

The truly sobering thing about trading the markets on your own is that no one makes you push that button. Win or lose, we are totally responsible in every way for our successes or failures. We can't even blame a bad market, as we alone make the choice to enter that bad market. On the one hand it's terrifying, because if I'm losing, well then I must look myself in the mirror and see the problem; but on the other hand, if I am successful (consistently anyway), then I can give no one else the credit. It is total freedom, and that freedom must not be abused, but it is a great feeling nonetheless. No employees, no bosses, no clients, no selling--none of it. Only us and the markets. What a job.


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 iqgod 
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Did you enter trading to toil by the hour and take home a modest pay?

If you are like most of us, you entered the arena with stars in your eyes, maybe seeking escape from a day job spent doing what you might not fully like. Perhaps you were rudely awakened on one trade or a series of them from your reverie and experienced loss, pain and frustration - even a blown account - and realized that the market hadn't embraced you with its open arms even though it seemed so easy.

Buy low and sell high - and look at that parade of all those setups that are passing by which you had been missing all along till now. In you jump and then you encounter that BUMP.

Humpf! you grunt! You learn and learn and learn, pick up something new, or atleast adjust something old and expect the miracle of profitability - you surely deserve it by now, after spending so much effort, time and brain? But it eludes you.

You enter a grind that has taken up much of your hard cash, sanity and stare at the lost opportunities that have walked past while you dreamt this seemingly futile dream.

At this point the trader is at a crossroads.... this post is for that trader.

The first thing you need to do is take complete responsibility. Start with your day job. Perhaps you have a bad manager. Do you often curse him and dream of sweet revenge when you drive past him in a Lamborghini bought with trading profits? Then give up that malicious thought. Decide that you will work hard and honestly, and make it worth your while.

Why do I say this? Because the amount of honesty trading requires has to be built up. You cannot sneak off some work hours and slip them into trading and expect good results. That is stealing. When you give honestly you leave no room for excuses - when you know you have done your best. This lays the foundation for discipline.

The second thing I want to stress is that be yourself. That is one journey I had to come face to face with. If you are an artificial self then you need to get into your real natural shape first. If you need to rationalize your actions then you are not your natural self. Your actions are the most important part of the trading equation. If you are acting naturally out of a state of a winner then many things follow naturally. The emotion of humility and staying relaxed because you are not auto-acting out a part assigned to you by some arbitary parts of the society will serve you well.


@tigertrader once described the qualities that a trader should possess. If you read that post you will realize that the greatest traders of all are almost required to have all the qualities of Mahatma Gandhi.


Here is what he said:

You must be confident, but ego-less; objective, but subjective; mechanical but analytical; focused but relaxed; disciplined but flexible; and patient but decisive.

To which pat came the reply: I think you are describing Mahatma Gandhi !!! No wonder 95% of traders fail!


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 tigertrader 
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iqgod View Post
The second thing I want to stress is that be yourself. That is one journey I had to come face to face with. If you are an artificial self then you need to get into your real natural shape first. If you need to rationalize your actions then you are not your natural self. Your actions are the most important part of the trading equation. If you are acting naturally out of a state of a winner then many things follow naturally. The emotion of humility and staying relaxed because you are not auto-acting out a part assigned to you by some arbitrary parts of the society will serve you well.

@iqgod: great piece-very well written and very insightful; and, you are spot-on in your reference to humility

humility is the most powerful currency one can utilize to prevent the market-mistress from collecting a toll larger than one should rightfully pay; one must have respect for the market and oneself. if one refuses to respect risk, the mistress will clearly find a gaping hole in such personae, so that she may serve up a healthy dose of humiliation.

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 iqgod 
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One of the benefits of having a good and trustworthy mentor in trading is that you don't learn to do things the wrong way. Unfortunately very few home-based traders have this luxury and when their self-taught methods are practiced sufficiently they come embellished with bad habits.

The best approach to eliminate bad habits is to firstly become aware of them and then superimpose the correct habits on top. With enough of this mindful practice (atleast 66 days, will talk about the figure later) the old habits will start to lose control over our thinking. But this can be a difficult and thorny process.

What gives? Why would a trader carry out such self-sabotage instead of 'getting better every day in every way'?

Of course if you never learn a bad habit that is the best, but at that point it seems such a good idea e.g. "to take that small winner to secure your wins" or to "move that stop because the market's going to come back anyway". Thus what @FuturesTrader71 calls the monkey-mind is the culprit. I have talked in my earlier few posts about what has to be done, but HOW does it have to be done?


Let us look at an example of a couple who are new pet owners trying to get their pup to eliminate a bad habit:


Quoting 
We recently acquired a 1-year-old mixed poodle puppy which is neutered and has his shots. Our problem is his aggressiveness -- he jumps up on us at home and on any strangers we encounter on the street who stop to admire him. His toenails scratch, he licks bare skin and even bites with an open mouth (not viciously, but those small teeth scratch!).

Though we step on his toes or push him away, he persists. To eventually stop this, we isolate him in a different location. Any suggestions?

Look at how the problem is being tackled. When a trader is in the heat of the moment, enacting the bad habit, digging up that huge hole in his account, he is blind to obvious fact, oblivious to sensible self-advice, driven by a demon that has possessed him. Its only later when he realizes the gravity of what he has done, and then vows never to do that again, but then another 'sure-shot' trade looms large and here he is moving his stop again when he should have exited with a small loss long ago.

Note that there are 'rewards' for everything a trader does. Until he becomes mindful of those 'rewards' he cannot control the drug-induced reaction he plays out that his two pound chemical factory is executing for him. Loss? Yes. Repeated loss? Habit. Remorse after-the-fact? Habit too.

Here is the solution suggested to those pet owners:


Quoting 
This is a learned behavior your puppy must now unlearn. He's been rewarded for jumping up and nipping for a year. Victims of his exuberance, even if bleeding, probably say "oh, it's OK" and pet him anyway because he's cute. You stepping on his toes and shoving him is further encouragement. To a dog, negative attention is better than no attention.

The word "eventually" is a big clue into solving your problem. I'm a big believer in time-outs to correct nuisance behaviors in dogs, but in your case it's happening AFTER the puppy has been rewarded with some sort of attention. He doesn't associate the isolation with misbehavior.

Correcting him will require 100 percent consistency. Biting is NEVER OK. Jumping is NEVER OK. The minute you feel teeth or claws, say nothing, walk away or isolate him in another room or in his crate for about five minutes. If he persists (which is likely), do it again. His attacks may intensify at first as he struggles to regain control of the game.

Avoid strangers on the street for now. Instead, set him up with people you know, instructing them to ignore him when he jumps or bites.

Shower the little guy with love and praise when he's displaying behaviors you want. Soon he'll associate the attention with being a "good boy" and jumping or biting with being ignored.

One other suggestion. A training class will help channel that legendary poodle intelligence into more constructive activity and be fun for both of you. He's more dominant than aggressive at this point, but you start retraining now. Good luck!

The monkey-mind is exactly like the little puppy. It wants to be a good thing but the feedback it receives in the sterile environment of a review is not enough to make it understand that bad habits are NEVER OK. That is why there is a disconnect between knowledge and execution.


Based on scientific research, If you want to break a bad habit, here is one method that is often successful:

1. Identify a positive habit and congruent behavior you would like to adopt.
2. Identify the habit you want to break.
3. Recognize the sensory impulse(s) you experience in your body or other stimuli that occur just before you usually act on the negative habit.
4. Instead of acting on the negative impulse at that point, use your conscious attention to re-focus your thoughts and behaviors on the new and positive habit you identified in Step 1.
5. Substitute the new behavior that is congruent with the positive habit you want to form for the behaviors of the negative habit.

Continue Steps 4 and 5 for at least 66 days. Notice that you are using the triggers from the old habit to reinforce your practice of the new habit.

How long must the new behavior be repeated until the behavior becomes a habit? There is no one standard time period for a habit to form — it can take anywhere from 18 to 254 days. More specifically, the period of time depends on the difficulty of the activity being learned and the level of commitment on the part of the individual.

For example, it is markedly easier to form the habit of drinking one glass of water every day than it is to do 60 sit-ups every morning before work. Lally and colleagues discovered that, on average, participants learning to form a new habit succeeded within 66 days. By the 66-day mark, the repeated practice of those activities had hit their plateau of learning increases, and thus, the behaviors became as automatic as they ever would become.

Researchers identified an important caveat to keep in mind regarding learning a new habit: early practice of the activity resulted in greater increases in automaticity. So, if you’re going to miss a day from your repeated daily practice of learning a new habit, skip a day that is further along in the 66-day period, since the reward/increase in learning for a new behavior is greatest at the onset.

For example, here is what I am trying:

I realize that almost all my trades have the exact same issue: I exit with fear while the trade is a winner....

Henceforth every time I have this urge to move my target order I will focus on my new desire to watch the trade reach its target. The focus will have to be on bodily impulses which are hard to document but I'm hoping that the mindfulness towards them makes me aware what they are in real-time. Note that I will not focus on all the combines I have scratched - all the lost opportunity, all the profit targets never reached etc. That is feeding negativity and is simply asking for a good whack which the subconscious usually willingly supplies!

I will do this exercise for 66 trading days and keep you all posted about the results each time.


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 iqgod 
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I once had the misfortune of meeting a trader who had just blown away 30 million bucks. He was devastated and depressed.

Where did I meet him? In the 10-day Mindfulness Meditation Vipassana program (described by me here) he was among the 800 people attending the program trying to find some repose and meaning to his life. (OF course at that time I thought of him as a complete fool to do that, and a sort of disciple of Satan who "deserved-it-for-anyway-for-doing-risky-gambling", myself never having waded in "impure"waters or vice of the financial markets which I placed in a certain category along with casino addicts, punters betting on horses, or cruel-Wall-Street-dudes whose business was cheating innocent people etc and more attributes of such unfounded villainy.

I had stated earlier in my puppy extract that:


Quoting 
I'm a big believer in time-outs to correct nuisance behaviors in dogs, but in your case it's happening AFTER the puppy has been rewarded with some sort of attention. He doesn't associate the isolation with misbehavior.

Correcting him will require 100 percent consistency. Biting is NEVER OK. Jumping is NEVER OK. The minute you feel teeth or claws, say nothing, walk away or isolate him in another room or in his crate for about five minutes. If he persists (which is likely), do it again. His attacks may intensify at first as he struggles to regain control of the game.

Later I heard about him. So amazing was his turnaround and recovery from that unimaginable numerical hole that I still believe that if you truly desire success, such an event (even if fictitious) may well serve as the intensified self-alert to get back on the correct path following rules. And I am sure that mindfulness gave him the tools needed for that recovery.


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 iqgod 
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I will post this line to help myself and anybody else decide if they are on tilt after a losing streak / big loser (also big winner):

Can you turn around and smile as a human to a human? Or is your smile a smirk or a feeble attempt with a hint of 'sad'?

If I or you answer yes, do not trade today.

Accumulated tilt is dangerous.


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TurismoTek
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I will post this line to help myself and anybody else decide if they are on tilt after a losing streak / big loser (also big winner):

Can you turn around and smile as a human to a human? Or is your smile a smirk or a feeble attempt with a hint of 'sad'?

If I or you answer yes, do not trade today.

Accumulated tilt is dangerous.

Two rules I employ:

[1] Do I feel at my best? Will I be profitable today?

If the answer isn't a confident yes, I don't trade.

[2] If I lose my 1st trade I finish for the day.

My first trade should be my best, most patient, if it loses, then either
  • The market isn't suiting my style
  • I got unlucky: Randomness
  • My performance is off

I'm not willing to take the risk that it's my performance, so I finish for the day.



Just a few ideas, of course not suitable for everyone and their trading style.
Turismo

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 iqgod 
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Two rules I employ:

[1] Do I feel at my best? Will I be profitable today?

If the answer isn't a confident yes, I don't trade.

[2] If I lose my 1st trade I finish for the day.

My first trade should be my best, most patient, if it loses, then either
  • The market isn't suiting my style
  • I got unlucky: Randomness
  • My performance is off

I'm not willing to take the risk that it's my performance, so I finish for the day.



Just a few ideas, of course not suitable for everyone and their trading style.
Turismo

Thanks for these ideas. They help!


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 iqgod 
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Today I succumbed to the "What-the-Hell" Effect.

This is described by Dan Ariely who is a behavioural scientist.

The day started extremely positive and I had made a good amount of profit but then I did not exit when the market signalled to (in fact I loaded up more) and hence ended down more than 2.5x the original profit.

Here is the chart, followed by the "What-the-Hell" effect.



Think what happens when you go on a diet. When you start out, you work hard to stick to the diet's difficult rules: half a grapefruit, a slice of dry multigrain toast, and a poached egg for breakfast; turkey slices on salad with zero-calorie dressing for lunch; baked fish and steamed broccoli for dinner. You are now honourably and predictably deprived.

Then someone puts a slice of cake in front of you. The moment you give in to temptation and take that first bite, your perspective shifts. You tell yourself, "Oh, what the hell, I've broken my diet, so why not have the whole slice - along with that perfectly grilled, mouthwatering cheeseburger with all the trimmings I've been craving all week? I'll start anew tomorrow, or maybe on Monday. And this time I'll really stick to it." In other words, having already tarnished your dieting self-concept, you decide to break the diet completely and make the most of you diet-free image. Of course you don't take into account that the same thing can happen again tomorrow and the day after, and so on.

This is a side-effect of 1. being a perfectionist OR being hard on yourself by depriving the self of too much; and 2. thinking you have infinite time and opportunity. Take care all.


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 matevisky 
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I feel you this is the hardest part for me as well. That's why I try to concentrate only to make my day even if it is a bit less than the target.
I have read a good book a following story. The reader went home after a huge trend day. His friend Was asking hím great day right market was moved big happy right ...?

If you are an intraday trader it is the hardest part ... No good advice here only that to have a daily limit and stop trading if you hit it.

Of course after starting to being consistence it will easy to go further and further because you are building your confidence up slowly but till that go step by step only.

I am more than happy to close my they with 20tick plus in 2 minutes if I feeling something is wrong with the market than to win big. Of course I am training my mind every day to review all the move what the market did but it is for
My further development only

Keep it up! If don't give it up if you know where to improve there is no place for doubt !

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 GaryD 
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And more of @GaryD's thoughts:

I just got off the phone with my wife, explaining how ridiculous it was, that with what I am making now, in something I have done for over 20 years, and am extremely good at (not going for ego, but for definition), but do not enjoy...

When I take a project today, I know 99% of the time what I will make the day I sign on. That is the biggest difference in belief.

I can make money almost every day trading, IF, (and if it were not just silly that word would be huge) 1) I do not care, and 2) the trade size is relatively small.

And at that level, what I know I can do, is about $50k a year. 1-2 contracts. Sounds absurd, I know. Sounds so easy also, to just multiply. But it does not feel easy, and for me, as crazy as it sounds, when the feeling is gone, I do not make money.

So, yes, I can burn the bridge, and I am considering it more each week. Thought I was there; my jobs were ending and my main account went to another PM. Have enough to eat for a few years, a wife who supports me, friends here that encourage me...

And then another offer comes up.

I have not missed a delivery schedule since 1996? I am opening franchises for various businesses across the country, and that one attribute makes what I offer attractive. They need to deliver on schedule, I am almost like an insurance policy. I do not fail. And because of that, it takes a few jobs and I have a new loyal client. Easy. But relentless, unforgiving, in a constant race, time of day means nothing.

Trading works on it's own schedule. Some trades are quick, and those are the best, but most, the overwhelming majority, work on their own schedule, and give plenty of chances to decide they are not going to work out. I know that, and with one contract, it is almost a game. Price can move against me, ok I give. Not that it matters.

But I know, with almost absolute authority, I will find the trade, and I can maintain profitability even at a 50% win rate, because of the way I trade... with one or two contracts. I could be net DD $1k, so what? And hit the next opportunity with zero baggage, 100% belief.

I could survive trading, there is no doubt in my mind.

But in the depths, somewhere there was this positive reward system in what I have done in the past, more psychological than financial, that has a deep knowing of what I produce on an annual basis, and yet that math will not transistion into trading, for some reason that I do not completely understand.

My solution; be willing to accept less. And yes, that works. And so many times recently I find myself thinking, make more, for what? Stuff? Toys? Ego? Proof that I can? And having already been there, none of that seems to matter.


"My solution; be willing to accept less. And yes, that works. "



October to date. And still, one day at a time. Thanks for the mention, and relax.

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 iqgod 
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"My solution; be willing to accept less. And yes, that works. "



October to date. And still, one day at a time. Thanks for the mention, and relax.

My butt- kicker @GaryD to whom I owe much of my profitable trading posted here; wow!

Thanks for dropping by Gary and fantastic trading!

For posterity:


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 iqgod 
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... and if you are in class Trading 101 (who isn't? The 101 keeps moving higher) this is compulsory reading:



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 GaryD 
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My butt- kicker @GaryD to whom I owe much of my profitable trading posted here; wow!

Thanks for dropping by Gary and fantastic trading!

For posterity:

Had mine kicked more times than I can count. Trade smaller.

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 PandaWarrior 
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Today I succumbed to the "What-the-Hell" Effect.

This is described by Dan Ariely who is a behavioural scientist.

The day started extremely positive and I had made a good amount of profit but then I did not exit when the market signalled to (in fact I loaded up more) and hence ended down more than 2.5x the original profit.

Here is the chart, followed by the "What-the-Hell" effect.



Think what happens when you go on a diet. When you start out, you work hard to stick to the diet's difficult rules: half a grapefruit, a slice of dry multigrain toast, and a poached egg for breakfast; turkey slices on salad with zero-calorie dressing for lunch; baked fish and steamed broccoli for dinner. You are now honourably and predictably deprived.

Then someone puts a slice of cake in front of you. The moment you give in to temptation and take that first bite, your perspective shifts. You tell yourself, "Oh, what the hell, I've broken my diet, so why not have the whole slice - along with that perfectly grilled, mouthwatering cheeseburger with all the trimmings I've been craving all week? I'll start anew tomorrow, or maybe on Monday. And this time I'll really stick to it." In other words, having already tarnished your dieting self-concept, you decide to break the diet completely and make the most of you diet-free image. Of course you don't take into account that the same thing can happen again tomorrow and the day after, and so on.

This is a side-effect of 1. being a perfectionist OR being hard on yourself by depriving the self of too much; and 2. thinking you have infinite time and opportunity. Take care all.

had my fair share of "what the hell" days....they are death to a trading account....I can feel them coming on...and only just now after all these years am I learning to walk away or to stop trading when I feel that sensation coming.....getting a handle on this aspect of my trading has made a huge difference in my confidence that I won't blow out again....it might happen but its getting less and less likely.....good job in recognizing it...

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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 iqgod 
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Sorry for not posting for two days in my journal. I've been thinking long and hard and trying to put down my thoughts that might fast forward this frustrating process for some of you and make you avoid the many traps that lie on the way to be coming a consistent successful trader.

Let's break it down to parts that can be easily remembered.

The first part is obviously Control. We think we are in control of our trading - the PnL curve proves otherwise.

Many traders starting out find that whenever they "decide" to do something in their minds e.g. like following a well thought out and carefully crafted plan there is an initial kickstart that make it appear that they will succeed - yes, they have it sealed this time! - only to find that at some point they find themselves ignoring the plan completely.

Let's fix this issue first.

The problem runs deep. If you want a cliché, as deep and tenuous as our evolution. The part of our brain that thought so hard, considered all cases and wrote that plan is what we shall call our Spock brain. Let's call it Spock for short.




The other part is what Morad Askar calls our monkey brain. This is your impulsive childlike part of brain that is full of boundless energy. Call it Mr.Peebles.




Mr.Peebles cannot be commanded into an OFF mode. Never. You are him in a way. You hopes, fears, ambitions, romances, desperation are the many facets of Mr.Peebles.

For this reason he gets to steer your car.

But you never acknowledge him directly. The thing you give credit to for your achievements is Spock - your reasoning and logical part - the one whom you think makes all decisions! But in truth the Spock part is dormant - he likes it when there is peace and quiet and when order is maintained. He does command Mr.Peebles like a parent gives orders to a child. Mr.Peebles is as obedient as a little child - he does most jobs in a likeable manner. But subvert him too much and soon he will crash in front of TV and forget about that grand project that Spock has planned for him - no logic works to make him do things Spock's way.




So, to review, here is what happens when you get a sound trading plan and then take your Spock and Mr.Peebles combo and launch into the market:

1. Use emotion as a driver.

Forget those manuals which teach yourself to be a emotionless robot while executing your trading plan. That is too much subversion for Mr.Peebles, who will ultimately waylay your best plans. Emotion is Mr.Peebles native language. IMAGINE the happiness of following the plan, the HORROR of failing because you did not follow your plan. Use Emotion as a spoon to stir your trading plan into a lively froth instead of letting it die on paper.

2. Use social pressure.

There is a reason to start your journal here on @Big Mike. I'm not doing this for you really. Mr.Peebles easily succumbs to a bit of social or oeer pressure. No one's going to pressurize you on @Big Mike, people are way too nice even while kicking your butt, but the invisible accountability is not lost on Mr.Peebles. Put out that post about the nonsense you did yesterday and Mr.Peebles is immediately on best behavior! Again, if the child you project onto trading is approval seeking, beware, and read further for the solution...

3. Make Mr.Peebles comfortable.

Mr.Peebles is also called an Orphan by psychologists. If he feels unprotected and uncared for he will go on a rampage till you sit up and notice him. Negative attention is better than no attention. So look after yourself FIRST - don't show up at your trading desk hungry, tired or without anticipating the fun, or without having had fun in your offtime.

For practical advice, see tricks in the next section.

4. Consistency

Mr.Peebles has to be trained to start doing the right thing IMMEDIATELY. This is the hardest part because of the associated inertia to start doing something but once YOU CHOOSE to do it the inertia is the best part that keeps you consistently doing the good things over and over again

We tend to make stupid decisions because we don;t think about the choices we are making. Mr.Peebles is too much concerned with NOW, QUICKLY, and FAST. So inject the START of the atrading day with Spock's prods and Mr.Pebbles get on the right track instantaneously, and continues doing so. (see Continuity below).

5. Discipline = Fun

Being a good parent means knowing who is incharge. Get your environment clear, have your trading platform uncluttered, practice execution and eliminate your environmental distractions so that Mr.Pebbles cannot find excuses. Make Spock recognize the patterns of Mr.Pebbles he needs to watch out for the most

6. Focus on priority

The good things of execution in trading are rarely the most urgent ones. Just like eating healthy and excersing show benefits over long term, good trading habits are to be prioritized instead of short-sighted goals of Mr.Pebbles ("wow, green! take profits!")

7. Be State-Conscious

If by chance Spock goes to sleep Mr.Pebbles turns into a T-Rex.

There is a need in the 'child' in each one of us that seeks for approval, praise and a pat from others. This same need flames you whenever you are criticized. While both are good, check if all you really want from trading is the approval and admiration from others. Pause for a minute and think about it. Because if your annwer is Yes then you are playing a very dangerous game. If this is an approval seeking activity it is going to be very difficult for you to lose face and accept mistakes as simply the regular cost of doing this business. Instead, losses will loom large as threats to your identity, and eventually kill you as a trader.

Criticism, from people and markets, causes anger - Anger is a disproportionate reaction to some auto-provocation. Anger and fear (and greed, which is also Fear, the Fear of Missing Out) are Mr.Pebbles triggers.




Continuity:

The solutions is monitoring. You cannot slack in this area.

Remember to monitor your:

- Health: This is achieved by good diet, good realtions, moderation, bramhacharya, good night's sleep, ensuring financial security.

- Resources: Your energy levels matter. You need the right amount. Are you tired (Pebbles: won't!), exhuberant (can work against, remember Mr.Pebbles easily excitable nature), emotionless / depressed / bland (absence of Mr.Pebbles! No trading today! Spock needs his assistant to trade.)

- Will: Remember, every decision cosumes your resources, but unlike most resources, willpower is completely exhausted and cannot be replnished in a daytrading session! Everytime you have to suppress short-term goals for long-term good in a trading decision a lot of willpower gets used-up.





Tricks and shortcuts:


- Do not introduce randomness: This means knowing your market, strategy, times to trade, and cultivating good habits without allowing events to hijack you. How? Say "No" to everything other than what you plan to do. Your survial instincts were useful while running from a mammoth, but make your intent so defined and objective that the "No" comes instinctively! No setup, no entry! Market crazy, deviate from strategy? No.

- Reduce the number of choices / decisions you have to make in a trading day. I use AutoOCO orders, monitor a single market, trade a single method, look at a 70-tick chart ONLY wihtout any other timeframes, have only 200 candles displayed and do not scroll chart back for more information. Have all the easy tasks automated and leave yoruself to take the hard decisions. This might even have the pleasant side-effect that your conscious brain will ave your decisions ready.

- Maintain focus on only the important parts of trading: Namely risk control, flawless execution, entering the screaming "must!" trades instead of might or could trades.

- Enforce limits religiously: This includes daily limits, number of trade limits,, exact size, proper stops, and regular breaks too. Don't use up your willpower on the lesser stuff but go for quality instead of quantity in trading.

- Most of all, Love yourself without fail: Ensure that you have fun, keep yourself out of depression, eat healthy (and not stay hungry because of fad diets either!). Do not stress your body because it is the critical support system that needs to be reset every night by good sleep, goodwill and lot of love. As I already said, follow the lowest stress strategy of living within your means, saving well, and using your time to your fullest advantage and not squandering it away.


Note thus that trading well is completely a game of setting priorities and then balancing your body/mental state to align with the priorities so that you consciously monitor your resources for best results. Monitoring is the key, because when you go into an autopilot / zombie mode (Spock goes to sleep) therein lies the undoing of all traders.

Trade well!



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 iqgod 
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If I compute all the losses I had in the first four years of trading, NET I am still negative. If I ever get another stab afresh at this thing, in another life perhaps, one thing I'd like to do differently is keep my initial tuiton fee donated to the market small.



I cannot even think of using the leverage I used to go all in with in the first year.


One thing I'm really thankful for was those losses, though large, were contained, unlike for e.g. this:

Architecture of a $7 Billion Loss: Causes and Remedies



However I am hopeful that the road to getting back into proper profitability, even though made longer by this initial mindless digging, would be walked over confidently.


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TurismoTek
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If I compute all the losses I had in the first four years of trading, NET I am still negative. If I ever get another stab afresh at this thing, in another life perhaps, one thing I'd like to do differently is keep my initial tuiton fee donated to the market small.



I cannot even think of using the leverage I used to go all in with in the first year.


One thing I'm really thankful for was those losses, though large, were contained, unlike for e.g. this:

Architecture of a $7 Billion Loss: Causes and Remedies



However I am hopeful that the road to getting back into proper profitability, even though made longer by this initial mindless digging, would be walked over confidently.

If you can lose 2 billion fast, you can make 2 billion fast, you can lose 7 billion fast. That's just massive stakes gambling.

Seriously can people get hired and lose 2 billion and be allowed to keep trading, gotta love finance.

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 iqgod 
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Please vote today if you like my journal.

Here is the link for pushing the Thanks button (Post #12):



I hope you've had as much fun reading it as I've had writing it and composing the material.

If you learnt something from it I'll count it as my karmic bonus.


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 iqgod 
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I just made up the words karmic bonus and then googled them to find out if I "invented" them.

Turns out there is an amazing post about them right here:

How To Get What You Want (And Earn Karmic Bonus Points!)


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 iqgod 
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Pre-one-week vacation I took this trade I am happy with:



I love diary style journals. I've been reading Raghee Horner for some time. Fascinated by her because of:

1. Her Indian origins
2. Her looks (byased on a certain undated photo)
3. That she has been trading for so long that she used to get stock quotes by postal mail and update charts by hand.

She writes and talks sense. She has some business of selling a system or a training course.

I listen to Rob Booker and Raghee Horner here, they are funny and silly, but do not fool around when they stress the core concepts necessary for successful trading:

The Trader?s Podcast

For me she was important because she was proof that it can be done in pyjamas.

I will not be trading today, mainly because I am attempting an Indian version of this:

The Engineer Who Bought Over 12,100 Cups Of Pudding to Earn 1.25 Million Air Miles

Further details currently a secret, will let you know when I accomplish it.

Perhaps I can make an indie film about it, something like "Punch Drunk Love". (Let me know if you've watched it, or if I am referring to something too out-of-way.)


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Pudding Guy/Dateline UC Davis/02-04-00


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 iqgod 
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How do you when to stop trading?

I know this isn't a manual and there is no one answer, but I use the following guidelines for myself:



The relationship between the size of the trade and one’s rationality is only linear to a point. If you feel you've passed that point a long time ago, S T O P.

If you are only watching the PnL display and ignoring the market context, or if you are focused on candles instead of the picture and find it impossible to step back and clear your head (i.e. impossible to stop watching) S T O P

If you feel you are in a kind of hypnosis, trance or muddle S T O P

If you feel there is too much on the line, your life is wasted if this trade doesn't work out S T O P.

I have stops but I move them. Yet the stops get hit. The market is relaying critical information to you. You are the victim here. Victims don't trade, only traders do. S T O P.

If you catch yourself adding more funds to your account during the session, S T O P.

If you come to the battle with battle lines drawn but later change to using wider stops, S T O P.

If you feel hopelessly pinned, see that the trend is against you all day and yet are fighting back S T O P. I know it will be hard at this point, but it will be even harder later on.

If you have you battle lines drawn and yet you look for more or think 'let it run' S T O P.

If you are thinking about mean reversion after a big move and are thinking about entering without a setup because the next move is so damn obvious S T O P.


I cannot stress the importance of S T O P.

Note: By STOP I mean only one thing: get flat, walk away.

But you say: I can’t leave the charts! Something might happen. Anything. I must be here.


If you have figured out the market, you think this trade is so simple to execute that it doesn't add up that anybody could actually be on the other side of the trade... no don't stop but change into Other-Side-Shoes and Think-from-The-Other-Side.

Think of all the losing days you've had and where your account would be if they were much much smaller. I have actually sat and analysed this. S T O P is also a trade. You trade in your ego for the profit of unbending commitment and for staying in this for the long haul.


Note:

I'd be flattered if you click the link below and hit the thanks button on the post TODAY :-) :



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 iqgod 
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I haven't traded my combine account for many days.

That is, after I experienced a huge loss in ES a few weeks back.

At this point I am feeling rather bland - I keep gathering stuff, analyzing, posting thoughts..... but am not trying to trade the combine (and the twist is that I still am trading real money... I recognize this as the need to make back the same in the same currency that I lost.. i.e. real money and not combine dollars.)

This 'wanting to be made whole again' is just a viewpoint, a postion, a point of view. Up and down have no meaning for a reasonable trading plan. How can I get back in touch with reality instead of going on being a paper combine-trader?


The fear here is screwing up parameters of the combine. Real account is steadily going up, in small increments compared to the big loss.


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 iqgod 
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Let me fly away to the moon or take a 10-tick loss.

Being risk-averse does not allow me to utilize opportunities. I'm firing up my combine engine to fly away to the moon (in small 10-tick rockets which can at most fall 10-ticks or less downwards.)

No more brooding.

I am back!


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 kronie 
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Outstanding thread, and good premise (first statement, page 1)

I have you on subscribe, and will watch its development and comment from time to time,

thanks for your contributions to futures.io (formerly BMT)