Still contructing my trading plan, nothing detailed decided, so I'll not explain every trade as I did. Other reasons to skip some trades are because that I overtraded, not be able to let my winning trade run further...
I have the feeling that I'm working for the broker to get lots of commision dilivered to their account but few profit lasted for myself
I'll go through all the documents and stuff about trading plan this weekend and try to make a quick review to Al Brook's Price Action books that I have read to build a draft trading plan get it posted. Hope that could be done in the next two days.
QQQ:
1st trade: short @100.23, target @100.10, stop @100.29, lost
The entry was a bit rush, I though that the price would not stay above MA for long, when my entry bar was red, I expected it to be the breakout bar. I was afraid to miss the down side move.
2nd trade: short @100.26, target @100.18, stop @100.33, win
Entered on the down side break out to previous downside hammer bull bar. My target was too close, I actually can put my target some where around 100.10. Now, I'm thinking back, unless using a trailing stop, I cannot figure out how further the price will go down. The MA was not bending too much at that time...Need to learn from others and exp.
FB:
I post 1min chart, but I was trading on 5min one. I was just scalping. Fear is my primary issue, which stops me to grow my winning trades and leave too soon.
1st trade: short @76.99, traget @76.88(resistance not shown in 1min chart), stop @77.04, win
Scalpe to a move down to resistence.
2nd-7th trade: I find I'm always doing this kind of trade since the end of august. Just cannot get rid of it. I think it is because of low confidence in managing the trade, which comes from emotional entry and exit, which often lead to lost, which knock down my confidence. A vicious circle! I'll confront it after establishing my written trading plan + strategy, maybe by sim trading.
8th-12th trade: Scapling in 5min chart, when I look into 1min chart, it makes more sense...
Total P/L = 1
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Monday: -48
Tuesday: No Trade
Wednesday: +67
Thursday: +5
Friday: +1 Total P/L = 25
The P/L is meanless to me now, as long as it not a big loss. After 2 weeks keep posting every trade, my problems have been shown clearly.
Thanks to @ratfink to stated my primary issue directly. Frankly speaking, I was denying what you said at first. I have read some books, watched video and traded for several months, and gotten all my previous losses back and even some profit. Even though I do not have a sound, tested written plan, I was definitely not considering myself having no 'EDGE'.
BUT @ratfink, you are no undoubtedly right about that!
I looked back all the trading records since the first trade I have made. I do not have an edge, all my losses and wins are showing this point. My losses and wins are too spontaneous, I was getting better than the very beginning by having more trading hours and exp, but never develop something original.
I was focusing on the psycho part of my trading skill by hand writting notes everyday to record my feelings, which is important, but I just realized that the psycho part could be inforced by owning a sound trading plan, which is inseparable. The more wins I get, the more confidence I establish, and more exp I get to improve my trading plan, so a virtuous circle should replace the vicious circle which is taking place now.
And thanks to all others reading or following my journal~
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The main thing I realized over time about plans/edges/methodology or whatever you want to call it is this:
If you look back at a trade you took 6 month ago - can you explain why you did take and should take that trade?
It doesn't have to make sense to wveryone, but YOU have to know why you were doing what you were doing.
If that is not possible, then what you did back then just wasn't trading.
Don't know if my point comes across... I think it is about your thought process being repeatable in the end..
Where else would confidence come from, if you can't know yourself if you would take this or that winning trade again?!
Anyways, enjoy your weekend.
ST
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This trading plan is the first writting one fo my own. It is based on the trading plan template from futures.io (formerly BMT)(orignated from trade2win). After nearly 10 months of day trading, now I’m confronting several psychological and technical obstacles. This trading plan is the first detailed strategy to deal with these issues, I’ll keep the trading records and review this trading plan every week, adjustment should take place every 2 weeks or monthly.
2．Facing Issues
Psychological:
Fear of trading: afraid of losing, even very small ones, exit too early with small profit because of fear.
Revange trade: try to cover back daily losses and achieve an even for the day, exit trade base on account balance rather than market condition.
Greedy: want to achieve a certain number of profit without considering market condition.
Perfectionism: want to get all possible profit, and price to move in expected direction once entered.
Technical:
Entry: no specific entry rules, easy to put one an emtional trade, overtrade.
Exit: no specific exit rules, profit target is always not achieved but exit with little profit too early.
Complementary indicators: only 2 indicators, EMA and priordayOHL, may need 1 or 2 more, if necessary.
3．Why to be a trader
Trading fits my personality and personal interests. This activity includes many parts that I’m interested in, like maths, computors promgramming, psychology etc,.
The first goal of trading is the discover mental weaknesses and imprvoing myself. Trading reveals the shortcoming of my personality very directly and trains me to be a self-decipline, humble persone. If not getting better, eventually I’ll be thrown out of the business. Indifference to losses and wins, learning forever, acceptance of changing and flexibility are all excellent qualites that needed to be sucessful in trading as well in any other aspect of life. Among all kinds of options, trading provides the most direct and efficient way to train these characteristics, also maybe the most expensive.
The second goal of trading is to achieve financial freedom. With the financial support from trading and later investment, I would have more time and energy focusing on learning about human society and the nature.
I believe that I can achieve what I expected because I already have several basic qualities to begin with. First, I can always admit my weaknesses and faults, I’m always alert to detect my ego about denying faults and making up excuses to protect itself. Second, I believe in myself rather than depending on others’ help, only can myself overcome my own weaknesses. Myself is the only choice, no one else can do that for me.
4．What sort of trader
I’m a discretional day trader, focusing on daily price movement of my target instruments. I want to be able to handle both trending and trading range market. I can devote all necessay time, energy and conviction in studying, learning and solving problems, in order to be a better trader. I cannot control the market, but I can control myself. I’ll be able to control myself by believing in myself and stick to my plan.
5．Strengths and weaknesses to trading
Strength: Courage to admit weaknesses and faults / ability to study and learn
Weaknesses: Emotion control is weak / still lack of experience in trading
6．In right frame of mind to trade?
I’ll only trade when I’m feeling normal and peace, not when I’m down, distracted or excited. I’ll try to maintain a good physical and mental health by doing sports / being humble to every aspect in life.
7．Incoming target
It should be progressing, for now, I want to be daily even or profitable, I’ll keep the daily loss under my max tolerance level, once arrived or exceded, STOP TRADING NOT REVENGE.
8．Annual Traing Goal
The annual goal till the end of 2014 is to develop my own trading ‘edge’, and develop a good trading habit. This goal will be achieved by:
a)Keep learning things from futures.io (formerly BMT) and other sources on a daily base. Taking notes when reading articals and watching webinars. Review the stuff I have studied from time to time, practice some if possible.
b)Building my own trading plan and writting my trading journal every that I traded. Reviewing, analysing and improving.
The achievement will be evaluated by number of overtrading days per week/month, number of emotional trades per day/week, fluctuation of sucess trades based on trading plan, number of watching/trading market days per week/monty, number of artical/book/webinar read/watched per week/month.
9．Monthly Goal (September 2014)
Build a trading plan and stick to it, test it and monitor the result. Keep doing daily/weekly routine.
10．Weekly Goal (W38 2014)
Same as month goal since it’s almost the last in September.
11．Market / Instruments / Timeframe
1st Step: I’ll trade US stock market, focusing on suitable DT instruments like FB/AAPL/QQQ/SPY etc,. I’ll trade mainly 5min chart.
2nd Step: Extent my trading to China stock market, HongKong stock market, be a position trader, on daily base. (forseen in 2nd half 2015)
3rd Step: US futures, options. China / HongKong futures. (2016)
12．Brokers / Data / Software
I’m using Interactive Broker, Ninja Trader to trade. Data from IB. Considering kinetick , and Tradestation as future combination.
13．Daily pre-market routine
a)Re-reading yesterday’s trading journal and daily goal, setting new daily goal.
b)Getting rest and storing energy for market hours (open hour is night 9:30/10:30pm, close in the early morning 4:00/5:00am in China).
c)Reading ‘Daily Reading on the Principals and Psychology of Day Trading’ by George Slezak.
14．Ananlysis of trading journal
a)Mark the chart with every entry and exit.
b)Recall the entry, target and stop of every trade, mark the emotional ones.
c)Mark the good and bad ones, analyse from emotional and technical aspects. (detail development needed)
d)Compare the result to trading plan and daily goal
e)Upload result and analysis on futures.io (formerly BMT)
15．Risk management
a)5% account risk forever / 1% per trade (not exceding daily max loss), if violated, stop trading for 5 trading days.
b)5 consecutive lossing trades should end a day (if not emotional then review strategy).
That's it for now, I'm posting it because I hope this can help me constrain myself trading according to it. Any idea/recommendation would be highly appreciated!
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Overtrading: Yes
Stick to trading plan: No Daily P/L = 0
QQQ:
One trade: short @199.83, target @199.35, stop @200.02, lost
My entry was a downside break out of previous low. The 4th bull bar was the fisrt and only bull bar of all the beginning 6 bars. I put my entry as stop sell order below the previous low, exprected the price to break there (it did), and go down for a measured movedown based on the openning range. Got stopped out early. I think it is normal, my though was right, and should enter again 3rd bars after this entry.
FB:
1st trade: long @77.35, target @77.60, stop @77.29, lost
2nd trade: long(add) @77.48, target @77.60, stop @77.29, lost
My first entry was the second time upside break out of openning trading range. The first brreakout was failed, but price has not droped to the bottom of the trading range and followed by a second breakout which has succeeded. I added when the price broke up the previous high. I was expecting at least a touch of the low of last trading day's last bar (I now realized I have made a mistake ! I was expecting a close of openning gap! But the open price of today was still in last Friday's range! So my expectation was wrong!). If I have not made this mistake, I would not add
3rd trade & 4th trade: emotional trades. Seen from 1 min chart, 3 was not a good entry, but in 5min chart my entry was a down side breakout of open price. My entry was not perfect, but a with trend entry should not be too badm especially when the trend is strong. But I got scared of losing more, once the price moved up a bit, I panicked and just wanted to escape. So got out with a loss.
5th trade: Actually another emotional trade. Downside breakout to a lower low, but My stop was previous 5min low, so I got stopped out.
6th trade-8th trade: since the 5th trade, there was actually a trending trading range. The price moved down in a narrow channel. Now I can not find any reliable reason why I entered I was just seeking any possible reasons to trade. When I'm writting this, I still sense a bit of eager to trade.
9th trade: long @76.72, target @76.85, stop @76.60, win
Entry bar is a two bar reversal in 5 min chart, on 5min chart the price has been away from MA and bull bars have appeared before, a move up to the low of openning trading range was reasonable target.
10th trade: long @76.72, target @76.82, stop @76.60, win
Just a scalp to fade the down side move. The 5 min bar was moving down side and strongly reversed up. I sense some urgence of bull side. I was not watching 1min chart, now I realized the I bought near the 1min MA.
11th trade: Emotional trade. Trying to get one more dollar to be even. Lucky, but extrem emotional and dangerous. Should take a note of this trade, should never do it again.
With different trading size, I managed to be even, but simultaneously, I was also trading sim on FB. SIM TRADING FB
I was fading a move to MA, normally I should have been stopped out, since the upside breakout was too far to place stop. Normally should enter some where near the end of 3rd or beginning of 4th bear bar. I was dealing was my long postion stopped out loss and scared by the large size of bear bar. Scared not to enter...2nd to 4th trade was reversed from one to another. 5th I was writting this journal, so no management, otherwise should stopped out early.
I can actually do better without pressure from dealing with real mony.
Two problems revealed today, need to search for information and deal with:
Eager to trade. The impulsion to trade let me enter many bad trades.
Pressure to deal with real money greatly influenced my decision making process.
Today's Object
1. Control Overtrading (No more than 6 trades per, accept whatever the result is after 6 trades) -- Failed 11 Trades in Total
2. Control Emotional Trading (Enter with clear setup + target + stop / Don't predict the market) -- Failed, Several Emotional Enteries and Exits
3. Appropriate Pause Between Trades -- Generally No
4. Stay as long as possible in winning trades (Monitering feeling of being in a winning trade reaching for target) -- Succeed Once, the last trades (actually was thinking about covering loss)
Ok, that's for today, good luck to everyone and myself!
--------------------------------------------- Wait the market to open-------------------------------------
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One trade: short @199.03, target @198.73 (exited @198.93), stop@199.17, win
Seeing a double top formed, entered at down side break out of previous bull bar. Originally expecting the price to touch yesterday's low. But I was terribly afraid that the price would not punch through the support around 190.90 (around my exit). So got out earlier. Extremly fear~~~
FB:
1st & 2nd trade: same situation as SPY trade, FEAR.
3rd trade: short @77.34, target @77.10, stop @77.53, lost
Expected a move down to touch the MA. Too early, should wait till 2 bars later.
4th trade: Scared by the bull shape of entry bar, reversed 3rd position, stop out during the down side break out of bull bar which just before entry.
5th-8th trades: Emotional trades, now I'm looking at the chart, feel I was like a prey caught in hunter's trap, struggled desperately to get out, but actually wasting energy and leading to a quicker death...
9th trade: long @77.14, target @77.28, stop @77.08, win
Finally a touch of MA, buy in down side of descending channel, would not be too wrong. And the natural stop is not far. Get target filled
10th trade: long @77.32, target @77.65, stop @77.10, win
A upside breakout of descending channel. After the strong bull movement from the 2nd bar of today, I believed that the pull back was about to finish, and a test of preivous high is possible. More important, the target is just a bit higher than the price I can get even....
-------------------------------------------------------------------- I'm always very nervous about winning trades turn into losing one. As I posted in the thread of 'Get nervous after earning money'. The same feeling of overall trading account profit and paper profit of every trade.
because of this , the first 2 trades and 9th trade on FB, the trade on SPY all exited too early. As many suggested, trading smaller size. I was actually trading only 50 shares (really small, compared to 1000 shares I was trading before starting this journal). I think the key point for me, personally, is not about how much money I win or lose. It about the fear of loss. I'll search for info and help about this point.
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