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Zen & the Art of The Small Account
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Zen & the Art of The Small Account

  #821 (permalink)
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Profitable day

I had some odd trades today and the pace of the action made me sleepy. But I managed to make money today even though I passed on at least one really nice trade.

I am having some issues with "breakout trades". I saw three of them today, all good trades. But I have a mental block about them. I heard someone say once that "breakout traders get stopped out a lot". So I have a real issue taking break out trades. I see them yet they are not part of my trading plan. I want to include them as they happen every day but really have no idea how to take a high probability break out trade.

What I did wrong today:
1. I did not do my morning routine.
2. I took a trade right before news.....+4 on that one but so not in the plan.
3. I took a trade that for whatever reason, I cannot remember what I was thinking. It was obviously not in the plan but I have no idea why I took it.
4. I did not take the best trade of the day for me....because I had a mild short bias and the trade was long.

What I did right:
1. I traded the correct size.
2. I held my trades to completion.
3. I exited the weird trade asap after I realized what I had done.
4. I passed on the break out trades even though I wanted to take them....they are not in the plan.

The low volatility is making it a little tough to trade due to the length of time it takes for a trade to set up and the amount of time I have to wait for the trade to finish....But perhaps this is good for me...teaching me more patience....I just wish I would hurry and learn patience already!.

If someone wants to jump in and educate me on how to properly take a break out trade, please feel free.

Cheers.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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Zen & the Art of The Small Account-2011-03-29_1031.png  
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  #822 (permalink)
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aztrader9 View Post
I had some odd trades today and the pace of the action made me sleepy. But I managed to make money today even though I passed on at least one really nice trade.

I am having some issues with "breakout trades". I saw three of them today, all good trades. But I have a mental block about them. I heard someone say once that "breakout traders get stopped out a lot". So I have a real issue taking break out trades. I see them yet they are not part of my trading plan. I want to include them as they happen every day but really have no idea how to take a high probability break out trade.

What I did wrong today:
1. I did not do my morning routine.
2. I took a trade right before news.....+4 on that one but so not in the plan.
3. I took a trade that for whatever reason, I cannot remember what I was thinking. It was obviously not in the plan but I have no idea why I took it.
4. I did not take the best trade of the day for me....because I had a mild short bias and the trade was long.

What I did right:
1. I traded the correct size.
2. I held my trades to completion.
3. I exited the weird trade asap after I realized what I had done.
4. I passed on the break out trades even though I wanted to take them....they are not in the plan.

The low volatility is making it a little tough to trade due to the length of time it takes for a trade to set up and the amount of time I have to wait for the trade to finish....But perhaps this is good for me...teaching me more patience....I just wish I would hurry and learn patience already!.

If someone wants to jump in and educate me on how to properly take a break out trade, please feel free.

Cheers.

I am not an expert breakouts trader , but I do trade them occasionally when the level is breached by a solid high volume bar and then a small low volume pullback bar , that's a very conservative entry and a low risk one as well your stop would be below the broken level
I have included today's 5 min breakout , it was a perfect one .
I hope it helps

"Risk more than others think safe.
Dream more than others think practical.
Expect more than others think possible.
Care more than others think wise"
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Zen & the Art of The Small Account-bp.jpg  
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  #823 (permalink)
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Thanks: 259 given, 788 received


There are different ways to define what a breakout trade is. A question for you to help clarify.

When you enter a long trade, how do you typically time the exact entry? Assuming you see an uptrend, do you:

1) Wait for price to come down to some predetermined level (a moving average or whatever) and enter with a limit order once it hits that level?

2) Wait for price to come down and then start moving up again, and enter with a stop order (say, 1 tick above prior bar's high)?

3) Something else?

 
  #824 (permalink)
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worldwary View Post
There are different ways to define what a breakout trade is. A question for you to help clarify.

When you enter a long trade, how do you typically time the exact entry? Assuming you see an uptrend, do you:

1) Wait for price to come down to some predetermined level (a moving average or whatever) and enter with a limit order once it hits that level?

2) Wait for price to come down and then start moving up again, and enter with a stop order (say, 1 tick above prior bar's high)?

3) Something else?

Stop order

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
 
  #825 (permalink)
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worldwary's Avatar
 
Posts: 523 since Mar 2010
Thanks: 259 given, 788 received

In that case, I'd consider that to be a form of a breakout entry (at least the way I think of the terms).

Breakout entries = enter when price is moving in the desired direction, generally with a stop or market order placed just beyond the preestablished entry level.

Pullback entries = enter when price is moving against the desired direction, generally with a limit order.

I guess to be more specific you're looking for pullbacks within a larger trend and then using a breakout technique rather than a pullback technique to time the actual entry.

The entry mechanics are the same for the larger breakouts that occur when price breaks above a key swing high or the previous HOD. If you can trade these breakouts on a larger timeframe chart, that might help. Price might look "overstretched" on the shorter timeframe at the point of the breakout entry but look more reasonable if you step back to a longer timeframe (5 minutes, 15 minutes, whatever works).

If you're generally accustomed to using stops in the 20-30 tick range then that should be enough room for most of these larger breakouts as well, it's just a matter of taking a step back and viewing a chart that shows the entry in reference to the overall forest rather than the trees. Not sure that makes sense...

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  #826 (permalink)
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AZ
I have not finished it yet (bit of a slow reader these days) but Golf is not a Game of Perfect is indeed a good read for traders. I see a lot of similarities and useful lessons. Thanks for the recommendation.

My focus is on:
1. Avoid the opening chop.
2. Honor stops
3. Ensure reward > risk on all trades
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  #827 (permalink)
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In the heat
 
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Losing day

What can I say. I screwed up big time today....not in dollars although I did get close to my stop. But the screw up was in several procedural issues which I will detail in a minute.

I am also gonna make some changes to the way I keep score. I've decided to return to the world of golf. I think the book "Golf is not a game of perfect" has some influence on me. I also remember back when my handicap was around 8 and how I played the game.....some things jumped out at me. More on that in a bit.

What I did right today:
1. Not to much.
2. I quit before I got into my daily stop to much.
3. Once I corrected number 1 below, I began to increase the range bar size as the range gradually opened up. The chart attached is what I finished on.
4. I practiced some on sim after stopping out. Normally I don't do this but was feeling pretty lighthearted and recognized I could not go back live even if I did well on sim which I did.....+75 ticks on essentially the same exact range as what I had lost money on. In the past, this would have pissed me off. Not today. I just recognized I traded better once the pressure was off and if I did in fact go live again today, I'd probably make the same mistakes over again.

What I did wrong today:
1. I noticed the range was VERY narrow again this morning upon turning on the screen. I failed to reduce the size of the range bar from 12 to 6 as dictated by the range. This cost me big time in terms of missed opportunity. I did have two minor profitable trades using the range bar but only because I bailed quick.
2. I took a trade that met none of my rules. @MickeyCaine called me on it and I ignored him. Double bogey.

Plan for tomorrow:
1. I want to play tomorrow for real like I played today for fun.

Ok so now more on the changes I mentioned earlier. I like golf. I understand golf. I know what it takes to play good golf. Golf is all mental and so is trading. So I am gonna keep score like @jungian. I will create a "golf" score card to record my trades. A name and a score for each kind of trade. I will post this later today if I get it done today. From now on, I'm just gonna play golf. I have fun when I play, even competitively and I want to have fun trading. Even when I lose I want to have fun. Less fun to be sure but fun nevertheless.

Now a little bit about my golf game. I played everyday for a long time. I got my handicap down to 8. But the road to get there was pretty rough. It involved lessons from a genuine LPGA pro. This actually helped. It involved buying the latest and greatest clubs....which didn't help. And it involved all kinds of mental games with myself trying to over come a terrible slice and the yips with a wedge.

One day I was teeing off over some water on a real narrow fairway. Of course I hit the drive in the water. In a moment of rage and frustration, I threw the driver in the lake. As the driver left my hand, I had an aha moment.....I put to much weight on the game. I let it define me as a person. I wanted to prove to my golfing buddies I was better than them and so my mind played some awful tricks on me and I sabotaged myself over and over. This all ran through my head as I watched the club sail through the air toward the water and when it hit the surface of the lake, I knew things would be different.

From that moment on, I knew the competition was not with my buddies but with myself. All I had to do was be better than the golfer I had been in the past. The winning would come later. From that point on, I got better. I stopped caring where my buddies finished. I only cared if I improved over last round. And I started having fun. I stopped keeping score for a while and just focused on hitting good golf shots and having a good time on the course. I stopped trying all the new clubs out on the market. I stopped reading Golf Digest, and I quit listening to my golfing buddies about how to fix my swing. Instead, I just kept playing. In fact, I rarely went to the range to practice. I just played round after round. If and only if I ran into an aspect of the game I needed professional help on did I look up something in Golf Digest or try to find a video about online.

One of the biggest helps I had was watching a slow motion video of Tiger Woods. In it I could see his swing was effortless and I saw how he set up and finished. I knew I could never fully copy it but I could learn from it. As I worked to copy certain aspects of his swing, I learned I could not swing as hard as I had been and emulate him. I had to slow down, swing easier and just let the club do the work. Amazing results. I started hitting the ball straighter, further and more consistently. I used to pull my back out playing golf trying to hit it so hard. After this, no more pulled back muscles. It was a game changer.

And today, I realized I just need to have fun at this trading game. Stop caring about the score...(sort of) and focus on hitting good shots. I have to keep score because its money involved but I think I can use the golf analogy to over come this aspect of the game. I need to stop trying so hard and just let it flow like when I started swinging easier and letting the club do the work. In this game, its the set up that does the work. Just let it happen and if a shot (trade) goes awry, well thats ok too. Just stop trying to force it.

So tomorrow starts a new way of looking at my trading game. Gonna just try to have fun out there, keep score because I have to and let the set ups do the work.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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Zen & the Art of The Small Account-2011-03-30_1300.png  
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  #828 (permalink)
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Cheers AZ. You may have just helped my golf game.

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  #829 (permalink)
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aztrader9 View Post
I had some odd trades today and the pace of the action made me sleepy. But I managed to make money today even though I passed on at least one really nice trade.

I am having some issues with "breakout trades". I saw three of them today, all good trades. But I have a mental block about them. I heard someone say once that "breakout traders get stopped out a lot". So I have a real issue taking break out trades. I see them yet they are not part of my trading plan. I want to include them as they happen every day but really have no idea how to take a high probability break out trade.

What I did wrong today:
1. I did not do my morning routine.
2. I took a trade right before news.....+4 on that one but so not in the plan.
3. I took a trade that for whatever reason, I cannot remember what I was thinking. It was obviously not in the plan but I have no idea why I took it.
4. I did not take the best trade of the day for me....because I had a mild short bias and the trade was long.

What I did right:
1. I traded the correct size.
2. I held my trades to completion.
3. I exited the weird trade asap after I realized what I had done.
4. I passed on the break out trades even though I wanted to take them....they are not in the plan.

The low volatility is making it a little tough to trade due to the length of time it takes for a trade to set up and the amount of time I have to wait for the trade to finish....But perhaps this is good for me...teaching me more patience....I just wish I would hurry and learn patience already!.

If someone wants to jump in and educate me on how to properly take a break out trade, please feel free.

Cheers.


Brian, please stop with the what I did wrong list. Analyze yourself, analyze the market, analyze yourself, analyze the market, repeat ad infinitum. Always check yourself before taking action, quick self check, will this go on the right list. We are doing this, be strong, be cool, be calm, be your best, always... SYX

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  #830 (permalink)
Membership Revoked
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Futures Experience: Advanced
Platform: NINJA
Broker/Data: ZEN
Favorite Futures: Crude
 
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Thanks: 192 given, 484 received



aztrader9 View Post
What can I say. I screwed up big time today....not in dollars although I did get close to my stop. But the screw up was in several procedural issues which I will detail in a minute.

I am also gonna make some changes to the way I keep score. I've decided to return to the world of golf. I think the book "Golf is not a game of perfect" has some influence on me. I also remember back when my handicap was around 8 and how I played the game.....some things jumped out at me. More on that in a bit.

What I did right today:
1. Not to much.
2. I quit before I got into my daily stop to much.
3. Once I corrected number 1 below, I began to increase the range bar size as the range gradually opened up. The chart attached is what I finished on.
4. I practiced some on sim after stopping out. Normally I don't do this but was feeling pretty lighthearted and recognized I could not go back live even if I did well on sim which I did.....+75 ticks on essentially the same exact range as what I had lost money on. In the past, this would have pissed me off. Not today. I just recognized I traded better once the pressure was off and if I did in fact go live again today, I'd probably make the same mistakes over again.

What I did wrong today:
1. I noticed the range was VERY narrow again this morning upon turning on the screen. I failed to reduce the size of the range bar from 12 to 6 as dictated by the range. This cost me big time in terms of missed opportunity. I did have two minor profitable trades using the range bar but only because I bailed quick.
2. I took a trade that met none of my rules. @MickeyCaine called me on it and I ignored him. Double bogey.

Plan for tomorrow:
1. I want to play tomorrow for real like I played today for fun.

Ok so now more on the changes I mentioned earlier. I like golf. I understand golf. I know what it takes to play good golf. Golf is all mental and so is trading. So I am gonna keep score like @jungian. I will create a "golf" score card to record my trades. A name and a score for each kind of trade. I will post this later today if I get it done today. From now on, I'm just gonna play golf. I have fun when I play, even competitively and I want to have fun trading. Even when I lose I want to have fun. Less fun to be sure but fun nevertheless.

Now a little bit about my golf game. I played everyday for a long time. I got my handicap down to 8. But the road to get there was pretty rough. It involved lessons from a genuine LPGA pro. This actually helped. It involved buying the latest and greatest clubs....which didn't help. And it involved all kinds of mental games with myself trying to over come a terrible slice and the yips with a wedge.

One day I was teeing off over some water on a real narrow fairway. Of course I hit the drive in the water. In a moment of rage and frustration, I threw the driver in the lake. As the driver left my hand, I had an aha moment.....I put to much weight on the game. I let it define me as a person. I wanted to prove to my golfing buddies I was better than them and so my mind played some awful tricks on me and I sabotaged myself over and over. This all ran through my head as I watched the club sail through the air toward the water and when it hit the surface of the lake, I knew things would be different.

From that moment on, I knew the competition was not with my buddies but with myself. All I had to do was be better than the golfer I had been in the past. The winning would come later. From that point on, I got better. I stopped caring where my buddies finished. I only cared if I improved over last round. And I started having fun. I stopped keeping score for a while and just focused on hitting good golf shots and having a good time on the course. I stopped trying all the new clubs out on the market. I stopped reading Golf Digest, and I quit listening to my golfing buddies about how to fix my swing. Instead, I just kept playing. In fact, I rarely went to the range to practice. I just played round after round. If and only if I ran into an aspect of the game I needed professional help on did I look up something in Golf Digest or try to find a video about online.

One of the biggest helps I had was watching a slow motion video of Tiger Woods. In it I could see his swing was effortless and I saw how he set up and finished. I knew I could never fully copy it but I could learn from it. As I worked to copy certain aspects of his swing, I learned I could not swing as hard as I had been and emulate him. I had to slow down, swing easier and just let the club do the work. Amazing results. I started hitting the ball straighter, further and more consistently. I used to pull my back out playing golf trying to hit it so hard. After this, no more pulled back muscles. It was a game changer.

And today, I realized I just need to have fun at this trading game. Stop caring about the score...(sort of) and focus on hitting good shots. I have to keep score because its money involved but I think I can use the golf analogy to over come this aspect of the game. I need to stop trying so hard and just let it flow like when I started swinging easier and letting the club do the work. In this game, its the set up that does the work. Just let it happen and if a shot (trade) goes awry, well thats ok too. Just stop trying to force it.

So tomorrow starts a new way of looking at my trading game. Gonna just try to have fun out there, keep score because I have to and let the set ups do the work.


Good read Brian, I can just see that club flying through the hot Arizona sun, beautiful. Hold onto it! We have to let go of the anxiety and stress about hitting the numbers and turn the focus towards managing our emotions. If we focus in on managing ourselves perfectly the result should be the optimum, and if we have an edge it will show up in the results. But let's not go all the way to paralysis, I went 0 for 0 today, just couldn't get a clean shot and was too worried about making a mistake. We have to relax, let it flow, find the calm. As NYBOT said to me when your intuition comes in, act on it, but be calm, nice and easy like a world class surfer, go with the flow.... Will now put on Laird for the 100th time and cruise my chart and think about who I am when the pressure and the game is on... Best.. SYX

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