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Zen & the Art of The Small Account


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Zen & the Art of The Small Account

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  #921 (permalink)
 PandaWarrior 
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Lornz View Post
Alternatively you could try to ride your winners longer. Look at your first two profitable trades, you left a ton of money on the table. From what I understand, you're still trading one contract? If so, I can understand your narrow targets.
Being able to scale in (adding to winners only) and out, gives a lot of flexibility. The goal shouldn't be to take more trades, but to get more ticks out of each trade.

That being said, I am impressed by your results and progression. It makes me miss the first few profitable months I had. After a couple of years of studying the market, I suddenly "got it". Trading does not really get boring, but it sure does get a lot less magical after some time...

Good "luck" going forward!


Thanks for the kind words. I am trading one lot and that makes it hard to hold anything very long. So for now, its just scalps....bigger ones in wide markets and narrow ones in narrow markets.....

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #922 (permalink)
 PandaWarrior 
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Today was a fantastic day for trading. Once again I sucked at taking every trade I saw. Once again, I left a ton of money on the table. BUT I made my target for the day and that is good enough for now.

There are two trades marked on the chart, I had a couple other minor trades that were winners and a loser but they looked just like these two so I am not gonna screen shot multiple screens.

I did take a more aggressive trade today that was not in my "normal" set up. It was basically a continuation trade. I took it on sim the first time and then for a real small target for real and it paid off. For the most part, I was looking to see if it was something I could fit into my trade arsenal for the future.

Additionally, I discovered its ok to enter at levels of confluence with no confirmation. Scary for me but I marked an area that had several points of resistance to it, looked for some weakness and then entered a sim short....I figured it would be a huge sell off and it was, almost two hundred ticks. I only took 20 on it since my track record for holding past that is spotty at best but still, it was a good call.

Net 48 ticks today.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #923 (permalink)
 Trankuility 
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aztrader9 View Post
When I began this thread, it was about money management, indicators, set ups and mechanic. After almost a year, I am 100% convinced it has almost nothing to do with indicators, set ups or mechanics....Yes those are important, but the most important thing is this....are you confident? Next is knowing where to get out, third; money management which is in part a function of knowing where to get out and after that, indicators, mechanics, entries, etc all play their part...albeit a much smaller part.

Good stuff. When I started I was all about the perfect set up. Very mechanical with very little discretion. Now it's the opposite. As you said, confidence is very important. These days I look for good conditions to make my trades rather than the perfect set up.

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  #924 (permalink)
bwasi
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Confident is the sum of all things

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  #925 (permalink)
 PandaWarrior 
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I've not been posting to much lately and I don't intend to post a lot anymore but on days I learn something important, I'll post it so I can remember it.

Today was one of those days. I had far more trades than normal but that was ok. Its what I did with those trades that matter.

A few posts ago, I wrote the exit was more important than the entry and that any entry would do as long as the exit was managed properly. Today that was proved out over and over again.

I took a lot of great entries, a couple of crappy ones and some so so entries today. The crappy ones I ditched pretty fast. The great entries were killer in terms of profit on the screen. BUT I got greedy today. Tried to stretch the targets out beyond my comfort zone. And let many of them come back for losers.....this was BAD. Fortunately, I ended the day green, but way off the day's equity high.

I also tried shorting the rally at the very top. But as tops go, it rounded off and by the time it sold like it knew it would, I was done for the day.

I also had the big picture lesson drilled into me today. "Trend Changes" on a smaller time frame chart are often just pull backs on the larger time frame. I ignored this to my detriment today.

Another valuable lesson learned the last couple of day....fewer indicators are better. I have gotten rid of almost every thing. Just using a single MA now on my chart. There are other things but they are just S/R/Fib stuff. I may ditch the MA at some point as over the last few weeks, certain price patterns have begun to emerge as important. But even more important than that is I have begun to recognize them without the indicators and quite possibly the most important thing is this....quite often the indicators obscure what is happening with price.

Not ready to trade naked yet, but getting there.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #926 (permalink)
 mmaker 
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I read your entire thread. I trade ES not CL.

Thanks for sharing.

My only comment is one that you might find controversial and may ignore.

My comment is "Lose the fibs." I know you are attached to them - but I am not sure they are helping you.

To me if you get no pullback and price moves sideways that is stronger than a 78% pullback. A 23% pullback is stronger than a 68% pullback. Those kind of pullbacks can be eyeballed.

Unless you are using a system that scales in on each % pullback - what is the point of watching them?

What i do think is important is drawing horizontal lines on peaks and valleys - i think Sharky? said one time he uses just one - the current one.

Also keep in mind you can get Lower Lows in an up trend and Higher Highs in a downtrend.

The question becomes what is the overall trend. I am not sure fibs answer that.

So I am saying consider changing your focus from watching fibs to measuring peaks and valleys and judging these against the overall trend.

To me price is king and you probably want to wait for a reversal before you initiate a trade anyways.

Feel free to completely ignore this post - or tell me i am wrong and why i should watch fibs. I am interested to know if i am missing something.

What do you think? Maybe things are different in the CL world.

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  #927 (permalink)
 PandaWarrior 
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mmaker View Post
I read your entire thread. I trade ES not CL.

Thanks for sharing.

My only comment is one that you might find controversial and may ignore.

My comment is "Lose the fibs." I know you are attached to them - but I am not sure they are helping you.

To me if you get no pullback and price moves sideways that is stronger than a 78% pullback. A 23% pullback is stronger than a 68% pullback. Those kind of pullbacks can be eyeballed.

Unless you are using a system that scales in on each % pullback - what is the point of watching them?

What i do think is important is drawing horizontal lines on peaks and valleys - i think Sharky? said one time he uses just one - the current one.

Also keep in mind you can get Lower Lows in an up trend and Higher Highs in a downtrend.

The question becomes what is the overall trend. I am not sure fibs answer that.

So I am saying consider changing your focus from watching fibs to measuring peaks and valleys and judging these against the overall trend.

To me price is king and you probably want to wait for a reversal before you initiate a trade anyways.

Feel free to completely ignore this post - or tell me i am wrong and why i should watch fibs. I am interested to know if i am missing something.

What do you think? Maybe things are different in the CL world.

First of all, thanks for reading the entire thread. I realize its a tough and incoherent read. I am quite sure there is little to be gained from it from the outside looking in.

Secondly, I learned Fibs in the ES world from a master trader. To bad I was to dense back then to fully grasp what he was trying to teach me. Fibs apply across all instruments and time frames. I know traders that only trade fibs and trend lines. Or fibs and MA's. Take your pick. The art is judging the price structure. The fibs and every thing else is just a tool to help do that. Take a look at the screen shot, I just grabbed some random levels to show how price reacted at certain fib levels. Were I to draw them on the intermediate moves, the same pattern would appear.

These are just on the daily high and low.....and the levels in between. The idea is this, pick a level and watch for confluence of items and price patterns to support your decision.

The premise is simple, price will seek a new higher high or lower low depending on trend. IF price cannot achieve this objective, it will seek a better price from which to initiate a new attempt to make a HH or LL. Simple. Chose your pull back level and seek confluence S/R along with PA. Use a trend line or a MA to help...I am beginning to believe the trend line is more important and more useful than any moving average. And then take conservative profits along the way....preferably before it has to make a new HH or LL before the profit target is hit.

Good luck.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #928 (permalink)
 Big Mike 
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aztrader9 View Post
I am quite sure there is little to be gained from it from the outside looking in.

I strongly disagree. Are you saying you've not benefited from reading someone elses journal on the forum? Because I find that can be a real inspiration of sorts, and a wake up call, of both what the common mistakes are as well as how to improve your own trading.

I hope you continue journaling.

Mike

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  #929 (permalink)
 mmaker 
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AZ, as I read your thread (and others) I realized the issues, fears and challenges I had were the same as others encountered.

So regardless of instrument, timeframes, indicators, preferences, biases etc. at the end of the day we all face the same obstacles.

(And they all end up right between the ears. )

There is no other place on the net that i found such honesty among traders as the futures.io (formerly BMT) web site. A lot of the issues you faced in your thread I have also faced and continue to face.

So when I said thanks for sharing I wasn't just being polite. I said it because I found someone who had faced the same obstacles I had and was honest enough to vocalize them.

I feel like I am sharing the same trip as you. So my hat is off to you for your honesty.

Thanks again for sharing.

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  #930 (permalink)
 worldwary 
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aztrader9 View Post
Take a look at the screen shot, I just grabbed some random levels to show how price reacted at certain fib levels. Were I to draw them on the intermediate moves, the same pattern would appear.

One quick thought on this. If your goal is to hold trades for longer moves, drawing too many lines on a chart can be counterproductive. The brain sees the line and expects it to act as support or resistance, even if the line is arbitrary.

When I look at your chart with all those fib lines plotted, I can see how it might be tricky to hold for a 50- or 100-tick move. I guess if price is breaking out to new highs or new lows you wouldn't run into those lines, but if it's trading within the established range of the day then you'd probably hit one of these lines every 10 or 20 ticks. That could potentially mess with the psychology.

I used to plot pivot points on my trading chart but abandoned them for similar reasons. Sometimes the pivots hold up as S/R, more often they don't; I was constantly cutting winners short based on the lines and eventually decided the whole practice was counterproductive. If you look at a chart at the end of the day it sometimes appears that the lines worked really well, but when you look at it carefully you might find that the lines failed more often than they held up.

Might be worth an experiment at least to remove the lines for a few days and see if that makes it easier to hold trades to fruition.

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