Quite a lot changed in my life this week, prompting me to re-assess everything.

My grandfather passed suddenly, although not unexpectedly, after battling leukemia for one and a half years. The greatest lesson I learned from him was to work hard but always put family first. The family my grandparents built is the most tightly-knit family I could ever have been born into.

I turn 20 years old today. While I know that it is perfectly normal to be totally clueless throughout ones 20's, I feel the drive now more than ever to get my shit together.

Where do I stand with my Trading?
I need to start from scratch and develop a methodology for day-trading that allows me to apply my edge consistently and take profits out of the market. Thus far in my live-trading I am a break-even trader. I am thrilled to 'pay' as little as possible for my trading tuition, but at the end of the day my goal is not to be a break-even trader, but a full-time professional.

What Issues have I run into?
-Emotions creep in when I least expect them.
-My analysis exceeds my execution for the aforementioned reason.
-My trading, while rule-based, still allows too much room for discretion, which opens the door for my emotions to run wild.

What do I need to change?
-I trade several fully automated strategies on the long term that I execute with zero emotional involvement. This is due to a couple of reasons. I've backtested the strategies on SPY since inception and am comfortable with their past performance during all market conditions. I have complete faith in these strategies because I have put them to the test and know that they are likely to continue working as long as I follow the entry and exit triggers to the cent. A few weeks ago, one of the strategies suffered its third worst intraday drawdowns in history. I didn't bat an eye because I knew that my job was to follow the rules and not intervene. I ended up getting an exit signal for 1/10 the max drawdown a couple days later. Good thing I didn't break the rules and close early out of panic right?
-I have tried to code numerous intraday strategies and have yet to find any edge that is trade-able.
-I don't have enough faith in my current day-trading strategy to trade it without second-guessing.
-I need to change my strategy to something that I can at least visually backtest, if not with an algorithm. This will allow me to develop faith in my system.
-What bothers me most about trading is getting stopped out and then watching price do exactly what you expected it to do. I would like to develop a system that allows me to trade with a much wider stop, or a time based stop such as close of day. Most of the time I would be able to close out losing trades when I recognize that they are not working before they hit the max stop loss/time stop. To facilitate this change in style I would need to greatly reduce my position size, likely from 1 e-mini down to 1-3 e-micro's to start.
-I dislike watching an entire session, waiting for the stars to align, and not getting a single entry signal. I would ideally like to discover an edge that applies to all markets so that I could find a viable trade by 10-11am EST every morning.


What is my course of action?
-Continue coding strategies to develop even a small intraday edge. i.e. 55% chance of closing either up or down on the day. This would afford me greater confidence trading with a close of day stop.
-Further investigate how waves nest within each other to create the wave of the next larger degree. A correction on a small timeframe is simply an unnoticeable blip in the trend of a larger time frame.
-Learn about volume profile and decide if it adds any value to my trading.
-Take time off/SIM trade until I am confident in and faithful to my strategy.

In other news, I decided to go Elite and check out all the valuable journals posted there. I've been inspired to learn new techniques from many of those contributions in the Elite section. I would like to thank everyone who has contributed to this journal and by extension my trading career thus far. When I return to trading with a rock-solid strategy (ha!) I will be posting my journal in the Elite section.

First off, my condolences for your grandfather. He sounds like an amazing person and I'm sorry your loss.

Now. Happy Birthday! You are just turning 20? You are way ahead of the curve my friend. I understand your sense of urgency, though I didn't have it when I was 20.

Here is some unsolicited feedback, feel free to ignore anything that does not resonate with you

Be patient with yourself. The fact that you are a breakeven live trader at 20 is kind of bonkers to me and you may have more of your proverbial sh*t together than you think. Even if you were to regress for a while and decide to take time off from trading you would not be falling behind at all.

You are mentioning emotions a lot, and I see you are talking about the ES in your posts. Traders much better than me keep pointing me back to the micros when I inexplicably trade like sh*t with the ES. Take this under serious consideration. I'm finding protective-stops based on actual price-action and price-levels the market is responding to to be more useful than arbitrary "Money-Stops" ie. "2 point stops because that is my limit", you know? Often the risk is much greater though. I feel like we're pretty much in a similar boat so I will leave actual trading advice to more experienced traders as I face similar problems, my friend.

Just want to wish you the best. I don't know your situation, but if you are feeling pressure about losing money, no one ever blew up maxing out their 401K or investing part of their money in a Janus mutual fund (or Vanguard, etc). Something to keep in mind, allocating money for riskier assets will seem much more comfortable if you have money working for you in boring investments, growing over time.

Good luck and I look forward to reading your journal!

Hi Zimmer,

I am very sorry about your loss and I hope you feel better soon. I look forward to your new posts and I wish you a wonderful weekend.



K

Thanks Snax,

You’re a killer and I’ve enjoyed catching up on your elite journal the past couple days. Seems like you are moving in the right direction more and more each month!

I’ve been using stop loss levels based on market levels ever since I began trading. It always made more sense to me than arbitrary levels to me as well.

I feel no pressure regarding monetary loss, but do feel a pressure to succeed.
I’ve maxed out my IRA contribution since I was 14 and it’s grown nicely in this bull market. I now trade the aforementioned collection of automated strategies on SPY in my IRA account and hold bonds. The strategies have clobbered the market over my test period of the past 26 years and I anticipate this outperformance to continue. That’s about as ‘boring’ as it gets for me, but you are right that it takes the pressure off of allocating to riskier endeavors such as daytrading.

Thanks for your comment Snax! I’ll see you over in the new journal! (Hopefully in a couple weeks!)

Quite a lot changed in my life this week, prompting me to re-assess everything.

Quite a lot changed in my life this week, prompting me to re-assess everything.

Quite a lot changed in my life this week, prompting me to re-assess everything.

My grandfather passed suddenly, although not unexpectedly, after battling leukemia for one and a half years. The greatest lesson I learned from him was to work hard but always put family first. The family my grandparents built is the most tightly-knit family I could ever have been born into.

I turn 20 years old today. While I know that it is perfectly normal to be totally clueless throughout ones 20's, I feel the drive now more than ever to get my shit together.

Where do I stand with my Trading?
I need to start from scratch and develop a methodology for day-trading that allows me to apply my edge consistently and take profits out of the market. Thus far in my live-trading I am a break-even trader. I am thrilled to 'pay' as little as possible for my trading tuition, but at the end of the day my goal is not to be a break-even trader, but a full-time professional.

What Issues have I run into?
-Emotions creep in when I least expect them.
-My analysis exceeds my execution for the aforementioned reason.
-My trading, while rule-based, still allows too much room for discretion, which opens the door for my emotions to run wild.

What do I need to change?
-I trade several fully automated strategies on the long term that I execute with zero emotional involvement. This is due to a couple of reasons. I've backtested the strategies on SPY since inception and am comfortable with their past performance during all market conditions. I have complete faith in these strategies because I have put them to the test and know that they are likely to continue working as long as I follow the entry and exit triggers to the cent. A few weeks ago, one of the strategies suffered its third worst intraday drawdowns in history. I didn't bat an eye because I knew that my job was to follow the rules and not intervene. I ended up getting an exit signal for 1/10 the max drawdown a couple days later. Good thing I didn't break the rules and close early out of panic right?
-I have tried to code numerous intraday strategies and have yet to find any edge that is trade-able.
-I don't have enough faith in my current day-trading strategy to trade it without second-guessing.
-I need to change my strategy to something that I can at least visually backtest, if not with an algorithm. This will allow me to develop faith in my system.
-What bothers me most about trading is getting stopped out and then watching price do exactly what you expected it to do. I would like to develop a system that allows me to trade with a much wider stop, or a time based stop such as close of day. Most of the time I would be able to close out losing trades when I recognize that they are not working before they hit the max stop loss/time stop. To facilitate this change in style I would need to greatly reduce my position size, likely from 1 e-mini down to 1-3 e-micro's to start.
-I dislike watching an entire session, waiting for the stars to align, and not getting a single entry signal. I would ideally like to discover an edge that applies to all markets so that I could find a viable trade by 10-11am EST every morning.


What is my course of action?
-Continue coding strategies to develop even a small intraday edge. i.e. 55% chance of closing either up or down on the day. This would afford me greater confidence trading with a close of day stop.
-Further investigate how waves nest within each other to create the wave of the next larger degree. A correction on a small timeframe is simply an unnoticeable blip in the trend of a larger time frame.
-Learn about volume profile and decide if it adds any value to my trading.
-Take time off/SIM trade until I am confident in and faithful to my strategy.

In other news, I decided to go Elite and check out all the valuable journals posted there. I've been inspired to learn new techniques from many of those contributions in the Elite section. I would like to thank everyone who has contributed to this journal and by extension my trading career thus far. When I return to trading with a rock-solid strategy (ha!) I will be posting my journal in the Elite section.