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Well I guess I'd better wrap up this thread with a post-mortem.
At yesterday's London open, I was coming off several days of good results, and I was feeling confident. When I saw a potential swing trade set up, I figured it was good for a big trade.
My first entry was after a trendline break with 2 lots. As the trade played out, I piled on additional positions, eventually reaching 12 lots. At that point I was getting anxious and decided to step so I wouldn't be tempted to exit prematurely. Price had formed a bear flag, which was breaking down and suggesting the bear trend woudl resume.
At around 20:45 the bulls stepped in, driving price up out of the bear flag, and in doing so hitting the trailing drawdown. My SL was at 4424, which was ok for 6 lots, but I hadn't recalculated it for 12 lots. (If I had been monitoring the trade, I would have bailed at breakeven after the bear flag failed.)
I got back to my PC at around 21:15 to find +$720 in my account and the trading features locked. A quick look at Rithmic Pro confirmed I hit the trailing drawdown.
About 15 minutes later, price turned around and shot down to my target.
I figure I made two big mistakes:
- I didn't recalculate the SL for the additional positions
- I left the PC, missing the break out of the bear flag and a chance to exit without a loss
Not sure if I'll do another evaluation. Maybe if there's a good promotion.
Well I guess I'd better wrap up this thread with a post-mortem.
At yesterday's London open, I was coming off several days of good results, and I was feeling confident. When I saw a potential swing trade set up, I figured it was good for a big trade.
My first entry was after a trendline break with 2 lots. As the trade played out, I piled on additional positions, eventually reaching 12 lots. At that point I was getting anxious and decided to step so I wouldn't be tempted to exit prematurely. Price had formed a bear flag, which was breaking down. I figured the bear trend would resume.
At around 20:45 the bulls stepped in, driving price up, out of the bear flag, and in doing so hitting the trailing drawdown. My SL was at 4424, which was ok for 4 lots, but I hadn't recalculated it for 12 lots. (If I had been monitoring the trade, I would have bailed at breakeven after the bear flag failed.)
I got back to my PC at around 21:15 to find +$720 in my account and the trading features locked. A quick look at Rithmic Pro confirmed I hit the trailing drawdown.
About 15 minutes later, price turned around and shot down to my target.
The way I see it, I made two big mistakes:
- I didn't recalculate the SL for the additional positions
- I left the PC, missing the break out of the bear flag and a chance to exit without a loss
Not sure if I'll do another evaluation. Maybe if there's a good promotion.
Sorry to hear you failed. I too have failed many evaluation accounts. Trading 12 ES contracts with the $150K is way too much IMO. I only trade the micros and add to my position throughout the day, mainly doing only swing trades. If you want to trade 10+ ES contracts you would need a huge stop loss. Just one ES contract with a stop at the 4422 high of the day and holding the short position until the end of the day would have been ideal. But hindsight is always 20/20.
I thought a long and hard about adding a point that the position was too large. I'd agree opening a position with 12 lots with a $5k drawdown is a bad idea.
In this case the idea behind the trade was to start small and add only after in profit, then monitor the trade to keep the SL at breakeven. This can produce some great trades with no drawdown. Tom Hougaard on YouTube does this really well. I fell apart with the monitoring and SL. I was more focused on not exiting early (normally a problem for me), and I completely failed to give proper consideration that price might spike up rather than down.
FYI, for most of the evaluation my trade size was 1-2 lots, scalping for 1-2 points.
Figured I'd write a follow-up after I busted the Leeloo eval.
In the months after, I retooled my trading and tried another eval. And another. And then many, many more. It took a while, but I've now got a funded account with Apex. Also I've hit the profit target for a 2nd account but need to trade it another 5 days to meet the 10-day requirement (micros of course). I have a 3rd account that is about one-third of the way to the target.
I'm uploading the equity curves from these evals. They show I have a problem with revenge trading. Most of the time I'm ok with routine losses - I lose 25% of my trades, and most of the time I can predict how a loss will transpire. However unexpected losses really mess with my head. When they happen I try to recover the loss immediately. It doesn't work and leads to revenge trading. Then I bust the account, undoing days of careful trading. That is the reason most of the equity curves end with a steep drop-off at the end.
My plan going forward is to get 10-20 of these accounts, then trade 2-3 of them at a time, rotating each day, so that if something unexpected occurs that sends me on a revenge trading bender, I'll still have accounts to trade afterwards.
Hope to return here in another 5-6 months to report that I'm taking huge withdrawals from prop firms. Cheers all!
I'm learning that revenge trading has deep-seated psychological roots, according to the literature (Trading in the Zone, Mental Game of Trading).
Rather than undertake the hard work to understand and rectify the self-destructive attitudes towards money that developed in childhood or whatever, I came up with a "duct tape" fix. I set up a separate evaluation account specifically for revenge trading. When I have an unexpected loss in a 'serious' account, I switch to the 'revenge account' where I can pursue my vengeance against the market.
Last night I made 2 trades in my funded Apex account for $250 profit, then an unexpected loss knocked me back to $178. I felt the rage build and switched over to a separate Apex eval that cost $33. After about 40-50 trades in that account I made $1.4k. I felt no fear or nervousness because it wasn't an account I cared about. However now that the balance in that account is now above $2k (with a $3k target) I need to start treating it seriously.
But no worries, I picked up a Leeloo eval for $27 or so (85% off promotion), and it's my new revenge account. I'm sure it won't be long before it gets some use.
Good luck to you mate, hope the FOMC treats you well tomorrow!
Mark Douglas (RIP) was one of the most brilliant minds in the field. He had those insights before anyone and they were spot on!
I do have some thoughts on your post if I may.
These are just my thoughts.
We don't trade our fears from childhood. We trade our fears of our perception of the future results of actions taken. Your reaction comes from previously past learnt behaviours.
Trading in a nutshell is simple. Make more then you lose and you keep the difference.
In reality, simple doesn't equal easy.
I too "revenge trade" and I know I'm doing it. I did it yesterday and gave back a weeks worth of profits.
I know I was doing it but still working on myself.
Lastly your natural urge is to do the wrong thing and that's a human gene thing NOT childhood trauma.
See when in a losing trade we will use HOPE as a coping mechanism. We do not want to lose so hoping subsides the uncomfortable feeling we have.
When we are in a winner we want to close because ALL WE FEEL IS THAT our profits will disappear. Our coping mechanism? Close the trade in ANY profits.
The result? Despite all out best intentions everything we need to do feels like the wrong thing.
I used a person afraid of spiders going to work at a spider farm to explain in my journal. I go into some detail there but for now...
Our natural inclinations for most people is to avoid spiders. If it was your only job opportunity and had to go to work there how would you do it?
Start small. Use imagination. Picture funny spiders. Push the picture away, bring it closer. Keep distance at first. Keep working at diminishing your natural reactions using exposure.
The more exposure WITHOUT the unintended reactions the more learning is taking place and your more inclined to do the right things in the moment.
We need to learn how to do certain actions regardless of how we feel because we know from exposure that's the right thing.m to do.
Simple yeup. Easy. Nope, damn near impossible. But... possible!
Apologies, I was being a bit flippant there. I did read the books and made a good faith effort to extract something useful, but psychology stuff doesn't resonate for me unless it comes with practical fixes I can implement. Like you I can recognize when I'm in tilt, and the practical fix I'm using is to trade a different account that I've designated for revenge trading.
Speaking of which, my Apex revenge account has been doing quite well. Last night I hit the profit target. One more day of trading micros and I'll have another funded PA account. It's one of my better looking equity curves, although I seem to be missing a few days (probably from reinstalling Ninja Trader on a new laptop).
Equity curve revenge acct
Sadly the substitute Leeloo revenge account I got a few days ago didn't last long. I can't remember what set me off, but I traded it into oblivion last night. After getting the dumb trades out of my system I went on to do really well in my funded PA.
Pleased to hear it. Maybe this designated revenge account principle is a good one! (As long as you always take care to use the right account with the right trading style?!).
