Thanks. Does this help alot with your strategy/trading? Are you profitable or does it do the job?
Also I see you have bold and underlined the "correct" but there are two questions that you did not choose the correct answer for?
"Is the trade taking too long?" And "Did you have strong feelings you should exit?" What is the right answer for that?
Last edited by nillz123; September 15th, 2010 at 02:25 PM.
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Yes, this checklist is really helping me. What it helps me to do mainly, is keep me from acting like a complete idiot, which is what I do when I don't have the questions staring me in the face.
I've just started trading live again after a year of working on psychology stuff. When I first came back into it I thought I had done enough work to not need a physical checklist. This was a huge mistake. I have done very well since I have used my sheets every single day. I can't trade every day, but the times I have, I have made significant improvements.
Regarding the two questions I left unanswered: (1) Is the trade taking too long? This is a judgment call and in my personal experience, I just "know" that the trade is taking an excessive amount of time. When this happens, I have never had a happy ending. People will call this a "time stop" and many people don't employ this. I have determined this would be useful to me, but I have not specified the exact amount of time.
(2) Did you have strong feelings you should exit? Most people will say trading is no place to use instincts or intuition. If I have extremely strong feelings about keeping out of danger, there's probably a reason, even if I can't identify it or put it into words. I have recently decided I need to listen to myself a bit more often. Doesn't mean I'm going to jump out of a trade, just something I try to be aware of. The book Blink by Malcolm Gladwell is extremely interesting in the area of instinct.
The following user says Thank You to tmmaggi for this post:
Could you elaborate about your fears?
Could you share some charts and show what's going through your mind when seeing a signal developing?
Is your mind shouting "jump in, there's your signal, no wait you missed something, are you sure, hesitate some more is better than losing, was it your signal, go on.... noooh you missed your entry" kind of thing...
I am missing many many good trades because of doubts which I don't have on Sim plus we are more willing to risk Sim so more profits.
I used to trade stock and Forex for many months....learning how bad software can be....how bad my trading entries were...how bad my eye on the market was interpreting and on and on, so I lost $14000 including membership, new hardware and books.
So I stopped live trading, until I felt confident to go Live again but when I came back.....the market told me I was not ready yet...so I was losing again with bad execution timing, not knowing why my setups would fail here, be so great there and problems I could not see before.
Went back to Sim, never giving up and studying harder the market behavior and my behavior to the market.
After what I've been through emotionally, fear "doubts" which I didn't have so much up to now was in the back of my head like a trauma.
knowing that everybody has not been burned like me, I'm both feet in the 80% psychological level that makes a "real trader".
What's weird is, I'm not afraid to trade, no heart beat and sweating hands but rather paralyzed by the thought that it may be my last bar, though I have a 10 tick stop and trading a 4 range chart. I just sit there with no orders waiting.
I'm silly, I could put more cash in my account but I insist on doing it with trading.
Every day I got my live charts ready with some Sim charts, where I would try to catch my signals.
I end up very profitable everyday Sim and no live trades for days....silly again...but I'm building my confidence back...I'm a much better trader today than 3 years ago and I would not have any problem trading someone else account...and that's what is so crazy
So trading is not really that important. Getting better at it and KNOWING is much more important.
Today I know where, how and why I should avoid or take my next setup.
I'm good at price action and know where sellers and buyers are hiding. I know how patterns develop and how I need to work quitting the Sim mode.
In 1 year from now, I will look at the fear mindset of today and realize that it was such a learning experience and so far away in time.
Your thread Nillz123 about paralyzing fear, can be so useful to many traders that are ashy to express their fear, that I wanted to share my experience hoping to help.
Last edited by PiCoTrader; October 28th, 2010 at 06:31 PM.
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Platform: Multicharts, SierraChart, MarketDelta, R-Trader Pro
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Fear and Trading
I wanted to share with you my thoughts: first, what you are going through is natural. our body and mind, has a natural tendency to stay away from negative experiences . What you are suffering from is not exactly fear, it's more of a paralysis because you are about to take a leap into the exact same territory and you don't want to experience the same consequences.
Now I want to address the other spectrum which is winning. Winning in finishing first in a marathon, getting an +A on a test,getting a promotion, etc. It's always the same type of an emotional rush that elevates our soul and gives us a sensation.
Fear and winning are the opposite spectrum but affect us both emotionally and equally.
Successful traders have neither fear (paralysis) nor have the sensation of elevation (winning).
Some do better than others in this department, and according also get compensated as such.
The one thing that beginners that associate with trading is making money,
and that in their mind is the winning part.
In my honest opinion winning in trading is the execution a strict plan of action.
The $$ that come out of a good executed plan is the by product.
So as a beginner trades to get out of the fear mode, accept that you will follow your plan to the fullest, no deviations. Following your plan should give you that emotional rush, because you will be saying to yourself "I am disciplined....I am following my plan...I have a methodology...my methodology might not be perfect, but I will improve as I am exercising it".
Now let me take you a little to the practical part. I am speaking for myself here, but discretionary trading on a sim mode never helped me. For me it was a way to get to know the platform, it's functionalities and its full capabilities when it comes to execution.
Here is what I did a while back to help me test my methodology: I completely automated it.
NinjaTrader has the strategy builder which is fantastic, and you can build a strategy and see how it would do in real markets. Maybe you can do that with your platform, and see the buy and sell that it generates. This might help you improve your methodology by looking at it objectively and tweaking areas where it is necessary.
Let me give you an example: I was looking at a certain price action set up on the ES, and it required an 8 tick stop and a 4 tick profit. Upon observation it occurred almost instantly. The method in back-testing and forward testing proved to work.
This requires a 67% winning ratio, and that is hard to achieve. But, I have made another observation: upon entry the market has retraced 4 ticks, and if it didn't hit the stop then it would go to profit.
So I decided to test it with 2 contracts: 1 for the initial entry, 1 if retracement occurred and keeping the target the same.
This has increased the results substantially. I would not be able to do that unless i saw the set up occur and the buy/sell signals occur in front of my eyes without getting involved. The automation took the emotions away.
I think you need to reach that part where you trust your methodology and you will if you have build it on your own.
Methodologies first built on visual observation and tweaked with different filtering indicators.
Outside of trading, you need to have an activity that you do successfully.
Something that gives you a sense of achievement and satisfaction.
This is one way to eliminate "scared money..the market is the best poker player and it will figure out your hand in a sec.
Lastly, I want to tell you that you are a winner!
You know why? Because you have more guts than 99% of society that would not even dare trading.
I wish you success in your trading journey and life.
PM with any questions about optimusfutures (800) 771-6748 (561) 367 8686. THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES TRADING.
Last edited by mattz; October 29th, 2010 at 08:34 AM.
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I have actually gotten a lot better now, and it is funny, I did automate my methodology to build trust in it. I seen that while it was a winning strategy, the draw downs to my methodology were something I just did not want to take and I realized, a long as you are trading a system you are not comfortable with, you won't win! I am moving away from scalping, and I am more of a daytrader, staying in trades for hours, just because I don't want to feel the heart-pumping action that scalpers like to feel. I don't want to stare at the computer montor for 2-4 hours with full concentration, watching every single move, jumping and reacting quickly to every news event. Scalping requires A LOT of concentration IMHO: Do I really want that?
Although staying in hours requires a bigger Stop Loss, I get a bigger Profit Target too. And getting a loss and then a PT thats bigger.
It has come to the point where I reward myself not from losses or wins, but simply on following my startegy regardless of a loss or win.
I will tell you that I do trade on NT6.5 and that does crask a lot because of Data and tick errors, and that bounces me out of my "mode."
Favorite Instrument: YM & Equities & Options & Mutual Funds
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Thanks: 56 given,
Here's a fun little test you can do to un-scare yourself. Put your 4 range no gap ES chart and TS Supertrend at 14 and 1. Then take every signal in your sim account, at the end of the day see how you did. Repeat until you know which signals not to take...
In my personal experience i was afraid to pull the trigger because: i had the wrong timeframe, and only one market on my screen.
Timeframe needs to be good for you, you know if its good if most of your predictions without any indicator are good. (only direction and consolidation area)
With multiple markets i can check my opinion, and i can explain why something is happening.
i have 6 markets on my screens, that makes it for me easier to trade (i mainly trade 2 markets)