Does anybody really make any money?

Ah. At last. In a nutshell.

No disrespect to dbp, but a trading plan sounds like it could easily lead to 'paralysis from analysis' - I know, I've been there.

Textbook stuff for the academically minded and it'll keep you safely away from the potential 'lessons' the market wants to deliver (and you need to receive) that bit longer, but you can't make profits without losses.

'A plan for all eventualities' I like it. Good work Paul.

Not sure I see the difference between a trading plan and a plan for all eventualities since the former should include the latter. The crux of the matter is approaching the market with forethought of some sort.

Good response.

Care to share an exemplar Trading Plan so that we can understand all that it encompasses?

Timsk created a nice template, though the result is as individual as the trader. My current plan is only a half page, though it didn't start out that way.

http://www.trade2win.com/boards/show...320#post166320

My point is on randomness. We can all have blind faith that we can read the market, yet maybe it's all just an illusion. I hope not. The trading plan thing is completely useless to me. I have all of those points already sussed. The one I'm having trouble with is buying the market and it actually going up. I have similar problem shorting. Apart from that I'm fine. It's a bit like all of those books on psychology of trading - you have to master yourself to trade - '******** you do' you have to buy before the market goes up - find any way of doing it and you've won. Smoke and mirrors. How can being in control of 'me' give me a profit?

If you have a plan all worked out, what's the ratio of your winners to losers?

What's your profit to loss ratio?

What's the longest uninterrupted string of losers that you can expect over 50 trades?

What's the maximum drawdown that your setups provide in those same 50 trades?

How much of that drawdown are you willing to tolerate?

Tubbs,

IMO there is a big difference between "reacting to the market" and trading. When trading I specifically do not "react" to everything I see in the market because I know that my chosen market, HSI, has a huge number of volume and price fakes going on and to react to those is to invite the boys to chew you up and spit you out (been there for the first few months).

This trading plan stuff is good and necessary but first you must have one or more edges. The edge is a combination of entry criteria (setup conditions, and trigger), stop, and exit criteria (varies with the entry).

What I do, when trading, is to monitor the market and react not to the noise but to seeing my criteria occur in real time.

So, although I am reacting to the market, I am doing it through the filter of a set of criteria that I have extensively tested and can retest over time if I think Market conditions have changed and are making me less profitable. If you cant buy going up then the chances are that you dont have a clean, crisp, clear set of entry conditions that you are confident in.

So for your problem maybe this is criteria X. And criteria X might be, Market trending up, Market breaks out of X bar high by Y points. Don't buy now ... wait for retracement and buy on a) breakout of retracement within Z bars or some retracement criteria. Or something else. But if you dont have the criteria clearly in your mind then you wont be able to do it.

You may have a different issue but this is certainly worth having a good look at.

I enclose an extraction of some Mark Douglas material that some people seem to have found helpful in this area (I recommend his the disciplined trader and trading in the zone). It might be of value to you.

Kiwi

In my view there is a simple reality check on this. If you believe that you can read the market and are not able to then it will result in ongoing consistent losses. The opposite is also true in that if you are able to read the market then you will acquire ongoing consistent profits.


Paul