my journal 2

This is a discussion on my journal 2 within the Trading Journals forums, part of the Reception category; I would go as far as saying that the first time we look at a chart, we can tell that ...

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Old Jan 25, 2010, 8:32pm   #57
 
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re: my journal 2

Yamato started this thread I would go as far as saying that the first time we look at a chart, we can tell that it's intuitively predictable. But then we start noticing that it's not totally predictable, and what's worse we get kicked in the balls each time we make a wrong prediction. Then we start studying technical analysis and start getting confused. The only problem is that you're not given a stoploss when you start off. If you were told: here's your weapon (as i used to say), you can lose x or make 3 x on each trade (if you lose x or make 3 x, your trade gets closed), then we could make all our predictions accordingly, and everyone would be profitable from the start. But no, we get kicked in the nuts, and start being afraid of making predictions and start thinking it's because we were mistreated as children... and all sorts of things... maybe if we were just starting to trade with a simulator that prevents you from being kicked in the nuts every time you make a mistake, we would not unlearn that natural intuitive approach which could turn us into a profitable trader within a month of playing the chart game for example. That's what I'll try to do now: I'll ask some of my cousins to play this game (they know nothing about trading) and see if and how long it takes them to learn it. And probably this will prove my point. That this game can easily be learned, and it doesn't get learned because each time you make a mistake you get kicked in the balls. I think this reminds me of some schools I went to, where teachers manage to make you hate pleasant subjects and to make you feel like you're "just not good at math" or similar, simply because they give you homework, and make you compete with other faster students. Competition pisses you off, and the fear of not being the best also takes some of that learning capability away.
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Old Jan 25, 2010, 8:55pm   #58
 
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re: my journal 2

Yamato started this thread http://stagevu.com/video/fyqymjcmzwhk
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Old Jan 25, 2010, 11:24pm   #59
 
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re: my journal 2

...why not set yourself an absolute target on www.chartgame.com ,which you have to achieve before even considering live trading again.Dont search for other games or outside education,just concentrate all your energies on this one task.I would aim for 25 maybe 50 winning stocks in a row....this would cut out "luck".....5 is too low an objective.....this would certainly prove that you have the reading skills you need...you would know that you know.
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Old Jan 25, 2010, 11:44pm   #60
 
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re: my journal 2

Yamato started this thread Sounds good. But since I am constantly on the verge of quitting I'll be happy with just doing a few 5 trades series for now. I can't handle more than 5 trades in a row.

I think you misunderstood what I meant by 5 trades in a row. I don't mean that I'll have 5 profitable trades and then just quit practicing. I mean I'll do a lot of practice, but just 5 trades at a time.

Last edited by Yamato; Jan 26, 2010 at 12:11am.
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Old Jan 26, 2010, 12:22am   #61
 
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re: my journal 2

Yamato started this thread I was feeling low and didn't have a good dinner. Didn't use any stoplosses, got upset when it didn't go my way...

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Old Jan 26, 2010, 8:05am   #62
 
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re: my journal 2

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Old Jan 26, 2010, 1:27pm   #63
 
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re: my journal 2

Yamato started this thread Still at work.

Once I'll get home, I'll practice more on the simulator.

Objective: make 5 trades in a row, and always have a profitable 5-trades balance.
Method: only make 1 bet per stock.

This will teach me that I have an edge, if I do, or teach me the edge, in case I still don't have one. And it will teach me that having an edge is inversely proportional to trading (in the sense of over-trading). The harder and more compulsively you look for trades, the less you will be able to pick the good opportunities. That's why some recommend to not spend your money out of your trading account, because if you count on your trading for your living expenses, this will put pressure on you to make money, and therefore to trade more.
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Old Jan 26, 2010, 5:19pm   #64
 
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re: my journal 2

Yamato started this thread The rule of only being able to make one trade per day in real trading and one trade per stock on the chart game is something that gives you tremendous power: you know there's no rush and that you'll be able to pick the best opportunity out of plenty of opportunities. It's a rule that encourages you to be picky, and it totally removes impulse trading. There can be no impulse trading if you are required to discard a majority of what you perceive as "opportunities". But can we still do this once we start making money almost every time we trade? Well, the trick I think is to still be "picky" no matter how good you seem to be and no matter how many opportunities you feel you're missing. You've got to feel as if you're wasting opportunities. The fear of missing opportunities is what makes you overtrade, trade compulsively and similar. By only allowing one trade per day, you know from the start that you will waste most opportunities, and you'll get used to picking the best opportunity there is. Furthermore it encourages longer term trades (since you won't feel like staying out of the market for the rest of the day), and to let profits run, since if you get out, you won't be able to get back in (and you'll miss the larger move).

In particular it gets rid of these things:
1) revenge trading: if you lose or miss a profit, there will be no more trades available to make your loss or missed profit back.
2) overconfident trading: if you win, there will be no trades available to return what you won by trading carelessly because you feel infallible.
3) doubling up on losers: if your trade is not going well, you won't be able to add it to by buying lower or similar. It either succeeds or fails, but you can't add to it.
4) hesitating when you're losing: you won't be tempted to second-guess your trade and exit early, because that's the only trade you can make today. But also, you will think about it more and choose more carefully, so you'll be less likely to have doubts about it.

And, the next day, whether you won or lost, you'll be over it.

Last edited by Yamato; Jan 26, 2010 at 5:29pm.
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