Nowler's Trading Journal

[Nowler]

When you are reading Constance Brown's book, I suggest you also read the chapter on Elliott Wave. In that chapter she mentions she is dyslexic and how she deals with it in trading (Page 288 of the second edition).

I put a little money aside this week so with another bit next week I should be able to buy it. Probably be here the week after.

Are you recommending I read up on the Elliott Wave itself or just read it for her take on dyslexia and trading?

 

[Brumby]

Are you recommending I read up on the Elliott Wave itself or just read it for her take on dyslexia and trading?

Basically her take on how she dealt with her dyslexic condition in trading. As for EW, unless you want to spend 10 years of your life learning it.

Also on price action I suggest you check out this website as there is a free course offered on trading. It is not those draw you in to buy stuff site. There are plenty of quality stuff in there.

https://adamhgrimes.com/marketlife-free-trading-course/

 

[Nowler]

Basically her take on how she dealt with her dyslexic condition in trading. As for EW, unless you want to spend 10 years of your life learning it.

Also on price action I suggest you check out this website as there is a free course offered on trading. It is not those draw you in to buy stuff site. There are plenty of quality stuff in there.

https://adamhgrimes.com/marketlife-free-trading-course/

Cheers mate.
I will check it out after the football today.
I looked into the EW before but I felt there were far easier things for me to learn first. EW seems like overkill to me but what would I know?!

 

[Nowler]

https://adamhgrimes.com/marketlife-free-trading-course/

This is great!

 

[Nowler]

Month 5, Week 1:

We had a storm here Sunday/Monday and we only got our power back Thursday but internet was dreadfully bad since then, so zero trading done this week. Not even any training/education as I had no internet. All I had was what was in my mind, so I ran through that I tried to work out a few things.

I am going to order that Constance Brown book shortly though...within the hour probably.
I also purchased 3x 1.5ft wide roll of... whiteboard style...stuff...
It's basically got the texture of a whiteboard/marker board and is sticky on the back. I just use a damp cloth to wipe the writing off it. This is mainly for trading but I'll jot down any important information on it.

I'll post a picture of it at some point but at the moment I just have a handful of markets written on it and then every half hour or hour during my trading days I am going to write down the price of those markets. This should help my understanding of said markets.

 

[dbphoenix]

Month 5, Week 1:


I am going to order that Constance Brown book shortly though...within the hour probably.

You may want to read the reviews of it.

 

[Nowler]

You may want to read the reviews of it.

The book itself is secondary.
I am only interested in the aspect of it that Brumby mentioned.

I won't be buying it new anyway, that's for sure... I will see if there are any digital versions of it first and if I can't find one then I'll look at buying a used one.

 

[Nowler]

Insight to my thinking processes:

Just sharing something that I was pondering today...

I was listening to someone explain aspects of trading today and I noticed myself taking comfort in knowing that this person I deem to be worth listening to is explaining stuff about trading that I already have an opinion/understanding of, and agree with.

...in my head this is confluence that I am on the right path. Then I wondered if I am wrong to do this... and whether this is confirmation bias or is it just confirmation?...Wondering how I could look at this from another angle and get a "bigger picture" perspective...

Just another day dancing in the dark...

 

[Nowler]

Attached to this are a few pictures of the roll of marker board that I was talking about :cheesy:

I got it for cheap on Wish and you basically just unpeel the back to reveal the sticky part and then rub on to the wall. Basically like a roll of wrapping paper...but white and laminated on one side. Simply wipe the board with a cloth and it's clean.

I got 3 x probably 1.5ft wide...6ft long?
I wouldn't trust the stuff to stay on the wall, particularly when over a radiator like in the attached pictures, so I added a few tacks to ensure it stays where I put it.

I used the offcuts on another wall which I plan to use to keep track of the interest rates and hourly market price change of a handful of pairs at a time (alternating perhaps).

A very useful item!
Very good if you want to make a drawing wall for your kids (or yourself)

 

[Brumby]

Insight to my thinking processes:

Just sharing something that I was pondering today...

I was listening to someone explain aspects of trading today and I noticed myself taking comfort in knowing that this person I deem to be worth listening to is explaining stuff about trading that I already have an opinion/understanding of, and agree with.

...in my head this is confluence that I am on the right path. Then I wondered if I am wrong to do this... and whether this is confirmation bias or is it just confirmation?...Wondering how I could look at this from another angle and get a "bigger picture" perspective...

Just another day dancing in the dark...

Unfortunately the path of a self directed trader is a path of self discovery. You are trying tp acquire the tools of the trade. Those tools eventually come together to form the foundation of your trading approach. In that journey, you will add, remove or refine those tools because of personality fit or lack of success. Such a path can be painful, frustrating and lengthy.

IMO you should try to ask members of these forum what they consider to be key components in their trading approach and trade plan. It might provide an insight into what is important in your own search for success.

I remember coming across an Indian saying :
"Those who know do not speak
Those who speak do not know
Since I have spoken I do not know"

At the end of the day, you need to apply your own filter because frankly those who know will be reluctant to speak. There is not much choice because without direction you will drift in the wilderness for a long time.

 

[Nowler]

Unfortunately the path of a self directed trader is a path of self discovery. You are trying tp acquire the tools of the trade. Those tools eventually come together to form the foundation of your trading approach. In that journey, you will add, remove or refine those tools because of personality fit or lack of success. Such a path can be painful, frustrating and lengthy.

IMO you should try to ask members of these forum what they consider to be key components in their trading approach and trade plan. It might provide an insight into what is important in your own search for success.

I remember coming across an Indian saying :
"Those who know do not speak
Those who speak do not know
Since I have spoken I do not know"

At the end of the day, you need to apply your own filter because frankly those who know will be reluctant to speak. There is not much choice because without direction you will drift in the wilderness for a long time.

I'm a sucker for a good saying!

Yeah i've not really asked many people how they trade yet or anything meaningful and specific to their trading style.
I wanted to develop at least the foundations of my own first.

Hopefully I don't have any electrical or internet issue next week. The week off was nice but i'd like to get back to doing some trading. I'm eager to see my trading stats move to the right side. The suspense is killing me since I don't have much else going on in my life

 

[Brumby]

I wanted to develop at least the foundations of my own first.

In order to build "a" foundation you need to know what that foundation represents. The obvious question is what do you regard as important components of that foundation?

I'm eager to see my trading stats move to the right side.

All traders want to make money. That is why we are in this speculative business. Wanting and achieving are two very different conversation. There are a few building blocks regardless of eventual trading style that you choose to adopt. The key operative word is "consistency". There is only one pathway to consistency and that is having a consistent trading process.

You need to address the following process :
1)What is your daily market preparation process?
2)What is your trade evaluation process?
3)What is your trade execution process?
4)What is your trade management process?
5)What is your post trade evaluation process?
6)How do you adjust your trading process as a result of (5)?

The key point is how do you conduct evaluation, achieve improvement and deliver consistency if you don't have a process bedded down?

 

[Brumby]

There are two youtube videos featuring how professional traders go about trading FX.

The first video walks through a number of strategies including factors for consideration when developing one.

The second video features how risk events are traded and the tools used.

 

[Lee Shepherd]

Nowler,

The white boards you have bought look great. Your office is starting to look very 'stock market trading' like.

If you are looking for people to say it looks fab, take my comment above along with everyone else that see's your office. However, the hurtful and truthful thing is that it is not needed and your money and time would be best spent elsewhere.

Get to know other long time successful people, get amongst those that trade full time for a living, go visit trading houses, seminars, prop firms and exchanges..... Network, get names and numbers, call people back!! You'll notice the same thing. They all look more akin to call centres these days. If you came to my office, you wouldn't even know the desk was a trading desk. There is no evidence, not even a scrap of paper.

Reason?
Its all done on computers nowadays with everything backed up on external servers to be accessed anywhere in the world by those with a pass. Many years ago as computers were coming in play, many old school would argue it was rubbish against books, they kept crashing, were slow and unreliable and you couldn't take them with you on the train. Now look at technology, we have in our pockets a reliable computer and every book in the world at our disposal. This goes the same for all trading related material.

I know you've only just bought them, but get rid of them. You will waste valuable time (and money) on updating them when you should be at your desk. With a suitable program - and any basic excel is by far quicker and more accurate than a white board - you would become more proficient in time management. We all only have 24 hours a day, so why does one person earn x amount whilst another complains about minimum wage or not 'having the money' to do this or that?

What I'm saying in a nutshell (throughout my waffling), is, do not be reliant on old technology. Get with and embrace the new.

Lee

 

[Nowler]

In order to build "a" foundation you need to know what that foundation represents. The obvious question is what do you regard as important components of that foundation?

For me, the most important component of my trading is risk/money management. With it, I have the freedom to be wrong without being piledrived into the ground. Without it, along with risking being piledrived into the ground it would also be a huge shame to be so reckless with something I'm putting so much effort into.

All traders want to make money. That is why we are in this speculative business. Wanting and achieving are two very different conversation. There are a few building blocks regardless of eventual trading style that you choose to adopt. The key operative word is "consistency". There is only one pathway to consistency and that is having a consistent trading process.

You need to address the following process :
1)What is your daily market preparation process?
2)What is your trade evaluation process?
3)What is your trade execution process?
4)What is your trade management process?
5)What is your post trade evaluation process?
6)How do you adjust your trading process as a result of (5)?

The key point is how do you conduct evaluation, achieve improvement and deliver consistency if you don't have a process bedded down?

You have been so helpful mate, so I hate to pester your further but, if I am misunderstanding, could you go into a bit more detail with these please?

1)What is your daily market preparation process?
- My daily process is to use the homework I do on a Sunday (where I find potential pressure to use as an edge when taking trades). I look to refine that throughout the week of course with emerging information. When I sit down to trade I will open the chart/s where I have identified potential pressure and I will analyse that/those charts first, looking for setups to the direction of the perceived pressure. I will also open up my Autochartist Market Scanner which I set to identify 80+% probability trades. I don't really trade the more exotic pairs because the spread to just silly. MAYBE if it's a potential move where I stand to make a 2-3:1 Risk/Reward then I might consider it. But typically I will stay away if I see a large spread (I kinda know where to expect em now)...there are plenty of opportunities in the majors and the less exotic...exotics.


2)What is your trade evaluation process?
- It's very early stages still in my trading life but what I am attempting to establish as trade evaluation is as follows. I like the MACD...I know I don't NEED to use indicators but I feel that the MACD is something that I can make good use of. The evaluation I am trying to establish is: Does the setup meet my level of confidence that it will be completed? Is this setup supported by fundamentals? If previous price structure/levels of interest/S+R indicate that the trade is likely to complete then I'll take the trade. I don't necessarily need fundamentals to agree with me but if it opposes what I am seeing in a set up then I shouldn't take the trade. I will look to the MACD to see if it's highlighting any warnings... ie. divergence against my trade direction. Also, is there any economic releases due to be released during the life of this trade? If so, workout the likely outcome of such data and how it will be perceived.


3)What is your trade execution process?
- I'm not entirely sure what you mean by this... Once I have worked out whether the trade is worth taking, I will either execute a market order or an entry order. I am not sure which I use more but I am comfortable using both market and entry orders. It really depends on the particular situation or set up for whether I use a market order or not. I guess I use the market orders for setups which are imminent and entry orders for trades which likely still have a bit more to go before being ready. Before I place the trade I work out my stop loss level. I do often place the trade and then immediately put my stop loss on, or else I will place it before I hit the button to enter the trade. The reason for this is that it's easier to place the stop after I enter the trade as opposed to beforehand. I'm not saying it's difficult to do before I enter the trade, I'm just saying the process is easier when I do it after I enter the trade. Don't mistake this for entering a trade and then figuring out where to place my stop. I know where my stop will be before I place a trade. Take profits are placed 99% of the time also. The shorter the intended trade time, the more likely that my take profit will be in place.


4)What is your trade management process?
- Because I work out my stop and TP beforehand, I shouldn't need to much trade management. Depending on the trade, I might add to it on a pullback. Moving stops back further is a bad habit I used to have and it hurt me quite a few times. Now, I work out what I think is likely to happen and I let it run. I do still take profit manually sometimes. I know some say this is a bad habit but at times I either just don't want to wait for that extra pip or 2 if price is running into resistance pretty much at my TP level.


5)What is your post trade evaluation process?
- If the trade was successful then I don't really evaluate it, per se. I mean... I carry out analysis beforehand, so if the trade was a success then I wouldn't cut it open to have a closer look. If I lose the trade then I will wonder why it failed. Where did my analysis go wrong? Can I see contradicting information in hindsight? Was it just bad luck?


6)How do you adjust your trading process as a result of (5)?
- This is difficult to say without a specific example but I will look to the tools I use to give reason to take the trade. Did I use the MACD? Did I use it right? Is there any reasons from the past price structure to suggest that the trade might not be successful?

There are two youtube videos featuring how professional traders go about trading FX.

The first video walks through a number of strategies including factors for consideration when developing one.

The second video features how risk events are traded and the tools used.

Thank you very much for the videos mate. I'm watching football now but I'll look at them in about 3-4 hours

 

[Nowler]

Nowler,

The white boards you have bought look great. Your office is starting to look very 'stock market trading' like.

If you are looking for people to say it looks fab, take my comment above along with everyone else that see's your office. However, the hurtful and truthful thing is that it is not needed and your money and time would be best spent elsewhere.

Get to know other long time successful people, get amongst those that trade full time for a living, go visit trading houses, seminars, prop firms and exchanges..... Network, get names and numbers, call people back!! You'll notice the same thing. They all look more akin to call centres these days. If you came to my office, you wouldn't even know the desk was a trading desk. There is no evidence, not even a scrap of paper.

Reason?
Its all done on computers nowadays with everything backed up on external servers to be accessed anywhere in the world by those with a pass. Many years ago as computers were coming in play, many old school would argue it was rubbish against books, they kept crashing, were slow and unreliable and you couldn't take them with you on the train. Now look at technology, we have in our pockets a reliable computer and every book in the world at our disposal. This goes the same for all trading related material.

I know you've only just bought them, but get rid of them. You will waste valuable time (and money) on updating them when you should be at your desk. With a suitable program - and any basic excel is by far quicker and more accurate than a white board - you would become more proficient in time management. We all only have 24 hours a day, so why does one person earn x amount whilst another complains about minimum wage or not 'having the money' to do this or that?

What I'm saying in a nutshell (throughout my waffling), is, do not be reliant on old technology. Get with and embrace the new.

Lee

Booooo... boooo Wendy Testaburger!
South Park reference

Thanks for the input mate.

I don't really mind if people think it looks good or not. It's there for a function, not as a glamour accessory. The laptop I am using is not actually mine. My own one packed it in about 4 months ago and I just don't have the money to buy another one just yet. I could if I really had to but as it stands I still have access to a laptop and I can pay more money off my debt this way. Unfortunately I won't be getting another laptop this side of christmas as I am probably going to be set back about 25% of my current debt this coming week or 2 as I likely need a root canal... I will have to take out a loan of €500 or whatever it is for those nowadays as the dentist does not accept a payment plan... life is certainly not easy folks...it's not easy at all...

Anyway, this laptop doesn't have microsoft office anymore for some reason and I certainly wont be paying for it. By writing down the hourly change in price of a handful of markets, I will better understand the current state of those markets, at least in relation to each other. Same with the interest rates... writing these down for a while will eventually build up a mental representation of them which I can automatically lean on...

Even without all of that, it makes me feel productive and considering how horrible my home life is, i'll take happiness anywhere I can get it.

In regards to getting to know long term successful people...those are in short supply in this area
Apart from this forum, I have no contact with other traders...I live in rural Ireland and cannot afford to get back on the road again. Maybe if I can get something going in a career/financial sense then I can improve this...

 

[Brumby]

For me, the most important component of my trading is risk/money management.

As Alexander Elder puts it, there are 3 M's in trading : Method, Money management, and Mind. You don't seem to have an issue with mind ... at least not yet. With MM, we have discussed before and so I will not labor further. That leaves method. So what are the pillars to your method?

- My daily process is to use the homework I do on a Sunday (where I find potential pressure to use as an edge when taking trades). I look to refine that throughout the week of course with emerging information. When I sit down to trade I will open the chart/s where I have identified potential pressure and I will analyse that/those charts first, looking for setups to the direction of the perceived pressure.

What is the meaning of "pressure" in your vocab. and its data source?

It's very early stages still in my trading life but what I am attempting to establish as trade evaluation is as follows. I like the MACD...I know I don't NEED to use indicators but I feel that the MACD is something that I can make good use of. The evaluation I am trying to establish is: Does the setup meet my level of confidence that it will be completed? Is this setup supported by fundamentals? If previous price structure/levels of interest/S+R indicate that the trade is likely to complete then I'll take the trade. I don't necessarily need fundamentals to agree with me but if it opposes what I am seeing in a set up then I shouldn't take the trade. I will look to the MACD to see if it's highlighting any warnings... ie. divergence against my trade direction. Also, is there any economic releases due to be released during the life of this trade? If so, workout the likely outcome of such data and how it will be perceived.

There are many things to unpack based on what you have said. For the time being I would just focus my question on time frame. Trading time frame is in my view a potential source of confusion in developing a trading system or a set of methodologies. If you are planning to use MACD in your approach, have you bedded down which time frame will be the basis of your trade decision, set up, trigger, stop and target? If you are using multi TF, a usual source of conflict is typically which TF becomes your trading TF.
Additionally, if your trading TF is 5 min or 15 min, then your total trade cycle is likely to be short. In contrast, if your trading TF is 1H or 4H, then your trade cycle will be much longer and potentially can bump into economic and data releases. Your trade plan in the latter might have to consider other open trade management scenarios as opposed to shorter cycles.

3)What is your trade execution process?
- I'm not entirely sure what you mean by this... Once I have worked out whether the trade is worth taking, I will either execute a market order or an entry order. I am not sure which I use more but I am comfortable using both market and entry orders. It really depends on the particular situation or set up for whether I use a market order or not. I guess I use the market orders for setups which are imminent and entry orders for trades which likely still have a bit more to go before being ready. Before I place the trade I work out my stop loss level. I do often place the trade and then immediately put my stop loss on, or else I will place it before I hit the button to enter the trade. The reason for this is that it's easier to place the stop after I enter the trade as opposed to beforehand. I'm not saying it's difficult to do before I enter the trade, I'm just saying the process is easier when I do it after I enter the trade. Don't mistake this for entering a trade and then figuring out where to place my stop. I know where my stop will be before I place a trade. Take profits are placed 99% of the time also. The shorter the intended trade time, the more likely that my take profit will be in place.

Trade execution can be a number of ways including at market; limit in or stop in. Depending on trading approach, there is the option to scale in. A common problem is fear to trigger after a string of failures. A trade execution process and approach can be designed to compensate a trader's trade psyche issue. It is not unusual that there can be conflict between trade execution and a trader's behaviour.

4)What is your trade management process?
- Because I work out my stop and TP beforehand, I shouldn't need to much trade management. Depending on the trade, I might add to it on a pullback. Moving stops back further is a bad habit I used to have and it hurt me quite a few times. Now, I work out what I think is likely to happen and I let it run. I do still take profit manually sometimes. I know some say this is a bad habit but at times I either just don't want to wait for that extra pip or 2 if price is running into resistance pretty much at my TP level.

Interestingly to note that you don't have open trade management issues ..... maybe not yet.

5)What is your post trade evaluation process?
- If the trade was successful then I don't really evaluate it, per se. I mean... I carry out analysis beforehand, so if the trade was a success then I wouldn't cut it open to have a closer look. If I lose the trade then I will wonder why it failed. Where did my analysis go wrong? Can I see contradicting information in hindsight? Was it just bad luck?

Do you document every trade that you take and the trade plan that goes with it?

6)How do you adjust your trading process as a result of (5)?
- This is difficult to say without a specific example but I will look to the tools I use to give reason to take the trade. Did I use the MACD? Did I use it right? Is there any reasons from the past price structure to suggest that the trade might not be successful?

If you do not implement (5) then it is unlikely you will be able to conduct (6)

 

[Nowler]

As Alexander Elder puts it, there are 3 M's in trading : Method, Money management, and Mind. You don't seem to have an issue with mind ... at least not yet. With MM, we have discussed before and so I will not labor further. That leaves method. So what are the pillars to your method?

I am not quite clear on what you're asking here. The pillars of something, to me, is the basic backbone of something...? The pillar of my method is to get in and get out as quick as I plan to (I don't think I would like to trade any lower than 15 min time frame). I must stand to gain pretty much a 1:1 R/R but I always want it to be more. Risk management is vital! Support and Resistance is a big part of my trading...I watch price in those areas and look for confirmation that price is going one way or the other. Knowing where I expect price to go and to not go is key! I'm not really sure what else to say here. I'm so bad at explaining myself...

What is the meaning of "pressure" in your vocab. and its data source?

What I mean by pressure is a likely push in a particular direction. Interest rates for example, a currency with higher interest rates is more attractive to investors than one with low rates. In that sense the "pressure" is in the direction of the currency with the highest rate. Obviously there is far more at play than just the interest rates, and a market could run in the direction of the lower rate too. Similar with inflation also...I believe slightly under 2% is what most countries are aiming for... if a currency/country has an inflation rate of 10% vs another with one of about 2%, then I would say that on that dimension the pressure is with the one with the optimal inflation rate. Again, there is more at play than just inflation rates also. I am just looking for things to put the probability of that coin flip in my favour and then provided my money/risk management is correct, I should be making money with even just a 40% win rate. I use support and resistance for targets and stops...

There are many things to unpack based on what you have said. For the time being I would just focus my question on time frame. Trading time frame is in my view a potential source of confusion in developing a trading system or a set of methodologies. If you are planning to use MACD in your approach, have you bedded down which time frame will be the basis of your trade decision, set up, trigger, stop and target? If you are using multi TF, a usual source of conflict is typically which TF becomes your trading TF.
Additionally, if your trading TF is 5 min or 15 min, then your total trade cycle is likely to be short. In contrast, if your trading TF is 1H or 4H, then your trade cycle will be much longer and potentially can bump into economic and data releases. Your trade plan in the latter might have to consider other open trade management scenarios as opposed to shorter cycles.

This is an interesting question because I dont trade to a set few timeframes, especially when the likes of the market scanner I use can flag trades on a 4hr TF, which I am also happy to take and sometimes even longer trades (which I am less likely to take, but might). If I am not using the market scanner at all then the vast majority of my trades are on the 30min-1hr TF... I'll use the 15min and 5min to fine tune the entry but things like the stops and TP's are typically chosen from the 30min/1hr TF. Not always, but the vast majority of the time.

I do get a bit confused though when jumping through the 5, 15, 30min TF's looking for the trigger to the trade. I feel like sometimes I am just looking for the 1 window which confirms a trigger but yet ignoring the other 2 not showing it... Say for example I identify a trade on the 1 hour. I'll go down to the 30min to have a closer look at price action/movement because perhaps the pullback I am looking for/expecting is not visible on the 1hr but is on the 30min or the 15min... isn't this confirmation bias? But...isnt it kinda working? My overall win rate is 46% which I think is decent, especially considering all of the losses a new trader is bound to have in the beginning. A 46% win rate, with a baseline of 1:1 R/R and often more than that... isn't that something some people would kill to have? Forgive me if I am being naive or green.

Trade execution can be a number of ways including at market; limit in or stop in. Depending on trading approach, there is the option to scale in. A common problem is fear to trigger after a string of failures. A trade execution process and approach can be designed to compensate a trader's trade psyche issue. It is not unusual that there can be conflict between trade execution and a trader's behaviour.

I am not sure what a stop in is, I will need to google that but all I have is a market order for buy/sell or an entry order to buy/sell. I cannot scale out of a trade. As in, I cannot reduce my unit size. I am aware of lingo about lots, micro lots and what not but Oanda use units. So for example, I have 50 units on a trade, I cannot close part of that. If I enter in the opposite direction to that trade with half of the initial trade, I will just be closing the 50 unit trade and now be in for 25 in the other direction. Maybe I am misunderstanding what people mean by scaling out of a trade. I believe some use that terminology when moving their stops up. Perhaps when I am hearing about people scaling out of a trade, they are scaling out the trades they scaled into? So are closing some of the smaller trades as opposed to reducing the size of the one bigger trade? I'm just after confusing myself again

Interestingly to note that you don't have open trade management issues ..... maybe not yet.

I guess I do actually have open trade management issues in the sense of the longer TF trades I sometimes take that run into economic releases. But I really need to do better to assess how long a trade is likely to run for, or if it is likely to be finished by the time of a new release... Then again, I could just decided that if I am in a trade coming up to a release and the trade is not specifically based on that release then as standard, I should close the trade.

Do you document every trade that you take and the trade plan that goes with it?

I don't document every trade, no. We spoke a little about this a few days ago and I said I'll attempt to do it more but as a whole, up to this date, no, I don't document them all. I do document some, as I agree that it's important to do so in order to figure out where I am going wrong but I just dont see a need to write down every single one. Perhaps if all my trades were very different in methodology then documenting all might be smarter but I largely follow the same few setups, so if I am losing an alarming number of trades then pulling any 3-4 samples at random from a pool of 20 losers for example should be a fair representation of my overall losing population. Perhaps later losses lose comparative relevance to older losses in a sense, particularly for me as a new trader as older losses should be due to issues no longer in my game. Some of my early losses were so silly! I hope I am not being naive here but I like to think that my recent losses are far less silly mistakes than those early ones.
There is nothing super complicated about my trading... there are not many components to it. So If I lose a trade and it was not due to bad luck then I, for the most part, am able to identify why I lost it. When I write down a trade I do write down my reason for entering it.


But back to this 46% win rate...
Can my trading really be all that bad if I have a 46% win rate and always ensure my stops are in place? Apart from the experimental period of 2-3 weeks where I was trading 4% per trade, I now keep it under 2%...so again, can my trading really be all that bad?

I do notice some improvement in my game, partly from the generous efforts from yourself and a few others. Then there's the improvements that naturally come due to exposure to something. I am untrusting of people in general and I have my reasons. I'm sure you can see my reluctance at times when you're advising me but just know that I am listening to you and I am certainly better off now than I was before I made this journal, so thanks mate. Please don't get too frustrated with me

 

[Nowler]

I do notice some improvement in my game, partly from the generous efforts from yourself and a few others. Then there's the improvements that naturally come due to exposure to something. I am untrusting of people in general and I have my reasons. I'm sure you can see my reluctance at times when you're advising me but just know that I am listening to you and I am certainly better off now than I was before I made this journal, so thanks mate. Please don't get too frustrated with me

Just to clarify...
I didnt quite fit the educational system when in school and in order to get where I am now I had to work extra to do it myself. That's what I mean by reluctance. The educational system failed me and it no doubt contributed to my reluctance to do anything that I have not come up with myself. I do realise that this can be damaging, but it also has it's good points. I do try to see things from other people's point of view and am trying to see it from yours.

 

[Brumby]

The pillar of my method is to get in and get out as quick as I plan to (I don't think I would like to trade any lower than 15 min time frame). I must stand to gain pretty much a 1:1 R/R but I always want it to be more. Risk management is vital! Support and Resistance is a big part of my trading...I watch price in those areas and look for confirmation that price is going one way or the other. Knowing where I expect price to go and to not go is key!

Feel free to question if you don't understand what I am saying.

The point about "method" in trading is simply this. Is there a method to the madness or is it simply madness? If for example, you tell me you have a magical coin and your trade decisions are based on flipping that coin. Being magical, it gives you high accuracy unlike normal coins. But say after some time your coin looses its magical ability. It doesn't generate the desired outcome. How do you fix the problem? Your entire methodology is dependent on its "magical" attribute. Let's turn back to your case. How do you evaluate the success or lack of a method based on "being in and out quickly" or "in your opinion where price should go"? How do you fix such an approach should your trade outcomes do not generate the expected results? Is your "edge" derived from your opinion about price action or being nimble? It is often said, if you don't know what your edge is you probably don't have one.
The aim of my questions is to help you to build clarity around your own methodology. Do you have one that you can define in simple terms? If you cannot define it, how are you going to evaluate its performance and make adjustments for improvement?

What I mean by pressure is a likely push in a particular direction. Interest rates for example, a currency with higher interest rates is more attractive to investors than one with low rates. In that sense the "pressure" is in the direction of the currency with the highest rate. Obviously there is far more at play than just the interest rates, and a market could run in the direction of the lower rate too. Similar with inflation also...I believe slightly under 2% is what most countries are aiming for... if a currency/country has an inflation rate of 10% vs another with one of about 2%, then I would say that on that dimension the pressure is with the one with the optimal inflation rate. Again, there is more at play than just inflation rates also. I am just looking for things to put the probability of that coin flip in my favour and then provided my money/risk management is correct, I should be making money with even just a 40% win rate. I use support and resistance for targets and stops...

You have a general idea about fundamentals but you don't know how fundamentals are applied in trading. It is a lot more complex than what you think. I use 50 % fundamentals and 50 % technical to trade. Market pricing on prospective interest rate movements is constantly in a state of flux and is very much driven by economic data. For example, last month the market priced in above 80 % probability that the BOE will raise interest rate in November but since then that probability is closer to 60 % because of recent inflation data especially with wage growth or to be precise a lack of. It is a highly complex approach and not as you think. This topic is a big subject in itself and I will stop here.

This is an interesting question because I dont trade to a set few timeframes, especially when the likes of the market scanner I use can flag trades on a 4hr TF, which I am also happy to take and sometimes even longer trades (which I am less likely to take, but might). If I am not using the market scanner at all then the vast majority of my trades are on the 30min-1hr TF... I'll use the 15min and 5min to fine tune the entry but things like the stops and TP's are typically chosen from the 30min/1hr TF. Not always, but the vast majority of the time.

I do get a bit confused though when jumping through the 5, 15, 30min TF's looking for the trigger to the trade. I feel like sometimes I am just looking for the 1 window which confirms a trigger but yet ignoring the other 2 not showing it... Say for example I identify a trade on the 1 hour. I'll go down to the 30min to have a closer look at price action/movement because perhaps the pullback I am looking for/expecting is not visible on the 1hr but is on the 30min or the 15min... isn't this confirmation bias?

This issue is best discussed using your own trade examples where you might have conflict in using different TF. I can give you examples but that might not be meaningful to you because of your trade methodology.

I suggest you post a trade plan where we can discuss.

But...isnt it kinda working? My overall win rate is 46% which I think is decent, especially considering all of the losses a new trader is bound to have in the beginning. A 46% win rate, with a baseline of 1:1 R/R and often more than that... isn't that something some people would kill to have? Forgive me if I am being naive or green.

A win rate of 46 % with a RR of 1 is negative expectancy. Your account will bleed. It is simple maths. Just google if you are not familiar with how expectancy is calculated.

I am not sure what a stop in is,

A stop in is generally used to trade break outs. Prices have to trade above or below a certain stop price to trigger you into a position. In contrast limit in, is typically used to buy pullbacks. Different trade methodologies require different entry orders.

Perhaps when I am hearing about people scaling out of a trade, they are scaling out the trades they scaled into? So are closing some of the smaller trades as opposed to reducing the size of the one bigger trade? I'm just after confusing myself again

A scale in strategy is used when you are buying pullbacks but the retracement points can be 38 %, 50 % or 62 %. They are all valid entry points but can only be known after the fact. By scaling in, you ensure you don't end up with your full position size at say 38 % even if the pullback reaches 76 %. By scaling in you also want to make sure you have at least a portion of your position if the retracement is only 38 %. It is sometimes frustrating to watch a trade move strongly away without you. Scaling out is the same principle.

I guess I do actually have open trade management issues in the sense of the longer TF trades I sometimes take that run into economic releases. But I really need to do better to assess how long a trade is likely to run for, or if it is likely to be finished by the time of a new release... Then again, I could just decided that if I am in a trade coming up to a release and the trade is not specifically based on that release then as standard, I should close the trade.

How long you would hold your trade is a function of your trade plan. If you don't have a trade plan or if you are confused by multiple TF, then you effectively don't have plan

I don't document every trade, no. We spoke a little about this a few days ago and I said I'll attempt to do it more but as a whole, up to this date, no, I don't document them all. I do document some, as I agree that it's important to do so in order to figure out where I am going wrong but I just dont see a need to write down every single one. Perhaps if all my trades were very different in methodology then documenting all might be smarter but I largely follow the same few setups, so if I am losing an alarming number of trades then pulling any 3-4 samples at random from a pool of 20 losers for example should be a fair representation of my overall losing population. Perhaps later losses lose comparative relevance to older losses in a sense, particularly for me as a new trader as older losses should be due to issues no longer in my game. Some of my early losses were so silly! I hope I am not being naive here but I like to think that my recent losses are far less silly mistakes than those early ones.
There is nothing super complicated about my trading... there are not many components to it. So If I lose a trade and it was not due to bad luck then I, for the most part, am able to identify why I lost it. When I write down a trade I do write down my reason for entering it.

Having a trade plan is an important component in developing a discipline trading process. If you don't have one, you will be building your trading on sand.

I do about 20 trades a week, I have a trade plan for every trade I take with documented trade screens using SnagIt and archived. I have been doing this for years. Some times I slack but over time it becomes part of your daily routine.