The Trials and Tribulations of a Trainee Trader

richy96

Member
54 2
@SBS
Oh forgot to mention

As I am self employed, for a couple months a year I have to work flat out.... for about two months a year in the summer I pretty much don't have to do anything (apart from live off the earnings from those few busy months) and the rest of the year I have to work a varying amount

So regards the US shares, I am genearally finished work by 3 or 4pm then have free time till 8pm or so when we eat dinner and settle down - apart from those couple of busy months of course when god (if one actually existed) knows what time i finish work!!

Oh and I never work Mondays. This is because when I worked for a salary I hated Mondays so once I went self employed I changed to a Tues-Sat working week.

Despite that choice, somehow, Tuesdays never seem quite as bad as Mondays did

So given that work pattern, this is why I think the US market and maybe commodities is a good place for me to trade

Oh had agood chat with the wife tonight. She's a couple of weeks behind my path with this.... but she sees herself as an 'in - grab - out.... repeat' sort of trader. Many trades, multiple small profits (or losses) per day. I guess that puts her as a classic wannabee 'day trader'?

Who am I to disagree with that? Thought it does not sound my cup of tea, I hardly know what I am talking about myself yet, but I did say to her - if that is where you feel your abilities lie then you should go for it. On paper of course :)

I really should get her to open a profile here. I know she has been reading up in her own way on her own time though I don't know and didn't ask where, so maybe she did come here.

IMHO I must not interfere with her journey, she's a canny lass so has to find her own feet.... and hang on to her own head and own blouse of course (though she does look rather nice without it lol) :D

Damn it she will probably do better than me 'cause she's a smart one ;)

Rich
 
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mike.

Senior member
2,101 709
Little something for you and the wife to watch Rich.

Dont start watching them tonight or the wife will kill me. ( once you start, its hard to stop ) :LOL: :LOL:



 

kimo'sabby

Experienced member
1,622 287
@kimo'sabby - I canlt quite understand the lines on your chart, could you elaborate?

Rich


The lines could have any meaning or value within the system concept spectrum, ranging from the simplistic to the complex, they are abstract.
 

richy96

Member
54 2
OK I have analyzed my performance based on the suggestions SBS gave me regards entry and exit points

The magenta lines represent my trades from open to close.

You can clearly see my first entry point X was badly timed as I went long at much too high a spot on the chart

This trade eventually netted me £498.18 but could have been so much better exectued

My next set of trades all started around line A which seems to be pretty close to the earlier support level of$4.540 (one is very hard to see on this graph is it is within one of the green candles) and I terminated themin the region of C

This batch of trades netted me a total of £995.69 and looking at the chart in retrospct I feel I exectuted these reasonably well for a beginner. Is that a fair assessment of my own performance?

The last two trades were opened around what looked to me at the time the new support level of about $4.526 though in actual fact the market moved against me for 30 mins - 1hr before rallying strongly. These all closed at position D after blowing out my profit calls at $4.632, together with my original trade which I started at point X, much too high, but then held on to on the conviction there would be a sudden surge in price following events in Ukraine. These three trades netted me £4808.12

I'd welcome comments, and yes, criticism of my performance, as this will hopefully help me learn to be a better trader, which after all is what we are all here for?

cheers
Rich

PS I obviously know my original position X was badly placed. I should have looked at the bigger picture before placing it, so you don't need to tell me that lol

PPS The Nat Gas market is open today but I am waiting to see if I can spot any trend before trading again.
 

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richy96

Member
54 2
OK it's time for another update

Over the last couple of days things have not been working too well for me - especially on the Nat Gas!

I got a bit bold with my winnings from last week and I've made three trades on gas all of which netted a loss and my total losses came to £2745.03 To be honest I m pretty much digusted with my performance this time.

The first of these bad trades was placed long $4.720 for 35000 contracts on 21/04 @ 18.24 but the gas price steadily declined that day and at a steeper rate than it was doing when I was trading against the market before that big jump. Because if that I was unable to get out of the trade at a profit and decided to leave it over night. If finally colsed out on a stop loss price of $4.677 at 09:26 and lost me £909.88

Unfortunately for me I then decided to place a position short $4.677 (when I had already told myself i would only trade long on Nat Gas) though i did put a guaranteed stop loss on this trade as I thought i would try that. This was placed on 22/04 at 09.38am as the decline in prices was still continuing. Of course the price instantly rallied, I placed another position short when it seemed to peak at $4.693 but it rallied again. The first of these closed out on me at $4.729 and I instantly closed the second one myself to prevent any further losses. However like I said I was £2745 down having had my fingers burnt badly.

I put this nasty little episode down to

Trying to trade a market after a big price jump when I couldn't see a clear pattern of trading

Bad discipline!! I twice went short in a market I had already decided to only trade long when conditions seemed favourable (market at or near previous support level). I also traded in an attempt to 'get back at the market' and cover my previous loss

The first of these three bad positions would have actually made me a decent profit if I had not set a stop loss - I need to think about the ramifications of that as I probably would not have entered the other two positions if I had let the first one pan out

OK some lessons learnt the hard way but in a strange way this maybe did me a favour. If things had gone well again I could easily start getting very over confident. And at least I still have a bit over £3000 of my previous gains so it's not all disaster.


I have also made three trades on shares again yesterday (Pandora /Ctrip) which netted me £140.98

Nothing too exciting to report about these but I have come to the realisation that I feel much more relaxed when I am in this sort of trade. Seeing as my intention is to earn £40 a day from trading I feel more confident I can achieve that goal in these sort of trades without ever riding the rollercoaster that seems to be Nat Gas prices!!

However I would still like to see if I can learn to effectively ride the rollercoaster, as a chllenge more than anything else

So what I have now done is to open a second demo account - I have two internet lines and 3PCs here in my office (the wife has her own PC) as I run my main business from home so one of these accounts is running on my 30m/bit cable line and the other on my 10m/bit DSL

I never set this up with the intention or even the idea of trading but from what reading I have done it could be an ideal setup for that purpose!

One demo account (the first one) I have £22.902.90 with no postions currently open and from henceforth I will use this one to hone my share trading techniques - with the intention of making £40 a day consistently. If this proves to be consistent and successful I will eventually graduate to a live account to trade by the same methodology

The other one has a fresh £20000 in it and I will use this for commodity trading only (Nat Gas for now but probably others later) and see whether or not I can learn to successfully ride that rollercoaster

I have by the way been watching the Nat Gas market today and very nearly placed a long trade $4.730 at around 11:35 this morning as I think I have spotted what looks like a new support level.

However I did not place it. If i had of done I could have closed out around $4.780 and netted £1750.00 on my usual contract size. Though I did not trade, I am encouraged by the fact I predicted a price rise in price coming. Prices have trailed off a bit now, if I see them hit what looks like the support level again I will certainly place a position this time

On the graph below you see the long position I did not place around 11:35 (though was extremely tempted) and S is the line where I perceived the support level to be

Rich
 

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richy96

Member
54 2
OK guys just a quick report back

I did as I stated separate two trial accounts, one to trade shares and the other Nat Gas and other commodities

Sticking with what I am comfortable with, I place two four trades on Pandora and as I was not seeing much of interest on Ctrip I had a look around and found another likely candidate (share with a regular long term trend but just a nice amount of 'waggle' room) in a US clothing supplier called Abercrombie & Fitch

The result of these four trades was basically a £100 loss which I closed out myself and three gains totalling £98. The loss was my first trade which was Pandora. Interesting (to me) again, if I had not closed out that trade it would have made me a profit in 3-4hours

So pretty much break even there

The Nat Gas turned out to be much more interesting I think.

After I ducked out on a trade yesterday that would have made me a damn good profit (but at least I predicted it) I placed just three more trades as I found the market increasingly readable which made me respectively approx £80, £1200 and £600 so three winners on the run and a net gain of around £2000

I then saw a fourth trade looming as the pattern reset itself once again but this ime I didn't take it as I am about to fly out to the Canary Islands early in the morning for a week of sunshine

Howeve i 'gave' the tip to my friend who went 4K down last week when I got very lucky - he did take the trade and depending when he ducked out he could have made ~ £1000

The position sizes I am taking on Nat Gas BTW are around £650

I saved the graphs for these last few trades as I would like to discuss them here in a bit more detail when Iget back.... but for now it's sun sea, the other S word, and some trading related reading lined up on my Android Tablet

Back in a week and will post those charts of my latest trades

for now though.... see you all soon

Rich
 
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richy96

Member
54 2
Hi

Well I am back from a week in the very sunny (and somewhat windy) Canary Islands and I have decided to look at the last few trades I made before I went on holiday to see if I can determine what went wrong (and right)

All these were placed on Natural Gas

The first one was a long position 35000 contracts approx £650 before leverage

Open $4.720 at 18:24 on 21/04 (point A on attached chart)
Close (on Stop Loss) $4.677 at 09:26 on 22/04 (point B attached on chart)
Net Loss £909.88
Chart is 1 hour candles

Looking at this trade in retrospect I can understand why I placed the position long at the point I did (price looked like it was at a support level and had been so for about 2 hours)

The market move rapidly and strongly against me at around 19:00 and my position closed on a stop loss I had set before 'hitting the sheets' for the night.

I'm extremely frustrated over this trade, as you will see from the chart my stop loss was placed very near or even at the lowest price point. Yet I placed it by looking back to the 17th April (first candle on this chart - point F) as this looked like a previous low point

If I had set my stop loss even a few tenths of a cent lower I would have still been in position. By 2pm the following day (point C) I would have broken even and by 21:00 that day (assuming I didn't close at a profit earlier) I would have a profit of £1120 as the price looks to have peaked around $4.752 at ponit D

My best guess is I shot myself in the foot with my own stop loss order. Or I was just damn well unlucky to the point of it all looking like a conspiracy agaisnt me lol

What lessons should I really learn from this trade though - that stop loss orders are not such a good thing? Did I place something wrong? Was I just really unlucky?

It's obvious in hindsite this could have been a winning trade (and a damn profitable one too) if I had just held the position a while longer - and the low point would not have been any worse than my chosen stop loss either

So from what little I learned so far this trade all looked like a good idea at the time. but what a mess!

I'd love to hear some advice over this from you guys, however I do have a few more charts to post yet... the next two were also losing trades on Nat Gas on 22/04
 

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mike.

Senior member
2,101 709
Rich, If your daily target is £40, why are you making such big trades on your demo ? you are trading with two accounts with 20k in each, Is this the account size you are planning to trade live with ? if not, why dont you try spreadbetting some of the stocks , 40 points at £1/point intraday should be achievable.
You would not need nowhere near that account size for £1 per point stakes, £500 area.
 

richy96

Member
54 2
Next two trades went bad on me

I got onto what I thought was a bearish trend

I read that completely wrong

Having looked back at the chart for the hourly candles (and also the second one which is four hourly) I can see why I though that was the case as it looked like the big jump upward on the 17th April (which I profitted from nicely) was gradually being reversed

Despite making a rule that I would only go long on Nat Gas due to the Ukraine situation I then broke my own rules and placed two postions short. If i had not broken my own rule I would have waited a bit and probably gone long a couple of hours later

First Trade (A on hourly Chart)
Short 35000 contracts approx £650 before leverage
Open $4.677 on 22/04 @ 09:38
Close $4.729 on 22/04 @ 13:17 on Stop Loss Order (C on chart)
Net Loss £1139.16

Second Trade (B on Hourly chart)
Short 35000 contracts approx £650 before leverage
Open $4.693 on 22/04 @ 10:35
Close $4.730 on 22/04 @ 13:21 manually closed (C on Chart)
Net Loss £909.88

Looking at the charts I could have eventually have made a profit of around £3850 from these two positions combined if I had closed around midday of 25th - three days later however in the process I would have been about £8050 down at the worse point in between!!

To put these trades into the bigger picture, they were between points X and Y on the four hourly chart - which is why I thought prices were gonna fall. I was wrong,

The most sensible thing I think I did was get out of this trade. And I am not going short on again Nat Gas again while the Russia/Ukraine situation continues

So with that in mind, and licking my wounds, my next few trades on Nat Gas in the following days were good ones and recouped a large portion of my losses.....

Now let's see what if anything I did differently

To Be continued...
 

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mike.

Senior member
2,101 709
Thats the second time i've been ignored, wont be commenting again on this thread.
 

richy96

Member
54 2
Hey Mike
Sorry you feel I was ignoring you this is not the case - I was doing something else at the same time and also creating these posts in a word processor then creating the graphs and uploading then post by copy pasting - so it took a little while to do

Hence I did not see your post between my own two! Please accept my apology, I can see why you think I ignored the post you made but that is not the case

Yeah I see your point

I'm playing with the two accounts mostly so I can try two different types of market and it helps me keep the results separate, that's all.

No in reality I would not be able to open a trading account of that size. I will be able to open one account of around £5000 but will not be able to do that until September as I need to use money that I can afford to lose and that is when my other business is at it's seasonal height

My idea at the moment is to see which market suits me best, try to analyze my results and worse exposure and then if I feel the risk vs reward is acceptable then trade in that market placing positions of 20% of what I am trying now (as my real account would be 20% of the size)

However if I can make more than 5x my intended profit from these paper positions I would then try a £5000 real account placing proportionally smaller positions (therefore less risk). If I can not make 5x intended profits with this play account then I would need to re-evaluate my opening capital, my risk level or reconsider my intended profits

I hope that offers some explanation of what I am doing and why. Whether It is really a sensible method to research my capabilities I don't know. It just makes sense to me.

That is why I post here so much - I want to learn and I trust you can see the reasons for my apparently ignoring your comments, which I was not. I actually value them.

Rich
PS Regards the first time I ignored you I'll go back and check, I didn't realise I had.
 
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mike.

Senior member
2,101 709
ok, no worries.

What i was trying to get across albeit pretty badly was, When I first started i was making a killing on the demo platforms, so much so that i couldnt wait to go live, I was angry with myself that i had not found out earlier about trading stocks and shares. But, i managed with help from many members on here to understand about trading more and more over the coming months, I read countless books, demo traded different strategies and eventually went live. In reality it is much harder than you could even imagine. trade the demo as if it was your live account, if you are going to put in 5k when you do go live then trade as if that is your balance and place trades within that margin, Forget about the 20k and making big money on some trades,Its totally meaningless.

focus on a strategy that gives you a constant amount of points/pips, not big gains and bigger losses. Once you have mastered that then you can steadily increase you're stake. money management is the key to trading, took me a long time to realise, but you will get there.
 

richy96

Member
54 2
When I first started i was making a killing on the demo platforms, so much so that i couldnt wait to go live, I was angry with myself that i had not found out earlier about trading stocks and shares. But, i managed with help from many members on here to understand about trading more and more over the coming months, I read countless books, demo traded different strategies and eventually went live.[/unquote]

Can I take from that statement then at least it is possible with some hard work to actually do this

What's the difference between making a killing on demo platforms and doing it in real life, is it simply that having a smaller trading account limits you more (obviously I guess) or is it a more psychological thing - that even with a £20K real account it would not be possible to replicate the killing you made on a £20K paper account?

Anyway before you feel I am ignoring advice :innocent:, I did say I would post my other previous trades on Nat Gas - the ones that worked and recovered most of my previous losses - so I will do so

OK I had four trades that gave profit and no bad ones - With all these trades i went back to my original strategy of only Trading Long, andf giving the trades a bit of 'breathing room' to work rather than closing them at a loss

Nat Gas (A-B on attached chart)
Long 35000 contracts approx £650 before leverage
Open $4.766 on 23/04 @ 13:46
Close $4.770 on 23/04 @15:11
Profit £83.34 (maunually closed with double that profit at $4.772 but jittery price slipped on me)

Looking at the chart I could not have made any more once I placed the trade so I'm happy with it

Nat Gas (C-E on attached chart)
Long 35000 contracts approx £650 before leverage
Open $4.764 on 23/04 @ 15:24
Close $4.775 on 24/04 @ 03:20 (profit call)
Profit £229.33

Happy enough with that one, I woke up to find I ha banked my hoped for profit


Nat Gas (D-E on attached chart)
Long 70000 contracts approx £1300 before leverage
Open $4.745 on 24/04 @ 00:58
Close $4.773 on 24/04 @ 03:20 (profit call)
Profit £1157.50

I was a bit bold on that one just before retiring to bed, but all the signals (suppor, resistance etc) looked sop good I placed twice my normal position size, but again woke up to a nice profit as my Profit Call was hit


Nat Gas (X-Y on attached chart)
Long 35000 contracts approx £650 before leverage
Open $4.764 on 24/04 @ 09:45
Close $4.790 on 24/04 @ 12:13 (profit call)
Profit £541.57

Now this last trade I am actually proud of - I feel I called this one spot on - with my profit call (based on the bottom end of the overnight highs range) being absolutely spot on - not even 0.001 cents out! I hope that is a justifiable feeling

OK so that is the last of the Nat Gas trades I placed beofe I went on hols - ther are also a few more Shares trades (All good) I haven't posted.

So far I made 29 trades of which only 6 were loss making - however I made some quite big losses as well as profits

Running total so far £2916 profit

Now like you say that is with £20000 paper accounts (not £25000 as I mistakenly said previously)

So if I was placing positions a quarter of that size on a £5000 real accountI would so far be about £730 up with 16 days of actual trading - so a good way ahead of my £200 a week target.

However I'm now going to go back and have a look at my maximum exposure on all my trades, as a percentage of my trading account, as I think probably I was hitting levels I would not be comfortable with

Oh one other thing you said Mike - I'm also going to have a good look at my six bad trades as something possibly interesting has occurred to me

Back laters
Rich
 

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