Tool me up guys

[Doomberg]

Ok some of you may of seen my ups and downs, i'm going right back to the drawing board.... i have some talent but my heads all over the place, impulse trading, revenge trading and not even checking what time the economic news releases are. Could everyone help each other by giving one bit of advice? I'll start with one; when day trading on short timeframes it's a good idea to check the trend direction on larger a timescale.

Also i've heard people talk about trend indicators, where could i get this?

Cheers, GLA :clover:

 

[NVP]

go back to basics

1) follow the longer term trend
2) use simple MA's ......they are the DNA of all systems
3) dont trade a market unless its clearly moving up or down
4) watch the S/R levels as a very dumb place to enter if you are approaching one

Good trading
N

 

[The Artist]

Ok some of you may of seen my ups and downs, i'm going right back to the drawing board.... i have some talent but my heads all over the place, impulse trading, revenge trading and not even checking what time the economic news releases are. Could everyone help each other by giving one bit of advice? I'll start with one; when day trading on short timeframes it's a good idea to check the trend direction on larger a timescale.

Also i've heard people talk about trend indicators, where could i get this?

Cheers, GLA :clover:

Hello Doomberg,

I think we've already establish on another thread that the issue here is not what's on the chart, but what's going on in your head.
To read indicators and recognize a trend is not a talent. To be in complete control of your emotions and self-aware of your own cognitive processes and how they relate to trading is what it's all about. You have to forget about finding the next great setup until you are 100% able to master yourself in the face of losses AND wins.

 

[0007]

Some good advice above from NVP. If you are going back to the very basics then do consider the sorts of markets and instruments you trade -- I've never been able to get on with Fx, don't really understand commodities, futures and all the very clever stuff. Only strange people and insomniacs get up early enough to trade the UK market where the shares never seem to move quickly enough for my liking anyway! I just find that US SP500 stocks suit me perfectly --or maybe they just work better with my methodology even though in theory that shouldn't be the case. I suspect it's down to personal psychology -- much underrated in my opinion.

I think it's always important to take on board "the big picture" -- the very smart traders can trade the noise on a short timeframe but you wouldn't start driving in an F1 car would you? This to me means looking at the longer timeframes and working from long to shorter. It's also easy to get deceived into thinking that your methodology is no good and then you start chopping from one to another --it could be that the market is not right for you at that time (or should I say that perhaps you are not right for the market -- the market is always right: we don't want any of that "wrong kind of snow" railway yuckspeak). I tend to use trending systems and at the moment I'm a bit wary because my market seems to have some doubt as to whether it's changing trend or not. Years ago I would have just assumed I was trading badly.

The thing is that trading is very personal and you really do have to find out what suits you and you can only do this by experimentation -- by all means use other people's systems etc etc but you've got to do the work yourself and analyse the results. My experience is that simple is best. Pick a system -- any system -- and paper trade it on past data. Don't forget to analyse what the market was doing at that time and pick a suitable methodology. If you can learn how to match a trading method to a market (and always remember that the market is always changing) and trade it successfully on paper, then you might just have the beginnings of some kind of profitable future.

Record everything, get it on a spreadsheet and look for patterns. If you're not profitable find out why -- go over the trade in slow time using software that can advance bar by bar in the appropriate timeframe. Blank off your mind/screen to the future and just analyse what is there in front of you at the time. If you do this enough and record sufficient data you will see patterns and trends emerging -- even if only to tell you that what you have been doing is no good. It's a long slow process but you will learn a lot if you have the determination and patience to do it. You really do have to understand what you're doing -- following rules blindly can be profitable in the right situations but it will kill you eventually.

 

[Sir Pond Life Dreg]

Wall planner, diary/spreadsheet to record Sl size, tp size, rr, number of trades etc. etc. and then make weekly/monthly totals and keep to a max risk of 1% of account until you feel confident that you know roughly whta to expect each month/quarter. You've gotta know wtf you'z doing so you can know whtat to change when it goes wrong. If you can't do all this then lump some on a decent sized short in a rising market like I did.:whistling

Oh yeah, a mouse trap, some pepper spray and a taser might come in handy for you Doom.
Think about staying out of the market for a few months homeslice, you've already said that the market has stuck it's wang in your ear and is still poking ya brains out, come back and make a fresh start after a break.

 

[NVP]

and if you do keep coming back...then keep researching / experimenting and learning.......... and one day it will work for you

astute Self Awareness, Knowledge of the Market chosen and then dumbass Perseverence is the key ........like any business

N

 

[DionysusToast]

Ok some of you may of seen my ups and downs, i'm going right back to the drawing board.... i have some talent but my heads all over the place, impulse trading, revenge trading and not even checking what time the economic news releases are. Could everyone help each other by giving one bit of advice? I'll start with one; when day trading on short timeframes it's a good idea to check the trend direction on larger a timescale.

Also i've heard people talk about trend indicators, where could i get this?

Cheers, GLA :clover:

Depends on the market.

On the ES, it helps to know where you are in the grand scheme of things but it regularly puts in 3-4 good sized intraday moves in both directions, so the overall direction is quite meaningless to some extent.

As for trend indicators - if you are discussing an indicator that tells you whether a market is trending or ranging IN TIME for you to reverse your approach, then this would effectively be a money printing machine. It is the holy grail although on the surface that might seem like an odd thing for me to say.

In terms of intraday trading, this is the one thing we are trying to figure out all through the day and something you get better on the more you get to know a market. I'd love an indicator to do it but I think it's a pipe dream personally.

 

[Mr. Charts]

Bit of an ambiguous title to this thread

 

[Sir Pond Life Dreg]

Bit of an ambiguous title to this thread

Pervert

 

[cablemonster]

1st up relax, the vast majority will fail at this however you need to make changes to give yourself a chance.

i reckon you are the sort of person who beats yourself up inside, cant understand why they cant succeed. Whatever you do you need to go back onto demo for a rolling 50 trade sample imo. I was told this over and over again by a veteran trader when I started, but no I kept throwing money away. I kept saying to myself I cant take it seriously unless money is on the line, of course that was a thinking error that had to be worked out.

Get your head right, you have to understand that a rolling 50 trade sample on demo is required and it must be taken seriously, every trade recorded and journal entry kept. Make a pact with yourself or declare it to other people that you will do this or give up trading. It really is that serious an issue. If you cannot trade seriously on demo and keep a journal imo you should quit, no shame in this after all the vast majority of people cannot trade profitably.

Why do you need to do this?

Well because otherwise the outcome of a trade has no meaning, it becomes a punt. You throw on a trade, whatever happens you don't move forward. If you lose, you beat yourself up or revenge trade. If you win you are elated and you add more or possibly even get cocky then make another loose trade.

So you build a set of stats on yourself. last 50/100/200 rolling trades etc. Once you develop this mindset you will then start to take even demo trading seriously because you will know that each trade is part of your stats and you are working towards a positive trade expectation.

Other things you can do are to take the pressure off yourself, make sure you dont need to pay your bills with trading profits, this is fatal imo if you are trying to be profitable. If you have a job then make sure you are able to run your strategies properly whilst working and vice versa able to carry out the job properly.

I have written this without one mention of an instrument or strategy. This is because if you don't sort out your mindset it doesn't matter what instrument or strategy you choose you will lose.

In terms of a strategy I think you need to think outside of the box and look at finding opportunities where other people don't look or other traders are emotionally beaten up. For example you may want to look at an instrument and work out the hours when most of the volume trades (market hours), then you may want to only look at opportunities to fade where price has reached say R2 or S2, this would be the initial filter. So your initial criteria might be there must be at least 2 hours of market time left with price reaching R2 or S2 (or R2/S3) to consider a fade. You then add in your other analysis to work out which trades to take, back test, forward test.

So this would be an idea to get started on an methodology where markets get over extended. Of course you can switch this around and trade when markets are unusually constricted playing the next expansion.

Be sensible with money management and make sure spread/slippage is tiny compared to you target expectation and you should slowly start to move forward.

hope that helps.

 

[Brumby]

You should take time out to replenish your psychological capital as it is likely depleted.

When you go back to the drawing board, you need to work on developing your edge. There are two edges you need to work on - understanding when the market gives you an edge and knowing how to exploit the edge when it is in your favor.

Bob Volman's setups are good examples of the market conditions that give you an edge. I am not suggesting to use those setups but to understand why they are useful. Essentially those set ups fall into two main categories (i) getting onboard continuing momentum; or (ii) positioning for acceleration in momentum.

 

[brewski1984]

The ironic thing is that if anyone of us posted the exact same topic you would be in here giving the exact same advice to that person as you are getting now. You know what to do.

 

[Chartsy]

Bit of an ambiguous title to this thread

phaggot

 

[Doomberg]

Thanks for all the advice guys, a lot of that is very helpful and thanks for the PM advice from a certain member

Thanks especially to cablemonster, your post made a lot of sense to me, maybe it's best i go back to demo for a while, because often my mistakes are down to being money hungry, and if i implemented my strategy properly on demo with no financial emotion i will see things from a different aspect and feel less pressure. Also my strategy is actually based on S&R and fading big intraday moves so your post was especially suited to me.

Regarding trading paying my bills, fortunately i am in a position where i have other income and i can trade as much as i like from my desk with no questions asked. All my tragic mistakes were down to discipline, i have been recommended "trading in the zone" to help with this too, i know i can do this!

 

[cablemonster]

Thanks for all the advice guys, a lot of that is very helpful and thanks for the PM advice from a certain member

Thanks especially to cablemonster, your post made a lot of sense to me, maybe it's best i go back to demo for a while, because often my mistakes are down to being money hungry, and if i implemented my strategy properly on demo with no financial emotion i will see things from a different aspect and feel less pressure. Also my strategy is actually based on S&R and fading big intraday moves so your post was especially suited to me.

Regarding trading paying my bills, fortunately i am in a position where i have other income and i can trade as much as i like from my desk with no questions asked. All my tragic mistakes were down to discipline, i have been recommended "trading in the zone" to help with this too, i know i can do this!

It's good news that you don't rely on trading profits to pay the bills that eases the pressure. don't be hard on yourself just make a pact with yourself that you will not throw away any more money until you have proven yourself on demo, if you cant do that on a 50 rolling sample and keep a proper journal of every trade then promise yourself you will quit trading. What is likely to happen is that you will adhere to this new way of working. Practice the good habits and throw away the old. If you really cant, perhaps accept that trading might not be for you. I suspect though you will adhere to it if you know the consequences.

What you will find is that if you take these new habits seriously you should still feel some emotional pressure on the demo as it should be clear to you that you cannot ever progress to real money trading until the rolling sample shows a positive trade expectation. Trading with real money and scaling up brings it's own issues which you can battle at the time, but until it is done on demo don't even think about that.

The main concept I would try and get in your mind (which helped me a lot) was 'what does this next trade mean to me'. win, lose or draw what does it 'mean'. If it is a random punt it has no meaning whatsoever. Once you have your 50 trade sample with a positive expectancy, lets say you have a 66% strike rate. How are you going to feel on trade #51 if the trade is a loser?

Of course you will expect to win the trade however would you be surprised if you lost? I hope not. Slowly and surely the emotion will retreat away.

And lastly do not rush things, the more in a rush you are to 'make it' the harder it is. I think you said you have been in the game 2 or 3 years. This is not untypical or unusual for someone who is self taught.

Good luck

 

[D70]

Some good advice above from NVP. If you are going back to the very basics then do consider the sorts of markets and instruments you trade -- I've never been able to get on with Fx, don't really understand commodities, futures and all the very clever stuff. Only strange people and insomniacs get up early enough to trade the UK market where the shares never seem to move quickly enough for my liking anyway! I just find that US SP500 stocks suit me perfectly --or maybe they just work better with my methodology even though in theory that shouldn't be the case. I suspect it's down to personal psychology -- much underrated in my opinion.

I think it's always important to take on board "the big picture" -- the very smart traders can trade the noise on a short timeframe but you wouldn't start driving in an F1 car would you? This to me means looking at the longer timeframes and working from long to shorter. It's also easy to get deceived into thinking that your methodology is no good and then you start chopping from one to another --it could be that the market is not right for you at that time (or should I say that perhaps you are not right for the market -- the market is always right: we don't want any of that "wrong kind of snow" railway yuckspeak). I tend to use trending systems and at the moment I'm a bit wary because my market seems to have some doubt as to whether it's changing trend or not. Years ago I would have just assumed I was trading badly.

The thing is that trading is very personal and you really do have to find out what suits you and you can only do this by experimentation -- by all means use other people's systems etc etc but you've got to do the work yourself and analyse the results. My experience is that simple is best. Pick a system -- any system -- and paper trade it on past data. Don't forget to analyse what the market was doing at that time and pick a suitable methodology. If you can learn how to match a trading method to a market (and always remember that the market is always changing) and trade it successfully on paper, then you might just have the beginnings of some kind of profitable future.

Record everything, get it on a spreadsheet and look for patterns. If you're not profitable find out why -- go over the trade in slow time using software that can advance bar by bar in the appropriate timeframe. Blank off your mind/screen to the future and just analyse what is there in front of you at the time. If you do this enough and record sufficient data you will see patterns and trends emerging -- even if only to tell you that what you have been doing is no good. It's a long slow process but you will learn a lot if you have the determination and patience to do it. You really do have to understand what you're doing -- following rules blindly can be profitable in the right situations but it will kill you eventually.

One of the best posts on t2w right there

 

[timsk]

What you will find is that if you take these new habits seriously you should still feel some emotional pressure on the demo as it should be clear to you that you cannot ever progress to real money trading until the rolling sample shows a positive trade expectation.

Hi Doomberg,
Another good post by cablemonster in which he again stresses the importance of having a positive expectency. Doubtless, you're familiar with the concept but, for the benefit of any subscribers to the thread who aren't, check out the Essentials of Risk & Money Management Sticky - where the concept is explained. If you don't want to read the whole thing, cut to the chase by scrolling down to 'SPECIFIC RISK MANAGEMENT' in post #2.
Enjoy!
Tim.

 

[VielGeld]

Yeah, if you say you have an edge, then the issue isn't with the method.

As with the previous thread, limit yourself to 5x leverage and .5% risk, and this should take care of the emotional swing as well. You'll do ok if can stick to this.

 

[Brumby]

if you say you have an edge, then the issue isn't with the method.

It is an interesting proposition and is worth further discussion.

Assuming we are familiar with the concept of positive expectancy and the components associated with it, it is invariably an outcome of something - whether it is a process or method(s). We all aim get there, the challenge is how rather than the destination.

Whilst positive expectancy can be affected by luck, chance, market condition, invariably long term consistent profitability has to come from some form of edge that the trader possess. Money management will not help long term because it will only be death by a thousand cuts.

What is an edge? What are the underlying principles in which an edge can be derived? How would a newbie approach this issue?

 

[p-lab]

Hey Doom,
It's sorry to say under the circumstances but your honesty has produced this really excellent and refreshing thread. I'd say most on here can relate to your issues as I certainty can. I know plenty that dismiss paper trading as some sort game and I couldn't disagree more. Used in the exact same manner as your live trading its one of the best tools in the box (Although I will add only after losing it for real). Anyway good to see you posting again fella....for me trading has always been more of a bob and weave exercise than the killer KO