Why Is The Obvious Not So Obvious?

[Lúidín]

No doubt the title will have some thinking

As can be seen from the number of posts in this section of the site, it is "obvious" that the majority of those who are seeking knowledge in relation to making money trading, have not done any solid ground work prior to starting.

If you were to build a house, would you put in 6 inches of concrete for the foundation?

I could make a list, but I will not bother, as I try to keep things simple and short.

So, why is it that the majority of people do not take very seriously the mental aspects (psychology) of trading, as it is by far the most important aspect.

What does the "psychology" of trading mean to you, and if you go off and search the internet for an answer, then the only person you are fooling is yourself.

You must speak exactly what comes out of your mind, and not use words of others.

Lúidín

 

[darktone]

Most people identify with their minds, and are just plain unaware of the stress and ego related issues they bring to trading and life in general. Then they search for the answer in a method that accommodates their state of mind (fearful). Market wisdom eh!
From there its an endless game of circles that can range from grinding a profit to doing ya knackers.

 

[itspossible]

6 inches of concrete

Thats me

 

[Lúidín]

No one can answer the question for anyone else, but we can make assumptions by reading what people post.

I think that what people fail to realize, is that there is a required learning curve in "the art of losing", as this goes against all we have been taught with our archaic education system.

How can someone in their right mind, start making money by learning how to lose money!

Have you ever seen any person post in a thread, asking for someone to show them how to lose correctly?

Also, learning how to lose correctly is but the start, for if you become an expert at only losing, then you will "obviously" not make any money.

If a person is not aware, and willing to radically change, the way they normally think then the odds of succeeding is very low, and that person will more than likely join the stats, which I have no doubt is indeed around 95%, if not even a bit higher.

Lúidín

 

[alexaherself]

No doubt the title will have some thinking

Some, perhaps.

Others may immediately recognise it from the well-known 440-page thread in another trading forum, where it originally appeared in identical form.

You must speak exactly what comes out of your mind, and not use words of others.

We must, but you don't have to, apparently?

 

[Lúidín]

Some, perhaps.

Others may immediately recognise it from the well-known 440-page thread in another trading forum, where it originally appeared in identical form.



We must, but you don't have to, apparently?

You are assuming, which can sometimes mean...

make an ass out of u and me

The point, obviously, is if you want to really try and help yourself, then you must be true to yourself, and not jump from jimmy to jack, so as not to make yourself look foolish in front of people you can't even hear, let alone see.

It really is amazing how silly people can be when it comes to trading, and I speak from first hand experiences

Lúidín

 

[itspossible]

No one can answer the question for anyone else, but we can make assumptions by reading what people post.

I think that what people fail to realize, is that there is a required learning curve in "the art of losing", as this goes against all we have been taught with our archaic education system.

How can someone in their right mind, start making money by learning how to lose money!

Have you ever seen any person post in a thread, asking for someone to show them how to lose correctly?

Also, learning how to lose correctly is but the start, for if you become an expert at only losing, then you will "obviously" not make any money.

If a person is not aware, and willing to radically change, the way they normally think then the odds of succeeding is very low, and that person will more than likely join the stats, which I have no doubt is indeed around 95%, if not even a bit higher.

Lúidín

A very good point.When i first started trading i lost 5k on shares but i was always quick to take losses.I then started spreadbetting and obviously had the advantage of being able to short.I didnt follow any charts and taught myself using patterns and feel-i made all of the 5k back.I think as long as you can cut the cancer quickly(losses)and try and let your profits run you can make it.The next step is having the mental mind set to make it.I stopped as i do not want trading to take over my life as it is very addictive.Depressing when losing and amazing when winning.I still watch the markets but i really think that people get married to charts etc.

 

[Lúidín]

You can actually post without using pictures :clap:

Yes, it can be very addictive, but you should not let it take over your life once you have worked out a way to make some money consistently.

If I was to get paid $5 for all the hours I have spent gaining the experiences, I would never need a margin account and could daytrade SPY and AAPL all day without any concerns about buying power.

We are all different, but we should all look for the least risky way to trade, that takes up the least amount of time.

I had to go full circle, before I realized that the best way for me was the way I was first interested in..what a dope I was, and I now feel real silly when I look back at all the years, and money, I wasted.

Lúidín

 

[tokyojoe]

You can actually post without using pictures :clap:

Yes, it can be very addictive, but you should not let it take over your life once you have worked out a way to make some money consistently.

If I was to get paid $5 for all the hours I have spent gaining the experiences, I would never need a margin account and could daytrade SPY and AAPL all day without any concerns about buying power.

We are all different, but we should all look for the least risky way to trade, that takes up the least amount of time.

I had to go full circle, before I realized that the best way for me was the way I was first interested in..what a dope I was, and I now feel real silly when I look back at all the years, and money, I wasted.

Lúidín

Hi, can you please tell me if you are consistently profitable each & every day ?
I will tell you that I am not.

This game changes everyday, the flow is different everyday, the opportunities vary greatly every single day.

The psychological aspect of this game (fear & greed) can be grasped fairly quickly, much in the same way that "price levels/areas of interest" are grasped fairly quickly.

But just because it hits my blah blah level, it doesn't necessarily make that area of interest tradable.

You speak as someone who is perhaps consistently profitable & my hat's off if you are, but I've been at this long enough on a part time level to know the craic.

If in the daily arena it is a wage made, or a wage lost (or worse) no amount of psychology is going to help us when we have a runner & it turns back, profit is profit.
No amount of psychology is going to help us if it goes all Donald Trump & we end up babysitting the position for 4 hours because the trap door fell open before we could jump to the side...... it's flown & out of your hands, then a pure gamble.

Sure the game is psychological, but it is also very mechanical, instinct & a degree of discretionary thought also plays a part.

Hard way to make a consistent wage, or is it ??

 

[Lúidín]

Hi, can you please tell me if you are consistently profitable each & every day ?
I will tell you that I am not.

This game changes everyday, the flow is different everyday, the opportunities vary greatly every single day.

The psychological aspect of this game (fear & greed) can be grasped fairly quickly, much in the same way that "price levels/areas of interest" are grasped fairly quickly.

But just because it hits my blah blah level, it doesn't necessarily make that area of interest tradable.

You speak as someone who is perhaps consistently profitable & my hat's off if you are, but I've been at this long enough on a part time level to know the craic.

If in the daily arena it is a wage made, or a wage lost (or worse) no amount of psychology is going to help us when we have a runner & it turns back, profit is profit.
No amount of psychology is going to help us if it goes all Donald Trump & we end up babysitting the position for 4 hours because the trap door fell open before we could jump to the side...... it's flown & out of your hands, then a pure gamble.

Sure the game is psychological, but it is also very mechanical, instinct & a degree of discretionary thought also plays a part.

Hard way to make a consistent wage, or is it ??

To be honest, no, but I don't trade every day at the moment due to personal circumstances. Let's just say I am returning to full time trading

Your post is very good, in that it asks many relevant questions, some that many might find hard to associate with.

As in all business ventures, there are always opportunities presenting themselves, which of course all will not see and act on, for variouys reasons - hence why we have a small few who make big money, as they have a knack for seeing and acting - take R.Branson for instance.

If you know the craic, then you will know that the mental aspect comes first, followed by the mechanics, of which some are far better than others, again, some of which can be seen and acted on by a few to make some good money, while most never see them for whatever reasons.

As for things going wrong, the only things that goes wrong is when the trader does not react to what is actually happening, which, is governed by his/her mental make up.

If your strategy keeps you in a losing trade for too long, then it is not a good one.

If you can not identify a strategy that allows you to exit a loser with a small loss, and have winners that are multiples of your losers, then you have not enough experience to differentiate between good and bad opportunities.

In order to achieve consistent profits, you must have a consistent strategy.

Lúidín

 

[Fugazsy]

I agree with Joe, only the right mindset will not help, of course is very important like in any endeavour we undertake but if we cannot read the charts the chances are very tiny, yes anyone can trade or have a run of successful trades, but the key lays in consistency, consistency is reached by skills, experience and also proper mindset.

Not sure if my mind or my thinking has helped me much in trading, initially the less I used it the more money I was making, the more I used it the more emotions was bringing into my trading.

“It was never my thinking that made the big money for me, it always was my sitting.” Livermore.

I think many will identify themself with their thinking and not only in trading to reinforce their trap.

"I Think Therefore I Am". Descartes

I think this last quote is full of BS, we are not what we are thinking and it can take sometime before we realise that.

 

[tokyojoe]

To be honest, no, but I don't trade every day at the moment due to personal circumstances. Let's just say I am returning to full time trading

Your post is very good, in that it asks many relevant questions, some that many might find hard to associate with.

As in all business ventures, there are always opportunities presenting themselves, which of course all will not see and act on, for variouys reasons - hence why we have a small few who make big money, as they have a knack for seeing and acting - take R.Branson for instance.

If you know the craic, then you will know that the mental aspect comes first, followed by the mechanics, of which some are far better than others, again, some of which can be seen and acted on by a few to make some good money, while most never see them for whatever reasons.

As for things going wrong, the only things that goes wrong is when the trader does not react to what is actually happening, which, is governed by his/her mental make up.

If your strategy keeps you in a losing trade for too long, then it is not a good one.

If you can not identify a strategy that allows you to exit a loser with a small loss, and have winners that are multiples of your losers, then you have not enough experience to differentiate between good and bad opportunities.

In order to achieve consistent profits, you must have a consistent strategy.

Lúidín

Thanks for your honesty Lui

Keep an eye on the pace mate, it will keep you out of trouble, you sound like you know what to look for.

 

[Lúidín]

Thanks for your honesty Lui

Keep an eye on the pace mate, it will keep you out of trouble, you sound like you know what to look for.

If you mean Time & Sales, yes, it can be helpful to finetune entries and exits, and even more so if you plot the bid/ask with the last to see when large prints are going off above the bid, or below the ask.

I just happen to have my own T&S with tick chart of bid..ask..last..and bottom chart for volume..just upgraded my hard disk to ssd to try and improve on speed issue..as I use a laptop..which has limited processing capabilities compared to a desktop.

Lúidín

 

[tokyojoe]

If you mean Time & Sales, yes, it can be helpful to finetune entries and exits, and even more so if you plot the bid/ask with the last to see when large prints are going off above the bid, or below the ask.

I just happen to have my own T&S with tick chart of bid..ask..last..and bottom chart for volume..just upgraded my hard disk to ssd to try and improve on speed issue..as I use a laptop..which has limited processing capabilities compared to a desktop.

Lúidín

Good move, solid state is fantastic, been using for a long time, super quick.

Just for clarity I use SB as a vehicle (for a number of reasons).

I use a confluence of tf's, done away with the indicators & lines etc. The lines draw themselves when you've been looking at charts long enough.

By pace I mean just that (pace or speed) of the print. I do from time to time ensure my latency is second by second in tune with what is being sent from the SB server.

Without getting into my method, I'm just simply saying I keep an eye on the pace, too nutty & it's overtrading territory, too slow & it's chop. I have a certain pace that suits my style, & it is actually a faster pace that I prefer.

 

[Lúidín]

Good move, solid state is fantastic, been using for a long time, super quick.

Just for clarity I use SB as a vehicle (for a number of reasons).

I use a confluence of tf's, done away with the indicators & lines etc. The lines draw themselves when you've been looking at charts long enough.

By pace I mean just that (pace or speed) of the print. I do from time to time ensure my latency is second by second in tune with what is being sent from the SB server.

Without getting into my method, I'm just simply saying I keep an eye on the pace, too nutty & it's overtrading territory, too slow & it's chop. I have a certain pace that suits my style, & it is actually a faster pace that I prefer.

You must be using IG's API

When I have time I do some work on my own setup, as I have a plan to use my own trading setup with data feed via IB Gateway. There are some issues with IB in relation to data, so I might switch to TDA in the new year, as I plan to do a good bit of option trading, but have not made up my mind fully yet about TDA.

This is a test I done lately on the T&S section, and where the hard disk speed issue showed up with lag between volume shift..have changed the disk to ssd, but need to do some more testing now, which requires live data feed, as T&S section only works with live data.

I have a feeling the laptop will be too slow for normal trading, but it is fine for development and testing with small risk, as I have a good PC and several monitors for later on.

What are you trading btw?

Lúidín

 

[tokyojoe]

You must be using IG's API

When I have time I do some work on my own setup, as I have a plan to use my own trading setup with data feed via IB Gateway. There are some issues with IB in relation to data, so I might switch to TDA in the new year, as I plan to do a good bit of option trading, but have not made up my mind fully yet about TDA.

This is a test I done lately on the T&S section, and where the hard disk speed issue showed up with lag between volume shift..have changed the disk to ssd, but need to do some more testing now, which requires live data feed, as T&S section only works with live data.

I have a feeling the laptop will be too slow for normal trading, but it is fine for development and testing with small risk, as I have a good PC and several monitors for later on.

What are you trading btw?

Lúidín

There is another switched on trader called f2calv you may be interested to speak with, he is into Options & is going through the motions of the in's & out of it now.

I only trade Dax, my interest re data feed is twofold : is the price on my screen the same as being pinged from the SB server at exactly the same time ? & how far from the dma is the sb price feed ?

I am only dealing with the SB internally & not the open market, but my only ally after the position is taken is momentum in the open market, the SB will shove the price to shake me out, but can only go so far from the dma as arbitrage traders will take advantage of them otherwise, this is why I can only trade in high volume scenarios.

I keep my set up simple on the data side, so the machine is more than enough, the SSD is a great thing to have, makes the standard disc seem prehistoric.

So it is a fine line line, if shakeout turns into real momentum & I'm on the right side, all good, but shakeout while on the wrong side turning into momentum :-0

The hardware is not my problem, it's the software in my head that need re booting from time to time

Good luck tomorrow.

 

[Lúidín]

I am a little confused. Understand the SB data and how they operate, but if you are trading big size are you not better off with a normal broker like IB for Dax, or even the likes of Exante at E1.50 for Dax Ftrs

https://exante.eu/markets/Futures/

I tried the Exante demo, but did not like their software, especially the charts. To be honest, I have had an account with about 5 sb companies, was with Datek and TDA, and been with IB for a good while now, and none of them can beat IB, as they tick most of the boxes, with their major drawback funny enough being their chart features, which is silly for such a big trading broker and would be very easy to fix, but they don't listen to small traders like me.

If you want to PM me with the way you are trading, I might be able to offer some insight into how you might be better off trading to avoid the SB's messing you about, as you rightly say they can only rattle you a small bit, and thing is the traders they employ are not really clued into chart analysis, which is you main weapon.

If you are fine, np.

As for tomorrow, I am not too concerned, as i have some low risk option trades on a low priced oil stock (bout 2K shares), and open 2 long positions in crude for $39 and $40 calls, again low risk, so would like to see a rally in oil before 16Dec - if it happens good, if not then no sweat, as I know the risk and am not worried about it, which is how it should be.

I read an interesting article over the weekend in relation to the feds upcoming rate hike, and many of the big players are expecting a bad Q1, based on the effects the rate hike will have on corporate business, so it will be interesting to see what actually happens.

My preferred style is daytrading the open, with no opinions of where it might go, just look and react to what is happening, get in and out as required, and try to make a good bit more than I lose. For me, I have found the best market to daytrade is US blue chip stocks, for several reasons, namely opportunities at the open.

I am always interested in what other traders are doing.

Lúidín

 

[Lúidín]

To get back on track.

There is a debate, if you can call it that, going on in another thread, where a few have highlighted a serious issue that one should consider, if that person has no other source of income other than the subject under discussion.

I am not using this thread to slate them, but as an example of why so many traders act and carry on the way they do. Also, I am not trying to say that the few are right, just noting that the few stated there is a serious issue that needs to be addressed if there is no other source of income.

1. Why do people turn down good advice that can only help them save money, not cost them money!

2. Why do people keep trying to prove something where no proof is really required!

3. Why do people believe what they want to believe, without seriously considering the possible outcome of their actions!

I could summarize and say "Why are people so stupid", but I won't, as that is not nice

Lúidín

 

[timsk]

To get back on track.

There is a debate, if you can call it that, going on in another thread, where a few have highlighted a serious issue that one should consider, if that person has no other source of income other than the subject under discussion.

I am not using this thread to slate them, but as an example of why so many traders act and carry on the way they do. Also, I am not trying to say that the few are right, just noting that the few stated there is a serious issue that needs to be addressed if there is no other source of income.

1. Why do people turn down good advice that can only help them save money, not cost them money!

2. Why do people keep trying to prove something where no proof is really required!

3. Why do people believe what they want to believe, without seriously considering the possible outcome of their actions!

I could summarize and say "Why are people so stupid", but I won't, as that is not nice

Lúidín

Hi Lúidín,
With regard to your three questions, keep in mind that they are all subjective. In other words, all three relate equally well to both sides of the argument (in the case of the 'other' thread), not just your side of the argument.

You might think that I'm stupid and that's fine, that's you're prerogative. Moreover, I'd plead guilty to the charge if it was made, as I amaze myself at my own stupidity at times. But that's another story. Similarly, just as the three questions are subjective, whether or not I'm stupid is also subjective, as others might think I'm clever and that you are the stupid one. (Just to be clear, I don't think either of those, far from it, but others might.) Either way, it doesn't much matter. What matters on a free and open access forum like T2W are the comments posted, regardless of your impression of the individual who posts them. The point being, if you focus on the message rather than the messenger, then the stupidity (or brilliance) of any individual member ceases to be important, as it doesn't help you get as much as possible from the forum and contribute as much as possible to it.
Tim.

 

[dbphoenix]

If I may, one needn't characterize any of this as "stupid", though if one were to do so anyway, he could avoid subjectivity by defining "stupid" as whatever results in a negative account balance. After a twenty-year online presence, I continue to be impressed by the same mistakes being made, the same patterns of behavior, the same arguments, the same personas (though with continuous changes in names), the same drive toward doing exactly that which is the opposite to what is in one's best interests.

The psychology behind all this is not terribly complex and it has been delved into before. But the delving hasn't accomplished much, if anything, because it's always the other guy who has these -- for want of a better word -- problems. And so we go on, and one finds a sameness to it all, particularly in the journals, particularly among beginners. In fact, one who left the boards, any boards, fifteen years ago and came back today would find little difference other than the obsession with forex.

Db