From Micros to Millions: 2% per day
- Thread starter sstheo
- Start date
Thinking and having opinions is the enemy, erase them from your brain.
Absolutely....with the thinking comes those biases. Also, you shouldn't care about the stimulus, the economy, the dollar, etc. unless you are trading longer term. Stick with your technicals and your PA patterns. Watch that win rate closely.
I think you need to decide if your 'Gut Feel' for a directional bias is part of your trading methodology or an excuse when things don't go your way. It's an important part of the discretionary journey.
You are running enough indicators and watching price action to have your directional bias etched in stone. Maybe gut feel could be used for reducing/increasing position sizing but even that should be relatively fixed - Election days, FOMC, Triple Witching, etc.
Not sure if you watch a DOM but bid/ask volume drops significantly whenever volatility increases, which should correspond to one's position sizing.
Yeah, this is pretty important. Just trade what you know, not what you think. There's a huge difference. I generally don't care about news at all, yet these past few days I had a feeling markets would go lower, due to elections. Where as if I just followed the signals, I would of made a lot more with a lot less stress and risk.
A frustrated trader wrote to me that he has lost so much and asked how I turned the corner. Here was my response.
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I get your pain. And I am not out of the woods yet myself. I have lost so much money and my other job in real estate is not working well this year.
I am torn because I feel like I am FINALLY being consistent after 15 years of trading (as of last month) and I feel like I can step on the gas (and I really need the income), but at the same time, what I have learned finally is to take it slow with lower risk.
I posted some of my history in a recent post, but...
I had gone to FX after losing $100k+ in stocks, options, FX, and futures. FX allowed me to trade with small positions. I developed my confidence there. I even got into the top 100 on ZuluTrade as a signal provider. But the FX market has some unique challenges, and I prefer equity indices.
I had no cash, so I went to the funding companies. I spend close to $10,000 all together on their subscription fees and resets in 5 years. They do have a place for traders who know what they are doing, but the constant deadlines and unreasonable profit targets are deadly to the development of a sound trading plan and appropriate emotional response to losses. And they suck in the newbies...
The micros saved me. I could finally step back and unemotionally be in a trade and not be so stressed that I was cognitively disabled, as I was with an E-mini trade on with almost instant massive losses.
Regarding becoming a consistent trader, I gave some good insights in the 10 things that I am called "my edge" in previous posts, but the bottom line is that
1) You have got to know if the market is trending or ranging and how to trade both of those conditions profitably. Using moving averages and trendlines can be helpful.
2) You have to be willing to swallow your pride and take your losses while they are small. Admitting that you will be "wrong" a LOT and changing your mind quickly will keep you from blowing up.
3) You must see that all markets throughout time have similar patterns on all time frames. These patters appeared to be wired into our DNA. Daily and hourly support and resistance levels, and even Fibonnaci levels have all shown to have a lot of validity.
4) You must allow yourself mental space to do this properly by keeping your position size, targets, and max losses small. The losses MUST be in the realm of "I don't care." Until you don't get emotional about a loss, you are trading too large or you stop is too large. Try the micros and try a fixed stop loss of $20, as I am doing (usually).
Success to you.
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I get your pain. And I am not out of the woods yet myself. I have lost so much money and my other job in real estate is not working well this year.
I am torn because I feel like I am FINALLY being consistent after 15 years of trading (as of last month) and I feel like I can step on the gas (and I really need the income), but at the same time, what I have learned finally is to take it slow with lower risk.
I posted some of my history in a recent post, but...
I had gone to FX after losing $100k+ in stocks, options, FX, and futures. FX allowed me to trade with small positions. I developed my confidence there. I even got into the top 100 on ZuluTrade as a signal provider. But the FX market has some unique challenges, and I prefer equity indices.
I had no cash, so I went to the funding companies. I spend close to $10,000 all together on their subscription fees and resets in 5 years. They do have a place for traders who know what they are doing, but the constant deadlines and unreasonable profit targets are deadly to the development of a sound trading plan and appropriate emotional response to losses. And they suck in the newbies...
The micros saved me. I could finally step back and unemotionally be in a trade and not be so stressed that I was cognitively disabled, as I was with an E-mini trade on with almost instant massive losses.
Regarding becoming a consistent trader, I gave some good insights in the 10 things that I am called "my edge" in previous posts, but the bottom line is that
1) You have got to know if the market is trending or ranging and how to trade both of those conditions profitably. Using moving averages and trendlines can be helpful.
2) You have to be willing to swallow your pride and take your losses while they are small. Admitting that you will be "wrong" a LOT and changing your mind quickly will keep you from blowing up.
3) You must see that all markets throughout time have similar patterns on all time frames. These patters appeared to be wired into our DNA. Daily and hourly support and resistance levels, and even Fibonnaci levels have all shown to have a lot of validity.
4) You must allow yourself mental space to do this properly by keeping your position size, targets, and max losses small. The losses MUST be in the realm of "I don't care." Until you don't get emotional about a loss, you are trading too large or you stop is too large. Try the micros and try a fixed stop loss of $20, as I am doing (usually).
Success to you.
i wonder at what point should we call it quits? i remember in one of shark tank episodes, kevin stated that if the business is not working after 3 years, do something else. In the realm of trading that could be a different strategy and not doing the same shit over and over again. but at what point do we walk away altogether? At some point you gotta say, trading is not for me? what is that point of no return, cause obviously running out of money aint it lol.
Someone enlighten me cause i'm at that fork in the road with trading. i'm thinking i should invest in managers programs like you see in collective 2 site and just forget about doing it on my own. Then focus on other worthwhile money making schemes.
Every
Everybody is different. Some people approach the market like a gambler, they expect quick returns and the ONLY reason they participate is for the money. While some people approach the market as a student, or like learning an instrument, the pay day is expected after a long time and they enjoy the learning process. Regardless, the market will definitely find your weak spot.
If you have found a strategy that has an statistical edge but find you are the weakest link in implementation, why not automate?
BTW, what happened with your dividend portfolio? Maybe you are more suited to investing and could meet you goals with a longer term approach.
Everybody is different. Some people approach the market like a gambler, they expect quick returns and the ONLY reason they participate is for the money. While some people approach the market as a student, or like learning an instrument, the pay day is expected after a long time and they enjoy the learning process. Regardless, the market will definitely find your weak spot.
If you have found a strategy that has an statistical edge but find you are the weakest link in implementation, why not automate?
BTW, what happened with your dividend portfolio? Maybe you are more suited to investing and could meet you goals with a longer term approach.
There is no substitute for having a thoroughly tested, consistently profitable trading plan and the learned and developed ability to trade it flawlessly.