Ghost of If You Can Draw A Straight Line
- Thread starter dbphoenix
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Since ET doesn't have stickies, I'm providing this here so that the information may be easily found. Just remember April 1st (Fool's Day 
).
First, one should read the first post to this thread. In that post, links to the first three threads are provided. There is also a link to the stickie at the end of the first thread which recommends important posts in the initial thread. All this amounts to about 40 posts, not 4000.
Once one has finished that, then it's time to look at how one is going to go about developing a plan. I will repeat here again that the journal is not a trading log. It is not set up to provide calls for those who are looking for tips. Rather the journal is a record of the journey. It begins even before the journey does, i.e., what one plans to do to prepare for that journey. The actual development of the trading plan takes place much later. So to postpone the journal until one is well on one's way is to misunderstand the whole point of the journal.
If one is interested in the SLA and AMT in particular, he can skip much of the developing a plan part since the plan has already been developed. It is unlikely, however, that one will want to jump in with both feet before doing at least some exploration and experimentation.
Beyond that, if one is going to focus on trading price, then Section 7 of Wyckoff's original course will be of help as he is the originator of all this. In Section 7, he tracks the balances and imbalances of supply and demand in a stock index, daily, throughout an entire year.
).First, one should read the first post to this thread. In that post, links to the first three threads are provided. There is also a link to the stickie at the end of the first thread which recommends important posts in the initial thread. All this amounts to about 40 posts, not 4000.
Once one has finished that, then it's time to look at how one is going to go about developing a plan. I will repeat here again that the journal is not a trading log. It is not set up to provide calls for those who are looking for tips. Rather the journal is a record of the journey. It begins even before the journey does, i.e., what one plans to do to prepare for that journey. The actual development of the trading plan takes place much later. So to postpone the journal until one is well on one's way is to misunderstand the whole point of the journal.
If one is interested in the SLA and AMT in particular, he can skip much of the developing a plan part since the plan has already been developed. It is unlikely, however, that one will want to jump in with both feet before doing at least some exploration and experimentation.
Beyond that, if one is going to focus on trading price, then Section 7 of Wyckoff's original course will be of help as he is the originator of all this. In Section 7, he tracks the balances and imbalances of supply and demand in a stock index, daily, throughout an entire year.
POKER RULE#35: Develop a true indifference to the game.
POKER RULE #36: Don't take the game personally. The poker gods are not out to destroy you personally (although it may somtimes seem that way). The game itself is as neutral and mechanical as a roulette wheel, a church raffle, or a lottery ball drawing... To repeat: players often think that elaborate steps are needed - great straining, striving steps, complex steps. The ordinary way of Zen dispels this. In modern life, as in poker, we often find ourselves tangled in frantic activity, trying to force events to our will, to make them happen. The actual answer is much simpler and involves a more natural approach. This sort of simplicity has been described in Zen literature in the following way: "When hungry, eat, when tired, sleep... The ordinary way is the way.
POKER RULE#39: When you take your emotions out of the game, other players' emotions become visible. When we are focused exclusively on our own emotions (as we often are), the emotion of others tend to be obscured. When we make ourselves neutral, however, we find that the canvas suddenly becomes blank and the emotions of others begin to appear.
POKER RULE #42: Your biggest opponent, and worst enemy, is always yourself. Years of experience eventually teach you that your main battle, always, is with yourself - your propensity for errors, for rationalizing marginal hands into good hands, lack of concentration, misreading other players, emotional eruptions, impatience, and so on...
POKER RULE #47: Fit yourself into the flow of the game... Some players approach the game of poker simply as a game, the way you might play Chinese checkers, or Old Maid. They can be observed playing their own cards and nothing else, staring hard at their hand, brows furrowed, never glancing up, strugglnig along. It's as if they are playing in a vacuum. Still others do the opposite, trying to dominate all parts of the game, force victory, muscle over the game with various aggressive maneuvers... Do either of the above two approach work? Yes, intermittently. A better approach - one that experience shows works more frequently - is to try to fit yourself into the flow of it...
Larry Phillips
POKER RULE #36: Don't take the game personally. The poker gods are not out to destroy you personally (although it may somtimes seem that way). The game itself is as neutral and mechanical as a roulette wheel, a church raffle, or a lottery ball drawing... To repeat: players often think that elaborate steps are needed - great straining, striving steps, complex steps. The ordinary way of Zen dispels this. In modern life, as in poker, we often find ourselves tangled in frantic activity, trying to force events to our will, to make them happen. The actual answer is much simpler and involves a more natural approach. This sort of simplicity has been described in Zen literature in the following way: "When hungry, eat, when tired, sleep... The ordinary way is the way.
POKER RULE#39: When you take your emotions out of the game, other players' emotions become visible. When we are focused exclusively on our own emotions (as we often are), the emotion of others tend to be obscured. When we make ourselves neutral, however, we find that the canvas suddenly becomes blank and the emotions of others begin to appear.
POKER RULE #42: Your biggest opponent, and worst enemy, is always yourself. Years of experience eventually teach you that your main battle, always, is with yourself - your propensity for errors, for rationalizing marginal hands into good hands, lack of concentration, misreading other players, emotional eruptions, impatience, and so on...
POKER RULE #47: Fit yourself into the flow of the game... Some players approach the game of poker simply as a game, the way you might play Chinese checkers, or Old Maid. They can be observed playing their own cards and nothing else, staring hard at their hand, brows furrowed, never glancing up, strugglnig along. It's as if they are playing in a vacuum. Still others do the opposite, trying to dominate all parts of the game, force victory, muscle over the game with various aggressive maneuvers... Do either of the above two approach work? Yes, intermittently. A better approach - one that experience shows works more frequently - is to try to fit yourself into the flow of it...
Larry Phillips
Figuratively speaking, the small trader should imagine himself as a hitch-hiker in the market. For the ordinary hitch-hiker, someone else supplies the car, chauffeur, oil and gas. When he thinks the car is about to go in his direction, he jumps aboard and rides as far as he thinks the car will go. When he notices the machine has been stopped by a red light, or is about to turn a corner and go in some other direction, or that the car is running out of gas, or the brakes failing to work properly, he steps off and figures he has secured about as long a ride as he may expect. All he has supplied in this transaction is a modest commission and whatever brains were necessary to observe and recognize the opportunity when to get on and off.
Richard Wyckoff
Richard Wyckoff
In a certain sense, reading charts is like reading music, in which you endeavor to interpret correctly the composer's ideas and the expression of his art. Just so a chart of the averages, or of a single stock, reflects the ideas, hopes, ambitions and purposes of the mass mind operating in the market, or of a manipulator handling a single stock.
The study of charts is not as some people claim, the mere identification of certain labeled patterns made by the actions of stocks. That sort of thing borders on the mechanical and does little to aid in the development of one's judgment. But when a student undertakes to read from his charts the purposes and objective of those who are responsible for a stock's action in the market, he is beginning to see, in a true light, the meaning of scientific stock speculation.
Richard Wyckoff
The study of charts is not as some people claim, the mere identification of certain labeled patterns made by the actions of stocks. That sort of thing borders on the mechanical and does little to aid in the development of one's judgment. But when a student undertakes to read from his charts the purposes and objective of those who are responsible for a stock's action in the market, he is beginning to see, in a true light, the meaning of scientific stock speculation.
Richard Wyckoff
Certainly one could argue that some traders lose because they don't understand enough about the markets and therefore they usually pick the wrong trades. As reasonable as this may sound, it has been my experience that traders with losing attitudes pick the wrong trades regardless of how much they know about the markets. In any case, the result is the same -- they lose. On the other hand, traders with winning attitudes who know virtually nothing about the markets can pick winners; and if they know a lot about the markets, they can pick even more winners.
If you want to change your experience of the markets from fearful to confident, if you want to change your results from an erratic equity curve to a steadily rising one, the first step is to embrace the responsibility and stop expecting the market to give you anything or do anything for you. If you resolve from this point forward to do it all yourself, the market can no longer be your opponent. If you stop fighting the market, which in effect means you stop fighting yourself, you'll be amazed at how quickly you will recognize exactly what you need to learn, and how quickly you will learn it. Taking responsibility is the cornerstone of a winning attitude.
Mark Douglas
If you want to change your experience of the markets from fearful to confident, if you want to change your results from an erratic equity curve to a steadily rising one, the first step is to embrace the responsibility and stop expecting the market to give you anything or do anything for you. If you resolve from this point forward to do it all yourself, the market can no longer be your opponent. If you stop fighting the market, which in effect means you stop fighting yourself, you'll be amazed at how quickly you will recognize exactly what you need to learn, and how quickly you will learn it. Taking responsibility is the cornerstone of a winning attitude.
Mark Douglas
When you understand how any number of typical market-related fears operate in your life and learn to release yourself from them, you will, in effect, be separating yourself from the "crowd." When you separate yourself from the "crowd" and expand what you know about the forces affecting your behavior to encompass the group, it will be much easier to anticipate what the group will do because they will merely represent a larger (collective) version of the way you used to be. In other words, you will know how other traders will behave before they do because you will be able to observe them from a detached perspective -- due to your having evolved beyond the choiceless state of operating out of fear.
Mark Douglas
Mark Douglas
The best traders can put on a trade without the slightest bit of hesitation or conflict, and just as freely and without hesitation or conflict, admit it isn't working. They can get out of the trade -- even with a loss -- and doing so doesn't resonate the slightest bit of emotional discomfort. In other words, the risks inherent in trading do not cause the best traders to lose their discipline, focus, or sense of confidence.
If you are unable to trade without the slightest bit of emotional discomfort (specifically, fear), then you have not learned how to accept the risks inherent in trading. This is a big problem, because to whatever degree you haven't accepted the risk is the same degree to which you will avoid the risk. Trying to avoid something that is unavoidable will have disastrous effects on your ability to trade successfully.
Mark Douglas
If you are unable to trade without the slightest bit of emotional discomfort (specifically, fear), then you have not learned how to accept the risks inherent in trading. This is a big problem, because to whatever degree you haven't accepted the risk is the same degree to which you will avoid the risk. Trying to avoid something that is unavoidable will have disastrous effects on your ability to trade successfully.
Mark Douglas
When dealing with psychology there are few fixes to be found in a book. A fortune cookie is just as likely to inspire change as anything else. Few will be compelled to change because of a rational argument when their ego is at stake. This is why most successful traders (or poker players) have stories about blowing up their accounts. They needed to be humbled enough to figure out where the real problem lay.
I would go one step further and claim that even traders who have identified their psychological weaknesses still struggle to get rid of these destructive habits. Here is one more fortune cookie for you:
"Meditation is not a matter of trying to achieve ecstasy, spiritual bliss or tranquility, nor is it attempting to become a better person. It is simply the creation of a space in which we are able to expose and undo our neurotic games, our self-deceptions, our hidden fears and hopes."
- Chogyam Trungpa
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