How can I be a discipline Trader???

B

benysl

Hi

I started this thread because I find myself a very lousy trader when it come to discipline. It is easier to develop a winning system but following it is very difficult to me.

I had some success early this year(jan / Feb) but on mar 2003 I start to increase my contract size instead of cutting losses when I should have I double up or averaging down and suffer a serious drawdown for that month.

Apr and May 2003 I decide to follow my system every single signal. Both month I am up. Basically my system is straight forward it based on a entry for the day if you are in position you enter a stop loss if you are not stop out by the end of the day you exit. Basically all position is either stop out or exit at Market on Close.

I find that it work fine if I leave my MOC order with the broker as they execute for me. But if I had to execute the MOC order myself I had problem, if it is a winning trade I can execute it easily 2 - 5 mins before market close. But if it is a losing trade I would execute at the last 30 seconds.

On 6 Jun 2003. I had a short position (by the way I trade Asian Market) I was on a losing trade so at 15 seonds before closing I am hesistating by the time I execute the market has already close and I am left with a Short position overnight this is against my system, my system never hold overnight. Even thou Nasdaq is down 2% and Dow has a pretty bad day on Friday it will be in my favor when market open on the 9 Jun 2003. But I kick myself for breaking a rule in 2 months which I shouldn't have in the first place. If I had a winning trade I had no problem exiting 2 mins before closing but because it is a losing trade I hold till the last moment to exit.

Anyone has a similar experience? Any good psychology book out there that can help me? Any advice is appreciated.

Thanks for reading
 
Plain and simple. You have to have rock solid discipline. Look at professional athletes, notice how disciplined they are. Their focus and discipline is amazing. That's what separates them from the others who couldn't make it.

Plus never never stop learning.

If you want it bad enough and practice extreme discipline, you will have a fair chance of making it. Without discipline, there is absolutely no chance. It is impossible to be a successful trader without discipline.

When I'm having a tough time. The only thing that keeps me in the game is my discipline. Well, my discipline coupled with experience will keep me alive.

Wish you the best.



I can recommend:

Mark Douglas
"The Disciplined Trader"
"Trading in the Zone"
www.markdouglas.com

Dr. Van Tharp
"Peak Performance Course"
www.iitm.com

I just read "Trading Chaos" by Bill Williams.
The book had some great psychology stuff in it. I just ordered his second book.
 
One more thing:

Discipline gives you the opportunity to build confidence. And when you have confidence, you won't mind taking a loss. You will be happy to.

Because once you take that loss you will be free to go on to your next opportunity. You will have the confidence to get in there and know that you can make it back.

Discipline and confidence will give you the opportunity to develop experience. Then use your "experience" to become a successful trader.
 
happy to take a loss yes this is what I really need to. Sometime I tell myself if this trade is a loss I am 1 step closer to a winner. It help sometimes. Anyway I think for the next few months or at least till the end of the year I will try to be a discipline trader. Regardless of my position (win or loss) I must pull the trigger when I am suppose to.

I thought I am a discipline trader for a while Apr/May 2003 as I follow my system closely until 6 Jun 2003 then I realise my discipline is still far from perfection. That night I hold my short and keep thinking of my position I ran 2 scenario 1 winning and 1 losing and find that if I am winning I would happily get out 2,3,5 mins before market close but because I had a losing position I cannot get out 5 mins before the closing (even thou I know 5 mins will not bring it back to a profit). My mind at that time is to wait for the market to come my way so I lose lesses. I am basically prepare to take a loss but my mind was telling me to take a lesser rather than more loss.

Thanks for your advice.



gotta_trade

Discipline gives you the opportunity to build confidence. And when you have confidence, you won't mind taking a loss. You will be happy to.

Because once you take that loss you will be free to go on to your next opportunity. You will have the confidence to get in there and know that you can make it back.
 
Keep a journal of each trade you enter. Record the reason why you entered the trade, what happened on the trade, and most importantly how you managed your money on your trade (how you used your stop loss).

Constantly review your journal to see if there are events or trades you constantly won or lost on. Look at your money management, did you use a stop loss, was it placed correctly, did you move it correctly.

After six months of writing and reviewing you will know whether to keep trading and whether you are gaining discipline.
 
Think of yourself as an order taker. It sounds like your system offers zero discretion at the close so think of it as just doing your job to close the postion exactly five minutes before the market close.

Or automate your exit order and let the computer do it for you and walk away from the building.
 
remember that episode of South Park where the kid gets a chip implanted in his head that shocks him every time he curses? :).. if only traders could get a similar one whenever we get a "bright idea" in the middle of a trade..

-qwik
 
I also have discipline issues. It came to such a point that I don't care if I make or lose money today/this week/this month. I just want to stick to my rules 100%! I know that I absolutely have to be consistent to become succesful.

Market has no boundaries, no logic. You don't want to add your own unknowns to this. You have to be able to operate within a certain boundary which are your rules. Most traders are stressed beacuse of the unpredictable nature of the market. I'm actually more stressed because of my personal unpredictability.

You have to etch this in your brain--You will never become a successful trader and survive in this game if you don't have discipline.

If you feel like you're losing control over yourself and about to violate your rules, pull the plug. Close the position and don't trade anymore that day. If you do this several times, you'll start building confidence in yourself.
 
Quote from chinook:

I also have discipline issues. It came to such a point that I don't care if I make or lose money today/this week/this month. I just want to stick to my rules 100%! I know that I absolutely have to be consistent to become succesful.

Market has no boundaries, no logic. You don't want to add your own unknowns to this. You have to be able to operate within a certain boundary which are your rules. Most traders are stressed beacuse of the unpredictable nature of the market. I'm actually more stressed because of my personal unpredictability.

You have to etch this in your brain--You will never become a successful trader and survive in this game if you don't have discipline.

If you feel like you're losing control over yourself and about to violate your rules, pull the plug. Close the position and don't trade anymore that day. If you do this several times, you'll start building confidence in yourself.
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GREAT POST!!!
 
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