I'd like to become a better trader

[PO]

P&L 0 points

 

[PO]

P&L 0 points

 

[PO]

I need to learn and relearn the lesson of top picking. Instead of trying to pick the top, I need to wait for the market to show weakness and sell pullback instead. You almost always get the same price or just slightly worse, and much higher probability of winning at the same time.

I broke even for today, but if not for my multiple stop-outs this morning, I would have been up about 8 points.

 

[PO]

Another observation is that I was so set on gap fill to come that I was ignoring what was in front of me and it was an uptrend. Need to be more flexible in my expectation and trade what I see.

 

[Laissez Faire]

Quote from PO:

Another observation is that I was so set on gap fill to come that I was ignoring what was in front of me and it was an uptrend. Need to be more flexible in my expectation and trade what I see.

The same thing happened to me on Monday. It seems like we`ve been conditioned to a lot of quick gap fills on the same day lately, but it is obvious that gaps can be unfilled for the day and even longer than that.

Thus, the gap is always a good target if you can get confirmation from the price action, but if the price action says we will leave the gap behind for the day, that`s the scenario you`ve got to accept and trade.

Today, it did work out, but only late in the day

 

[PO]

Quote from Laissez Faire:

The same thing happened to me on Monday. It seems like we`ve been conditioned to a lot of quick gap fills on the same day lately, but it is obvious that gaps can be unfilled for the day and even longer than that.

Thus, the gap is always a good target if you can get confirmation from the price action, but if the price action says we will leave the gap behind for the day, that`s the scenario you`ve got to accept and trade.

Today, it did work out, but only late in the day

speaking of gaps, I think there is one opened around 1254-1244. We can easily drift there on pre-holiday low volume without a major pull back. Something to keep in mind and not try to catch the top.

 

[Ghost of Cutten]

Quote from PO:



My Resolutions --- I will need help to stick with them. I don't know why I break my rules... But I cannot longer afford to do that.

1. I'm trading ES exclusively.
Never adding currencies, stocks or options into the mix.
They take away from my focus.

2. Take only selective high probability trades.
It's better to miss a trade then to rush into it.
When in doubt - stay out.

3. Always have a catastrophic stop loss in place.
Don't ever add to a loosing position.
I need to learn how to loose.

4. Don't trade until I assess the market's trend.
Will try to write down reason for a trade, stop loss, target.
Publish my EOD p&l here.

5. Keep tabs on my emotional state.
Take a break after a loosing trade.
I don't need to be right, I need to be wrong small.

Suggestions:

I would alter 4. to:

4. Don't trade until I assess the market's *state* - i.e. bull trend, bear trend, ranging, unpredictable noise - and then select the strategy appropriate for the prevailing market state. You are assuming there will be a trend - but markets usually don't trend, and spend most of their time ranging or moving around aimlessly and unpredictably. Use trend strategies when it's trending, when it's in a range use mean reversion at extremes, when it's directionless noise don't trade.

I would add:

6. What is the bull scenario, the bear scenario, and the neutral/ranging scenario? How would the market act under each scenario? How will the market act if it transitions from one scenario to another? How do I identify each scenario or transition, and how should I best respond in each case (bull, bear, neutral/ranging, transition)?

Example: the ES is in a strong bullish trend intraday. You adopt the strategy of being long 1 contract using a trailing stop, and adding 1 contract on dips, and selling out that contract into extended rallies. The bull scenario is that the trend continues with higher highs and higher lows. The neutral scenario is that the trend pauses and then enters a choppy trading range, maybe slightly taking out the recent lows, triggering stops, then going back to the recent highs, doing a bull trap false breakout and reversal back into the range. The bear scenario is that the trend reverses, takes out the lows and moves significantly lower before a weak rally, then stalls and heads back even lower. Transition from the current bullish market state might be say 45 minutes without any new highs; rallies getting weaker and pullbacks getting stronger; market reaching strong overhead resistance; and so on. You would then have to decide the odds of the bull run being over, given the signs the market is showing; and then assess how the market should act if it is the start of a choppy trading range (somewhat weak, but not very weak price action), or the start of a new bear trend (very weak market action).

 

[Ghost of Cutten]

Quote from PO:

closed previous trade at break even as I never was happy with it.
I broke my rule of not trading congestion and taking only high probability set ups.

Why did you enter a trade you weren't happy with? Why did you break your rule?

You won't stop breaking rules and overtrading unless you identify the psychological reasons for acting that way. That requires self-analysis and record-keeping of your thoughts and reasons, not just your actions.

 

[PO]

P&L -7 points

That big green candle after the report got me excited and I bought after a small pullback. Pullback was too shallow to buy so soon, but I yet again didn't want to miss the move. I know it all after the fact, but when I'm in the midst of it, I just don't see it.

After that I revenge traded for a little bit untill I realized that we are in a range congestion and I should stay away.

I'm still too emotional and impulsive. will take a day off tomorrow to work on these issues.

 

[PO]

Quote from Ghost of Cutten:

Why did you enter a trade you weren't happy with? Why did you break your rule?

You won't stop breaking rules and overtrading unless you identify the psychological reasons for acting that way. That requires self-analysis and record-keeping of your thoughts and reasons, not just your actions.

thanks for your comments, I'm working on self-analysis and I also need to think about it and figure out some way to record my thoughts during trading.