It's not "practice, practice, practice" but deliberate practice
- Thread starter nitro
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When you get to advanced beginner, you begin to recognize the interlocking relationship of fractal trends.
Most people stay at beginner until they quit trading.
What is most common in the financial industry is only seeing up and down being repeated. This is the price action orientation.
So by the third up/down, the people oriented to horizontal lines like their S and R really get shaken out.
Post a table that shows three columns. Put up/down in the left and sentiment in the middle. On the right list dominance or non dominance.
You will find that a trend requires three moves. You can see in your table three up downs equals a full cycle of two trends.
Get 10 sheets of paper and pencil in one such table on each page. Count how many pages you waste before you understand a trend has three parts.
Think for an hour about the difference between S and R and a trend's RTL and LTL. See if you can find out why S and R do not work for making money and using RTL's and LTL's does work for making money.
After a while you may be able to understand what a price BreakOut (BO) really is. It certainly is NOT a BO of S or R.
One of the leading causes for failure as a trader is NOT restricting your trading to a specific and certain fractal of trending cycles.
The two major symptoms pf price action ignorance are the "early" exit and failing to take the max profit and then, too late, a chicken feed level of trading stop gets hit and a potential profit was turned into a loss at the pain limit of the ignorant trader.
Drills are how practice makes perfect. Anyone who posts in ET, usually presents his contemporary stumbling block. there is an easy drill for any stumbling block. Doing a given drill as long as it takes, is an immediate cure.
The six progressive skill levels going to expert trading only require doing a few drills on each of the progressive levels.
Take the problem you are addressing. To select the drill you need most is easy for any good mentor.
As a person moves through the beginner levels, he has to make a mental switch from up/down to right/left.
A normal heritage and life style is usually up/down oriented. IBM introduced for its sales people a test. It was published in Think magazine in the mid 50's. The unobtrusive test was to detect the person's orientation: vertical or horizontal.
You are a vertical person.
To trade as an expert, you have to be horizontal.
The horizontal BO's are "volatility expansion" Increasing money velocity of profit taking and RTL BO's the second stage of a new and opposite trend. This is true for both long's and short's.
S and R have different meanings for different sentiments and different dominances. A vertically oriented person , therefore, is fucked, if he tries to make up trading rules.
Trading is simple. There is no money management. There is no risk management. These things only come from vertically oriented people who are trying to learn to trade.
IBM was famous for introducing binary thinking in business. Read the principles of Behavioral Science of Behavioral Finance. Find out how all the mistakes people make are classified. There in black and white the drilling Practice) message is presented.
It takes an hour to write down the pieces of a trend. Long trends are identical to short trends.
Practice is only purposeful if, after you have the pieces, you do drills on putting the pieces together.
Jumping unintentionally from one fractal of cycling to another fractal of cycling, is the bane of potential traders who will never make it.
All fractals are interlocking in a ratio of 3:1.
Up/down is in a ratio of 2:1.
Any trend has three price moves: dominant; non-dominant; and dominant. Any trend has four volume moves (grouped by consecutive price moves): peak to trough to peak; peak to trough; and trough to peak.
So you see trends begin and end on volume peaks.
The proof in geometry is the method by which a person figures out how markets work.
All of the drills required have been posted and explained over and over.
So do the table over and over until you figure out how to change, mentally, from a vertical to a horizontal orientation. Try to understand how financial cycles work A financial cycle is composed of two opposite trends one after the other. Each trend has three moves.
The table looks like this:
Up long dominant
down short non dominant
Up long domimant
down short dominant
up long non dominant
down short dominant
A trend has three parts: dominant; non dominant; dominant.
A CW trpe guy is trading his set ups. LOL
He takes a long it is dominant
So is the next long he takes
But the third long he takes he loses the profits of the first two trades because he does not know the market is now in a short trend.
He jumped fractals all the time.
So most people practicing are practicing going out the back door and having to quit. See those I mentioned.
Up long dominant
down short non dominant
Up long domimant
down short dominant
up long non dominant
down short dominant
A trend has three parts: dominant; non dominant; dominant.
A CW trpe guy is trading his set ups. LOL
He takes a long it is dominant
So is the next long he takes
But the third long he takes he loses the profits of the first two trades because he does not know the market is now in a short trend.
He jumped fractals all the time.
So most people practicing are practicing going out the back door and having to quit. See those I mentioned.
Just wondering if your talking about elliott wave theory. Where there are three runs each of the 2 first runs followed by a pullback.
I might be entirely wrong.
I also feel if you have a true passion for trading you really don't even feel like your practicing. Actually my passion is like a disease that's progressing. Ha Ha.
I love to look at charts all day. After a while i just start to see things that i am not sure others have ever noticed. I am sure some have.
Just saying that there are so many variables in trading approaches that some people may be practicing but not moving forward. Trying to add this and that to make something that doesn't work work.
I use three variables Naked chart, take profit, stop loss. On any time frame. Max length of trade 4 days or so. I like mid to higher frequency trading.
It reminds me of an old story someone had told me about a contest on weather predicting. The folks in the contest came up with elaborate weather predicting models. The guy that won didn't have anything fancy to show. He simply said the weather tomorrow will be similar to the weather today.
So for me i feel i have an edge in predicting tomorrows outcome much better then next weeks thus the reason i like higher frequency trading. Not 100 trades a day but a few highly probable entries. I will hold within a small time frame until my take profit or stop loss hits if neither does I reallocate my money elsewhere.
Also i like this higher frequency trading due to the opportunity to compound your account with the same risk you had the previous day just a larger account.
This is just where my practicing has taken me. I am only 33 so i may sound like i have a lot to learn. Matter of fact as far as i am concerned i know nothing and never will thus the reason i have the drive to improve and move forward with my systems trades.
I look for a highly probable take profit followed by a reasonable stop loss. I don't mind my stop loss to be a little larger then my take profit as long as the win rate is high enough.
This followed by proper money management just in case you run into an unlucky amount of losses. (Draw Down).
Just being honest about where i'm at. Not at all saying anybody should do what i do. Or that I am worth anything. None of that means anything to me. I just like to do what i do think how i think.
I'll tell you what though Jack! Go ahead and throw some constructive criticism my way. I may not take it like a champ but i'll try ten times harder and practice ten times smarter.
Also I'll never quit no matter how bad it gets no matter what happens i love this game. Probably way to much for my own good!
But who's to say!
Obviously your a smart guy! Have a good one!
Thanks Jack,the drills are amazing,you are right.Now I got it what "jump fractals" means,I still do jump fractals,even though I know the consist of the 3 moves in price and 4 moves in volume.I need more practice,I guess.For hold and reverse on a 5 min chart I don't have appropriate tools.I got a sheet you were talking about,too.I like Vienna's one DNA of the market and I also do logging.
Be more "cautious" with the reply from Jack. It is merely a theoretical framework of ideal sequences.
The actual price and volume moves are sometimes visually and analytically "out of sync" to you and can make you spin and frustrated. You are then likely in the trap of "jump fractals" where your MADA in sequences could be incorrect and one mistake leads to another mistake.
So, you think you have a change of trend but you are not. You think you have a change of trend in a higher fractal but you are not.
Blame "jump fractals" on the limit and illusion of geometry in minute charts which could not deal with unusual cycle characters effectively.
I doubt that you can practise proposely with not to "jump fractals" until you enquire sufficiently more insights on the sequences.
Quote from Paddler:
You will be cooked. Do not say I never warn you.
Yes,I've already tried that and was cooked to the tune of 40K.But then i was a complete idiot...It has nothing to do with Jack btw,but I don't want to be cooked more.
P.s.BTW Jack,thanks for your time and efforts youve spent on my humble person.I've done a lot of drills under your mentorship.Want to thank other devotees as well!
Let's spend our time and efforts for problem solving and helping to others!
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