Maintaining Self Discipline

[studentofthemarkets]

This is my first post here on Elite Trader. I've been reading the contents of this site for years, but never seemed to have any reason to write anything until now.

I've been shown a way to trade that is most likely going to be profitable and doable for me. I don't plan to share the method. However, I'm having a really hard time following this trading system. I can see it working on the charts after the day is over, and many times I do take trades following the rules of the system. Those trades do really well. However, I'm making so many mistakes that I'm currently at a 40% win rate using a 1:1 risk to reward ratio.

A random system of entering, such as a coin toss, would be better than how I'm trading.

However, when looking over my trades very closely, I find that the majority of the losing trades have been due to my lack of self-discipline to follow the rules exactly.

My general tendencies to take losing trades are:

1. Jump right back in after a losing trade. Usually price has retreated to what looks like a better entry. So taking a second trade looks even better. Do that process enough times and oops, just lost 5 trades in 3 minutes. So, to overcome this I'm trying to work on passing up even a good trade if it's right after a loss. I'll probably fiddle with this rule a few times before finding something that seems to work.

2. Jump into a very fast moving market. Sometimes that works, sometimes that doesn't. It's not a very reliable way to enter. Too many times I've bought the exact high, to the tick, by doing this.

3. Fudging the rules because I want a trade and the market isn't setting up correctly for my entry, so I think.....I KNOW it's going to here, I should just get in now. I'm wrong so many times, when will I ever realize this? I need to remember a coin toss is a better system than my perception and remember I have rules that do work, when I follow them.

4. The rules of my system are complicated. Extremely. Too many times I've thought I was entering correctly, but I forgot about one or two rules. Or I simply misread the market criteria and thought it had set up according to my entry rules, but it didn't.

Point #4 is critical. The first 3 have to do with me as a trader, not following my plan. The 4th has to do with my trading system. Is it as reliable as I believe it is? If so, why is it so difficult to get it right? Is this something that will get better with more experience? I need to work on not misreading the entry set ups, as well as being very methodical with following each rule exactly.

What I hope to accomplish with this journal is to reflect on each of the issues that are keeping me from success and hopefully, begin to overcome them.

My goals for this next week:

1. Take only trades in accordance with my trading plan.
2. Record daily here on Elite Trader whether or not I followed my trading plan.

If anyone reads this, thanks for stopping by! Comments are welcome.

 

[expiated]

A random system of entering, such as a coin toss, would be better than how I'm trading.

I doubt it.

But to the point, I wouldn't be surprised if all four of your tendencies had to do with the same issue, which would be not having a thorough understanding of, and complete confidence in, WHY the method works. It sounds like you are simply following a list of requirements without a clear knowledge of the role each part plays.

If this is true, if addressed, there is a possibility that the behaviors you described above might begin to happen much less frequently because of the confidence and trust you would then have in the plan giving you the motivation to wait for the right opportunities to present themselves rather than chasing after unfavorable ones, and because your clear and thorough understanding of how the method works will enable you to "see" the ideal setups in their entirety without having to always refer to the rules/criteria in minute detail.

 

[Nobert]

I've been shown a way to trade that is most likely going to be profitable and doable for me. I don't plan to share the method. However, I'm having a really hard time following this trading system. I can see it working on the charts after the day is over, and many times I do take trades following the rules of the system. Those trades do really well. However, I'm making so many mistakes that I'm currently at a 40% win rate using a 1:1 risk to reward ratio.

Hey there student & welcome.

You said that you have been reading for years ;

yet, maybe iv missed it, but you haven't mentioned how long you're learning the hardcore skills, with screen time & practice, since knowing what to do & knowing how to do are two different things.

Once you get better at how to do part, the discipline part will adjust accordingly to your priorities & those are quite simple - to get the real understand of what is happening, once you open the position & to become profitable.

The process might take from 6 months to years, depending on your inborn character traits & personal effort combined with work ethic.

While we got members who made it pretty quick, some are struggling for decades & i personally, only admire that kind of determination.

If it gets hard & it will, just remind yourself - why to do part.
(the dreams behind all of the effort, the vision)

Following this tread and best of luck

5:59

 

[dozu888]

This is my first post here on Elite Trader. I've been reading the contents of this site for years, but never seemed to have any reason to write anything until now.

I've been shown a way to trade that is most likely going to be profitable and doable for me. I don't plan to share the method. However, I'm having a really hard time following this trading system. I can see it working on the charts after the day is over, and many times I do take trades following the rules of the system. Those trades do really well. However, I'm making so many mistakes that I'm currently at a 40% win rate using a 1:1 risk to reward ratio.

A random system of entering, such as a coin toss, would be better than how I'm trading.

However, when looking over my trades very closely, I find that the majority of the losing trades have been due to my lack of self-discipline to follow the rules exactly.

My general tendencies to take losing trades are:

1. Jump right back in after a losing trade. Usually price has retreated to what looks like a better entry. So taking a second trade looks even better. Do that process enough times and oops, just lost 5 trades in 3 minutes. So, to overcome this I'm trying to work on passing up even a good trade if it's right after a loss. I'll probably fiddle with this rule a few times before finding something that seems to work.

2. Jump into a very fast moving market. Sometimes that works, sometimes that doesn't. It's not a very reliable way to enter. Too many times I've bought the exact high, to the tick, by doing this.

3. Fudging the rules because I want a trade and the market isn't setting up correctly for my entry, so I think.....I KNOW it's going to here, I should just get in now. I'm wrong so many times, when will I ever realize this? I need to remember a coin toss is a better system than my perception and remember I have rules that do work, when I follow them.

4. The rules of my system are complicated. Extremely. Too many times I've thought I was entering correctly, but I forgot about one or two rules. Or I simply misread the market criteria and thought it had set up according to my entry rules, but it didn't.

Point #4 is critical. The first 3 have to do with me as a trader, not following my plan. The 4th has to do with my trading system. Is it as reliable as I believe it is? If so, why is it so difficult to get it right? Is this something that will get better with more experience? I need to work on not misreading the entry set ups, as well as being very methodical with following each rule exactly.

What I hope to accomplish with this journal is to reflect on each of the issues that are keeping me from success and hopefully, begin to overcome them.

My goals for this next week:

1. Take only trades in accordance with my trading plan.
2. Record daily here on Elite Trader whether or not I followed my trading plan.

If anyone reads this, thanks for stopping by! Comments are welcome.

It’s not a discipline issue. You don’t have a working system. As matter of fact, rule based profitable systems don’t exit.

 

[Option_Attack]

"4. The rules of my system are complicated. Extremely..."

Doubt that will allow any real and long term success.

 

[Nobert]

"4. The rules of my system are complicated. Extremely..."

Doubt that will allow any real and long term success.

That part, gets the attention right away.

Extremely complicated can be fixed by improving in certain skill sets. And some work on perspective/mindset, should be done as well, because if not -
then it's like going into the ring & already thinking about defeat.

 

[gaussian]

4. The rules of my system are complicated. Extremely. Too many times I've thought I was entering correctly, but I forgot about one or two rules. Or I simply misread the market criteria and thought it had set up according to my entry rules, but it didn't.

You should seek a parsimonious system rather than throwing everything at the screen. Chances are your system has data points that are performing the same task (in linear regression terms, they are not contributing to the R^2). Systems that are easy to explain tend to do the best when compared year over year.

Start removing indicators. First at random, and then more targeted. Run backtests each time to see the effect of each indicator removal. If you are only adding 0.05 to your profit factor, but reducing your sharpe by 0.15 (just made up numbers) you are adding indicators that are more risky than beneficial.

If your system is still complicated, you need to look into automated entries and exits.

Jump right back in after a losing trade. Usually price has retreated to what looks like a better entry. So taking a second trade looks even better. Do that process enough times and oops, just lost 5 trades in 3 minutes. So, to overcome this I'm trying to work on passing up even a good trade if it's right after a loss. I'll probably fiddle with this rule a few times before finding something that seems to work.

Retails need to stay away from the microstructure trades.

 

[fan27]

As matter of fact, rule based profitable systems don’t exit.

My brokerage statements say otherwise.

 

[Stocktracker]

This is my first post here on Elite Trader. I've been reading the contents of this site for years, but never seemed to have any reason to write anything until now.

I've been shown a way to trade that is most likely going to be profitable and doable for me. I don't plan to share the method. However, I'm having a really hard time following this trading system. I can see it working on the charts after the day is over, and many times I do take trades following the rules of the system. Those trades do really well. However, I'm making so many mistakes that I'm currently at a 40% win rate

If anyone reads this, thanks for stopping by! Comments are welcome.

Every person learns the market on his own base, some traders have a short learning curve, others will take them a little longer to experience and learn all the curve balls the market throws at them. The trick is to trade small, so you can last long enough in the game to prefect your trading plan and be able to handle those curve balls.

Good luck.

 

[Peter8519]

It been more than 10 years since my last job. I was naive back then, to think how difficult the stock market can be if I put in the hard work. Looking back, it was like jumping a deep hole without a rope of getting out. No one can help me getting out, I have to do it myself. Discipline is the key but having the following are equally important.
1. A supporting/understanding spouse (if married)
2. Have enough capital for the long haul

Have a living documented plan to instill discipline. The market is constantly challenging us and we have to learn and adapt constantly. Of course, protecting our capital is key and nothing else.