Maintaining Self Discipline
- Thread starter studentofthemarkets
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Today is one of those days where I failed at "Maintaining Self-Discipline."
I got the direction of the trades taken right most of the time, but the timing of the entries was really bad. The volatility was a little different than what I'm used to and so it threw me off to see what I thought was the right direction to trade, and it usually was, and to be stopped out, yet think the trade was right, and if I re-enter, I should catch it.
Rather than quitting, recognizing that I wasn't trading well in this environment, I increased the number of trades taken. This way of thinking backfired and cost nearly all of my profits in the Main Demo Account since November 19. I'm left with $45 of profits (after commissions) and a 53% win rate. One really awful day of trading can undo so much. I know that. I hate that it works like this. And I really don't know how I'm going to learn to be self-disiplined enough to overcome this in live trading.
One thing needs to change: I need to know exactly what my trade entries are. I'm guessing way too much. If I know what usually works, and have a day where it doesn't, that should really help in recognizing when I need to quit for the day. I could set a limit on the number of losses, and I plan to when trading live. But for now, it makes sense to me that I need to learn, as in today, things that you can't learn by stopping early for the day. If I had stopped early, I would still have believed that "if I had just caught the next trade...I could have made back the losses." Now at least I have the grief of the consequences of continuing to trade when I shouldn't have. And the one thing that I was so proud of...having a net profit for 2 months has basically disappeared.
The "2 Contracts Demo Account" was a disaster. By not moving the Stop Loss to BE, I added more losses to the losing streak I was on. There were some good things to notice, however. 1. There was one runner and I closed it for 65 ticks ($325). 2. The original placement of the take profit for the runner was placed an addition 70 ticks above that, and was eventually hit. 3. Price only went against the runner by 5 ticks. Really wish I could catch only those kinds of trades.
Main Demo Account: 9 wins and 15 losses
2 Contracts Demo Account: 4 wins and 20 losses (Note: having a runner didn't overcome the these losses.)
Practice Demo Account trading the first 30 min of the open: Ended negatively
I got the direction of the trades taken right most of the time, but the timing of the entries was really bad. The volatility was a little different than what I'm used to and so it threw me off to see what I thought was the right direction to trade, and it usually was, and to be stopped out, yet think the trade was right, and if I re-enter, I should catch it.
Rather than quitting, recognizing that I wasn't trading well in this environment, I increased the number of trades taken. This way of thinking backfired and cost nearly all of my profits in the Main Demo Account since November 19. I'm left with $45 of profits (after commissions) and a 53% win rate. One really awful day of trading can undo so much. I know that. I hate that it works like this. And I really don't know how I'm going to learn to be self-disiplined enough to overcome this in live trading.
One thing needs to change: I need to know exactly what my trade entries are. I'm guessing way too much. If I know what usually works, and have a day where it doesn't, that should really help in recognizing when I need to quit for the day. I could set a limit on the number of losses, and I plan to when trading live. But for now, it makes sense to me that I need to learn, as in today, things that you can't learn by stopping early for the day. If I had stopped early, I would still have believed that "if I had just caught the next trade...I could have made back the losses." Now at least I have the grief of the consequences of continuing to trade when I shouldn't have. And the one thing that I was so proud of...having a net profit for 2 months has basically disappeared.
The "2 Contracts Demo Account" was a disaster. By not moving the Stop Loss to BE, I added more losses to the losing streak I was on. There were some good things to notice, however. 1. There was one runner and I closed it for 65 ticks ($325). 2. The original placement of the take profit for the runner was placed an addition 70 ticks above that, and was eventually hit. 3. Price only went against the runner by 5 ticks. Really wish I could catch only those kinds of trades.
Main Demo Account: 9 wins and 15 losses
2 Contracts Demo Account: 4 wins and 20 losses (Note: having a runner didn't overcome the these losses.)
Practice Demo Account trading the first 30 min of the open: Ended negatively
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One of my filters I've been ignoring for the last week. So, starting tomorrow, I'll try to take trades only aligning with the filter and see what happens. With backtesting, it's seems like the answer. But I've thought that with so many things before and real time never seems to work the same.
Update:
Since I will be starting over with the "Main Demo Account" after Monday's losses, I decided to take a break from the goal this journal was created for: improving my statistics using 10 SL and 10 TP. I traded using 2 contracts with 10 SL but managing the trades. I don't know what to think. I ended up nicely positive for the day ($370) and the drawdown of the account was minus $80 at the worst part. However, the losses from using 2 contracts added up fast and it seemed like without have a high accuracy rate, I'm still just "gambling" in a sense. In other words, today's trading seemed to be very risky. Why am I trading if I don't like risk? I guess I thought I could micromanage my entries to make the risk to reward very minimal. Looking at the charts, it looks like that should be possible, but when actually trading, there are so many variables, that I feel like I'm guessing on every trade. I don't like that at all. And that was the whole point of working so hard to improve the 10sl/10tp stats. It seems like I can't improve them, yet it also seems like the more time I spend focused on just the 10sl/10tp I'm noticing more and more things that can help with timing entries. So, I haven't decided how long of a break I'll take from trading 10sl/10tp without adjustments.
Since I will be starting over with the "Main Demo Account" after Monday's losses, I decided to take a break from the goal this journal was created for: improving my statistics using 10 SL and 10 TP. I traded using 2 contracts with 10 SL but managing the trades. I don't know what to think. I ended up nicely positive for the day ($370) and the drawdown of the account was minus $80 at the worst part. However, the losses from using 2 contracts added up fast and it seemed like without have a high accuracy rate, I'm still just "gambling" in a sense. In other words, today's trading seemed to be very risky. Why am I trading if I don't like risk? I guess I thought I could micromanage my entries to make the risk to reward very minimal. Looking at the charts, it looks like that should be possible, but when actually trading, there are so many variables, that I feel like I'm guessing on every trade. I don't like that at all. And that was the whole point of working so hard to improve the 10sl/10tp stats. It seems like I can't improve them, yet it also seems like the more time I spend focused on just the 10sl/10tp I'm noticing more and more things that can help with timing entries. So, I haven't decided how long of a break I'll take from trading 10sl/10tp without adjustments.
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Practice Demo Account trading first 30 min of open: Ended in losses
Main Demo Account: $130 profit after fees/commissions
I suffered from the fear of taking a losing trade and missed a lot of good opportunities today. The trades I did take were not great entries, although I thought they were at the time. The drawdown was $220 and the highest the account got was $130 which is when I quit for the day. Trading with 2 contracts and managing the stops works nice when the trade is going in my favor. It's gonna be a while before I can be more precise with my entries, but I'm still working on it.
I just noticed something: If I had traded 10sl/10tp with 1 contract, I would have been at breakeven minus fees, because I would have had 4 losses and 4 wins. Possibly I could have done better if I had managed the trades. Managing the 2 contracts is what helped this to be a positive day. However, the drawdown on the account is out of balance to the wins, so this could easily have been a losing day.
Seems like if I don't get a winning trade the first time, then I keep trying and going more in the negative. When I'm in the negative and I do get a winning trade, I close it too early so that I have a positive balance and don't risk losing it again. Two of the trades today would have made hundreds of dollars if I had just stayed in longer. If my entries were more precise, so that I was catching those trades the first attempt, it would be easier to hold onto a runner.
Main Demo Account: $130 profit after fees/commissions
I suffered from the fear of taking a losing trade and missed a lot of good opportunities today. The trades I did take were not great entries, although I thought they were at the time. The drawdown was $220 and the highest the account got was $130 which is when I quit for the day. Trading with 2 contracts and managing the stops works nice when the trade is going in my favor. It's gonna be a while before I can be more precise with my entries, but I'm still working on it.
I just noticed something: If I had traded 10sl/10tp with 1 contract, I would have been at breakeven minus fees, because I would have had 4 losses and 4 wins. Possibly I could have done better if I had managed the trades. Managing the 2 contracts is what helped this to be a positive day. However, the drawdown on the account is out of balance to the wins, so this could easily have been a losing day.
Seems like if I don't get a winning trade the first time, then I keep trying and going more in the negative. When I'm in the negative and I do get a winning trade, I close it too early so that I have a positive balance and don't risk losing it again. Two of the trades today would have made hundreds of dollars if I had just stayed in longer. If my entries were more precise, so that I was catching those trades the first attempt, it would be easier to hold onto a runner.
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Based on what I can see, your trades should have been taken on the 1mn chart and not the 5mn chart, especially for a scalp. Green means up and red means down and you could have made more cash just for the sake of buying the color green and selling the color red and not pay any attention to what type of candle or Volume you have, are you ready for a switch yet?
"your trades should have been taken on the 1mn chart and not the 5mn chart, especially for a scalp"
I use the 5 min for trying to find the trend. But I actually enter based off of lower time frames.
I can start posting a 1 min chart.
Hmm....I kind of see what you mean as far as buying the color of the candle. I'll try to use that as a filter along with what I've been doing and then when I post tomorrow's trades I'll post the Heiken Ashi chart alongside to compare how it went.
Thanks for your input!
"your trades should have been taken on the 1mn chart and not the 5mn chart, especially for a scalp"
I use the 5 min for trying to find the trend. But I actually enter based off of lower time frames.
I can start posting a 1 min chart.
Hmm....I kind of see what you mean as far as buying the color of the candle. I'll try to use that as a filter along with what I've been doing and then when I post tomorrow's trades I'll post the Heiken Ashi chart alongside to compare how it went.
Thanks for your input!
Candle colors or bar colors are colored based on how the chart software perceives the bars, they are considered either up or down, but most trading software, one can manually select colors for up bars and down bars, the software default selects whats green or red, but there is also a mixed bar that you can color differently. Be careful with that one, i used to use a different color for it, but often times it would spook me out of a trade too early, its good for tops or bottoms but it easy to identify why a bar is mixed on where its combined open or close points are. This stuff is no secret, people just need to look and experiment with what they have.
Good to know. I don't really pay attention to mixed bar colors...I think I have them showing on the TOS platform but haven't thought about it with Sierra Chart.
Something came up and I wasn't able to trade much today.
However, I did catch a winning trade. It also aligned nicely with the Heikin Ashi 1 min candles.
Next week I'll try to stay in a trend longer.
Only took 1 trade today:
Main Demo Account: Made 50 ticks in one trade, 1 contract off at 14 ticks and 1 contract off at 36 ticks.
Going forward: I'm considering working on the 10sl/10tp only in sim mode when it's not trading hours because it seems like using 2 contracts and managing the trades is much more profitable and I haven't been able to make much of a profit with 10sl/10tp. I had been hoping to have a better winrate using 10sl/10tp before adding contracts and managing them. But I'm admitting defeat here and moving on. I want to see what happens using 2 contracts set at 10 ticks stop loss and adjusting the target....will have them originally set to 10 ticks and 20 ticks for a profit target, but will adjust them. Also, the stop loss will be adjustable only for a tighter stop or move to BE+ but at this point I don't plan on having a larger than 10 SL, although there may be some high volatility days where I do adjust that to larger. I know using a set 10 ticks for a stop loss isn't the best way to go about it, it should be placed under a previous low or have some reasoning behind where it's placed. But for now, I want to try this and see how it goes. There is a good reason behind it: it will help me to learn to identify good entries that have only 10 ticks at the most risk. Sure, there are other good entries, I see them all the time, that are likely to work but need a larger stop loss amount. For now, I don't want to work on that. Without changing the original placement of 10 ticks for a stop loss I can monitor better how I'm doing as far as the likelihood of a trade working for a tight stop loss vs adding more risk to a trade. It's just a parameter to work within that I like using for now, while I'm learning my way around charts, but in the future I'm sure there will be a time to work on that.
However, I did catch a winning trade. It also aligned nicely with the Heikin Ashi 1 min candles.
Next week I'll try to stay in a trend longer.
Only took 1 trade today:
Main Demo Account: Made 50 ticks in one trade, 1 contract off at 14 ticks and 1 contract off at 36 ticks.
Going forward: I'm considering working on the 10sl/10tp only in sim mode when it's not trading hours because it seems like using 2 contracts and managing the trades is much more profitable and I haven't been able to make much of a profit with 10sl/10tp. I had been hoping to have a better winrate using 10sl/10tp before adding contracts and managing them. But I'm admitting defeat here and moving on. I want to see what happens using 2 contracts set at 10 ticks stop loss and adjusting the target....will have them originally set to 10 ticks and 20 ticks for a profit target, but will adjust them. Also, the stop loss will be adjustable only for a tighter stop or move to BE+ but at this point I don't plan on having a larger than 10 SL, although there may be some high volatility days where I do adjust that to larger. I know using a set 10 ticks for a stop loss isn't the best way to go about it, it should be placed under a previous low or have some reasoning behind where it's placed. But for now, I want to try this and see how it goes. There is a good reason behind it: it will help me to learn to identify good entries that have only 10 ticks at the most risk. Sure, there are other good entries, I see them all the time, that are likely to work but need a larger stop loss amount. For now, I don't want to work on that. Without changing the original placement of 10 ticks for a stop loss I can monitor better how I'm doing as far as the likelihood of a trade working for a tight stop loss vs adding more risk to a trade. It's just a parameter to work within that I like using for now, while I'm learning my way around charts, but in the future I'm sure there will be a time to work on that.
