Quote from slapshot:
Yes, from "Trading in the Zone" I think is where I read it.
So eloquently describes a small trader getting squeezed out of a position almost exactly as it pivots...
I apologize in advanced. After listening some of his stuff, my conclusion is: it is not going to help me much. It is interesting to look at the material since Mark Douglas obviously have spent so much time thinking about the subject. Just from some vocabulary he used, I suspect he just rips stuff off Buddhism and other eastern disciplines, piece them together into his pseudoscience framework. This is the age of relativity and quantum physics, who still think like him? You better have some scientific evidence to back your theories. At least make up some fake statistics...
Here are some stuff off my head that I found helpful (not the exact wordings):
1) Kevin Haggerty (tradingmarkets.com), he was in the Marine Corp:
"Being in that part of Asia, you either can get it done or not get it done - no trading psychology B.S. Trading is just numbers like any business, if you can't take the heat, go do something else."
2) Sun Tzu's The Art of War:
"Whether you are going to win the battle depends solely on whether your enemies have made any tactical mistakes." (Minimize your chances of mistake unless you want other to win)
"Even though you know you can win a battle, you might not want to fight it just for the sake of winning." (There is always risk and cost - tell that to Mr. Bush.)
3) Marty Schwartz:
"Play with your head not with your gut."
4) From my checklist:
Any one trade is not important in the long run. Play small. Stick with the plan.
This is kinda where I am right now:
For my S&P scalping, I need a method with an edge that fit my personality. All methods have a very small edge. They are either high probability/low reward or low probability/high reward. Then I have to do everything in my power not to dampen the edge, i.e. doing screw-up things such as overtrading (taking unqualified setup and increase commission cost) and mixing in other methodologies.
I set myself to focus on a limited number of trade per day. Basically I am a scalper using a high probability/low reward setup with relatively tight stops. I can easily do things to dampen my edge just by mixing in low probability/high reward methods. I am doing what is comfortable for me then I will be less frequent to fall into emotional drama... why would anyone want to confront their ugly side? You do that at the comfort of your leisure not while handling money. There is a time and place for everything. If shit happens all the time, there is a problem with the plan or method.
This is just a note to myself of what fit me best at this stage. I also think paper trading is the best way to visualize/simulate/internalize the plan and save a ton of money. I wish someone could tell me this earlier. Enough babbling.
