Quote from NeedHelp:
Heya!
Well, I did short this morning but I was very weary of reversals because of my previous experience with shorts. And then I got in LONG a little bit of the mid day rally. Not much. So, longs don't feel so bad. I just need to do that everyday. But I'm still so fearful from the scars.
This is some progress. I'm not making gangbusters. But then again I'm NOT losing gangbusters either on this reversal. It's somewhat of a good sign right? Making some progress right guys??
-k
Needhelp,
Well, you are making good progress! Congrats!
I think one possible solution to your problem is perhaps to build trading systems. Trading systems will REMOVE any EMOTIONAL PITFALLS you might have - like the tendency to short RALLIES. Or get nervous with longs,etc. Or any number of issues.
I can empathize with you. This last week, I went through a rather brutal process myself. It has nothing to do with not being to go long. It's more of me not doing what I'm used to doing. I'm more of a systematic/quantitative type trader.
And this last week all I did was manual scalping, because I"m still in the process of setting everything up. The results were DISASTROUS to say the least! Like ouch! And it was the WORST week of my trading career so far. I couldn't believe how fast it went. One person on here knows that.
So you are not alone. Because it's so EASY to get into the pitfalls of emotions - fear and greed. And errors in entries and exits. Risk management, position sizing, etc. Trading is difficult enough as it is. But to get emotions and host of other nontrading issues involved makes it a lot harder.
So, why bother sweating over it and let the machine execute your strategy exactly EACH AND EVERY TIME? I mean no strategy is perfect but that's why you backtest it until you find something that is suitable.
I mean I've done some successful manual trades in the past. Some exciting war stories of being up huge on a big down slide or big rallies. But on average, I think manual trading costed me when you are not in the right frame of mind. When you and the market are aligned, a manual trade can result in explosive profits. But when you are not it can be not so great.
So, on average, it's best to be systematic about things at least for me. You want to cover 80-90% of the cases. Not 10% of the case when that one manual trade is so great. There will be times for that...
Now, I'm embarking on a new plan of systematizing everything: Entries, exits, stops, risk managment, position management, real-time filtering/scanning, executions, etc. So, I'll spend my time refining and working with system issues. And let the yo-yo feelings of the market volatility be dealt by my trading system. Plus, by using the system, I'll not only not have to deal with the human issues of fear,greed, indecision, mistakes,ec. But I can trade more securities as well. As a daytrader, you can only watch closely at most 1 or 2 stocks or futures closely. But with a trading system you can run an entire portfolio and potentially produce more profits. When I was working at various quant funds, we held positions of hundreds and in some case thousands of securities long/short. So, in that case, it's impossible to manually open up a hundred charts and read the a hundred times & sales.
Just think of what a system can do for you. Relieve pressures and make you more disciplined.
Good luck! Wish me luck too!
quantpatterns
