I should note that a lot of these issues never really came up before. Here is what I attribute that to. The better my tape reading skills become, the more I realize how bad a trader I really am. Before in my ineptitude, it was easy to explain any poor preformance by using the typical trader excuses. Now I realize these excuses are totally irrelevant, and my problems stem from internal rather than external factors. Hopefully this increased awarewess will ultimately be to my benefit, but now it is a source of conflict.
NQ Trades
- Thread starter AFterburner
- Start date
I appreciated your post very much. I was wondering, could you please elaborate on this point? I am interested to hear what you think about this statement; specifically what was your first impression and/or initial reaction? Thank you.
After reading your journal for a while I realized you didn't have any technical trading problems, that you knew what you should do, but didn't do it. So the question became, 'why is this guy putting himself through this.' I thought about when I was in the same sort of hell my first year or so of trading. At one point I was trading options based on fundamentals. Can you believe that crap? All because I knew what was going to happen. I was right almost all of the time... months after I had already lost bundles of cash on positions that were too big to begin with.
I got out of that funk when I started thinking about some wonderful (heh) training excercises I had the extreme pleasure (haha) of taking part in, in beautiful (hohoho) Quantico, VA. Lying in the snow for hours, waiting for a group of knuckleheads to walk by so we could unload on them. When they didn't come, we didn't continue to lay there until we died of exposure. We got up and left and waited for the next opportunity. There was nothing wrong with our planning or our setup, just that you can't control other human beings.
I thought, it was a huge price to pay, to lay in the snow for so long, but I paid it and didn't care. So I should not have a problem exiting a stinking bad trade, the second I know it is a bad trade. That hardly costs anything. Sure, sometimes i'll be fooled, but who cares. Maybe those knuckleheads walked by five minutes after we left. Nothing I can do about it. At least I wasn't cold anymore.
Hey, maybe you could start a tape reading thread. I'm sure a bunch of us would like to learn how, and you'd get a lot of satisfaction out of being a mentor, I think.
My problem is that instead of getting out of the snow when I know that I should, I'll think about how last time they came by five minutes after I left. Then I'll stay another five minutes; only this time I'll be just a little bit colder. Then five becomes ten, ten becomes twenty. At this point I know that I should have gotten out when I first thought it, but now I'm committed. Finally, four hours later when I'm at the verge of a hypothermic coma, I summon the strength to call in an air lift. As I'm being flown out, I look down to see them coming along in the distance. That sight is more painful than death. So next time, I push my endurance even further.
Here is something that I've always believed. It's important to learn from your mistakes, but it's essential not to drawn the wrong conclusions. I realized the mistake, but my solution was to wait in the snow even longer next time. Therefore, I've drawn the wrong conclusion, and worse yet is that practice makes permanent (not perfect). Where originally it was a voluntary mistake, now it is an involuntary response. At this stage it will be very hard to overcome.
Well written journal.
I recognize a lot in your journal about the discipline issues in myself. Also our trading styles seem similar (coincidence?). We also might be in about the same phase of development.
From what I read I think you are a good trader indeed and possible great trader-material.. IF you overcome these mental issues.
I am gonna give you the best advice I gave myself lately: Don't be so hard on yourself! I hope you want to do me a favor in return. I really wonder how long you have been trading. If you don't want to make this public pm me!
Cheers,
t4s
I recognize a lot in your journal about the discipline issues in myself. Also our trading styles seem similar (coincidence?). We also might be in about the same phase of development.
From what I read I think you are a good trader indeed and possible great trader-material.. IF you overcome these mental issues.
I am gonna give you the best advice I gave myself lately: Don't be so hard on yourself! I hope you want to do me a favor in return. I really wonder how long you have been trading. If you don't want to make this public pm me!
Cheers,
t4s
I think that Friday was a preparation day (or an inflection point depending on how you look at it). In the tape I could see that there was a lot of positions (long and short) being accumulated (this was most evident around 2:00 EST although I didn't realize it at the time). There are always a lot of both long and short positions being accumulated at an inflection point but only one will prove to be correct. The crazy thing about inflection points is that by looking a chart, you could make a sound case for either direction. The tape is the tie breaker. When I was starting to get extremely frustrated is when other traders began to take their positions. Right now I am feeling really sheepish because not only did I get out early, I got out before the move had even begun. This happens to me more often than I care to admit with position trades. I see things developing very early and get in. Then I get extremely frustrated because the move isn't happening right away or how I expected it to happen. Finally I get out right as things start to heat up. Looking back, I think that Thursday was the false breakout to shake out all of the weak shorts (myself included). Friday was the day to hook all the dip buyers (myself included since I had to buy to close out my position). I wasn't anticipating either of these things. Now the market is positioned the same as on Wednesday except that I no longer have my position nor do I have the heart for it anymore. If and only if market action confirms my theory, I will try to pick up some easy points on Monday. However, I will not attempt another position trade because I am too weak (mentally and emotionally) for it right now. Please be advised that this is just my personal market theory and should not be construed as gospel. I wrote it in order to gain some clarity about what had happened to me this week. I am only posting it because I feel that it contains valuable insight into market and trader psychology that can be adapted to fit many different situations.
Since you are always advising me, I thought that I'd return the favor. It seems to me that you prefer the role of mentor/teacher to that of trader. It also seems to me that you are too risk averse for trading. Trading is the business of managing risks, not avoiding them. I could see where you might freeze up completely under certain trading circumstances (I've been having similiar problems lately related to second guessing myself). If I were you I would be trying to derive my income (if necessary) from being a psychologist/psychiatrist specializing in traders rather than actual trading. You could always trade at a minimal level just to gain insight about the trader's mind. I think that you would find this career much more satisfying (and lucrative) than trading for yourself. Just a suggestion. Please don't take offense, because there's nothing to be offended about. I'm not saying that you aren't a successful trader, you probably are. I just think that your passion is helping traders rather than trading. Maybe I'm wrong, but that's the vibe I get from your posts.
Hi AFterburner,
First of all...don't try to guess whom I am.
Just ask and no offense was taken by your above comments.
I've had numerous leadership positions from childhood to adult...leadership roles that require great discipline to keep everybody working together while leading by example...
Jr. National level sports, International level sports, Ex-Military, Academics, Parenting and even being the designated kid to take on neighborhood bullies when I was a kid.
Yes...I have a strong tendency to inform, instruct and lead by example while reflecting upon my own past experiences...
especially when someone is asking for answers to their questions.
I am a futures trader...I've been happy with this career (didn't start in futures) for over +14 years although it had a rough start.
As for freezing up...I'm not sure where you got that from nor the purpose for the comment.
Every trader has some form of trading problem. Yet...to suggest freezing up...that's an odd statement considering you know nothing about me personally.
I do know this...I highly recommend to a trader to stop trading if they freeze up while trading...this is something extremely serious...
not the usual stuff we as traders deal with day to day in the market.
You don't know how deep my pockets are...you don't know how large or small of a size I trade...you don't know how long I've been trading size...you don't know how I manage my risk via position size management...you don't know how my prior experiences have instilled themselves into my trading nor do you know my pain threshold.
My definition of Freezing Up: No longer having the ability to perform when under pressure or unusual stress...not being able to think in a way to accomplish the goal or a task.
That's never happened in my trading and I hope it never will happen although it has happened in other areas of my life (more info later in this post).
Further...I trade because of the challenge and I see it as a good job to have to engage that challenge.
In fact...if you knew me when I was an athlete and knew me personally as a trader...you'll see that I treat both the same...especially the psychological aspects...
that's my edge.
I'm just happy that challenge allows me to be profitable and to be able to support my family.
To be fair...if I wasn't profitable...would I still be trading?
The answer is no...I have a family to support and would find another career faster than you can blink an eye to be able to continue supporting my family.
Here are more facts...
One of my closest friends is a well-known psychologists, my spouse academic background is psychology/psychiatrics and plans soon to get her PhD...
We also subscribe to a monthly psychology magazine that's one of my favorite magazines to read next to my Black & White magazine
Therefore...your advice or recommendation for me to go into psychologist/psychiatrist specializing in traders rather than actual trading...is not very good piece of advice because having one in the family and two in a close group of friends is enough and would probably disturb the balance we have.
Also...I'm not interested in returning back to any post-graduate level studies...just to make money analyzing traders.
I do understand your just poking around...trying to find something...
please just ask via private message...you'll get answers to your probing a lot faster and more accurate.
As for my passion...its my family, landscape photography and darkroom photography.
Once again...trading is a job I enjoy that supports my passions in life.
My sleep is rarely disturbed by events in my trading...it's just a job just like all others before it.
I'll tell you what can freeze me up (second guessing myself)...doing current landscape shots with my new format camera...first time I changed my newborn diapers...first time I was pushed over a steep ski slope at Whistler at one of its highest peaks (first time skiing...no ski lessons and was lied to being told we were going to the beginners slope) by my spouse and some friends...
second time down I didn't freeze up...didn't want to be laughed at again
Simply...my passions and my job work well together...there's a balance.
It's critical that traders have a balance in their life to perform well under pressure when hard earned money is on the line.
This is what I want you to understand nor to underestimate my happiness with what I do via suggesting a different career...
a lot more to you than I thought.
AFterburner...you have a good psychological trade journal here...stay on course with that as long as it still helps you accomplish your goal...don't try to analyze others when the journal is about you.
Good night.
P.S. My initial posts to you are mainly via questions (probing)...not advice.
My first advice to you was to read what happened to other journals about accountability...after that...I didn't offer another piece of advice until you said you were looking for suggestions.
In fact...if you review my posts carefully...you'll see most of our exchange was about the essence of your journal and/or me asking questions.
Maybe you took my comments about being careful as giving advice.
I'm just trying to correct your statement when you said I'm ALWAYS advising you.
NihabaAshi
I started a thread a while ago about discretionary entries and exits. No one seemed interested... but this is what we face:
entries: too loose means lots of small losses from lower quality trade setups. However, you catch all of the good ones.
Too tight means you avoid all of the lower quality ones, but you miss to many good ones.
exits: too tight means you are giving up too much profit, not letting your winners run enough, but you avoid all of the big losses. Too loose means you get all of the big moves, but this hardly compensates for all of the smaller winners-turned-losers and larger losses.
The goal is to strike a balance, to stand somewhere in the middle in both entries and exits.
The price we must pay to stand in the middle is that we will occasionally miss a good trade and occasionally exit a little too soon or a little too late. Otherwise, if we go for it all, we get screwed as noted above. There's no way around it.
Thus for me it's an ongoing process. If I start missing too many good trades then i'll loosen up my entries. Notice I said 'too many' good trades, not 'miss a single good trade'. Same goes for exits.
Quote from NihabaAshi:
First of all...don't try to guess whom I am.
One of my closest friends is a well-known psychologists, my spouse academic background is psychology/psychiatrics and plans soon to get her PhD...
We also subscribe to a monthly psychology magazine that's one of my favorite magazines to read next to my Black & White magazine
Therefore...your advice or recommendation for me to go into psychologist/psychiatrist specializing in traders rather than actual trading...is not very good piece of advice because having one in the family and two in a close group of friends is enough and would probably disturb the balance we have.
NihabaAshi
Sorry. Next time I will use a private message (I just want to take this small opportunity to wrap this up in the journal). You were one of the posters to my journal that I couldn't quite get a handle on. I couldn't justify taking any of your suggestions until I knew where you were coming from. Hearing that one of your good friends and especially your spouse are involved in the field of psychology makes sense. That was the missing piece of information that I needed. The rest was just auxiliary probing. There was nothing more to my post than trying to figure out the psychiatrist vibe I was getting from you while also eliminating any cross signals or lingering possibilities. Thank you for your honesty and once again I apologize for handling it the way that I did (these instant messages / public forums are a new experience for me).