SlaPa
- Thread starter Hooti
- Start date
Caring about who wins, caring about winning, caring about profit are all behaviors that eventually lead to failure, largely because they all introduce ego into the picture. And in this regard, it doesn't matter whether one is mechanical/automated or discretionary/intuitive. They find/stumble upon something that "works", or appears to, and they use it until it doesn't "work" anymore. Then they tweak or overhaul or start over. But they never begin with a thoroughly-tested, consistently-profitable plan at the outset.
There are many reasons why one might be short-term successful and yet blow it all when circumstances change, the most common being market conditions. Since beginners are by definition ignorant (which is cured by learning), few if any understand the role that market conditions play in their success. '98-'99 is only one example of this. But a great many of these failures, rather than review and learn from their failures, instead decide that there is no "there" there, that it's all a lot of hokum, that it's all the gurus' faults and everybody who claims to be successful is lying. And have been. For years. Decades. Centuries. These people need to find something else to do with their time.
Success does not come with caring -- no matter how deeply -- about winning and profits. Success comes with trading well. And that is the only concern during the trading day: did I follow my plan? (the plan being the thoroughly-tested, consistently-profitable plan, not the "it looks like it's going to go up" plan or the "I feel like it's getting ready to move" plan) Doing the "exact, right things" over and over? Yes, assuming that they have in fact proven to be the "right things". Doing the same untested and only occasionally profitable thing over and over does nothing other than empty the account, though it may prompt one to feel "disciplined".
The fact is that most people have no idea what they're looking at. Therefore they have little to no idea what to do with it. Review the journal posts made for Thursday and Friday and you'll have no trouble finding people who actually lost money one or both days. There is no excuse for this, though there are plenty of reasons, the chief reason is that none of them have, again, thoroughly-tested and consistently-profitable trading plans.
Those who really want to be successful will plan their trading sessions in advance, anticipating every scenario they can think of along with all the accompanying contingencies and end the day by reviewing what they did and why they did it EVERY SINGLE DAY that they trade. Those who do it once a week or once a month don't care, but they will complain the loudest.
This is the thing I've come back to over and over. The Plan that turns out not to be a plan. It was what NoD said she found also, that we thought we had a plan, but in hindsight and with experience realize we in fact did not. For me that is in spite of the countless books read and classes taken.
That is why I'm going back to observation, to take what I understand now and go over the process again.... maybe now I have a clue what a plan is. Watching Db apply his plan has been just as significant as the plan. Knowing to do it is as important as having it.
There is another thing though... like in the super bowl. Those teams both had plans and were professionals. Yet Denver got off on the wrong foot. Perhaps ego came in? With ego, or for whatever reason, they were to tight and forced it? Just a quick initial loss that day and they were not able to recover during the rest of the game, and one stunning initial loss turned into a rout.
I see that in trading also, as you say... likely due to introducing ego into the picture, even if you have a plan. It is just human.
BUT in trading you don't have to keep playing. If you are having a bad day, or something outside of your control happened, you can take some time and get back on track.
IF you have a thoroughly-tested, consistently-profitable plan. And you know it is that.
Success comes by trading well, with a real plan.
We talked today about the scientific method.
Why is it not applied more by those trying to learn to trade?
You can't find your way with the scientific method if you can't control your variables.
If you don't control the variables you will come to conclusions that seem factual that don't work.
Another factor is: if you have a bias to start with,
if emotions or prior belief systems give you a colored set of glasses,
then you will likely adjust the variables to 'prove' many things that also do not work.
Why is it not used more in trading?
Based on my own actions, I never could control the variables enough to correctly apply the scientific method. And certainly not to find confidence and trade size.
Now that I've traded with SLA and AMT, and see potential there...
They can be simple enough to have variables that I have a realistic chance of tracking and keeping valid records of. I still am simplifying what to track so as to do better at record keeping. The first time(s) through the process I was still unsure of what mattered and what didn't. But I kind of see it from start to end now, at least at one level.
That is why I recently decided to start waaaay back even before observing the market, so as to first observe myself while observing the market. To clear up my own bias, emotions and colored glasses so that I have a chance to discover and work with objectivity.
Db's new thread 'how to observe' can be seen as an opportunity to begin with the scientific method... to understand the variables -- and have a chance to discover something that actually works.
In chat today there was a recognition of emotions coming in and affecting judgement.
The trading was with alert disinterest at first... then it wasn't. So cool and important to notice that and stop trading. Hearing that from others (Niko) helps me a lot.
We also spoke of an 'elevator to hell' as price dropped.
Dante spoke of the levels of hell...
"abandon all hope, ye who enter here".
But...
no hope, no fear? ...we say that also.
Hummmm.
Some of those elevators you want to take, and trade without emotional confusion.
The trading was with alert disinterest at first... then it wasn't. So cool and important to notice that and stop trading. Hearing that from others (Niko) helps me a lot.
We also spoke of an 'elevator to hell' as price dropped.
Dante spoke of the levels of hell...
"abandon all hope, ye who enter here".
But...
no hope, no fear? ...we say that also.
Hummmm.
Some of those elevators you want to take, and trade without emotional confusion.
In a discussion, someone was talking about trust at the hard right edge and applying what one has back tested, forward tested, sim and even live traded successfully for some time...
yet...
"There's a very odd feeling putting on a trade where you know the odds are favorable, but it feels sort of wrong."
to which Db replied of course:
"It's so much more relaxing to just follow the damn rules and scratch if it doesn't work out."
...and I can go there, to relaxing and following the rules, at least some of the time.
If I just do SLA, the relaxation is growing. But my notes while trading are revealing that I tense up around what I'm thinking of as AMT extremes. This happens almost exclusively when I have just started the trading day. This is some squiggly thing between my ears.
It's not a CSW in the sense that I have it in my notes and I see it coming with time to act. So it's not 'I could have if only'... or 'I would have if I had seen it in time'...
Maybe it is just part of how AMT is soaking in. I know the odds are good, but it feels kind of odd.
This is probably one of those 'letting go' and just-do-it kind of things.
It's not a mental light turning on, but an emotional one. Or maybe both together.
yet...
"There's a very odd feeling putting on a trade where you know the odds are favorable, but it feels sort of wrong."
to which Db replied of course:
"It's so much more relaxing to just follow the damn rules and scratch if it doesn't work out."
...and I can go there, to relaxing and following the rules, at least some of the time.
If I just do SLA, the relaxation is growing. But my notes while trading are revealing that I tense up around what I'm thinking of as AMT extremes. This happens almost exclusively when I have just started the trading day. This is some squiggly thing between my ears.
It's not a CSW in the sense that I have it in my notes and I see it coming with time to act. So it's not 'I could have if only'... or 'I would have if I had seen it in time'...
Maybe it is just part of how AMT is soaking in. I know the odds are good, but it feels kind of odd.
This is probably one of those 'letting go' and just-do-it kind of things.
It's not a mental light turning on, but an emotional one. Or maybe both together.
I know exactly how you feel today my plan made a ton of points but I failed to follow the most basic rules!
I wondered at the time if I ought to bring AMT into this, but it became clear after the first thread that without it the SLA became pretty much PickUp Stix. While the SLA and AMT are synergistic or complementary, depending on how you want to look at it, choices sometimes have to be made. The AMT is largely for those who have longer timeframes, i.e., those who want to and can hold from the upper limit of a channel to the lower limit and vice-versa. But frightened traders find that to be impossible.
Therefore, when at the limits, I encourage traders to take full advantage of the situation, as we did Friday, Monday, and yesterday. However, if one exits at the end of his session, he will likely find that he is suspended in a noman's land the following day with little clue as to which way to go. In these circumstances, it becomes necessary to rely more heavily on the SLA and let the market tell him what to do rather than trade off the extremes. In this way, he may find himself returning to the previous extreme or heading toward the other one.
"We have met the enemy and he is us".