Small Change

[dbphoenix]

Quote from vorzo:


Gotta rewrite my trading plan, I neglected it with all the new liberties of trading futures, and now it's payback time.

I'm not sure that rewriting your trading plan is going to help much. The errors you're making have nothing to do with your plan. And they're very simple errors.

"When I decide to make up for the losses by doing a couple of quick scalps." This is not an unusual error, but it's a discipline issue. Until you're able to stop doing this sort of thing, no plan is going to help you, not even a purely mechanical one, since it's unlikely that you'd be able to follow it.

"Instead of stopping here I do one more trade, and I lose 2 points." Just the sort of thing one would hear in Vegas. Again, not an issue of planning but of discipline/psychology.

And as for pressure, that's at least partly because you don't have enough money. If a given trade is given the power to break your psychological bank, then too much emotion is invested in it. If the money is terribly important, you shouldn't be trading at all.

--Db

 

[vorzo]

Quote from corvus:

Vorzo...I know your situation well.

There are two things that I'd love to give you that I have picked up being in a similar situation. First, today was options expiration day...stocks especially and index futures too, tend to act really squirrely, defying every law of speculative physics I know as expiry players hit the market.

Funny that you should mention it - it knew it was the expiration friday, and I went directly for the March contract of BBY, but it never crossed my mind to stay on the sidelines - yet another lesson from "our lady market" .

Quote from corvus:

Second thing is about your executions. You said that you do well on simulators but your real trades don't work out the same way. Ignoring today, take a look at how exact your entrances and exits are in real trades vs simulated ones. You mentioned that your emotions get pretty involved in real trades. Well, I've been working on that too, and I noticed that my emotions in real trades tend to skew my entrances to points pretty far removed from ideal...I'm always entering early or late. And worse, I tend to cut my winners short too! So, combine a less than ideal entrance and cutting out early, and one doesn't tend to net much...and definitely not enough to cover the trades that actually do fail and hit your stops. I've been marking up my charts with ideal entrances in grey arrows, and actual entrances in red and green arrows...it is very revealing...

You're right, my emotions do skew my entries/exits much the same way you described it, or even worse. Marking the ideal vs real executions on the chart is great advice, thanks - I'll do it for my past trades.

 

[vorzo]

Quote from dbphoenix:

"When I decide to make up for the losses by doing a couple of quick scalps." This is not an unusual error, but it's a discipline issue. Until you're able to stop doing this sort of thing, no plan is going to help you, not even a purely mechanical one, since it's unlikely that you'd be able to follow it.

"Instead of stopping here I do one more trade, and I lose 2 points." Just the sort of thing one would hear in Vegas. Again, not an issue of planning but of discipline/psychology.

You nailed it brother, it is totally a discipline issue, and it's deep rooted too. I've always done things my way in life, and had a tendency to ignore the rules.
This is my fiercest demon, and I am fully aware that I MUST overcome it if I want to succeed. I thought of a countermeasure: I'll get a timer and set it to go off every 10 min when I trade, and do a quick reality check by writing down what's going on in my mind - that way I can identify and eliminate my negative states before they sabotage me.

Quote from dbphoenix:

And as for pressure, that's at least partly because you don't have enough money. If a given trade is given the power to break your psychological bank, then too much emotion is invested in it. If the money is terribly important, you shouldn't be trading at all.

--Db

The pressure didn't come from being afraid to lose money, but from being afraid that a trade can put me below the $2k limit, and that I won't be able to trade till I added more money to my account. Mix in the hurt pride should I not be able to hold this "last line of defense" and you get the picture.
It's amazing how it's all psychological.

 

[dbphoenix]

Quote from vorzo:



The pressure didn't come from being afraid to lose money, but from being afraid that a trade can put me below the $2k limit

Same thing in terms of the resultant behavior. You should not be feeling any pressure at all from any source. If you are, then your ego is on the table in some way.

I'm not trying to discourage you, but it should be clear from these posts that you are sabotaging yourself. Therefore, reworking the strategy may only be a postponement of what will have to be addressed eventually. I suggest that you make these psychological issues your first priority and worry about the plan later.

--Db

 

[vorzo]

Quote from dbphoenix:


I suggest that you make these psychological issues your first priority and worry about the plan later.

--Db

db,
Thanks for the advice. I rewrote my rules and made a short term plan for trading. Generally I will simtrade NQ and refine the MA XO strategy, and do a daytrade here and there with tight stops (back to PDT ). Once I'm happy with the simtrade results, I will add more money to my account (enough so I don't have to worry about no psychological limits) and trade NQ.

On Mon bot 100 of ADRX, after its generic claritin got approved by FDA, at $13.55, on the reaction after the initial rally. Closed at $13.60 so decided to hold overnight. WRONG! The next morning I didn't hear the alarm and by 7:00 am (10:00 EST) the stock was down 0.50, and I didn't have a hard stop in !! Donated -$53 on that one. Ugh.

Today I went long HPQ, right after it bounced off the bottom.
BOT 100 $16.35, stock went up to $16.60 then it pulled back, and started going lower with mkt - sold at $16.39 (below consolidation at $16.40) for an ironic +$3.

Simtrade results were not as great for the past few days with that whole lotta chop. Will test a fixed target MA XO strategy (stop at 6 ticks, target at 8 ticks).

Good trading to all.

 

[vorzo]

If you recall, my main strategy for trading EMinis was an MA XO. Works fine in backtesting, but sucks in reality. The reason - it's a lagging indicator, so the actual cross happens only one bar later ... And if you backtest this, it tells you it's a loser ...

So I gave up on MA crosses, and I am now testing something simpler: a single MA-price crossing strategy (you go long when a bar closes above the MA, , and you exit when it closes below the MA, and viceversa for short). I needs refining, maybe going long only when MA is already in an uptrend, or entering when price crosses rather than bar closes above the MA. Will simulate this for while.
Any thoughts?

 

[vorzo]

While simulating NQ, I noticed the 3 daytrades sitting in my account, so today I went for it.

Faded NOK right after the open, but chickened out too soon for +0.06. It went up another 0.40 after that!
Then faded KG after 10:00 when it started to bounce (after Briefing piece that UBS defended the co), and took exit at bkeven. Stock went up 0.35 after that.
Was also watching SLVN, but saved the trade for another day.

Good thing is my entries were good. Bad thing is that my exits were too early.

Good trading to all.