Taking $36,192.23 to hopefully more than $36,192.23

Week 8

TF: 2 wins, 1 full loss, 1 moved stops, 1 loss on discretionary trade
Corn: 1 win, 2 moved stops for break even
Soy: 1 loss and 1 moved stop for break even on discretionary trades
HSI: 1 wins, 3 moved stops
DAX: 3 wins, 1 massive loss

Total: 31795.49, down 575.22, -1.8% for the week, -11.2% for the year.


-----------------------------------

This week was series of massive, massive failures on my part. A complete disaster.

I should have been up over $3000 but instead I took a loss of $600. I made so many errors and deviated from my plan so many times, I don't know if there's anything I can do to correct myself. Every single deviation from my plans caused me to lose money. It's uncanny how that is. Every single deviation from the plan. I passed on or cut short trades that ended up getting full wins, and took trades that ended up with losses. Last night, I blew up on the DAX, but more on that later.

For the most part, HSI was good. 1 win and 4 moved stops. I changed up my targets and losses to hopefully cut down a bit more on the cost of moved stops.

TF was good this week, and volatility has been increasing. All my targets this week were 50% above the average, and Tuesday and Wednesday were big targets. I took a large full loss on Wednesday, but Thursday and Friday were smaller full wins, which more than made up for my losses. I noticed that the overall volatility was increasing due to the political situations, which is why I didn't cut the number of contracts, and that worked out for me this week. I'm hoping this continues, if I don't blow up my account. My most profitable month last year was May during the Flash Crash and Euro problems, so hopefully this continues.

My psychological cancer is the DAX. I took 3 discretionary trades this week, all small wins. But it felt really good to get back so money, after losing so much in October and November last year. Then last night, I blew up. My target was large, and I passed on the first trade which turned out to be a full loss. Feeling emboldened, I took the second trade which happened to be a short at the lows of the day, and immediately started taking heat. Then, I went on tilt. Instead of taking my regular loss like a man, I couldn't bear the thought of losing all the gains I had accumulated this week, so I started adding more contracts, hoping for a retracement, but I never, ever got retracement and ended up taking a massive $1800 loss. It's incredible both how crazy I got, as well as how wrong I was in terms of the trade. It makes me sick to my stomach.

Ags was just as bad but for different reasons. On Wednesday I was in 3 trades that would have netted me $600 if I just stuck with the plan, but instead I cut them all short, incurring a $200 loss. This was the day of my big loss on the TF, so I couldn't bear the emotional pain of losing more money, and panicked. On Thursday, I did the same thing, but this time, because I made back some of the money I lost the previous day, I didn't want to LOSE the money I had made, so I panicked and cut my trades short. This time it cost me $750. On Friday, there was no opportunity to take any ags because it went immediately parabolic, and I can't trade days like this.

I'm at a loss for words. I don't know why I did this, but I feel like I'm not learning anything from my experiences. Nada. It's depressing and embarrassing. I almost decided to quit writing this journal because I feel so embarrassed. I can't get past the hurdle of cutting my profits and letting my losses run. It's such a rookie mistake, but I can't control my emotions.

One thing I've decided to take is change the number of contracts I trade on the ags. I scale out of my ags trades, but I've decided to cut the number of contracts and move my targets up. I cut my potential profits by 16%, but decreased my risk by 33%, so I think this might help me take more ags trades without freaking out.


Notable deviations from the trading plan:

S: - HSI would have been a win, but I forgot to set the target, and then when I manually tried to trade it, I forgot that it was set to the Sim account (the default on NT, which is annoying). I ended up missing a full win.

M: - Holiday.

W: - As explained above, cut all my ags trades for a loss, and then ended up winning.

T: - ditto.

F: - Ags went parabolic, so I didn't trade anything. To be honest, there was a window of opportunity to take my corn trade, but those usually fail when corn acts like this, so I passed on it, so technically I screwed myself out of around $300-400.
 
Week 9

TF: 2 wins, 2 losses, 1 moved stops, 2 wins on discretionary trade
Corn: 1 full win, 3 moved stops for gains, 3 full losses, and 1 moved stop for break even
Soy: 2 full losses
HSI: 1 full loss, 2 moved stops
DAX: 1 full loss, 1 win on discretionary trade

Total: 30282.03, down 1515.27, -4.8% for the week, -16.3% for the year.

-----------------------------------

This was another horrible week in terms of PnL. The TF system was okay, basically break even on the week, but ags really killed me this week. The trades I didn't take I got brutalized on, and the ones I didn't take went on for winners. The only good thing is that my change last week to decrease the number of contracts helped me out, so I think I will stick with it.

The volatility with respect to the TF has definitely increased these last two weeks. Unfortunately it means that my targets have been increased, so I get larger swings. Each trade is roughly $1800 or more, and represents over 5% of my total account. The wild swings this week gave me extreme heartburn but, this is what I've been hoping for, so this is where the rubber meets the road in terms of my setup, so I'm going to do down fighting. Last May, the TF system returned 13%, so I'm hoping that if I'm lucky enough, I will be able to recoup a good portion of my account in more volatile times. My hard stop is when my account reaches $20k, then I will close up shop.

Ags was just brutal for me. I don't recall really deviating from the plan very much this week, I just didn't take entire trades but I think I was essentially following my plan. I just got taken to the woodshed on several occasions. More frustratingly, when I was tempted to cut my trades at break even because it wasn't working out, I decided to stick to my plan, and my 3 full losses stemmed from me not cutting the trade short. It's extremely frustrating.

Luckily I decreased the number of contracts, so the losses weren't as bad as they could have been, but nonetheless, the bulk of my losses this week came from my ags trades. Let's hope that it gets better next week.

HSI was crappy this week. No wins, and 1 full loss because I changed my targets last week to try to reduce my overall losses from moved stops.

DAX wasn't so great either. I shouldn't trade DAX anymore because I clearly have no clue what I'm doing or no sense of how the DAX moves, but last night I still did. Of course, I took a full loss, but then I took a discretionary trade where I made most of my losses back. I'll investigate this discretionary trade further to see if I can get reproducible results.


Notable deviations from the trading plan:

W: - Took a massive loss of around $1800, but then was able to win back some of it in a discretionary trade.

T: - I use buy stop limit orders to fill my orders, because it saves me on slippage. However, Interactive Brokers didn't fill my order for 1 contract, whereas Zenfire filled 7 contracts. IB sucks, I really hate them, but unfortunately they're how I trade HSI, so I'm stuck with them for now. So I missed out on about $200 from a missed win.
- IB again didn't fill my HSI order before it moved too far away from me, but it would have been a moved stop.
F: I took a discretionary TF trade, and got out after 6 ticks, and watched it move 40 ticks to my initial target. I came to a revelation that I lack patience in the sense that if the trade doesn't immediately go in my favor, I lose confidence quickly, and my internal clock for how long a trade should last is completely wrong.
 
Quote from jedwards:

I took a discretionary TF trade, and got out after 6 ticks, and watched it move 40 ticks to my initial target. I came to a revelation that I lack patience in the sense that if the trade doesn't immediately go in my favor, I lose confidence quickly, and my internal clock for how long a trade should last is completely wrong.
More...

Sent you a PM.
 
Taking $36,192.23 to hopefully more than $36,192.2

**************************************************

This is how it started..............Take a break and reasses. otherwise you'll be joinning me and 98% of traders. :(
 
Week 10

TF: 1 wins, 1 losses, 3 moved stops, 1 win on discretionary trade
Corn 1: 2 moved stops, 4 full losses
Corn 2: 1 full win, 1 full loss, 1 moved stop
Soy: 1 win, 3 full losses
HSI: 1 win, 2 moved stops (would have been 2 wins, 3 moved stops)
DAX: 2 wins, 3 moved stops (I didn't trade it)

Total: 28038.73, down 2243.3, -7.4% for the week, down 22.5% for the year.

-----------------------------------

This was another horrible week in terms of PnL. Thanks to NoDoji's post which she sent me, it helped me get back on the right track mentally. Unfortunately, this week it was the actual trades that failed me. I will be forced to drown my sorrows in a Sausage McMuffin with Egg on my way to work this morning.

For the 3rd week, my TF system has produced higher targets, but unfortunately I don't seem to be hitting them. High volatility such as this week is the bread and butter of my TF trade, something I've been waiting 6 months for, but it doesn't seem to be working out. I had 1 full win, but a bigger loss. Thursday was a monster target of 4.5 pts and I took immediate heat of almost 3.5 pts but it recovered to become a moved stop. After it stopped me out, it went on to hit the target, yay! On a bad note, Ninjatrader failed me on Tuesday, my only profitable day of the week; it encountered a technical glitch and my trades didn't fire off, so I scrambled to enter some manually, and missed out on 1/3 of my profit.

Ags was another horrible week. The vast majority of my losses stemmed from ags this week. I didn't really do much with the trades, they just didn't work out. I'm going to have to analyse them more carefully this weekend and see if I want to keep trading them.

HSI would have been an okay week, except NT also failed me here as well. I think I have my technical problems cleared up though.

DAX seems to be doing okay relative to its performance last year, but I'm still pretty hesitant to trade it full time.

Basically, I'm starting to lose faith in my setups. It could be that the setups I use aren't very successful anymore, so I'll have to go through my notes and the charts and see if I should continue doing what I'm doing. I'm well aware that I'm taking massive losses and I'm within 2-3 weeks of my loss limit of $20k, so some steps I will think about taking are taking less ags trades, and drastically cutting down the size that I'm trading, maybe all the way down to 1 contract.

Historically, for my TF strategy, I expect roughly 2 wins, 1 loss, and 2 moved stops per week. The slight edge in wins to losses is what makes the system profitable. This year, in 2011, using the classic parameters for my TF system, I have 14 wins, 15 losses, and 20 moved stops for a total of -15 pts. Trading 5-6 contracts per trade, it shows for the most part why I'm down 8k so far. Even if I use my modified strategy (with modified targets, stops, etc) that I now use, it produces 19 wins, 10 loss, and 20 moved stops, which is exactly my expectations, but it still returns -11 pts. It means that my losses far outweigh my gains. So it very well could be that my strategy is now broken. This is something I'll have to go over more in detail.

Bottom line is, when does a trader know to retire a particular setup after suffering a huge drawdown?

Notable deviations from the trading plan:

M: - Should have been a full win on my Corn 1 strategy by I chickened out.
T: - As I mentioned, NT had a problem and didn't set my trades, so I missed out on about $500.
W: - I did a discretionary trade that got me 50 ticks on the TF on a single contract. I essentially am fading my own TF strategy, which is kind of sad, but it appears to work. I will do more investigation to see if I can model this and backtest it.
-I didn't trade ags today because the 10th was the USDA report, as per my trading plan. Corn 1 would have been a full win.
-Another glitch with NT that forced me to miss out on a win for the HSI.
Th: - The TF produced a target that was 4.6 pts. If I lost I would have lost about $3000. I was having heart palpitations at about -3.5 pts, but it ended up reversing, and then I got a moved stop. I need to trade less contracts when the channel is this wide, and maybe target 50% of the target instead.
-Took a Corn 2 trade, but I set up my charts incorrectly. Luckily I escaped with a moved stop for a profit.
-Missed another HSI trade because of NT problems, but I think I've figured them all out so next week should be smoother
 
Quote from bearnbull:

Taking $36,192.23 to hopefully more than $36,192.2

**************************************************

This is how it started..............Take a break and reasses. otherwise you'll be joinning me and 98% of traders. :(
More...

Thanks for your comment. Yes, it's in the front of my mind these past few weeks, and something I need to really consider whether or not my setups work, and whether or not I should even be trading futures anymore. It's largely been a complete disaster, but I'm trying to stick through the drawdown, because inherently I believe that the system works. I could be completely wrong, though, so that's something I'll have to come to a decision on.

I also trade options, but that has been much more successful this year for me. It might be that I close up my futures trading and just stick with options.
 
Week 11

TF: 2 wins, 2 losses, 1 moved stops, 1 win and 2 losses on discretionary trade
Corn 1: 3 wins, 1 moved stop for a win
Corn 2: 3 wins, 1 full loss, 1 moved stop for a win, 1 moved stop for a loss
Soy: 3 wins, 2 full losses, 1 moved stop for a win, 2 moved stops for a loss, and 1 moved stop for break even.
HSI: 1 win, 1 full loss, 1 moved stop (would have been 2 wins, 1 loss, 2 moved stops)
DAX: 3 wins, 1 full loss, 1 moved stop (I didn't trade it)

Total: 27389.21, down 649.52, -2.3% for the week, down 23.1% for the year.

I think this week was the breaking point for me. Not just because of the PnL, but because of the failure of my TF to take advantage of the volatility, which as I've mentioned before is the bread and butter of the system. I've been pretty good about not messing with the bulk of my trades. But the biggest factor is the inability for the TF to produce a winning rate, despite the large volatility (the targets were on average over 2.5 pts, which is almost 75% larger than the average for the year). Throughout 2008 and 2009, the volatility in the markets was immense, and the profitability of my TF system was over 100% for those years.

This week on the TF, I got 2 wins, 2 losses and 1 break even. What hurts even more is that at the end of last week, I decided to try to decrease my risk. On Monday, I took the trade with the full number of contracts, and then aggressively moved the stop on 1/2 of them. I, of course, got stopped out of that half to the tick, and the other half went on to hit the full target. This kick in the nuts reminded me not to mess around with the trade, and cost me about $850 in profits. Regardless of that mistake though, Monday and Tuesday were both wins, and my best two days since January. I was up over $2500 for both days, so I started thinking that this was going to be a good week. Despite my optimism, I didn't increase my contracts, overtrade, or do anything foolish, I was in a good frame of mind and actually thinking of cutting the number of contracts to preserve my gains. Historically, whenever I've had a decent gain, I usually get it wiped out the next day. I convinced myself, however, that if this was going to be a good week, I should be consistent so instead I cut the number of contracts by 1. Much like Charlie Brown trying to kick the football from Lucy, on Wednesday I took a massive loss of about $2000. That's just about how my luck has been going. Thursday I got a moved stop, and then the final kick in the nuts was a full loss today.

Without the profitability of the TF system, there's no way I can make a profit. There's no way I can sustain 2 losses a week, so this really brings into question the viability of my TF system. I am seriously thinking of cutting the number of contracts, but the only thing holding me back is that at the end of December 2010, after taking a bunch of losses, I decided to stop trading until January, and the system ended up making back most of its losses for the month. Watching it hit win after win really increased my frustration level, so I don't know if I can handle cutting my contracts and watching it win, I'd almost just rather lose all my money waiting for the system to improve. I know that's not rational, but it's honest. I may just take 1/3 of my contracts off the table, and trade that way until I hit my dropdead stop.

Crazy week in ags, but it ended up being decent despite the fact I wasn't able to trade one of my strategies because of limit down and up situations. Overall, it was good and reversed the losses from last week. I don't feel like I'm overtrading, but the number of trades I've been taking has increased, to roughly about 3-4 per day.

HSI was break even, it would have been profitable except for luck. Wednesday would have been a nice gain of $250, but I have programmed maximum targets for the HSI trade, and Wednesday's target was 0.5 pts larger than my maximum trade of 40 pts, so my strategy didn't execute.

FDAX had a phenomenal week, but the targets were huge. They were 3-4x the average size going back to October. Monday thru Wednesday alone would have produced a gain of 45 points per contract, or 1125 euros, or about $1575 per contract. Unfortunately because of daylight savings, I wasn't able to stay up late enough to even watch it, so it was a missed opportunity. Given how expensive the trade is, and given how much money I've lost I can't afford to risk any money on this trade, so I guess I'll just watch this from the sidelines.

Notable deviations from the trading plan:

M: - As I mentioned, on Monday I moved the stop for 1/2 my contracts aggressively up, thinking I was being more conservative. I got stopped out to the tick and then it hit the target. This was the last time I messed with the trade, and going forward, I'd rather cut contracts than move stops.
T: - Corn went limit down so I didn't get an opportunity to trade.
W: - After taking a loss, I took a discretionary trade that ended up being a full loss. This feels like a revenge trade, but the reasons were solid. Without this win, and if I hadn't moved my stop on Monday, I would be up around $650 instead of down $650.
Th: - Corn went limit up, so I missed out on some trades.
 
Quote from jedwards:

Week 11

TF: 2 wins, 2 losses, 1 moved stops, 1 win and 2 losses on discretionary trade
Corn 1: 3 wins, 1 moved stop for a win
Corn 2: 3 wins, 1 full loss, 1 moved stop for a win, 1 moved stop for a loss
Soy: 3 wins, 2 full losses, 1 moved stop for a win, 2 moved stops for a loss, and 1 moved stop for break even.
HSI: 1 win, 1 full loss, 1 moved stop (would have been 2 wins, 1 loss, 2 moved stops)
DAX: 3 wins, 1 full loss, 1 moved stop (I didn't trade it)

Total: 27389.21, down 649.52, -2.3% for the week, down 23.1% for the year.

I think this week was the breaking point for me. Not just because of the PnL, but because of the failure of my TF to take advantage of the volatility, which as I've mentioned before is the bread and butter of the system. I've been pretty good about not messing with the bulk of my trades. But the biggest factor is the inability for the TF to produce a winning rate, despite the large volatility (the targets were on average over 2.5 pts, which is almost 75% larger than the average for the year). Throughout 2008 and 2009, the volatility in the markets was immense, and the profitability of my TF system was over 100% for those years.

This week on the TF, I got 2 wins, 2 losses and 1 break even. What hurts even more is that at the end of last week, I decided to try to decrease my risk. On Monday, I took the trade with the full number of contracts, and then aggressively moved the stop on 1/2 of them. I, of course, got stopped out of that half to the tick, and the other half went on to hit the full target. This kick in the nuts reminded me not to mess around with the trade, and cost me about $850 in profits. Regardless of that mistake though, Monday and Tuesday were both wins, and my best two days since January. I was up over $2500 for both days, so I started thinking that this was going to be a good week. Despite my optimism, I didn't increase my contracts, overtrade, or do anything foolish, I was in a good frame of mind and actually thinking of cutting the number of contracts to preserve my gains. Historically, whenever I've had a decent gain, I usually get it wiped out the next day. I convinced myself, however, that if this was going to be a good week, I should be consistent so instead I cut the number of contracts by 1. Much like Charlie Brown trying to kick the football from Lucy, on Wednesday I took a massive loss of about $2000. That's just about how my luck has been going. Thursday I got a moved stop, and then the final kick in the nuts was a full loss today.

Without the profitability of the TF system, there's no way I can make a profit. There's no way I can sustain 2 losses a week, so this really brings into question the viability of my TF system. I am seriously thinking of cutting the number of contracts, but the only thing holding me back is that at the end of December 2010, after taking a bunch of losses, I decided to stop trading until January, and the system ended up making back most of its losses for the month. Watching it hit win after win really increased my frustration level, so I don't know if I can handle cutting my contracts and watching it win, I'd almost just rather lose all my money waiting for the system to improve. I know that's not rational, but it's honest. I may just take 1/3 of my contracts off the table, and trade that way until I hit my dropdead stop.

Crazy week in ags, but it ended up being decent despite the fact I wasn't able to trade one of my strategies because of limit down and up situations. Overall, it was good and reversed the losses from last week. I don't feel like I'm overtrading, but the number of trades I've been taking has increased, to roughly about 3-4 per day.

HSI was break even, it would have been profitable except for luck. Wednesday would have been a nice gain of $250, but I have programmed maximum targets for the HSI trade, and Wednesday's target was 0.5 pts larger than my maximum trade of 40 pts, so my strategy didn't execute.

FDAX had a phenomenal week, but the targets were huge. They were 3-4x the average size going back to October. Monday thru Wednesday alone would have produced a gain of 45 points per contract, or 1125 euros, or about $1575 per contract. Unfortunately because of daylight savings, I wasn't able to stay up late enough to even watch it, so it was a missed opportunity. Given how expensive the trade is, and given how much money I've lost I can't afford to risk any money on this trade, so I guess I'll just watch this from the sidelines.

Notable deviations from the trading plan:

M: - As I mentioned, on Monday I moved the stop for 1/2 my contracts aggressively up, thinking I was being more conservative. I got stopped out to the tick and then it hit the target. This was the last time I messed with the trade, and going forward, I'd rather cut contracts than move stops.
T: - Corn went limit down so I didn't get an opportunity to trade.
W: - After taking a loss, I took a discretionary trade that ended up being a full loss. This feels like a revenge trade, but the reasons were solid. Without this win, and if I hadn't moved my stop on Monday, I would be up around $650 instead of down $650.
Th: - Corn went limit up, so I missed out on some trades.
More...
why are you screwing around in so many different markets?
 
Quote from Free Thinker:

why are you screwing around in so many different markets?
More...

Based on my initial backtests in 2009, the TF, DAX and HSI were markets that I could trade in profitably. My initial goal was to trade once a day per market, so that was just 3 trades a day. Since then, the only market that has held up is the HSI and I stopped trading the DAX.

Last year I started looking at corn and soy, and it looked like I had a profitable setup, so I added them. I'm trading them more, about 2-3 times a day, but I think they may be more reliable than the TF at this point.
 
Week 12

TF: 4 wins, 1 moved stops
Corn 1: 1 win, 2 full losses, 2 moved stop for a win
Corn 2: 1 wins, 1 full loss, 1 moved stop for a gain, 1 moved stop for break even, 1 moved stop for a loss
Soy: 1 moved stop for break even, 1 moved stop for a loss
HSI: 2 wins, 3 moved stops
DAX: 1 wins, 1 full loss, 3 moved stops (I didn't trade it)

Total: 28561.17, up 1171.96, +4.3% for the week, down 21% for the year.

A profitable week, and I'm grateful and won't look a gift horse in the mouth, but it should have been much, much better, if not for a combination of bad luck and stupidity.

The TF finally produced a great week. 4 wins and 1 moved stop with a theoretical gain of +5.2 pts/contract is fantastic. It's been the best week for the TF since August 2010. The volatility decreased a lot, roughly 33% smaller targets than the last few weeks. Because of technical problems, I missed out on about $1000 in gains. On Wednesday, I missed out on 2/5 contracts, and on Thursday, I missed out on 3/4 contracts, all because of technical issues (orders getting rejected, etc). I could have reentered the trade manually, but decided against it because I would have been chasing, and ended up missing out on the profits.

Ags was breakeven until today, and then it turned into a nightmare. I have 2 trades that I usually try to take with Corn, and I missed the discretionary one by 1 tick. This is likely the reason why I got more aggressive with the other Corn strategy (one that I always trade) and doubled the contracts. Corn was moving quickly to my target, so I thought I could get out of some contracts before the full target, but instead I quickly got stopped out of all my contracts to the tick, so I lost about $850. You can imagine how pleased I was at myself. I should have just traded 2 contracts and left it at that to preserve my gains.

HSI was good and continues to be the most consistent market for me this year. Coincidentally, it's the only market I trade fully automatedly, because I'm at work and I can't touch the trade. Hmmm, I wonder if that's telling me something...

DAX had an unexciting break-even week and the volatility has been drained from it, which is likely why the results have decreased a lot. I think when the volatility increases again, I may dip my toe back into the DAX.

All told, both the technical errors and my own stupidity cost me about $2000 this week. I should have just turned off my computer this morning and not traded today to preserve my gains for the week, but I'm still struggling with the "be the casino, not the gambler" mentality. If I am ever going to get profitable, I need to trade every setup, and over time it works itself out. At least, that's the theory. So I pushed myself to trade today, even though I really didn't want to. If I ever find myself in the position of having a profit on Friday morning, I may re-think this strategy.

Going forward, I may consider trading ags a lot less, maybe down to 1 trade and 2 contracts a day. I think my instincts with respect to ags isn't very good, and it doesn't seem to be improving, so maybe I'm just spending too much time on something that I won't be good at.

Notable deviations from the trading plan:

M: - Took a corn trade but got out too early, and I missed out on $250.
W: - Took 5 contracts on the TF but 1 was rejected and 1 experienced a bug.
-On Corn, I took a trade, but it took too long to move so I got out for break-even, and saved myself $550.
Th: - Took 4 contracts on the TF but 3 were rejected.
 
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