The Subconscious mind...

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The 'relaxed state' Grob writes about when one first releases himself from the restriction of goals is nicely put (incidentally, similar to the feeling I had the first time I went from long to short in one shot -- release from the restriction of my positions I guess, don't know why but the thought intruded here)

In regards to goalsetting/position holding, I never have any explicit goals in mind while I trade; however, in regards to trade exits I'm still wondering if there may be some use for an arbitrary (unrelated to entry) method of profit-taking.

I don't know if the following is along the lines of what Mike wrote about fears triggering impulsive (exit) behaviors, but I'll give it a shot. For me, the entries are by default clear and "obvious" setups, yet beyond the initial thrust that I need to capture to even stay in the trade (w/o stops getting triggered), as market movement accumulates further and further out in time and price from my entry signal, the ratio between perceived risk vs reward in keeping the position becomes increasingly hazy. An exit as symmetrically clear as the corresponding entry is very rare for me; it then becomes a judgement question of whether market movement which normally would be insufficient for justifying an entry would suffice "mentally" for an "acceptable" exit. In other words, doubts accumulate as time and price extend further out from entry; considering the position in the "now" usually results in the attitude of "well I probably wouldn't buy now but since I'm already long I can see where it goes", which is kinda lame in itself. But holding a position, one does not have the luxury of patience that one can afford while being flat and stalking an entry.

Given that I don't have pre-set goals and try to handle each trade on its own circumstances, the exits generally remain my dilemma. I'm beginning to suspect that mentally accepting exits as always suboptimal compared to entries is in the end probably just a rationalization for my current inability to cope with the real implications of what my entries entail -- that is, holding times of far greater duration in time and price than what I'm used to.
 
My contention is that you are a person who uses a visual sensory monitoring system primarily. That is all the knowledge that you have for doing analysis is largely shapes and pictorial.

Yes, I have developed an ability to visually identify and react to price patterns. Using an image I will try to identify the future actions of other traders looking at the same thing I am looking at. In a consistent market with continuous price action, this type of trading is very profitable, people fulfill their own expectations where the losers will get caught at the tops and the bottoms and the winners wait for consistency in P/V during tops and bottom. I am readily able to identify points where other traders will start tightening their stops and points where price and volume become exhausted. During inconsistent markets (ranging/choppy/erratic etc…) my goal is to stand aside. This is the foundation of my approach – I am more concerned with how others will react to what they see because my goal to anticipate it.

Second, you predetermine what "success" is on a per transaction basis.

Yes. I assume a losing position from the moment I enter. Success is losing well (small). I am successful in that respect but when I win large – I realize in hindsight that my win actually left a substantial amount on the table. Success in winning is not clear in my mind yet. I do not have a concept of successful winning and in reality, I am not sure if such an idea exists.

With this in mind, I would like to suggest to you that as time passes you have little knowledge and internal support for doing observations, doing analysis and making decisions related to time. We need to address and deal with this.

Not sure what you mean by internal support. Do you mean confidence? Is this similar to shaking out the weak hand idea?

Time to me is a linear abstraction. Time has no bearing in a non-linear event – such as the relationship between price and volume. I ask anyone out there to prove me wrong regarding this (my) concept of time. The only merit of time is closing the position if after some amount of time there is no price movement, i.e. time stop.

I am trained to search and render aid in spaces that are in total dissarray. Operating in the dark and in hostile environments as a team player requires an excellent and comprehensive SOP. What is to be avoided at all costs is getting anxious about the context as a result of analyzing where you are. Where you are does not matter; what matters is knowing how and what to do at all times to solve the emergency at hand.

Above is the operational picture that I have of you and which you can attain if you are able to synthesize into your operations what I am going to suggest to you.

You created an accurate picture. What is SOP?

Agree strongly with being to react well during an emergency. Emergencies to me are profits being taken away and me not taking them quick enough. My anxieties stem from always feeling a sense of deception by the price movement – anything can and will happen – it is my belief that occasionally it is done so as to reduce a trader’s confidence involuntarily. This comes back to shaking out the weak hands idea.


Sensory processes are paired with the emotions. Emotions come as a direct result of sensory inputs and the mind producing "feelings" and biochemicals. You are in a space where you do not have access to the best array of visual information. By changing the setting and context you will be able to sense more comprehensively.

This input will not be too useful at first. This is because you do not presently have in your mind what you need to compare against what you will be seeing. This will prompt some feelings that are disconcerting when you "see" internally that you cannot do analysis and decision making. you will determine that you need more information and knowledge however.

You have proven to yourself, absolutely, that there is a causal factor (s) for your "feelings" and their is a cause of the behaviour those feelings precipitate.

That takes care of that issue.

What is the best array of visual information? I believe it is specific to any given person and their ability to develop a muscle memory type reflex to that information. I like the 3-min and I will occasionally refer to the 30-min to garner support for my idea. Does the 3-min produce any more “deception” than any other chart? Does one type of visual information garner more relevant info than another? My belief (tell me if I am wrong on this) is no.

I am also inclined to believe that price (no matter the time frame) holds all the necessary info. Info outside of price is useless because one can always find information to disagree with price (and vice versa). You are saying that I am limited in my view, but give me some good reason why I should compare anything to price?

With respect to my feelings, they are helpful in identifying losers quickly, but that’s it. Anxiety is the causal factor. How do I get rid of anxiety (actually I would call it a mild form of paranoia) without harming my ability to cut losses quickly? There is a fine line here and I am not experienced enough to know where these principles diverge – see the my last paragraph for further comments.
 
the other predominant issue is the one where you move from contion A to condition B. Condition A is achieving the process of getting to your predetermined goal (In itself not too good an approach). Condition B is making the money still on the table after your goal has been reached. Beginners who are trading in situations where they do not know what is going on spend a lot of momentary time (time after time in a sequence) of setting goals that justify getting out at the wrong time (too early).

Here in condition B you lack almost all knowledge required to be able make money in this condition. That can be remedied as well.

From here on out in this post I am addressing the "fix".

We fix your anxieties with knowledge and analytical skill development. Before that, we enable you to "see" the market situation which, in turn, sets up all the new knowledge requiredments.

You have a very isolated look at the market because of how you monitor. P and V on the 3 minute are insufficient.

I could give you a set of drills to do to make the point but I won't. Instead consider that you are just in a hyper sensory place and lets eliminate that by surrounding it on both sides. Use a long duration fractal as you base of observation and only go the 3 minute as required. At turning points on the 3 minute use a faster picture to slow down the 3 minute relatively speaking. both of these factors will almost destroy your dependnance on the 3 minute.

Okay, I like where you are going with this. I know nothing about fractals hence I need to investigate. Where is a good place to start?

For the beginning always use a longer duration fractal where each bar fills the width of the channel. this will keep you moving from one fractal to another according to the pace of the market. this will also kill the singular importance of the 3 minute chart.

For the faster than 3 minute observations change to a non chart manner of observation. The more modern DOM displays (button) are good for this. Absolutely do not go to a 1 min chart.

As you acquire knowledge in the context of your "collection" of things in each of these monitoring domains, you get a lot of anxiety out of the A context of getting to you "goal". Use a technique of goal changing that parallels the way you scale into trades. Each scaling in deserves a goal change in some manner. This will make A GOAL less rational and soon no goal may show up based upon your approppriate monitoring.

You are saying to eliminate goals and by doing such I will improve my monitoring abilities. Okay. What if my goal is to maximize this trades potential and risk the minimum amount of unrealized profit in doing such? I believe you claim that fractals will provide me with a better total market view in order to accomplish this.

Context B is where you need to have the comprehensive SOP for getting to making all that money that irrational goal setting took away from you. If you note well, you will find that just after you consider goal setting mentally and allow yourself to consider not setting a goal, you find a sort of soft peaceful relaxation comes in the space momentarily. you will find a tensing up as you return to not allowing your self to not set goals. This is because you instinctively knw that in nature and natural setting there is no goal concept at play. Survival is not a goal. What is survival? Good.

The goal divides A and B. You are going to succeed in B by adding on all three monitoring timing levels the boundaries of the volume action. Add the price boundary too as a second thought. If you can bound then you can articulate the path across the bounds for making money.

Once you have a good collection for this, then you will find that the anxiousness of trading the B context is gone and what replaces it is the stimulation of being in "anticipation" of next steps along the path and modifying the path as required. Their will never be any boredom.

Let me know when the goal drops out of the pictures. By then you will see that A and B are the same situation in two different parts of the profit taking cycle.

The combination of all this stuff will quadruple your money velocity. The other factor is your personal energy. You will have to find uses for all the energy that is going down the drain now in anxiety; I recommend that you use the new energy for non trading family activities that do not resemble your youthful activities.

I understand this and it is a good perspective. However, how does this relate to setting price points?

Let me take another approach and bear with me while I try to explain it.

Lets say that comfort is the opposite of anxiety. Most traders like to play in the comfort zone, The majority of volume in these areas indicates this. My approach is to define uncomfortable areas and trade them. Anticipation is a form of anxiety – a bull flag is a beautiful example of anticipation. The price will test a point, come back and retest, come back less, test and then break. I see this is as a group of people trying to get into a building through a small door. They all push in unison and then recede, push and then recede a little less. Then someone sneaks through akin to the price breaking the flag. A rush of volume and steady price increase follows. After the rush who is left to go through the door? Is there a continuous steady stream of participants? Was the price break a small group who will now be looking to get back out?

My goal in the above case is to anticipate when the group wants to exit – I want to get out before everyone else. This goal will often limit the amount of money I take because I have deceived my self into believing that everyone will be looking to exit in the near future (does time relate to this? Am I missing something important?). My goal is not monetary in such circumstances. This is simply a defensive mechanism to hold onto my profits.

Feeling anxiety and comfort are very useful tools IMO. I use them everyday to make decisions. I see comfort and anxiety in the price movements because this is the way I see my trading – I know through having made similar mistakes many times over where others will be making the same mistakes
 
Quote from Mike805:

Jack,

I am working on a reply.

Anyone else have any comments on these ideas?

As a remote trader, I have zero contact with other traders. My friends know nothing about what I do hence I have no means to exchange ideas other than through this site.

I will say that what has been said so far by Jack is dead on.
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Quote from Grob109:



Let me know when the goal drops out of the pictures. By then you will see that A and B are the same situation in two different parts of the profit taking cycle.
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Very Interesting.......I have been thinking of trading something similiar. I trade B(30 min) cycles in only one direction. This is dependant on the C(daily) timeframe. My trades for A(5 MIN) are dependant of the B timeframe but not necessarily in the same direction as my B position. It can be with or agaisnt position B trade.

My B position trade can be under water for a while before the price actually turns and is profitable. My A trades are intraday positon trades or/and scalps. Sometimes I lose money on the B position but I am essentially hedging it with my A intraday trading. This happens when we have a BO on the daily timeframe essentially.

My A scalping/intraday trading is almost always pos for the day. The only time I really take a loss in A timeframe is when the B postion takes off and I have to cover my A postion due to a change in the Operating Point as you say.

Then I switch my bias on the A timeframe and exit my B(30 min) at a profit.

I know this is confusing but I am new to this and wanted to share my thoughts and experiences.
 
Quote from tradingbug:

Very Interesting.......I have been thinking of trading something similiar. I trade B(30 min) cycles in only one direction. This is dependant on the C(daily) timeframe. My trades for A(5 MIN) are dependant of the B timeframe but not necessarily in the same direction as my B position. It can be with or agaisnt position B trade.

My B position trade can be under water for a while before the price actually turns and is profitable. My A trades are intraday positon trades or/and scalps. Sometimes I lose money on the B position but I am essentially hedging it with my A intraday trading. This happens when we have a BO on the daily timeframe essentially.

My A scalping/intraday trading is almost always pos for the day. The only time I really take a loss in A timeframe is when the B postion takes off and I have to cover my A postion due to a change in the Operating Point as you say.

Then I switch my bias on the A timeframe and exit my B(30 min) at a profit.

I know this is confusing but I am new to this and wanted to share my thoughts and experiences.
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Sorry. After rereading my post, I know I am really really confusing. I will write a better draft that is much more coherent . Sorry for the confusion.
 
Quote from tradingbug:

Sorry. After rereading my post, I know I am really really confusing. I will write a better draft that is much more coherent . Sorry for the confusion.
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Do you actually understand what Grob posts?
 
Quote from mhashe:

Do you actually understand what Grob posts?
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I understand bits and pieces. Not really the whole thing. What I do understand about the market is that it always moves in cycles.

What I think Grob109 is trying to convey is that one can trade cycles the same way but on differnet timeframes.

I trade 30 minute cycles in only 1 direction using the daily timeframe as a reference guide for the 30 minute position trades.

I also trade 5 minute cyels in only 1 direction using the 30 minute timeframe as a reference guide for the 5 min scalp/intraday position trades.

SOmetimes my 30 minute postion is underwater but I am scalping/intraday trading(banking intraday profits) 5 min in the direction opposite my 30 min position.

When my 5 min scalp/intraday position goes underwater due to an operating point change, I cover immediately and this simultaneously corresponds to my 30 min coming out of being underwater and becoming a positive postion trade.

While my 30 min position trade is then above water, I am still scalping on the 5 minute(after i banked the 5 min loss due to operating point chagning) to bank more profits along with the 30 min position trade.

I have not gotten everything to work exactly perfect yet but this is just my thinking of how things fit. I see that it could be possible. Hopefully, I am able to turn my thoughts into cash.

This is my interpertation of what grob109 said. I hope its helpful but I could be way off.
 
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