What's Worse: Missing the Move Entirely or Giving All Your Profit Back?

[Blotto]

Quote from Speciaul_K:

With the way the oil market has traded the last 2weeks don't you find it hard to not book profits early?
Such as 4/12-4/14
Im not sure what you target profit wise in a oil trade. Myself I target 1.00 but I find this discussion relevent in trading oil. I would guess if you target .20-.30 moves is not very relevent.

Well I'm sorry if it isn't relevant but that is how I trade - 20 to 30 cent moves. I do take trades which go 1.00, but not very often. The biggest trade on Friday would only have booked me .90.

Trading is trading - no matter whether you are targeting the next 4 ticks or the next 4 dollars. I scalp the CL contract after the inventories and have been known to hold a position for a few weeks (although I've not done this in a long time). Trading is trading.

I don't find it hard not to book "early" - I take trades as far as I believe they have to run in that timeframe, and then free myself up to work other markets. I'm not a fan of holding longs through a 45 minute range because I expect it to move up after - I'll just get back in before the next breakout.

Quote from JScott:

I can't believe you didn't string us along a bit more while we tried to determine whether you actually knew a thing or two. You kinda showed your hand pretty quick there. Thanks for stopping by.

Hello JS. Those who know, know; those who don't....don't!

Quote from Tonkadad:

I also have to say that if I created this thread I would take offense to BLotto's prior statement. Again it is a provocative statement and I believe good can come out it. But ego's will have to be checked at the door and we need to be open to self exploration. It's the events that turn our view of the world upside down that we grow the most from.

"This really is a horrible thread to read through. The blind leading the blind. All this pain and fear, negative language, and the old textbook cliches."

+1. Excellent. Indeed!

Looking back at my comment there, I can see how it could be provocative. I stand by my initial thoughts that this thread had a very negative, self deprecating tone...I was trying to convey the sentiment that a trader ought not to berate themselves for "missing out" on what are not even real opportunities. You cannot blame yourself for not trading every turn in the market when you do not have the skills to read it. Concentrate on what you can do, stay profitable, continue to learn and improve your skills. The alternative is to bring out the sack cloth and ashes.

Quote from schizo:

Hence the reason why successful authors of Trading 101 outnumber successful traders in this field. All Blotto is doing is *stating the obvious*: Either you get it or you don't.

Blotto faulted the trader for "missing the trade" as:

- lack of understanding
- failure to pull the trigger
- not concentrating on the task at hand (ie noticing the entry late)

If you think about it, however, those three tongue-in-cheek answers (and they're not your old textbook cliches?) are actually one and the same. It's you who fail to pull the trigger because you clearly don't know what you're doing. While I don't entirely disagree with his premise, is it so simple as he seem to portray? Isn't it presumptious of him to think that trading is so clear cut? Why, that's like saying just because I scored more points than him, thereby made more money than him, I must know more things about the market than him. Obviously he made less because he knew less than me. Or is it?

I would submit that what I was stating was not obvious to anyone who posted on this thread discussing which was worse as between "missing out" or "giving back". If it appears obvious now then that is credit to my explanation, is it not?

You are right - they are one in the same. I didn't say it was simple, I just stated it in a simple manner which everyone appears to have now grasped, to their benefit. Lets have no more self punishment for "missing out". When you understand something you can explain it in simple terms.

If you and I traded the same market during the same hours and you consistently made more points per contract than I did then it follows you are a better trader. That may or may not mean you understand more about the market, but beyond dispute it would qualify you as a better trader.

 

[NoDoji]

Quote from Blotto:

What I will add to this is that I am not trading size. If you're trading more size than you can get done within a few ticks you need to rethink. Limits need to be placed in advance and you need to buy into falling markets etc. I am (and will be for the foreseeable future) small enough that I can get filled within a couple of points. Working large orders is a whole different story.

I trade limits in advance in sim a lot, but trade differently live. I imagine after enough experience I'll be better at knowing where to scale into a reversal zone. Also only trading 1 lot now, except for a brief moment of 4-lot insanity Friday. Trading 1 lot is quite a challenge in terms of letting winners run without giving all the profit back.

 

[Speciaul_K]

ok, sounds like your style doesn't run into this problem.

Quote from Blotto:

Well I'm sorry if it isn't relevant but that is how I trade - 20 to 30 cent moves. I do take trades which go 1.00, but not very often. The biggest trade on Friday would only have booked me .90.

Trading is trading - no matter whether you are targeting the next 4 ticks or the next 4 dollars. I scalp the CL contract after the inventories and have been known to hold a position for a few weeks (although I've not done this in a long time). Trading is trading.

I don't find it hard not to book "early" - I take trades as far as I believe they have to run in that timeframe, and then free myself up to work other markets. I'm not a fan of holding longs through a 45 minute range because I expect it to move up after - I'll just get back in before the next breakout.

 

[Tonkadad]

My hats off to the CL Redux bunch, you are putting it on the line everyday. I have total respect for all of you. Not quite ready to join you, but soon i will be there.

 

[F112358]

If you miss the move entirely, you either do not know how to catch the move profitably on average, or worse, lack the courage to catch it and ride it.

If you give all your profit back (or ride losses), you have a trade management problem.

IMO the second is much easier to fix.

The first is mostly psychological and most will struggle all their life without finding the solution.

I haven't read the previous replies, but they are surely mostly crap as usual.

 

[wst]

Quote from schizo:

From newbies to pros, we've all been there. Whether you missed a pop or you rode the pop only to give it all back, the outcome is the same. This is perhaps the oldest conundrum that have plagued traders world over for eons.

The first case is a rule break due to bad discipline.

The second case is nothing to sob about, it's perfectly fine to give back not-yet booked profits because it is part of the trading plan, ie the price reversed before the profit target where met.

 

[Blotto]

Quote from schizo:


The best way you can demonstrate to me that you really know what you're talking about is to post your trades in real time. Considering that you already trade CL, you can join me at CL Redux thread. Then we can talk like real traders.

Yes, I had some time today so took the bait. Please see my posts in CL Redux for Monday April 26. I hope and expect that this demonstrates to your satisfaction.

Good trading,

 

[enochbenjamin]

Blotto - Its an everyday affair over at Redux! Stay for a while!

 

[JScott]

Quote from Blotto:

Looking back at my comment there, I can see how it could be provocative. I stand by my initial thoughts that this thread had a very negative, self deprecating tone...I was trying to convey the sentiment that a trader ought not to berate themselves for "missing out" on what are not even real opportunities. You cannot blame yourself for not trading every turn in the market when you do not have the skills to read it.

You still seem to operate in absolutes. Sounds a bit amateurish.

You take your setups as they come. If you miss a setup because you aren't following your own rules, then you have room for improvement (fear). If you miss a trade because your setup wasn't to the exact tick, then that's trading and you go on (lack of greed).

I don't see how either one of these have to do with "not having skills to read it [the market]". You are implying perfection.

And for someone who doesn't like "negative, self deprecating" tones, yoiu have a funny way of reinforcing positive behavior with others.

To each his own. Good trading.

JS

 

[kiwi_trader]

which brings me to my absolutely absolute opinion of what is worse:

The worse one is the one where you didn't obey your own rules.
Moves come and go, and we can never control them, but we can and must control ourselves if we want to be traders.