Why do we not honor our stops/go off plan?

Quote from maxpi:

Sounds like you are uncertain that your system is correct when the pressure is on and you use disgression. That means you are not a system trader and you are not a disgressionary trader either, you are a systemessionary trader. You have a mess in the middle of your trading system.

BTW there is no cure for it, you are born that way.

:)


Max
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Disgression? I guess you mean discretion. And I see what
you're saying. Sometimes we start out with a plan and then
go back or deviate from the original idea. But, I don't really
believe that proves you're any particular kind of trader.

And, I don't believe it's some sort of psychological deformity
that can't be cured. Just takes a little experience and practice.
 
Quote from Breakout:

How does being DUMB sound for an excuse...hehe

Take these two trades for example...
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Honestly, without the benefit of hindsight your exits look pretty good. What I would change about those trades are the locations of your stops. They don't make sense to me.
 
Quote from Lobster:



Honestly, without the benefit of hindsight your exits look pretty good. What I would change about those trades are the locations of your stops. They don't make sense to me.
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Hi...the idea behind the stops is, to take small quick losses and let my profits ride. When I see the market trending up and selling pressure come in, I look for a place to go long. If the market
keeps going down and hits my stop, then I just get out and
wait for another trade. Sometimes I'm wrong, sometimes I hit
it right on the bottom tick like I did the first one. But, the main idea is to keep my losses small and let my profits ride, which I
failed to do on these two examples. (let the profits ride, that is)
 
Quote from maxpi:

Uhhh ok, I gotta make a list

1) check spelling

2) expect people to take me serious.

:(

Max
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Oh, you were just kidding...lol

Okay, sorry dude :D
 
Quote from maxpi:

That means you are not a system trader and you are not a disgressionary trader either, you are a systemessionary trader. You have a mess in the middle of your trading system.

BTW there is no cure for it, you are born that way.

:)


Max
More...


LOL = 'systemessionary'

This has been happening to me as I have been experimenting with scalping vs. intraday range trading.

There is a cure, it is called focus, practice and discipline. :D
 
I can't speak for anyone else, but the mistakes I've made kinda'
take the following path:

1st stage: GREED-- I just refuse to lose my money
(stock goes lower)

2nd stage: HOPE-- I just know it will come back; after all, they always do, don't they?
(stock goes lower)

3rd stage: Desperation-- I'm down too much to take this kind of loss; I'll wait till the next reversal and sell with a smaller loss
(stock goes lower)

4th stage: In the bathroom puking; how will I explain this to my wife.
(stock goes lower)

5th stage: I become a long term investor; I'll just make this a swing trade.
(STUPID!)
 
If you're not going to follow it, why put a stop to start off with...

Answer is:

Lack of discipline

OR

Lack of trading methodology
 
If you start thinking of stops as a mechanism you should use to play for a better position (and don't just think of them as a risk management tool), then you will start to think of taking stops proactively and not reactively...
 
If you put a mouse in a two part cage and make a little light go on 5 seconds before a painful electric shock is introduced into the cage, the mouse will ignore the light the first few times.

In the future, every time you turn the light on, the rat will run out of the part of the cage that delivers the electric shock -- every time.

Imagine if there were some system to deliver painful electric shocks every time you did something stupid. Sooner or later, you'd stop doing avoidable stupid things.

So, if you don't do something you are supposed to do, stick a paper-clip into the hot section of your electrical outlet and touch your foot on the metal of your floor-vent.

You will stop doing dumb shit in no time!


Ps: Do not really try this -- some people are pussies and their hearts can't handle the mild electric shock.

Additional Note: Check out B.F. Skinnard and some of his behavior experiments. This is precisely why slot machines are so profitable for casinos. They provide a random intermittent reward system and that is precisely what will keep people coming back -- random intermittent rewards. Can you think of anything else that provides random intermittent rewards? The market perhaps?

 
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