Yukoner's 2015 Psychological Journal

[Redneck]

There was a lot more going through my mind today with making trade adjustments.

I was super focused on whether or not I was doing the correct thing.

I almost think that might have been a detriment, as I just needed to stay relaxed and let things work.

It was...

We can only focus on one thing at a time (proven fact)

This is why I'm so anal about getting the discipline down cold

It must be ingrained to our very core - so it simply what we do - without the need to think about it


So it becomes our absolute default way of acting / trading - period

=========================

Aside;

Whenever I've changed up my trading - even in the slightest - it jacks me up for a day or two - every time

So don't be surprised if your changes end up doing the same to you

Our brain - go figure

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Screw ups today - but also acknowledgements..., then recoveries from same

Good Job YK

===============

Btw - whether you know it or not - you're also working on (building) patience

It do take ample to get through this stage

It'll serve you well going forward Sir



Rome wasn't build in a day...., took seven to create the world

Forging a trader ain't any easier

Keep on Truckin

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Tomorrow = we'll do'er all over

RN

 

[Handle123]

UDay #1 - Slept well, and went into the day with my normal trading routine under my belt. I took a few extra minutes before turning on my computer to just monitor myself, and make sure I was ready. Felt my heart beating a bit faster, and I realized that I was a bit concerned about the day. Best I could say was "jitters". So I waited... I relaxed... and I reminded myself of my weekend homework, and of following the plan.

Day started off fine, but that chop early on caught me on my first couple of trades... which was fine. Then I made a mistake and took a breakout signal, but had missed we were right at a high volume node based on previous structure... that would have invalidated that trade setup. So suddenly I am down now 15 ticks. I pause, I wait... I relax... and just chilled until I felt like I was seeing the market well again.

Then it started to come together and I took four winning trades in a row. Doing what I was supposed to do based on market condition. Those all felt good. I reacted accordingly to what the market was telling me. Then missed a couple of great entries, mainly because the market was moving so quickly... but that was fine as I didn't chase it.

Then I made one other mistake. I was in a winning trade, and up about 10 ticks. As per market conditions I reduced my risk to below market structure, so I now had about 6 ticks at risk. Then this was the mistake...trade came back a bit, and I thought... "why take a 6 tick loss, just reduce to only two ticks"... and barely thinking, I did that. I was stopped out, and suddenly realized I had made an error... I had adjusted based on emotion, not on market structure/condition. Once I realized what I had done, I got back into the trade on the same entry point, and left my stop 6 ticks away and continued to manage it correctly. Checkmark for doing it right the second time.

My final trade of the day I was up 10 ticks or so, and I did want to cover, but again it was only based on wanting to have those ticks and not let the trade work out. So I left it alone, and I let it work out only to take a loss. Checkmark.

There was a lot more going through my mind today with making trade adjustments. I was super focused on whether or not I was doing the correct thing. I almost think that might have been a detriment, as I just needed to stay relaxed and let things work. I am going to remember that feeling of just being relaxed, and try to get into that mode tomorrow before I put on any trades.

-349

I'd like to tell you just to think harmony is the answer to your woes when market gets you messed up, but if one saw my office before I tore out the broken walls and ceiling, I am an emotional trader when things don't go right cause I messed up. Buddies often wondered why I had dozen keyboards and monitors as backup, my best event was throwing a ball at the wall and it came back harder than I threw it hitting me in the head and waking up in hospital. That didn't stop me from doing it, but you adapt to using sponges, ROFLMAO, and I have calmed down much more-. I use a different Trade Plan for each market I trade, ES is like some 500 pages big cause any and all images of smallest of hints to people's emotions shown as price bars and crude oil so much less due to much less volume and larger margins. I HATE to lose day trading and in long term trading it is total opposite I lose in futures very high amount, sometimes 96% of trades and still do very well. I am very competitive against myself.

I only think in terms of equity curve percentages, I need a winning day each day, so if near last trades of the day and I am down on day, I will reduce targets just to get enough to pay for losses and fees as they are a loss too. And this is part of my Trading plan as well. next bar.

Tomorrow new day.

 

[Redneck]

I HATE to lose

Me too

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Aside;

Things that make me go - Hmmmm


So let's think about this

We are hyper competitive - comes with the territory

And what true competitor likes losing - ever

Furthermore

In the civilian world - folks can.., for the most part..., avoid that which they hate...., gravitate toward that which they like/ enjoy

We otoh..., must embrace..., and willingly accept - that which we hate - repeatedly..., endlessly..., unwaveringly


Seriously...., how jacked up is that - LOL

We are certainly sick individuals - of that there can be no doubt


RN

 

[Stocks4life]

For me Trailing stops tested out as means to not let profits run, but I suppose it you find them good for whatever you tested it is valid to use. But when you scalping I really don't see the point, too often in my youth I allowed to let price give more away than just get out, sort of deer in headlights, plus it took my concentration away as very often market has said it has mad S/R, I prefer to get to breakeven plus tick and leave it there.

Handle, agree for scalping BE+1 trailing works the best, but on oil if YK is gunning for 50-80 ticks I would think a reasonable stop trail would help (it is a skill in its own to place the correct stop trails). Anyway I would probably toss my monitor out the window if I had a 70 tick target on CL it goes 69 and then reverses and stops me out for a loss check my a.. But this is me..

 

[Yukoner]

YK

Good to see you finishing last part of the week strong (disciplined)

Good Job Sir

====================






Now..., call me crazy - or stumped - but what in the hell does this mean

I could decipher this sentence (parts bolded and underlined) several different - and likely wrong - ways

Just want to understand so I can monitor your adherence

==========

Tomorrow another new day

We otoh - must maintain diligence



RN

Thanks @Redneck! The way I was taught, is that you manage the trade until market conditions show the trade assumption is invalidated. For market conditions I am using a smaller degree of time frame to enter with the target of a larger degree time frame. An example from today was 51.88 in oil which I had previously identified from larger degree time frames, and I used that area to get long off of.. and also to look at shorting from.

As I write this, CL has traded up into a larger degree time frame that if given the proper balance area setup (like what just happened on the 1min chart between 52.47 to 52.55) I would be looking to short it in the 52.42 to 52.48 level. Rational is that we have a high volume location in this area, we are extended for the night session, that same rough area was two previous daily bars swing highs. So it is a logical place for a reversal. Dialing down into the one minute chart, when seeing a balance area form, it gives me a the risk of a daytrade, but the reward potential of a longer term time frame. So if short 52.44 for example, and risking 17 ticks.... my first target is back to the 52.00 area... and after that would be the 51.74 area. (For the record, I am not normally trading this time of day, but the setup was there so wanted to point it out)

Now this I where I had trouble. In theory, and as I was taught you exit trades or make adjustments based on that market structure changing based on buyers stopping buying and sellers stopping selling... but until that time, you stay in the trade. So if short 52.44 and CL sells off to 52.10 (a logical place to pause out), you don't just exit the trade because you expect a bit of a pull back. That is normal in the auction. One can lower the risk based on that same 1 min market structure... but just to exit because of profit, isn't the right decision. For myself, I would be up 10 or 15 ticks and just had to take profit... rather that let that work until market conditions showed otherwise.

Hope that answers the question. In a nutshell, all trades have to be adjusted based on auction market principles.

YK

Edit: 7:46 pm my time (PST) and I could short 52.46 right now based exactly on what I said above... the old me would have jumped in and done the trade... the new me says, "Hey, wait, you are done trading for today... conserve your mental capital... and be ready for tomorrow.... now finish up your homework and relax."

 

[Yukoner]

I only think in terms of equity curve percentages, I need a winning day each day, so if near last trades of the day and I am down on day, I will reduce targets just to get enough to pay for losses and fees as they are a loss too. And this is part of my Trading plan as well. next bar.

Tomorrow new day.

I've often thought about that same thing, and then I say... Well, If I am good enough just to trade for smaller targets and make dollars... why wouldn't I do that all the time?

 

[Yukoner]

Since this is a psychological journal, I'll share some observations. Firstly, by "stick with a plan" have you proven you can stick with your trading plan, or have you proven you can stick with a rule that says "fixed stop or target"? If it's the second one, why would you be doing this in a combine where you're trying to qualify to be a funded a trader, instead of doing this in the sim account you refer to? If it's the first one, why aren't you proving you can stick with your trading plan?

Earlier in your journal, before your fixed stop/target experiment, it seemed you were cutting profits short or getting stopped out of great trades around break even because you weren't allowing price enough time to reach your larger targets. Most of these trades not only went to your target, but exceeded your target. You analyzed these outcomes and saw that you'd have excellent profits overall. Now that you're actually doing this fixed stop/target experiment, it seems that hardly any trades are hitting your target. What changed?

Secondly, regarding your daily loss limit: Did your extensive statistical analyses that led to your trading plan demonstrate that it was somewhat common to have losing days greater than $400? If so, why are using that as a loss limit in your combine? If not, are you putting on trades at entry prices that are slightly different from your plan? I've found that an entry price just slightly different from my 2-tick slippage cushion allowance is often the difference between a profit and a loss. Are you taking slippage on entries into account when placing profit targets? That could account for all these trades coming within a tick or two of your target.

Things aren't making sense to me here. It's as if you're engaging in outcome bias, or attempting to fulfill a part of an idea but not the entire package, which in trading will generally result in disaster for your account. That's fine to do in sim, but why waste money on a combine experimenting this way?

@NoDoji first, thanks for the input. It is a busy life for me right now, so really just able to answer your questions. All good stuff btw.

For me, sim doesn't teach the same... there is nothing on the line... so I don't have the same pressure. That is why the combine works for me... something on the line.

As for trades hitting my target, I don't know if too much changed other than I seemed to have an awful lot of them that would be within 10% of the profit target. (2 or 3 ticks) I don't take slippage into account, but one idea might be to have a MIT order for my profit target. Certainly something to consider. Combine trades seem to be the last ones to get filled.

I have had to strip some things away, just to show myself that I could execute in the market what I was supposed to do. When I mention "upgrade", I am talking about adding onto the base that I have all ready built. If the trading plan needs to be changed later on, that is just fine, as I will have proved that at least I can consistently execute the plan.

YK

 

[Handle123]

Handle, agree for scalping BE+1 trailing works the best, but on oil if YK is gunning for 50-80 ticks I would think a reasonable stop trail would help (it is a skill in its own to place the correct stop trails). Anyway I would probably toss my monitor out the window if I had a 70 tick target on CL it goes 69 and then reverses and stops me out for a loss check my a.. But this is me..

I do agree to getting out with something on every trade, I like using risk to reward, I can't see risking 69 to get one, still comes down to a great deal of back testing AND what you can live with as I certainly can't handle day trading methods any more where I lose often but gets great profits, when I was younger, yes I could.

I've often thought about that same thing, and then I say... Well, If I am good enough just to trade for smaller targets and make dollars... why wouldn't I do that all the time?

I been extremely lucky to get to watch others trade through the years, saw team of two guys in 2002, they in their sixties each traded alternate days to put on up to two trades per day, first 30 minutes. Their Goal was one point and quit, they did 1,000 lot on limit, they showed me daily statements for past ten years when they started with one lots for like three years, amazing they hit like 95% of the time. Never told me exactly what they did, but they were incredible on knowing the S&P/ES much better than me at the time. It started to change my targets to less and time traded. Am sure one day I might be down to 30 minutes as well.

 

[Handle123]

Got to leave early for blood tests, been studying all night, LOL
LOL dumb me, I put a trade on while putting on my socks, I thought EMA hooked around, and 10 seconds of staring at it, got out. Little things outside the norm can really disturb your concentration.

 

[Redneck]

In a nutshell, all trades have to be adjusted based on auction market principles.

YK,

What I type here are simply my random thoughts

I remain focused on the discipline

In no way is this an attempt to alter your approach / method

Rather it food for thought

==========================


For market conditions I am using a smaller degree of time frame to enter with the target of a larger degree time frame.

I get using a bigger TF to contextualize the landscape – then using a smaller TF to fine tune the entries / exits

Add in a trading TF - it exactly how I trade


One can lower the risk based on that same 1 min market structure...

This is a false (and widely held) belief – it all the same PA.., regardless the TF(s) we choose to break it up in

Smaller TF is a microscope – used to fine tune entries / exits / stops / targets

Note - I hesitate adding that we could use the smaller TF for trade management - because it simply too easy to get hooked on the 1 min crack - and turn into a ping pong ball

but just to exit because of profit, isn't the right decision.

Agreed

Exit when the reason for entering invalidated – otherwise allow the trade to run its course


Dialing down into the one minute chart, when seeing a balance area form, it gives me the risk of a day trade, but the reward potential of a longer term time frame.

Smaller TF is simply a microscopic view – nothing more


Now this I where I had trouble.

In theory, and as I was taught you exit trades or make adjustments based on that market structure changing based on buyers stopping buying and sellers stopping selling...


Imo this is where auction market theory falls woefully short for actual day trading

We've no clue when…, or even if – buyers / sellers will step in – until they have

We’ve no clue how long they will remain

We’ve no clue to the degree of their voraciousness

AMT is only good at describing these in hindsight

We must work in the here and now


Btw…, I invite anyone to detail out the error of my thinking

Just keep is factual…, and more importantly – your rebuttal must provide actionable..., directional insight - for the here and now

That is after all what we trade / where we live - right here..., right now

No argument AMT has its uses in longer term trading - but not in day trading


but until that time, you stay in the trade.

Again - agree


==============

Next thought

I am an absolute believer…, and staunch practitioner of setting profit targets

Random (in no particular order) thoughts about setting targets


Will I miss a vast majority of a trending move – absolutely

Will I save my ass.., my emotional capital…, and make money – in that trending move..., and in a ranging.., volatile…, or reversal environment – bet yer butt…, which more than makes up for the above


Profit Target must always fit into the instrument’s personality

An instrument’s personality evolves throughout the year / quarter / month / week / session / economic cycle / presidential term / shtf events / FOMC mtgs/ earnings / who can say what else

Best we're able to roll with it


Always better to get a small portion – than it is to get 100% of nothing

Over a session – small portions add up


Long gone are the days of entering / holding a day trade for any length of time

This is a trader’s environment – and has been for awhile

=======================================


Simply random thoughts YK

I remain focused on the discipline aspect
(and will until you can say with confidence – that not even the ex can/ could sway you when trading)

Edit: 7:46 pm my time (PST) and I could short 52.46 right now based exactly on what I said above... the old me would have jumped in and done the trade... the new me says, "Hey, wait, you are done trading for today... conserve your mental capital... and be ready for tomorrow.... now finish up your homework and relax."

Sweet!!!


RN