Another new trader

Discussion in 'Professional Trading' started by ziyan, Jun 16, 2011.

  1. ziyan


    Hi everyone,
    I've recently started at a prop trading firm. While trading, I feel like every time I go long, the market goes down and vice versa. I could almost swear the entire market is working against me, but I'm sure this isn't the case. What is my problem and how can I improve my timing with confidence in my executions? I use a trend-following strategy and try to be reactive to stock movements. I realize that I am still a complete novice (it's my third day) and I have much to learn. What can I do to survive?
    I'd highly appreciate any helpful information I can get.
  2. If you're in a slump take a few weeks off from live trading and switch to paper trading until you get your confidence back. Look back at all of your entries and exits (especially for losing trades) and look for things they had in common that you can improve on. Figure out what the mistakes you made were and what you can learn (e.g., 'Setup X does not work on a day when the market is doing Y').

    Another suggestion is to come up with a non trend following strategy you can use for days that seem like they have a high chance of being sideways / range-bound days. Trend following setups can be extremely effective on some days but aren't always the best thing to use many days in certain market conditions.

    You could also make a point of scaling into your trades more slowly in smaller chunks so can have a higher chance of winning trades.

    And if you're way off, it might even be possible to adapt a method where you change your previous long setups into short setups and vice versa.

    Once you go back live for your first week, just start trading small share size until you're back on track in terms of consistency.

    Also keep in mind if it's just your 3rd day and you're pretty new to trading, it can be very difficult to see the market well and be consistent. It takes time to figure out exactly how everything actually works (often 1-2 years), so to survive you should give yourself a tight maximum loss per day and trade only very small size until you are at the point where you have 75%+ positive days.
  3. Market has been super choppy lately.

    Trend following doesn't work now.
  4. Come back in min 6 months. Then we can talk about what your problems are.
  5. ziyan


    Thanks, thunderboltr. That sounds like some really good advice. I'm definitely going to lower the share sizes while I'm trading. However, some people say that paper trading will not be as effective since I will not see a reaction from the market from my trade. Is that a valid concern I should have?
    Thanks again for your help.
  6. ziyan


    swiftmike, do you mean that it's just a tough environment to be trading in right now?
  7. Why so condescending? We all have to start somewhere.

    OP, as you already know, the market is not against you. It just feels that way in the beginning. When you gain more knowledge, you'll realize this really is just a game against yourself. You are not competing against anybody but yourself.

    Read Trading in the Zone by Mark Douglas for the psychological aspect of trading. It won't tell you when to get in or when to get out, you'll have to figure out the technical part on your own. And that depends on your personal makeup. Are you more comfortable trading short term or long term? Can you put in a few years learning and not making money? You'll need to analyze your trading and find out what you did wrong and what you did right. Losing money doesn't necessarily mean it was a bad trade and vice versa. Experiment with different time frames, different entry and exit strategies. Try out different instruments. It'll take time, but if you are persistent and open minded, you'll find success eventually.
  8. Ziyan, are you daytrading?
  9. ziyan


    Thanks everyone for all the insightful advice. I'm finding all this very helpful and would like to know more.

    Hook N. Sinker -- yes, I am currently new to day trading.
  10. what's your trading plan? have you backtested your trading strategy? if you're at a prop firm, can't you just watch what the bigger, more experienced guys are doing and just piggy back their trades?
    #10     Jun 18, 2011