Designing a system for your Psychology

Discussion in 'Strategy Development' started by RangeTrader, Mar 31, 2012.

  1. I have been day-trading for a few years and have issues holding a position for more than 30 minutes. It doesn't matter if a position is going with me, flat, or against me. The stress just gets too high and I panic exit.

    I solved the mental strength problem by designing my own system and indicators for doing 5-10 minute long trades. My main chart I trade the ES with is the 1k Vol(Equivalent to the 100 Tick pretty much.) and I also watch the L2. With the market moving at a good pace with medium volatility around 10-12AM and 1-3PM EST my trades are sometimes as short as 2-4 minutes. I am only capturing 1-2 points per trade.

    I think that it is very important for people to program their own indicators so that they understand the math behind them. I have no confidence in trading with indicators that I don't fully understand.
  2. I tend to have the same feeling... don't like using 3rd party indicators and prefer to make my own, even if they're based on the standard ones...

    What kind of indicators are you putting together?
  3. I have lots of custom indicators that I use... See attached! I only watch like two things at once so it's not overkill. Anyone looking at my charts is likely just going to get dizzy... I just get dizzy and confused when I look at other peoples charts! LoL!!!

    Lower indicators...
    1. I call it "Pulse", it's price vs range with capitulation signals and stuff
    2. Market range and it's trend
    3. Proprietary cycle indicator
    4. Proprietary cycle indicator

    Two of those trades in the attached chart were completely retarded... The after lunch counter trend short and the long trade which I just kicked myself for and exited with a couple ticks... Doing long trades during a transition into a downtrend... Even if you can pull it off, it's just not smart!!!

    Ever have one of those moments where you enter a trade and you think to yourself "That trade entry is retarded..." a moment later?
  4. The hardest part is how I must enter shorts within two ticks of range highs and longs within a couple ticks of range lows.

    I do my best trading after the morning news trending/whipshaw is over... I also need about an hour to get a "feel" for the market action most days. Once I start calling the moves correctly on my notepad and my technicals look good I go to work!!!
  5. Wow. you been doing this for some time.

    Some of those indicators are pretty well elaborated :)

    On my side I'm just getting started with coding my own indicators. I'm used to trading strictly with L2 (using charts only for occasional reference), I also studied many of the standard indicators a few years ago and the ones that made most sense to me where stochastic likes, since they use the highs and lows and that's something I've always looked at on the L2...

    So I'm building on ideas aroudn that area and building ratios and such that are based on the high/low for different time periods... the difference between them,etc...

    Still don't have anything very solid but I'm slowly getting there.

    I attached a pic with some of these ideas...
    They don't give headaches yet, but they'll get there soon. :)
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