I am reading Van Tharp http://www.amazon.com/gp/product/00...002-6169819-2862443?n=507846&s=books&v=glance It covers some of the issues you mentioned. I can't tell you if the book can help, because I have not finished reading it yet. But the way he looks at things does open my eyes to new perspective ( ...and realizations).
there have been cases of people working on this for 10 years or longer and being consistent loosers during this time and then turning the corner. There is no garantee that you'll figure it out, there are no absolutes in this business. However, if your heart is no longer in it then I strongly suggest to call it a day, cut your losses and move on to other things. I belief that you only find success if you are convinced that you'll succeed. There are some good expressions that I have found here on ET and let me regurgitate them (thanks to the original posters, cannot remember who they were) Confucius: The superior man makes demands of himself The inferior man makes demands on others Ralph Waldo Emerson Do not go where the path may lead go instead where there is no path and leave a trail Roald Amundson Victory awaits those who have everything in order - people call that luck Defeat is certain for thos who have forgotten to take the necessary precautions in tme - that's called bad luck Tao te Ching, chaper 11 Using what's not: Thirty spokes converge on a hub What's not there makes the weheel useful Clay is shaped to form a pot What's not there makes the pot useful Doors and windows are cut to shape a room What's not there makes the room useful Take advantage of what is not there By making use of what's not Tao te Ching, tetragram 56: Those who know do not speak Those who speak do not know Block the passages Close the door Blunt the sharpness Untie the tangles Harmonize with the brightness Identify with the way fo the world Thomas Edison Our greatest weakness lies in giving up. The most certain way to succeed is always to try just one more time. Just because something doesn't do what you planned it to do doesn't mean it's useless. The best thinking has been done in solitude. The worst has been done in turmoil. The three great essentials to achieving anything worthwhile are; first, hard work, second, stick-to-it-iveness, and third, common sense. Calvin Coolidge 1872 Nothing in the world can take the place of persistence. Talent will not; nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Eduction alone will not; the world is full of educated derelicts. Persistence and determination alone are omnipotent. There were some other ones, cannot remember the exact words and I think it was from Edison: Most people give up not knowing how close to success they were Success is dressed in overalls and hard work Results? I have plenty of results, I know a thousand things that won't work! And these basically all sum it up: - In order to know what works you have to know what won't work. - No-one is going to give you the keys to the holy grail - In order to succeed you'll have to work harder than you have ever before Remember one thing: Trading is the oldest profession (yes even before the other - something needed to be traded) and fear, greed and manipulation are deeply engrained in our psyche. good luck psycho analitics
This is a reality check. Log it into your checkbook, and find some satisfaction in knowing that you have been paying your dues. Not sure how long you've been at this, but guess what, you have not failed. Payed, have you, all of your commissions? And still, after all of this time, have a trading account do you? Already know you, that which you need. Okay, now that I'm off my Yoda trip, you need to find some satisfaction in knowing that you're not one of the 95%, or whatever it is, that failed at trading. You did not lose. Put that into your mind. Log that into your checkbook. Maybe you're not yet one of the 5%, but you never will be if you keep your current mindset. "Every battle is won before it is ever fought." I'm not saying that I drink from the holy cup, by the hand and the grace of God, or any of that Holy Grail bullshit. I don't. But when I started out I wasn't as lucky as you. My account was getting gouged. Bludgeoned to death very quickly. I had to learn, it is Kill or Be Killed. Trading is simple... That being said... Trading is NOT easy. The winning plan is conviction. It is belief in what you are doing. Adhering to the rules, adhering to your guidelines. Develop a sound trading strategy. Target Profits MUST be larger than losses. If the expected per/trade win percentage is 1:1, then develop a plan that can continue to exist at 1:3. Losses MUST be limited. If your Target Profit for any particular trade is $2.00, and your Stop Loss is $1.00, but your actual Average Winning Trade (over a long period of time) is $0.75, then you are going to, on average, lose money. Trading is a numbers game, and getting the numbers right is half the battle. Over-exposure will kill the new trader. Many new intra-day traders who end up losing are in the market for 7+ hours a day. Why? Do you feel a need to get even with the market after a loss, so you jump right back in? Are you feeling a bit greedy, like you just gotta get that extra $0.05, only to lose $0.15 more? Are you up on the day, but down after commissions? Is that a good reason to jump in head first? Capital Preservation is of the utmost importance. You can NOT make money, if you run out of money. Put Capital Preservation above all else. Period. Risk Management is the name of the game. Any Ego is too much of one. I am not a winner. I am not a Loser. I am a market participant. I am not winning. I am not losing. I am long. I am short. I am not up. I am not down. I have a vested interest in the market's direction and where it is going. Effective analysis is key, not an under utilization of available resources, not analysis paralysis either. Know what you need to know. Ignore the noise. Trade with the market. Go where the market wants to go. Ride the waves. Don't buy tops. Don't sell bottoms. The most important indicator is, and always will be, Price. Quit going long during lunch in stocks that consistently chop or go down during that timeframe, even in a Bull market. If you trade intra-day, then trade intra-day. Do not take home a trade that was losing, only to find it gapped down even more overnight. If you have multiple trading time-frames, trade in multiple accounts. Don't short Oil during a war crisis in the area of the world's largest supply of Oil. Not even if the Bollinger Bands, or the Moving Averages told you to do so. On the flip side, don't go long Oil after reaching historic highs during an oil crisis. It may go higher, it may not, but if it is not a trading vehicle that you specialize in, fight the urge and avoid it. Trust me, Cramer was not the first to coin the phrase "Pigs Get Slaughtered." Don't trade on fundamentals alone, if you are a short-term trader. Don't go long just because a moving average made a cross-over, it is a lagging indicator which means it has no bearing on future direction. Look at the orders, look at the ticks, look at the charts, look at the buyers:sellers, look at the market advances:declines, look at the corresponding exchange's direction, look at the sector's direction, how weighted is it in its corresponding ETF? What is that fund doing? Read its news, what is the sector news? What are its relatives and what are they doing? Have you found a better prospect yet? Collectively, what has all of this information told you? Go Long? Go Short? Avoid it altogether? Like I said, Trading is NOT easy. But that doesn't mean that it can't be simple. In my opinion the most valuable indicators are not the ones on the price charts, they are all of the independent variables that come together to form a matrix around each trade. Look at all of the variables surrounding the trade, when a large percentage of these indicators match what the price chart is telling you, pull the trigger and make the trade. Really, it's all only as simple as you make it. You break one rule, and you will lose clarity. You break a few, and those very same rules will end up breaking you.
You must do your search for a brief consolidations and following BO on 10 or 5 min charts, 1hour is useless for that. It is futile when you are not using proper method for recent market conditions. I do not know what your method is but if it does not work for you, then you must change it. Reversal trading is fairly easy and unemotional ( compared to trend following ), but must be done right way.
I think "The Predictors" by Bass is a good book. It covers a story particularly for systems traders. The quotes on page 231 are quite interesting.
Bert, I gave up on charts much earlier than you. I realized I had no talent for screen trading and everything I tried looked like a mirage. Fortunately there is another form of trading that you like I am totally compatible with. "Systems trading". I found the learning curve was very short and without the psycho drama of a discretionary trader. Try out what I did. Buy a copy of Futures Truth for $25 and look at the out-of-sample performance of the systems in the market you wish to trade. They give the past 5 years of annual results along with trade frequency, and profitability by trade. Find one you like (that is also fully disclosed), and buy a copy. Not to trade...but to take apart and see what there is about it that makes it work. Backtest it with changes and see how it affects the results. If you're analytical like me then you'll be amazed how fast you'll come up with your own profitable system. If you don't want to spend any money then go to the wealth lab site and look at the code of successful systems. You'll get ideas and figure this out in no time. Building a trading system may be time consuming, but it is definitely not rocket science. 44yotrader
thanks to all who have contributed. Made me think. Old Trader, what you describe is part of what got me enamored some years back--from the book Reminiscences of a Stock Operator, where the guy (Livermore) talks about reading the tape and getting a feel for what's happening next. I'm sure there's some value in that. banjo--that may very well be true. The current market environment probably shoots some of the theories out the window. 40yo, I'll contemplate that. At first, the idea of going thru the nuances of systems trading seems too grudging, too tedious. It seemed that I could get a better feel for the characteristics of buying and selling thru charts. But I may have reached a point of agreement with you here. Thanks.
Bert, i would read and re-read Oldtrader and 2manywhiners's posts. They contain much wisdom of experienced and sucessful traders... Too many ppl come into the market expecting to figure out an edge/a rigid set of rules that will make them all the money in the world .. well, it ain't gonna happen ).. lucky for us discretionary traders .. good luck Bert, taking a step back is not necessarily a bad thing, it enables you to spring 2-3 steps forward later... pom