Getting my act together

Like I said before, this thread is very instructive. I’m starting from scratch, but can afford $2k/month as risk money. I don’t plan on just jumping into the market, I’m reading as much as possible and am starting to use some software and “e-money” to help me understand what I’m doing. I’m in the middle of the first “Dummies” book for online investing. A few more for basic education, then on to John J. Murphy’s, “Technical Analysis of the Financial Markets.” I don’t claim to be a genius or anything, but I am motivated and want to learn this stuff.

What I really find interesting is his strategy. Like you said, you had no background on him, so I assume he made his money himself—and wasn’t a trust fund baby or anything. Maybe he was in finance and went private once he had a good enough portfolio. In any event, his strategy was to crunch the numbers and buy like Corporations do. He tried to anticipate what they did, and it sounds like he was successful at it.

I don’t understand all of the implications of these paragraphs, but I assure you, I will try to understand every bit of it. I think its gold! He gave you a condensed education that you could have not gotten in any book:

"...He uses 100% market orders. No stop or limit orders. I used a limit order once when I wanted to get a price for an exit with profit. He lit into me "Who the hell do you think you are? If you want out...get out!!! Don't screw around and risk losing money because of a tick." That is burned into my brain.

The basic trading entry is all in at entry and then lighten up without price moving in our favor and out when proven wrong for loss or all out with a profit when a turn appears imminent. We never used stops and did the six sec. routine. Ex. If he thought the market would go up then I'd place maybe 10 contracts long. If the price didn't move but the analysis moved from market strong to market normal then I'd take off 3 contracts at whatever price. If the market went back to strong then I'd add them back in. Once the market went from strong to weakening then I'd close out the position. On trend days we'd just hang on all day long and exit around the close.

The only indicator he ever showed me was a one standard deviation Bollinger Band. He'd point to the std. dev. lines and said see these? They represent the range of the past. If you need some help on anticipating direction 65% of the time the market will turn around near one of these lines. If the market goes through the line or stays on it, it's trending...don't go against it..."

Please continue this thread, I’m learning a lot. Thanks, you gave me some insights I don’t think I would have ever gained otherwise!

 

check out phantom of the pit for more thinking along this vein
http://www.webtrading.com/phantom/chapter1.htm

 

so after 20t in pocket, I put in a short to test the water and of course they pulled the plug to take it higher, after market resume I put in more shorts with target 11792 then take off for lunch, but guess where it stopped and reversed; exactly 1t above 92, how could they know any way, I got 5 bucks left now, enough for a fish sandwich meal, to be cont...

 

Quote from j_wentz1

Not so much a goal as a suggestion. You are obviously busy and don't have a lot of time. If you exercised at least 20 minutes a day the right way, you could probably do double duty in your life--lower stress and get some decent exercise in a short time period.

--------------------


Thank you, I know you mean well. The stress I have is self-induced. Usually I come into a day with very little stress. If I see a great setup it's usually easy to get a trade on. Then the problem starts. If the trade takes off in my favor like the analysis indicates then I get nervous (happy feet). I keep seeing reversals where there are none and I exit too early to avoid losing profits. I do this even though there are no exit signals, no indications of trend exhaustion, etc. It's self-induced nonsense. When I foundered for the past year I kept changing my trading style based on others ideas. At one time I thought the process I was taught was flawed and I just needed to fix it. I'd jump in a position based on any crazy idea and then start using my analysis. Only then would I notice I screwed up. Instead of admitting my mistake and bailing, I'd create all kinds of elaborate ways to trade the position. Anything but take the loss. I think in the process of losing, something inside me said "don't trust your judgement...see how many times you've screwed up?".
I'm out of my trades from this morning and I'm still stressed out. I even wrote down the whole process of the trade and where I made mistakes. Doesn't seem to help...at least not yet.

I think I've figured out where the problem is. The only question for me know is how long will it take to fix.

I don't think exercise is the answer but I'll keep it in mind.

 

I am very jumpy trader getting out too early most of the time but I also get out even faster when it doesnt go my way so I am profitable. I saw some of your recent p and l's and thought I was looking at my own. $40 or $50 , sometimes more but the thing is the amount made does not matter. What is required is being profitable consistently. That is the only thing required. I know that if I can make $50 a day consistently I am on my way. If you are in a hurry to make money then you get yourself in a bind thats hard to get out of.

 

I'm sorry you're unhappy with my $6.00 r/t fee + exchange fees.
I think you might be doing all your trading without any outside help and for you the commission is very important.

For me, a commission from anywhere from $3.00 - $10.00 per-r/t will not make any difference on my success or failure as a trader.
I expect to trade larger moves (once I get my act together), so the commission isn't a big % of my costs. If I net $50 r/t then a $1.00 reduction is only a extra 2% profit. At this time it's not important to me.

Another thing, I have daily interaction with my broker and I need them for my trading. Since I've only placed about 20 r/t's in the past 4 months and since my account is so small, I think they've been very generous with me. Also, I want them to make money and keep some good people. When Justin left I really felt like I lost a friend. Maybe he couldn't make enough due to all the discount accounts he had. I wish he had stayed and if by giving them a extra buck or 2 per r/t, they keep some talent, then I'm all for it.

Please, if you want to squeeze your broker, go use a pure discount broker. I'd prefer to keep my broker happy to help me and go the extra mile for me like Justin did.

 

<b>gutsytrader</b>, I appreciate all you've written & shared inside this thread. Thank you for that.

I do have a question for you:

Say you were looking to hire a professional trader to manage your own personal funds. The first person to interview for that position is <i>gutsytrader</i> exactly as he is right now.

What would be your first and then lasting impression? What positive and negative points about g.t. would you write down on a piece of paper while evaluating this potential manager of your personal funds?

 

I'm glad you're getting something from this thread. I had a couple of things that came to mind after this mornings mess.

One of the things he told me was about the different market players in terms of a western.

1). The individual trader rides alone. Noone notices their movements and they can seldom do much harm to any of the other players. If they don't team up, they have very little chance of staying in the game.

2). The large speculator is like a gang of bandits. They go where they want and cause havoc on a routine basis. If they run into the individual trader, the individual will get whacked. In fact they love to have individual's in the market. Each one is easy prey for their silling trading movements.

3). The institutional traders are like the calvary. Wherever they go, they bring others. They have the resources to deal with the large speculators and take them on whenever they get out of hand. They move with force and you can be sure where they go the markets will follow.

Ride with the calvary and your trading will be easy.

 

Looks interesting, I've bookmarked it. I'll check it out later.

 

Sounds like the way my trading going when I was trying to wing it. I know you'll hang in there. Now if only your subconscious would forget about it...