If you really believe in your system, then you will "want" take every trade your system signals. If you are hesitating, go back to the drawing board.. backtest, forward test, paper trade and prove to yourself that the system works. Then you will believe. There's a fine line between discipline and idiocy. People stubbornly continue to follow systems that have a negative profit factor even though they have no idea if it really has proven itself to work or not .. in the name of "discipline". Then they wonder why their account balance is down to 3 digits. A good % of all the posts on here would be gone if people realized that they simply haven't done the homework in determining whether their set of rules or "edge" even is profitable.
Flashboy: I think itâs very important to have your rules down on hardcopy that you can go over before each trading day. For me, I also keep graphical representations of my setups with the pertinent system criteria in visual form on 2 or 3 sheets of paper mounted right next to my monitor. During market hours, I donât want to be reading the text of my rules, so the schematics that in essence captured my rules serve that function. I can eyeball those sheets and compare them to the chart on my computer and it serves as a constant reminder through out the day of the types of trades I absolutely need to wait for before getting in or stay out. Thatâs just a mechanical way to help me maintain a degree of discipline. Maybe it might help you. As far as your tendency to take trades outside your defined setup after a good day, try to detach yourself from results of past trades â good or bad (easier said than done, of course). Focus only on the here and now - on the applying your rules correctly and accurately to the present trade. Kermit
There are number of things that make us do stupid things while trading and nine times out of ten they cost us money. Fear, greed, addiction to the trade, insubordination and Ego. Fear, gets us out of the trade which later proves profitable if we'd only the nerve to stick it out. This is a biggy because fear via adrenaline can alter your brain chemistry making it harder to think clearly. Greed, has us taking trades outside our rules because we want money dammit and we want it now. Addiction to the thrill....This is a biggy for many. Even the most non-gambling person can not help but be thrilled by trading. It is sometimes difficult to just sit on your hands and do nothing. We need that endorphin fix. Insubordination, to yourself! It is hard for the same creative active mind that comes up with our trading plan to then subordinate itself to said plan. We march to a different drummer blah blah. The creative mind hates rules and discipline. Oh and then there is EGO. ..We hate to admit to being wrong, to being beaten, so we throw ourselves at that great white whale with predictable results. The whale doesn't care that you're angry. These are some of our enemies. We must know their faces so we can fight them when seen. I'm sure there are others ......anyone?
ABSOLUTELY! The only way. Read no further... indahook has given you THE answer... ! Now you decide which it will be... bust out or get sick and tired of losing and breaking so-called rules, and begin to do it right... and then modify as you go along so your rules don't break you even if you no longer break them! Ice
Trading plan, profit target, trade set ups, trade rules, trade log are to live by and if all else fails screw Harry Potter and go for the 26er of wisky and a little AC DC Highway To Hell. Works for me. Cause sometimes we all forget the rules. Happy Trails Amigo gw
What used to give me an excuse to go on a bender was the 3rd or fourth losing trade in a row, even if everything went by the book. It's taken me a very long time to get over that hump and make each trade independent to the trades made before or thereafter (playing poker/blackjack helps alot in this regard); after so many foul-ups, it finally dawned on me that it didn't make any sense for losing my cool because of a few losers. Knowing your weaknesses is more important than knowing the market, cuz you can't control the market -- stay confident with your edge and everything else falls into place.
Watch your equity curve. If you like the shape, continue doing what you're doing. If you don't, change what you are doing.
Thanks to all of you for the replies.. and so many of you are right on the money... I'm getting close to detaching myself from trades.. that is when I lose I shake it off and look for another opportunity.. used to be I'd be shot for the rest of the day.. Someone said.. GREED - I want money and I want it now Dammit.. this is so true in my case and is why I'm taking those trades that are not in my plan.. The other FEAR - getting out of a position too early that continues to go my way .. my account would be much healthier if I had overcome this one.. thanks again.. and Good trading to everyone
Yes getting out of trades too early when things are trucking the right way has got to be more of a pissoff than losing a trade or just sitting there and watching it happen is just as bad. Ones measure of judgement and trade percervierence does get better with time and this my friend is what gets down to experience. If your in a draw down state the day when you can come back into the trade day and at least make your losses back partially if not totally is the day you can give yourself a "well done" instead of a "son of a bitch". Remember these posts and protect yourself with sound risk management. ES to us starters is one tricky mover some days. As time goes on you will be able to stay in the trade to hit some type of profit instead of pulling the pin. Best of Luck. gw
Trading is like programming as for bugs they are unavoidable. They can only be reduced. A programmer can program without any design plan and his program can then become an awful spaghetti with many bugs. Have a specific trading plan for that day, play it with scenarios and just not content with general rules for when you will have to apply them you must be in full concentration capacity and that's could be overwhelming for you if not prepared enough. I repeat there are 3 levels for achieving something: - concept - design - realisation going from concept to realisation without design can be hard for some complex process. Your general rules are just concept.