The generally accepted systemic way to determine this is to do a MAE and MFE analysis of your trades. nitro
Well.... I do not consider trading as only a "result oriented" career. However, If one is able to trade profitably, consistently and remain happy while trading, then the trading career might be a good match. (This thread is in the "psychology forum" isn't it?) In the beginning, the newness of many jobs wears off....like the new car.......For me, it takes about 3 months. The challenge that full time trading gives to me, makes the job more interesting, and I am learning about myself from other traders constantly. (probably why I have stayed an independent trader for all these years) My contributions are my PERSONAL points of view and in no way would I want to preach the way it is. For me the emotional challenges are overcome with formulating a plan and following it. Discretionary trading is the hardest for me. I find myself trying to "can it" into a definable strategy, system or set-up. I am always trying to find the MFE and MAE based on an entry with a definable strategy. I am critical of myself for this, as there comes a point of "curve fitting" that makes strategies null and void. Discretionary trading requires reading price action and experience. One must react to the present and ever changing conditions that present themselves and adjust accordingly....now how can you "can" that? Lots of "what if" or...."and/or"....or...."if/then" questions which lead to following the "price road" of going long and short and playing the probabilities and being on the right side(or discovering the right side). The experience in this thread may find my comments amusing as there are some along with Jack, that are able to trade seamlessly and by learned instinct which is what I am trying to master. I feel my road to mastering this....leads me to try and identify velocity, direction and time to gauge the type of set up I am entering. Since I only trade the ES, which proves to be rather challenging to me, the increased leverage causes caution. The emotional part of "REAL TRADING" my money and other peoples money can change one's best layed plans. But, I have learned to find a reward in understanding my plan, set-up and "doing the right thing" when trading. I can explain every one of my trades and withstand any criticism, as I followed my plan. Other times just do not make since like last week I was short and we had that ES spike down in a 3 minute time period.....now I did not plan that!!!!! but my trade was busted, anyways, but I still got some of the profit. So my point would be also to understand how to take a loss (or profit) and how to remain happy. Many traders committed suicide during the depression in the forties, so do not fall into the this trap. This is a business, and a rather boring data entry job........ Many newbies are drawn in to trading, due to a gamblers mentality and if they are to survive long term they will need to lose that in my humble opinion. You can test yourself by this- You make a profit, BUT you did not follow your plan, you feel frustrated, unhappy about your day. Try to level out and to understand what makes you happy and learn it. If its just profit that makes you happy, well good luck. For me, its orchestrating the orchestra and not letting the price lead me around, but using it to discover the correct side. The profits will come, you have your whole lifetime! Please excuse me for replying about myself so much.....I do not feel comfortable talking to a forum in an authoratative capacity and I hope I nerve get that way. Some pro's in here have earned their position in the trading community and I consider myself a novice to the likes of them. My current studies are currencies, multiple instrument commodity trading and spreading(not options). I currently trade the ES full time and make my living from it. For those of you wondering if it is possible, Yes it is, humbly speaking. Michael B.
The thread title talks about targets (which could mean bigger picture or individual trades targeting in the contest of trading, or even daily targets etc.) The question (above) talks about goals, which may mean individual targets for trades, but is more usually used for bigger picture things not necessarily directly related to the actual activity of trading other than trading being the means to achieve the goals. The thread has been placed in the psychology forum which tends to be more esoteric than trade strategy. 0008. Could you clarify what you are asking about, since there are clearly many possible interpretations of what you are asking with very different types of answers being appropriate to the different type of question? Best Natalie
for a quick answer : MAE = Maximum adverse excursion MFE = Maximum favorable excursion The Book: Maximum Adverse Excursion by John Sweeney For example: You enter a rocket and the beginners level......you would keep a stop log of sorts to put it in your language Jack. Like this: Rocket entry...question what was the max high reached after entry Next question: what was the maximum low reached after entry? Now you could use a variation of a "time slice" with this or base it on a velocity slope which is what I am currently studying Michael B.
Okay I enter at 990.0 and it maxes at 997.2 and I get out when rocket ends at 996.3. It regressed during the rocket to 995.2 between 997.2 and 996.3 when the exit signal came. My MFE is 997.2 and the MAE is 995.2 as I think I see it. what do you do with the #'s?