This is something that never came naturally to me as a trader. That is, listening to my inner voice. It just amazes me, the bullets that I have spookily dodged the last 6 months in equities. It's like travelling down a road in a car, everything is looking fine but you just decide for some reason to bail out, so you sit by the side of the road watching your car continue undisturbed without you, then all of a sudden a tractor falls out of the sky and lands on your car. You feel relief. Anyone else know what I'm talking about?
It usually happens watching baseball. Last week, was just watching the game, then new batter comes up, out of nowhere my mind thinks and I say, "this guy's going to hit a home run", and he did on 1st or 2nd pitch. My wife was angry because it was the other team. Or in the post-season, in the 8th or 9th inning, same thing but for calling a wild pitch. It only happens once, after that won't happen the rest of the game. It usually comes when passively watching but not particularly trying to predict anything. For the rest of the game, it will be me just trying to hear it and be right, so doesn't work. I think I pick up on something not directly noticeable, like the pitcher is tired or nervous from micro-face expressions or something. Sometimes happens when trading, but only one time in the session. For the remainder, it's me thinking and trying to force it. Best idea to write down, because it's very easy to remember the times it works out but forget the times it doesn't, so you don't get a good count of how accurate it is, or when it works vs doesn't.
My First twenty five years of day trading I kept two journals, one on signals and other on emotional thoughts. I learned same reoccurring patterns of same thoughts almost everyday, when I thought of canceling targets as this trade was going to buy me this: http://www.cars.com/vehicledetail/detail/633839991/overview/?aff=aol I have to get out immediately as trade most likely going to stall. And when I have intense fear like this: Instead of getting out early, I stayed with the Trading Plan.
Listen to your inner voice. "Because it's real." Good traders are systematic. Great one's have, or use, their sixth sense...to exploit a new leveraged dimension. 'All movement in the universe is caused by tension between positive and negative furies'
I think there are two issues. One is the idea of intuition which may be a recognition-primed decision (defined by Gary Klein). Essentially years of experience leads to massive amounts of information being stored and some cue allows "experts" to recall those memories/information almost effortlessly, and make surprisingly accurate decisions. However when viewed like this, intuition becomes nothing more then recognition and recall and is much more algorithmic than intuitive. The second issue I think is selective memory. How many times were you wrong about that truck falling on the car. Or how many times did you jump ship when the security continued to perform in a favorable direction. I would make a journal of every intuitive decision you make and then record if you were correct or not. This is easier said than done since we are so inclined to be right, and you may dismiss your intuitive thoughts as soon as you realize your wrong and not even realize you had an incorrect intuition. If you actually feel you are correct often then look for those cues that may be part of some algorithm or maybe accurate heuristic that you may be experiencing.
man I have been through this, my guess is it happens about 50% of the time when it starts trending on you, you can do no wrong, and not just in trading, in every thing in your life like the last time, I had a huge profit at 11 am, and got flat and drove to Walmart, and didn't hit a single red light, and there was the prime parking space waiting for me, and I needed about 11 items, and ten of them had the on sale tag easy to notice when the coincidence is moving in your favor, and usually ignored when it is moving against you. my strategy involves 90% strict money management and 10% guessing what the market will do I can survive on the 90% money management, but I need to guess right to make money Usually the guessing right is just that sixth sense listening and analyzing, and catagorizing everything into what feels right and what sounds wrong but still, my guess is I only guess right 50% of the time, and my performance record would probably back that up
Yes keeping a journal as others in the thread have recommended also is solid advice. This seems like right way forward. So far, I have been keeping a list of the equities with the date entered and exited and I do regularly go back and see what would have happened and although a small number did go on to offer bigger profits, the overall effect of bailing out just blows me away. There was one that really shifted the next day after I bailed (PRTA) and I was on here whinning about it the day if happened, but funnily enough, it has come back to where I got out. The longer this has gone on the more confirmation I have gotten that I need to just go with it.
I'm a big believer in Luck. I rely on it to make money. But in my life it is allowed to run free in a limited environment of money management.