Nodoji, You're absolutely right.. I can read the market but I'm not trading based on my ability and it because of my stupid emotions.. it's always in the way of my trading. I'm grateful for many advice that was given to me here but I've done them before and my stubbornness still wins.. Maybe I'm not meant to be a trader.. I mostly trade stocks and I'm a daytrader.. I look at different timeframes but my main one is the 5 min. chart..
Day trading a 5-min time frame isn't easy because it requires a lot of focus. Price might consolidate for 10 minutes or 60 minutes. You have to fight the urge to manufacture something out of nothing during these periods, yet at the same time remain focused enough to act without hesitation once price tips its hand. What might be helpful to you is an exercise where you act as if you're teaching a class on day trading and describe what's happening with each price bar that prints. Describe the market environment to your "class". When a setup forms, identify it and describe why it's valid (or why it's not valid, if you use filters). It will be more difficult to trade out of plan while you're doing this. I sometimes Skype with some other traders and it helps relieve that impatient feeling where you just want the market to make a move and it refuses to do so for quite a while, and you're certain every little move means you're about to miss out on something big. There's a flat 20EMA, and price is breaking out of a narrow range by a tick in both directions, slowly destroying the morale of impatient overtraders. Thing is, most of the time the market finally tips its hand on the smaller time frame (such as a 1-min chart for 5-min traders), and you'll be able to get in on it with far better odds in your favor if you're patient and wait for those little patterns to appear. Read Bob Volman's book for a superb and comprehensive analysis of these small time frame patterns where the market tips its hand quite reliably.
Nodoji, It's like you're reading my mind.. I thought about acting as a teacher describing my strategies before and because of your reply, I will actually implement it. My main timeframe is 5 min but I do look at 60 min as well.. I do also have 20 EMA on my charts.. You know your stuff and thanks for your help..
mrnate22, Read what Steveh said above 10 times and slowly word for word. I missed the importance of this for more than 2 years and spent far too much time on setups.. If I were learning all over again, I would spend the first 2-3 months on context only and mastering the ability to determine should I be entering long, entering short, or doing nothing before I even considered defining a setup. If you are a PA trader and cannot master this(defining market context), forget defining setups...because there is a good chance you will be trading on the wrong side of the market. Wolf PS. Look over some material from Lance Beggs. He does the best job I have seen explaining the importance of defining context first.
Thanks Wolfpacker, I actually do know this and I do apply it to my trading.. But again, my problem isn't technical but mental where I get too excited to trade to the point that I disregard all the rules just for thinking I will make money.. I enter into crap setups even though I know full well that I shouldn't and so forth.. I can spot great setups and know what trends we're at BUT I rarely end up using them cause I'm already emotionally ruined and that's the solution I'm trying to find..
My advice to you then is to stop trading live money immediately and hire a trading psychologist. The money you will save(not lose) with your 80% loss rate will easily fund a psychologist. In the meantime, read up on Mark Douglas and Denise Shull. Best of luck. Wolf
I personally recommend Andrew Menaker as a trading shrink, if you go that route. I read a lot of stuff on trading psychology but it didn't stick until I worked with him.
If after 5-years one still can't harness their emotions and discipline it is time to accept the harsh reality. Not everyone has what it takes to be successful. Trading shrink, coaches, suggestions do this, do that differently is just delaying the inevitable. Time to be honest with yourself. There are other way's to earn a living.
I doubt this really makes any difference in him cause he can't follow his rules anyway. I still go 2-4 times a year for hypnosis for help in concentration and memory. Fifteen years ago I went monthly to get better control on discipline, this might help you as well.
Well, I figured when he said he was impatient it was because he was a swing trader or a day trader who waited for very specific 30- to 60-min setups that might happen once a day. If he was a 5-min day trader or a scalper, then impatience indicates other problems. I think regular hypnosis sessions is a great idea if you can find someone with a solid track record.