I previously used my journal "Maintaining Self Discipline" to document my journey in trading and attempts to be better disciplined. I'm learning that self-discipline in trading is not enough if one is not using a good rules-based system. For example, I can be disciplined to start at the same time every day, to stay with one instrument traded (well, I do struggle there), and make myself follow generalities that I've adopted for the way I want to trade. But without having a preset plan for different scenarios, I am caught off guard and make decisions that are not rules-based. That's kind of the difference between discretionary trading and an automated system. There are so many ways that a discretionary system can become a loose system that isn't well structured, that a computer program at least has the advantage that it sticks with only the rules it's programmed to follow. So, rather than discuss actual trading or what I'm doing in trading, I thought I'd start a compilation of quotes or book titles or links to sites that I come across that will help me stay focused on the goal of becoming a discretionary rule-based trader, and perhaps eventually make an automated or semi-automated trading system based on those same rules. The saying, "you are what you eat" kind of has a broader application. Just like how the things we eat become the building blocks our body uses for itself, the things we put into our minds can be used to build foundations for success or failure. The things we put effort and time into, we (usually) get better at. Trading might be an exception...some never get better, I think. But anyhow, by making entries into this journal once a week or so, it will serve as a reminder to really focus on becoming a rule-based, disciplined trader. The rules need to be what I know works. The self-discipline is what is needed to stick with those rules. https://www.quora.com/Do-you-follow-a-rules-based-trading-system
Yes you should follow a rules based system but make sure that each rule in your system is grounded in reality and is not stuff you hear on the internet.
If you are like most humans, you doubt yourself and will be very long till you don't over ride your set of rules. I firmly believe I can't program rules well until I can manually trade system to fine tune system, otherwise it is doomed. Am not being disrespectful, but might want to try a shrink or hypnosis to go deeper into why you self doubt. I did many sessions of hypnosis and still do. Good luck
True. Before I can ask that I need to ask myself why I haven't made well thought out rules. I have always resisted the idea of having strict rules for trading, but now I'm at the place where I need to make developing these rules my priority.
It's one way to determine if the problem is the rules or the trader. If you don't have any rules it's almost impossible to break, bend or ignore them.
Good point. I've been using backtesting results in NT8 to confirm what I'm seeing on the charts for what I want to have as my system.
Thanks. I think the self-doubt is because I've been too careless with trading. Thought I should just read the market and do well. But I'm thinking my next step is stick with one very strict set of rules and not change them and learn to use them before changing or adding. I kind of have in mind what I need to do. Haven't had any time to work on it, so I just think about it a lot.
HOW DID YOU KNOW? That's exactly what I followed when I blew my account end of July! I have the first two rules of my new plan written out: I had to put "find one thing" because I have several strategies in the making, but need to spend a little more time narrowing it down to one strategy and then make the strict rules for it.