Hi Dan, I'm afraid you've lost me with that one..... I'm working on my discipline for following my entry and exit rules with a method I have a lot of confidence in. Why would it be any better for me to develop a new method that has more straightforward rules just to complete the 20 trade exercise. The only reason why Iâm doing this is that I think I have a good edge. I would argue that my current trading flaws are fear based and therefore moving away from something that works for me would be three steps back. I totally agree that the wheels are spinning big time at the moment â¦..⦠but all the issues are between my ears, and I have some time to get them right. Thanks for the feedback.
dont you have to sit an exam to get a eurex seat? major ball ache but worth it if youre a high volume trader. what is the liquidity like on eurex russell products these days?
BULL SHIT!! most of the market wizards are discretionary. paul rotter is discretionary george soros is so discretionary, he even goes by the pain in his back!! sorry - but you are just sooooo wrong on this.
lol.... neat post. the only thing id add to this is imo douglas doesnt mention that the end result of this exercise should be a profit (great if it is of course!). the purpose of the exercise imo is just to get a working belief in the 5 probabilities ethos. this is why he states that you should be willing to put aside $xxxxxxx in case every trade is a loser. in other words, the exercise could take 20 or 100 trades to complete - but it is not complete until you do have a working belief in the probabilities/true nature of the market. i think this is an important factor when doing the exercise. from my own experience when I did it, i had a loss and assumed it was because my edge was non existent. the reality was that i wasn't being selective enough in deciding when my edge was there. in other words, my edge wasnt there on most of the trades! this can create a lot of issues and psychological damage until we are aware of this. the nub of what i am saying - and this has been very important in my own trading is as follows: douglas talks of flawless execution and that we should execute our system flawlessly - ie take every VALID set up. but this does not mean taking EVERY set up. each set up should, to be defined clearly and concisely, so as to leave no room for doubt if it is there or not. lets say there are 4 criteria here: 1/ clear long time frame signal 2/ clear short time frame signal 3/ volume confirmation 4/ sufficient liquidity its no use taking the trade if only 1 or 2 of these criteria are met. all 4 MUST be met, and then and only then should that trade be taken. this is flawless execution. taking every trade that meets ALL of your criteria, not just 1 or 2 (like I used to do thinking I was trading flawlessly, telling my self 'you dont know what the market will do next' etc according to the 5 probabilities) hth
Jessop, The fact that you are still trading futures after eight or nine months in a very difficult market says you are doing something right. Looking at this from a long term point of view (years), alot of this emotional stuff is going to be much less of a problem with experience. Do you think the guy who has made 10,000 trades over the last 5 years has the same emotional intensity when he puts on the fourth trade of the morning compared to the guy who has 300 trades and six months under his belt? If I were you I would commit to the first x number of signals, say 3-5. If you could consistently take the first 3 trades of the day I think this problem would go away.
Fred, Thanks for that. I agree, especially that the end of the trade exercise must be when there is a really ingrained belief in probabilities. The blackjack/casino analogy is the key element for me. The trouble is Iâm not letting my edge play out. At the moment itâs like I keep getting dealt two Kings and ask for another card every time !! However, even Douglas said that profit taking was the hardest part of the game and didnât really have much more to say than scale out sensibly. Interesting point you make on sufficient liquidity. All my signals include volume confirmation by their very definition, but Iâve never considered liquidity before. Cheers
Dman, Thanks for that. Iâm sure you are rightâ¦.â¦.Iâve noticed the difference in the last four months since Iâve been live. In the first week of being live â I took 3 signals out of 40+ and when I was in the very brief trades I could hardly hold the mouse due to sweaty mitts, and I had to watch each and every tick movement on the screen. Any loss was a total downer and I generally stopped actively trading for the day. These days I am happy to take a loss (only for valid signals â not my occasional gamble trades) and can walk away from the screen in a trade for 4-5 minutes. So emotional progress I guess. Cheers
Getting into the habit of walking away from the screen for 4 or 5 minutes could cost you some $$$ if your stop doesn't work (you do use IB right?) and ER2 goes against your position fast on a breakout of some type. I would never walk away from the screen. But then again that's just me...
not to mention your only dealing with the symptom, not curing the cause (if you just walk away to avoid conflict)