I thought I would share a current challenge I am facing which I need to work on. I don't think it is the last thing I will have to master as I don't view my trading like that, I don't think it can be 'solved' so to speak. There will always be things that need improvement or working on even when I am a 70 year old man placing a trade (quite a few decades away lol). So my current challenge is a variation on a theme of not 'sticking to my plan'. Rather than not sticking to my plan through frustration of it not working or boredom (which have happened in the past!) this time I have not stuck to my plan due to over-confidence and feelings of invincibility. For some time now I have had a daily target of 10 ticks and daily stop loss of 15 ticks. During July I traded very well sticking to my plan religiously but what I found was the overconfidence/ego thing started to creep into my psyche. With hindsight I can look back now and realise it was happening slowly every day incrementally. I had a long streak of winning days, I am not going to say how many but it was long. Part of my plan was to shut down my trading platform once my daily target was done, the reason for this is I like to preserve mental energy for another day. Sometimes it takes me 30 mins to hit my daily target other times 4 hours. On Wednesday of this week I decided to continue trading past my +10 ticks daily target. My mindset at the time was, 'I have only been trading 90 minutes' I am leaving so many ticks on the table here, I will just take prime set ups and push for more ticks'. This was going off plan. I went on to make +20 ticks for the day, twice my daily target. Driving home I felt invincible, I started to think about sizing up next week and what I would spend the extra money on. With hindsight I can now see how this was a marker for what was to come. Thursday - I was very tired, I had to be up at 5.30am to get the car to the garage, plus I had a minor argument with the wife the night before. So with hindsight my decision making abilities were not 100% even though I thought they were fine. My first trade showed me a good profit of +6 ticks however for some reason I hesitated, I didn't take it and scratched it. Second trade at one point showed me +6 ticks, again I didn't take and ended up taking a -3 (!wtf!). At this point I am looking back in my journal and thinking, what the hell is going on I could have taken +5 on both these trades and have completed my daily target, platform shut down. But no. 3rd trade - great entry and I took a -4 loser, nothing wrong with this trade, just didn't pan out and I took the loser according to plan. This is where in hindsight I got really pi55ed off with myself, I was riled and my decision making ability was impaired. i was -7 ticks on the day when I could have had my daily target complete. 4th trade was a good entry but I managed it badly and took a -5. I am now at -12 ticks for the day and pi55ed. With hindsight I should have shut down and ended there booking a -12 tick on the day. Coming off the back of a long streak of +10 tick days and a +20 tick day the day before a -12 tick day is fine in the grand scheme of things. Then came trade number 5. I know I wasn't thinking straight as I cant even remember why I entered, my journal just says, 'poor entry', 'badly managed'. I ended up taking a -21 tick loser. wtf. wth. I finished the day on -33 ticks in absolute disgust. I had just wiped the majority of this weeks gains out.my daily stop loss of 15 ticks went out the window, why did I ignore this? ignore 15 why ignore 20 ticks. A 20 tick loss on the day would have been bad but not a disaster but -33 ticks wtf. Friday - didn't trade as I had other commitments. Probably a good thing I took a little break given Thursday's performance. Looking back the warning signs were there for me. Anyway this is my new challenge, how not to repeat this. lolol.
Profitable but still mastering things to improve the amount of profitable so will likely never stop mastering this biach!!
Here I am at 1.00am Aussie east coast time trading the SP500,SP200 and FTSE100 Indexes and Options, I find indexes to be my low hanging fruit, if there is one thing that I have learnt it is that you are only as successful as your last trade. There is no final hurdle to profitability. Over the years I have encountered virtually every challenge posted on this forum. One key hurdle that dealt with most of these challenges was learning to accurately determine market strength/weakness, all I had to do was learn to understand market action/behaviour, this is where my confidence to do what needs to be done when it needs to be done comes from, I'm not talking about charting here, that is trying to predict which is futile. All I try to do is be part of the current moment, if the market is strong I buy, if the market is weak I sell, I only ever trade at the market. There is not one professional trader I know, myself included that can know if the next tick is a continuation of the trend or the first one of a reversal, trying to forecast the future is a fools errand, leave it up to the Gypsies with their crystal balls, your job is to trade what you see in front of you. Forget price levels, forget charts and indicators, it's all trying to predict the future. Because it is so hard to get a good price when right about the market I am overjoyed to get my trades on, the harder it is the better, don't be scared to pay more, if it is too easy/cheap then you have probably got it wrong in the short term at least. I never deliberately put a trade on when I think that I am wrong. Stop losses are just one more attempt to force your will on to the market, mr market couldn't give a stuff about your stops, your orders your positions, price levels or anything else for that matter. he does whatever he wants to do, you are wasting your time and money trying to influence him. The market must be your stop, when it no longer behaves the way it should for you to hold your position then and only then should you get out. Yes, I cop drawdowns, that is just part of trading, just as losses are no matter how well you are trading. Just make sure that you are not overtrading when the inevitable drawdowns and losses arrive, as they surely will, this I guarentee. You will continue to make mistakes as long as you trade, welcome to the real world, there is no way to protect yourself, just try to not repeat them too many times.lol Trust what I say," I make mistakes all the time yet continue to make consistent money in spite of this, nobody is so profficient that they can avoid this trading reality, so don't stress about it". I hope this helps. Cheers John
The last trade that lost.., and the next one.., and the next one.., and the next one.., and the next one..., and even one after that ad infinitum Just sayin RN