Why do i keep buying at the wrong time?

esospezosella · Jun 10, 2024

I had the same trouble, mainly because of limited knowledge on the technical analysis side. Once I understood how patterns work and should be combined with different technical indicators, I started to make much more informed and timely decisions.

semperfrosty · Jun 10, 2024

wxytrader said:
Oh sure wildchild quotes some Shakespeare (and not even good Shakespeare) & Sun Tzu inferring the same thing I've been saying about the market being determined, and he gets all the praise???
wth
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Hahaha

He may have even cheated and used ChatGPT! haha

And dont worry too much wxy,Ive still got you pegged as the secret genius! hahaha

murray t turtle · Jun 10, 2024

PPC said:
I’m not aware of a book that would give you the answers you’re after. It’s like @schizo said “So if they give you what looks like a bunch of crumbs, don't get offended too fast. It's probably much more than what it first appears. Take it one or two steps further and see if you can make sense out of those crumbs yourself.”

In other words, you really need to start thinking for yourself, and backtest everything for yourself, and add few tweaks here and there to match your personality. Here are few crumbs:

Dopamine Hits
First of all, you need to understand that successful traders get dopamine hits from successfully executing their plans rather than the small wins. Stay away from the “action” in “quick pump and dump” penny stocks! If you need adrenaline, then go bungee jumping. This might sound trivial, but being drawn to the action in the markets is a major red flag, it really is a big NO NO, it's totally incompatible with successful trading !!!

Stop spiining wheels, start a journal with set-ups and stats
Start keeping a journal with your set-ups that you took and/or missed, so you can (somewhat objectively) do more of what works and less of what doesn’t.

Checklists
It is detrimental to your psyche to stare at charts without knowing exactly what to look for. Discretionary trader needs to analyze set-ups in real time (and not after the fact), therefore it is critical to know exactly what s/he needs to see. For example, I cannot see a trend there as you did, and that's OK, as long as you have your own objective definition of uptrend which you apply on consistent basis. Use checklists as a pilot would before take off. Use checklists almost like an algorithmic process. And yes, we all make mistakes and miss things even with checklists. But checklist will slow you down and should interject some objectivity. (Whether the trader will follow the checklist/plan is a different can of worms)

Stop staring at the screen
Staring at the screen introduces stress. The longer one stares at the screen (intraday), the stronger the inclination becomes to take action to justify one’s time. This mainly applies to beginning and intermediate traders, experienced traders will sit on their hands. It’s far better to take one good quality set-up per day, then half a dozen shitty trades.

Psychological Diary
Also keep an emotional diary like girls do. Seriously, it’s like as Marty Schwartz said:
“Trading is a psychological game. Most people think they’re playing against the market, but the market doesn’t care. You’re really playing against yourself.”

Trade liquid stocks that pattern well
I’d argue that the TA “context” is quite different for liquid stocks vs illiquid stocks. I’d strongly recommend to stick to big caps and liquid mid-caps in which institutions, hedge funds, etc., get involved in. Otherwise you might continue spinning wheels because the illiquid stocks don’t pattern well and their volume reading is unreliable. Plus it takes just one trader with even small account to move illiquid stock. On the other hand, you can follow the buying/selling pressure in very liquid stocks, because the big elephants with their volume simply cannot hide (major edge if you learn to read the nuance in volume).

Have defined set-up based on trade logic
Perhaps consider @schizo suggestion of focusing on retests, because he’s right that breakouts fail a lot, plus retests are also based on how the markets actually trade. You can add few rules around it, and then start back-testing it by manually scrolling past charts (and filling out your journal with stats and screenshots). For example, if you want to trade retests of intraday breakouts, then the night before you can run scans for stocks that show buying pressure on daily time-frame, and things like that is what will slowly help you to develop your own “context” that you’ll actually believe in.

Start off with being as mechanical as possible
To most beginners I’d recommend to start off as mechanical as possible (to enforce objectivity and consistency), and only once they start becoming consistent, then they can slowly start introducing PA. Unfortunately, those beginning traders that start off with price action (especially on intraday charts) are going to be juggling far too many dynamic variables at once (TA and psychological variables), and they’ll continue to mess up and spin wheels for a very long time. Simplify things to few robust rules that work and you believe in, even if the returns will be very low. First you need to learn to play defense and protect your capital without pissing away your money on trades which make no sense to you.

“There is no single market secret to discover, no single correct way to trade the markets. Those seeking the one true answer to the markets haven’t even gotten as far as asking the right question, let alone getting the right answer.” ~Jack D. Schwager
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%%
Good + very good;
not that I would leep an emotional diary like a female unless I was female.
[-666 ] think mr mute was the one that kept buying penny stocks;
needs to study a lot more including how eay it is to lose big %% on penny stocks.
777\ As they say in chicago, the smarter you are/ the longer it takes LOL+ true[ Edit; Limited budget is no excuse for wasting money on penny stocks/ /SPYG + related sells for under $100, last close anyway]

mute9003 · Jun 10, 2024

good advice indeed.

mute9003 · Jun 10, 2024

i have 2500 dollars in my CASH account right now.
i started during the peak bull market where i was literally buying and hodling and waking up 9-15k richer. and then when bear market started i had no idea what to expect or even what to do. since i dont know what bear market is. so i lost almost all of it back.
kept trying to get back into trading for almost 2 years and struggled to even take basic trades because i lost about 30k total and about 16k of my personal money that i used to feed my initial account.
so now i switched to cash account so i can practice day trading and scalping.
because my self sabotage shows up more in longer time frames. i still dont trust myself to hold a trade overnight. for whatever reason i cant do long timeframes right now. i am planning to gradually increase my timeframe and quality of tickers i trade as my account grows slowly.
at the moment i still cant get myself to buy a 5 dollar stock because of fear that it has more ways to go down than a penny stock.

plus penny stocks on one or two minute chard develop patterns much quicker.
i can participate in multiple trades a day and watch how they develop rather than waiting for one chart to play out over 5 days.
i know they are shit stocks i have no delusions about them (thanks to tim sykes repeating that over and over) but my belief is if someone else can do it i can learn to do it as well.

i did learn to build engines and computers (and do many other things) from forums. and got rather good at it. so im used to being told many things. as long as there is useful info i will find it in the irrelevant pool

schizo · Jun 10, 2024

Here's ES trading in similar fashion. What should I do???

wildchild · Jun 10, 2024

semperfrosty said:
And to paraphrase from the movie Tombstone:"Look darlin',evidently Mr wildchild is an educated man..."

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wildchild · Jun 10, 2024

semperfrosty said:
Hahaha

He may have even cheated and used ChatGPT! haha

And dont worry too much wxy,Ive still got you pegged as the secret genius! hahaha
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I actually got it from an Alan Watts speech. The first 2 minutes are where he highlights the point not to force things.

murray t turtle · Jun 10, 2024

tomkat22 said:
I try to avoid stocks under $5 but I suppose if someone put a gun to my head and forced me to trade such stocks I'd use Ross Cameron's system. You know,get up at 3 am ET and find stocks that appear to be breaking out on news and try to jump in on the front side of the move. Those type stocks have usually shot their wad by the open but sometimes they will also make a follow up push later in RTHs. Happens 2 or 3 times a week(at least). CRKN.........
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%%
3 ] EARLY to bed early, to rise could make you healthy ,wealthy + wise perhaps LOL.
IF I wanted thrills [+ did not mind losing a max amount of money LOL] =CRKN=good way to do it.
All Time hi>$444
below $1.00 now .
777] But come to think of it , never heard of a good trade or trade plan with a gun to your head LOL
888] After looking @institutional holders, mabe overpriced @ $00.88 or $00.80
As they say in Chicago the smarter you are, the longer it takes....................... Go for it\ penny stocks\ especially if you value your own opinion more than markets.

semperfrosty · Jun 10, 2024

wildchild said:

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Brilliant! hahaha