Thanks to all who have left your footprints here in the past few days. I apologize for not having responded to each and everyone. But I hear you, and I'm really grateful that you took the time to write.
I have been doing a little more thinking after my posting on Saturday, and asking myself if I've really had a moment of epiphany, or is this simply just me being fickle. I ruled out the latter, but I can't be sure about the former either.
The thing about epiphany is that you can have as many as a dozen of them in a single day. I have heaps of them everyday - as I look at my charts, as I see price moving a certain way, and even when D says something seemingly trivial, I can extract patterns and draw lessons from them and form brand new conclusions to add to my very massive (not at all sophisticated, not even organized, just a HUGE and MESSY one) trading framework.
But no, this is not about me realizing all of a sudden that I've been doing it all wrong. As a matter of fact, I know without a doubt that the only way I'll ever get to find out what is right for me and what is not is by LOOKING BACK.
So what's important for me now is to stick to a general PLAN, or system, or method, whatever you call it - in my years with the public sector, I've gotten used to the terms "Framework" and "Standard Operating Procedures".
As far as trading goes, my framework will include such elements as my vision, goals and objectives; my values, beliefs and assumptions - simply put, my personality; my limitations - financially, physically, mentally, emotionally; my other obligations and commitments ; etc, etc.
My Standard Operating Procedures (SOP) - which is pending completion - will include a myriad of factors and parameters (just like I've done it before at work - I've written a 30 page long one for a single policy when I was with police (just the main body, EXLUDING the 19 annexes) that literally gave my superior a nightmare...she slept TERRIBLY after going over the first draft that night), and will be reviewed and revised as and when the market changes its pace and mood, and in accordance with changes in my life.
Unless I have the above, no after action reviews or the deepest reflections will help me pinpoint my problem and improve my trading. In fact, without the above, after action review is simply a joke. I can write a thesis on why it is, but I'll spare myself the agony.
It's a relief to know that all my past AARs are simply garbage. It would be a real pain to have to go over them, and I'm glad that now that I've satisfied myself that they are junk, I won't ever have to read them again.
I've whined too many times about not having a proper trading system, while actually preferring the whole time to trade the very discretionary way. I scalped and took scalp profits coz I had hated to lose (there are other reasons - good ones - to take scalp profits of course). In order to have perpetually winning days, I couldn't afford to get aggressive. I must take what was offered in that few seconds to a minute or at most 3 mins. I've always said I had based my exits on momentum. I had indeed. If price was going in my direction too fast, I'd get out. If price was going too slow, I get out too. So, I was always looking to get out.
While this is probably widely practised on the floor by those who trade huge contracts and enjoy better commission rates, I've come to realize that even if I had had plans to substantially increase my contract size over time, that this way of trading is simply NOT for me, for the one and only reason that my emotional makeup is simply not suitable for this kind of play.
I've read too many times about the consistency of many scalpers, and I don't doubt they make money on daily basis, and I don't doubt that some have an entire year of NIL losing months, weeks, and even days. I have no doubt that these are people have gotten to where they are because they have gotten - above all other things - so good with protecting their capital that it's near impossible for the market to take it away from them.
Well, I've learned, gradually, that I am lousy at protecting my money. I don't like losing, and I certainly don't enjoy having my money taken away from me. But I don't actively protect it. I have a tendency to protect my ego first, then my capital.
I make a dreadful scalper. Dyed-in-the-wool horrendous.
I am going on and on simply coz I need to convince one single person that this change that's going to happen is necessary. That person is ME.
My approach from now on will be radically different - not just in terms of how I execute my trades, but also in how I prepare for them. I will no longer come up with scenarios on where the market's likely to be heading today, the following day, this week, or even a few hours later. After the initial overhaul, there'll be minimal planning and preparation on a daily basis.
The time that I'll start looking at charts to see if there's a play is when the US market opens at 930am est.
I will no longer be trading one single instrument. I'm still trading purely futures, but I'll be trading both indices and currency futures (No energies, soft/hard metals, grains - all in all, no commodities at all). This is the way I've been trading forex (I don't have a bread-and-butter pair). So far I have no complaint when it comes to trading forex. I have decided to trade futures on a long term basis only because the futures market is regulated. I prefer to trade a market that's regulated, and instruments that can't be manipulated by market makers or a few huge players.
I should resume trading today, unless something cropped up. E.g. if my pc crashes on me before D gets home - I've been overloading it.
I have been doing a little more thinking after my posting on Saturday, and asking myself if I've really had a moment of epiphany, or is this simply just me being fickle. I ruled out the latter, but I can't be sure about the former either.
The thing about epiphany is that you can have as many as a dozen of them in a single day. I have heaps of them everyday - as I look at my charts, as I see price moving a certain way, and even when D says something seemingly trivial, I can extract patterns and draw lessons from them and form brand new conclusions to add to my very massive (not at all sophisticated, not even organized, just a HUGE and MESSY one) trading framework.
But no, this is not about me realizing all of a sudden that I've been doing it all wrong. As a matter of fact, I know without a doubt that the only way I'll ever get to find out what is right for me and what is not is by LOOKING BACK.
So what's important for me now is to stick to a general PLAN, or system, or method, whatever you call it - in my years with the public sector, I've gotten used to the terms "Framework" and "Standard Operating Procedures".
As far as trading goes, my framework will include such elements as my vision, goals and objectives; my values, beliefs and assumptions - simply put, my personality; my limitations - financially, physically, mentally, emotionally; my other obligations and commitments ; etc, etc.
My Standard Operating Procedures (SOP) - which is pending completion - will include a myriad of factors and parameters (just like I've done it before at work - I've written a 30 page long one for a single policy when I was with police (just the main body, EXLUDING the 19 annexes) that literally gave my superior a nightmare...she slept TERRIBLY after going over the first draft that night), and will be reviewed and revised as and when the market changes its pace and mood, and in accordance with changes in my life.
Unless I have the above, no after action reviews or the deepest reflections will help me pinpoint my problem and improve my trading. In fact, without the above, after action review is simply a joke. I can write a thesis on why it is, but I'll spare myself the agony.
It's a relief to know that all my past AARs are simply garbage. It would be a real pain to have to go over them, and I'm glad that now that I've satisfied myself that they are junk, I won't ever have to read them again.
I've whined too many times about not having a proper trading system, while actually preferring the whole time to trade the very discretionary way. I scalped and took scalp profits coz I had hated to lose (there are other reasons - good ones - to take scalp profits of course). In order to have perpetually winning days, I couldn't afford to get aggressive. I must take what was offered in that few seconds to a minute or at most 3 mins. I've always said I had based my exits on momentum. I had indeed. If price was going in my direction too fast, I'd get out. If price was going too slow, I get out too. So, I was always looking to get out.
While this is probably widely practised on the floor by those who trade huge contracts and enjoy better commission rates, I've come to realize that even if I had had plans to substantially increase my contract size over time, that this way of trading is simply NOT for me, for the one and only reason that my emotional makeup is simply not suitable for this kind of play.
I've read too many times about the consistency of many scalpers, and I don't doubt they make money on daily basis, and I don't doubt that some have an entire year of NIL losing months, weeks, and even days. I have no doubt that these are people have gotten to where they are because they have gotten - above all other things - so good with protecting their capital that it's near impossible for the market to take it away from them.
Well, I've learned, gradually, that I am lousy at protecting my money. I don't like losing, and I certainly don't enjoy having my money taken away from me. But I don't actively protect it. I have a tendency to protect my ego first, then my capital.
I make a dreadful scalper. Dyed-in-the-wool horrendous.
I am going on and on simply coz I need to convince one single person that this change that's going to happen is necessary. That person is ME.
My approach from now on will be radically different - not just in terms of how I execute my trades, but also in how I prepare for them. I will no longer come up with scenarios on where the market's likely to be heading today, the following day, this week, or even a few hours later. After the initial overhaul, there'll be minimal planning and preparation on a daily basis.
The time that I'll start looking at charts to see if there's a play is when the US market opens at 930am est.
I will no longer be trading one single instrument. I'm still trading purely futures, but I'll be trading both indices and currency futures (No energies, soft/hard metals, grains - all in all, no commodities at all). This is the way I've been trading forex (I don't have a bread-and-butter pair). So far I have no complaint when it comes to trading forex. I have decided to trade futures on a long term basis only because the futures market is regulated. I prefer to trade a market that's regulated, and instruments that can't be manipulated by market makers or a few huge players.
I should resume trading today, unless something cropped up. E.g. if my pc crashes on me before D gets home - I've been overloading it.
2 comments:
Jules,
Good luck with your big changes. I'm sure you'll find what works for you.
LT
Thank you, LT :-)
I'm prepared for it NOT to work for me for a while. It's so against my nature. But I need to break the barrier. It seemed to me, initially, that scalping is for me coz it fits my very impatient disposition. I had overlooked the other more glaring character flaw: I am more emotional than I am impatient. :-) So, clear stops and exit targets are what I need to keep me in the business. At least til I'm totally able to accept probability to be the main theme of the game.
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