Yesterday (Apr 20) was a bad day for me, simply because I had lost it again. When I could have taken a net USD 100 gain, I ended the day with a USD 737 loss. The first trade messed up my psychology and things spiralled down from there.
My first trade - I was experimenting with an entry that I wasn't familiar with, and because of that, I had a hard time managing my trade, and exited at a place I usually wouldn't have. Took a 140 loss. Got back in again, using the alien method. While I could have taken a USD 120 gain on the 2nd trade (had I used my own familiar approach, I would have recognized the loss of momentum and gotten out), I ended up getting out at where I've placed my protective stop and took a USD 300 loss.
I could have stopped there. But unlike last week, I refused to accept a losing day. I went in again to fade the down move during the US lunchtime session. It started out fine - I caught the hammer and the move went at least 2 points in my direction promptly. On any other days, I would have taken my profit given that it was just a scalp. I didn't. When I had gone in with the intention of simply fading a trend, at some point during the trade, I had assumed that that was going to be a major 6 point retracement at least. After all, a hammer had formed on the hourly chart, and there were piercing patterns, hammerS, bullish engulfing patterns and all on the 5min. So I stayed. And let a 2 point profit turn into a 6 point loss.
All because I got emotional again. I had traded with a different appraoch (when will I ever learn to just TRUST my own method???), and because of that I couldn't own the loss.
Consecutive losing trades on any given day is an indication that the tone of the market has changed - and I could either take a loss while it's still small (yes, like last week), or deploy a different strategy (I scalp on trending days, and "swing" on other days). Last week was week of chops and range-bound moves, and I did ok with my "swing approach" from tuesday to friday. Yesterday was clearly a trend day, and I made the mistake of using a loose stop, and then of overstaying in a counter-trend move.
Mistake number 3: staying with ES on a trending day. I can't handle ES on trending days. I'm used to TF's nice 3 - 6 long-bodied bearish candles down with 38.2% retracement on a trend day. With ES, I love the choppy days, coz I just somehow grasp ES' choppy moves.
It's a day full of mistakes that I can either learn by heart and move on, or get grumpy and all and take a break for the next few days. The latter is clearly out - I don't remember having really taken a break even when I felt ,at my lowest point ,that I simply couldn't go on anymore. I don't know if that's a virtue or a vice - that I don't know when to STOP. What I do know is that I'm not easily defeated. And that's an understatement. Maybe things would have been better had I learnt to back off sometimes. But I don't stand down. I can't. I would have to be a different person to do that.
So I'm going back in today. Not doing any analysis of any sort. I'm not going to guess where the market's heading. It could move up higher than its previous high, or it could reverse to look for 660, it doesn't matter. What matters is the price action within the day - you can never know for sure if the bears or the bulls are going to win until the battle's over, so you take cover when your side is clearly no longer in the upper hand. Don't hang around and become a casualty. Know that something's NOT looking right, and bail before the ultimate worst happens. That's what I always aim to do.
I'm going to be scalping mostly - I seem to have lost touch and apparently need a lot of practice to learn how to RUN again - coz as soon as my application to Infinity Futures is approved and my funds wired, I'm going to be trading multiple contracts. I have to accept that every individual is different - with me, I can never trick my own brain into thinking that a 100 loss is a 1k loss. When I'm faced with a situation that I can easily lose my shirt, I WILL run. Otherwise, I won't. Just me.
My first trade - I was experimenting with an entry that I wasn't familiar with, and because of that, I had a hard time managing my trade, and exited at a place I usually wouldn't have. Took a 140 loss. Got back in again, using the alien method. While I could have taken a USD 120 gain on the 2nd trade (had I used my own familiar approach, I would have recognized the loss of momentum and gotten out), I ended up getting out at where I've placed my protective stop and took a USD 300 loss.
I could have stopped there. But unlike last week, I refused to accept a losing day. I went in again to fade the down move during the US lunchtime session. It started out fine - I caught the hammer and the move went at least 2 points in my direction promptly. On any other days, I would have taken my profit given that it was just a scalp. I didn't. When I had gone in with the intention of simply fading a trend, at some point during the trade, I had assumed that that was going to be a major 6 point retracement at least. After all, a hammer had formed on the hourly chart, and there were piercing patterns, hammerS, bullish engulfing patterns and all on the 5min. So I stayed. And let a 2 point profit turn into a 6 point loss.
All because I got emotional again. I had traded with a different appraoch (when will I ever learn to just TRUST my own method???), and because of that I couldn't own the loss.
Consecutive losing trades on any given day is an indication that the tone of the market has changed - and I could either take a loss while it's still small (yes, like last week), or deploy a different strategy (I scalp on trending days, and "swing" on other days). Last week was week of chops and range-bound moves, and I did ok with my "swing approach" from tuesday to friday. Yesterday was clearly a trend day, and I made the mistake of using a loose stop, and then of overstaying in a counter-trend move.
Mistake number 3: staying with ES on a trending day. I can't handle ES on trending days. I'm used to TF's nice 3 - 6 long-bodied bearish candles down with 38.2% retracement on a trend day. With ES, I love the choppy days, coz I just somehow grasp ES' choppy moves.
It's a day full of mistakes that I can either learn by heart and move on, or get grumpy and all and take a break for the next few days. The latter is clearly out - I don't remember having really taken a break even when I felt ,at my lowest point ,that I simply couldn't go on anymore. I don't know if that's a virtue or a vice - that I don't know when to STOP. What I do know is that I'm not easily defeated. And that's an understatement. Maybe things would have been better had I learnt to back off sometimes. But I don't stand down. I can't. I would have to be a different person to do that.
So I'm going back in today. Not doing any analysis of any sort. I'm not going to guess where the market's heading. It could move up higher than its previous high, or it could reverse to look for 660, it doesn't matter. What matters is the price action within the day - you can never know for sure if the bears or the bulls are going to win until the battle's over, so you take cover when your side is clearly no longer in the upper hand. Don't hang around and become a casualty. Know that something's NOT looking right, and bail before the ultimate worst happens. That's what I always aim to do.
I'm going to be scalping mostly - I seem to have lost touch and apparently need a lot of practice to learn how to RUN again - coz as soon as my application to Infinity Futures is approved and my funds wired, I'm going to be trading multiple contracts. I have to accept that every individual is different - with me, I can never trick my own brain into thinking that a 100 loss is a 1k loss. When I'm faced with a situation that I can easily lose my shirt, I WILL run. Otherwise, I won't. Just me.
Again, I won't post my P&L for yesterday until end of this week. All reds pisses me off. And I can't trade when I'm angry with myself.
6 comments:
Hang in there, Jules. You are on to something. Just have to find a way to keep these days as small as possible and what you had last week can be duplicated over and over and over again.
Sometimes I have to remind myself that losses should be "statistically" accounted for in the plan. Map out your daily average loss since starting your new quest, once you break that average in a day it is a mathetical deviation, a statistical warning for you to sit out.
If only it were that easy, right? Shit, if trading were an easy profession, I don't think neither of us would be attracted to it. I think we like the pain, now we just have to find the reward.
Be safe.
:-) MVW, I never knew it was the pain that I've been attracted. But I think you're right! My attention span is so short, whenever I get something figured out, I'll immediately lose interest. :-)
About my loss yesterday - yes, I should have stopped at a 2 to 3 point loss. Coz whenever I choose to bail at that amount instead of my usual 6 point stop, or a scratch, it means I'm not comfortable being in a position that I wasn't sure about enough in the first place to scratch. That has always been very accurate in predicting my performance for the day.
Thanks for the encouragement :-) Happy trading today!
"What I do know is that I'm not easily defeated. And that's an understatement."
Perfect quote. That attitude is all any of us need Jules, just that and enough time and space to learn the game.
Posts like this are the reason I love your blog. You like to write about how "quirky" you are, but the truth is you always sit down and think it through. It's a pleasure to follow along.
JE
Infinity futures has Trade Navigator.. I think TN MAYBE suitable for your style.
this trader use TN to trade..
http://knightcapitalmanagement.blogspot.com/
JE,
Such a lovely note :-) Thank you.
Waiting Trader/Trailing Stop Trader (I'm going to have to start calling you WT or TST...),
I'm not sure if the one I'm using now is TN, it's really ME-friendly (I'm almost pc illiterate). Thanks for the link, will check it out.
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