Flojomojo

http://www.traderslaboratory.com/forums/f30/five-levels-of-becoming-a-good-4253.html I too find myself falling back into stage two from time to time when frustration is creeping in...but that only reminds me that I shouldn't be there and work to shake it off and look foreward once again. “Success is the ability to go from one failure to another with no loss of enthusiasm.” --Winston Churchill

Besides the Wyckoff thread, that I highly recommend, I have two threads saved in my favorites: All you need is a chart and Trading with PA "No Indicators" You might also consider getting the ebook of DBPhoenix where he sums up his years of forum activity. Its a nice structured way to get you started and absolutely packed with information! Have a great time reading! Flojo

Don't know wether there is more to come, but for those wanting to file this nice thread I put the rules together in a word file. Enjoy reading, Flojo Zen_and_the_Art_of_Poker.doc

Here some statements of an interesting article from MITs Anrew Lo. He did a study with 33 daytraders to try to link emotional states with P&L: "The results from this experiment confirm and extend those of Lo and Repin (2002) and Steenbarger (2002): we find a clear link between emotional reactivity and trading performance as measured by normalized profits-and-losses." "Specifically, the survey data indicate that subjects whose emotional reactions to monetary gains and losses were more intense on both the positive and negative side exhibited significantly worse trading performance, implying a negative correlation between successful trading behavior and emotional reactivity." "Also contrary to common intuition regarding typical personality traits of professional traders, the psychological traits derived from a standardized personality inventory survey instrument do not reveal any specific “trader personality type” in our sample. This raises the possibility that different personality types may be able to function equally well as traders after proper instruction and practice." "This suggests that emotional reactivity may be counterproductive for trading performance, but the differences are not large enough to render this conjecture conclusive. However, subjects whose emotional states exhibited higher correlations with their normalized daily profits-and-losses (Pleasant with gains, Unpleasant with losses), do tend to have worse overall profits-and-losses records, supporting the common wisdom that traders too emotionally affected by their daily profits-andlosses are, on average, less successful." "...our results show that extreme emotional responses are apparently counterproductive from the perspective of trading performance." As I am definitely to be categorised as a beginning trader I don't consider myself to have much valuable input for this discussion...and I rather read the input of ppl here that I have come to value. The only 2 cents I can throw in is: I agree with Lo that the extremes tend to "short circuit" my more complex decision making faculties. Hence I think that "the zone" is somewhere in between and whenever I become aware of an (for me) unusual emotional state I start to analyze its root and start questioning my entry/exit criteria for the trade. By now I also immediately walk away from my desk for the day when entering the negative extreme of the spectrum in order to give my head the time to reestablish the right mindset. AERPub.pdf

LoL...I guess my attempt to keep a thread clean failed miserably giving me the opportunity to become one of the first Sandbox members! (When you can laugh at yourself, you are free. - Ted Loderer)

I hope this is not too far off topic for this thread: In the last days I had some thoughts on market participants: When one looks at the dates of market crashes (1929, 1987, 2000, 2008) the following came to my mind: This is the first time in history that the same people (professionals and individuals alike) are faced with/create a major bull market. The bursting of the dot.com bubble hurt many in 2000. Usually I´d say that people forget pretty fast and at the latest the next generation will have no personal reminiscences about the last crash when they start investing. One could say that every 20-40 years there is a completely new set of people tackling the market. The only way to look at past crashes is through data, books, documentaries, etc. With the memory of the last crash still in the heads of peoples´ minds: - What impact does this have on their market behavior as we move towards the bottom? - Could this reborn fear in the heads of people be responsible for the speed at which markets are dropping? (with professionals and individuals saying to themselves "I don´t want to loose my shirt like last time!") What do you think? Flojo

Hi brownsfan, also have a look at this study from the bank of england which I just stumbled across here. It basically adds the numbers to Anna-Maria´s post and is more compact than the BIS study. Flojo

The Triennial Central Bank Survey results you can find here under the point "Trading characteristics". Cheers, Flojo

Hi and welcome Pepperdog, maybe you can ask AbeSmith in this thead. He´s got a psychology degree so he might be able to help you better to overcome your problem. I admit I am facing the same problems and am working on them too (who doesn´t!)...it´s really one hell of a mind game! Usually the subconscious blocks us in order to protect us from doing something stupid. Maybe you have to find that thing out and work a little more on it to overcome that blockage. I also highly recommend The nature of risk by Mamis. Its not so much about the psychological aspect, but really goes into the topic what risk actually is and which types we face. Really well written and by the writing style and contents it is in a totally different league than most stuff out there! Cheers, Flojo

uhm...sdoma whats the point of quoting a rather insignificant line from almost 5 months ago? :hmmmm:

Hi Firewalker, I´ll try to answer your question. DB, please correct me or add as you please. (next two paragraphs are scippable...wrong answer) Ok, to start off something that I have to remind myself of sometimes: Price does not do anything just because there is a box drawn in that region, but price does what it does! That´s why the question "Would this box be the next logical stop" is maybe a bit misleading. The box is not a "logical" reversal zone, but a "potential" one. What´s important is what price does as it gets there...if it actually gets there. It´s the old "be available" story then. It depends on your system what to do. But as Livermore once said: "I go long or short as close as I can to the danger point, and if danger becomes real I close out and take a small loss." Back to the picture, note also, that where you have identified a conjestion zone this is also 1/2 the upmove. Chartwise I see no reason yet to be long at the moment. Actually this might be a good danger point to go short. What might be of significance though is that if you draw supply and demand lines on top and bottom of the peaks it seems as if supply is running out of a little bit of breath. Therefore watch closely where that next possible downswing starts to run into buying pressure. Hope this answers your question. Cheers, Flojo ooops, I just realized that your chart is from 04 and you are actually refering to the current action! As far as I know DB doesn´t comment on current market action and I can undestand his reasons. Coming to the current market action: Price broke hard through the midpoint of the 03-08 upmove and the mist of a potential climax run surrounds us. But to be honest I leave the going long during a daily chart climax run to the ppl with the really big balls! Also a single premarket up session does not yet make an accumulation phase. Hence I´d say the path of least resistance is still down.

Hi DB, I got a short question about using a volume by price distribution to identify congestion zones: As I have no volume for currencies the distribution in my previous post was generated by counting how many times a price was crossed by bars in a given time interval. (I´m currently reviewing if this method is sufficent) It is the time interval that gets me thinking right now. Depending on how far one looks back the distribution will look a little different. How do you judge how far you look back in time? So far I only have a conjecture that a distribution created by price moving around in a range in the near past is more important than the statistics of price in the past way back (except of course if price hasn´t been in a region for a long time). Best regards, Flojo

Here's my 15Min macro box story for September 28th. Personally I don't see the need to draw any additional congestion zones. Comments always welcome, Flojo 080928_BoxStory.pdf 080928_BoxStory.zip

I havn't got the proper data feed so I had to stick to a screenshot of a yahoo finance chart. A clue can be found on the longer range macro view. Honestly I myself am not sure yet how to judge pressure over time via swing steepness. Just my 2c Flojo S&P.pdf

But to answer your question I found this article. Here's some extract: The dataset he used goes from 1970 only until 2004, so it might well miss out some of the more recent volatility in correlation. But even stopping at 2004, Coaker concludes that it's not enough to invest in uncorrelated assets; you have to invest in consistently uncorrelated assets. And if you want a consistently uncorrelated asset to offset your US equity exposure, the best thing he can find for you is natural resources. Natural resources have had a correlation of less than .20 to all 17 other assets in this study, with the highest being just .19, for both small growth and small value. Natural resources have had the lowest average correlations—and the most consistently low correlations—to every asset in this study, including every category of stocks, bonds, and alternatives. Hence, natural resources have provided more diversification benefits than every other asset in this study. Of special note, natural resources have had a negative correlation 83 percent of the time to U.S. bonds, due to their inverse relationship to inflation.

Well, they are paid for writing 'something'..."Buying pressure was higher than selling pressure" most probably won't get any financial press sold and will hardly fill an article...

Attached is the box version how DB sees it. (Originally posted by him here in post #99) Flojo 080921_BoxStory_DB.pdf

Since I guess you also correct your boxes in hindsight, this is fine for me. I still try to embrace most of the activity in my boxes and hence catch myself drawing them too big. Thanks for your valuable input!

I've prepared a little macro view of the last EUR/USD swing. Are the congstion areas drawn correctly? :hmmmm: (Origninally I posted the graph here in post #40) Thanks for the feedback! 080921_BoxStory.xls

Preparatory work for this week, including: 1) Daily chart 2) Last week with boxes 3) Macro view with boxes What's your preparatory work? Edited: Forgot to mention...how to read a box chart can be found in this thread 080921_Homework.pdf 080921_BoxStory.xls

Here's my weekends homework: EUR/USD analysis of last week 14-19th September. Comments, questions, etc. are all welcome. Yay! The views to this thread cracked the 1000 mark! What do you pay attention to in these posts? :hmmmm: 080914-080919_Charts.pdf 080914-080919_Charts.zip

I'm back from my short trip, down to business again and just completed my annotations for last week. So far there was not much discussion about the annotations, how you see them, what you actually read when looking over the chart, the box placement, etc....any suggestions for making this thread a bit more lively? Are my posts with charts like this actually of any interest to you, or am I just occupying server space?!? Good trading, Flojo 080907-080912_Charts.pdf 080907-080912_Charts.zip

...if someone wants to put it on their trading desk... DB_Wyckoff_terms.pdf

I'm not a techie myself, so mighty google has to do the trick for me Looks like you have to reinstall your Windows or replace the file. Check out the first couple of links here. This is a link to the microsoft support pages giving a short description. Watch out that you don't delete your files while reinstalling. To secure your files first, check whether you can make a boot cd, boot from there and save your stuff then. If you don't get your system running to access your files, download a version of Knoppix and secure your files from there. Good luck!

I usually listen to metal but also a lot of softer more intricate stuff like: