What is the Single Largest Roadblock Standing in the Way to Your Trading Success?

[kookeboy 10]

Gday guys

 

First post ever here :-) I swing trade Australian equities and have just started a bit of index trading.

 

Just thought I'd let you know this thread, and probably the last 6 or so, have been some of the most insightful stuff I've read.

 

I'm only 12 months into this gig full-time and will post more of my plight and thoughts, but the big ones for me are the ability to see some red without fear, and also "hindsight" where you look back and say "if only I got out there" when, in reality, you think that about every single pip. LOL

 

One quote I heard the other day which is apt. Fear drives the markets. Fear of losing, and fear of missing out.

[Rande Howell 10]

The biggest road block to trading success is the "you" doing the trading. And our avoidance of confronting ourselves.

Rande Howell

Index of /

[Justaguy 10]

MadMarketScientist,

 

 

- adjusting entries around round numbers; I think I will put a note how my trades would have went if I was adjusting them using this rule, and then observe the long-term effect. I noticed that the market often bounces off exactly from round numbers on YM which I'm trading, and felt like I can put something discretional in place around those round numbers, but I didn't yet know what. Not sure how you do it, but you've nailed it again...

 

- clear-cutting recent swings; I sincerely have no idea what this means. Can you shortly elaborate please..

 

Thanks again for the concrete & sound advices, and regards.

 

Clear cutting....he is referring to adjusting around those swings just as he does with key levels (round numbers......)

 

As for key adjustments....I am adding in a chart of the GBPUSD. I had a long setup occur on the doorstep of the 1.5400 level. Made the adjust and the order never triggered was would have been a loser. Look around the 8:45 time. You will see the setup but no arrow that indicates a fill. These adjusts are an integral part of my trading.

 

[gandalf33 10]

Thanks for the clarification Justaguy, sounds like playing swing breaks. There's something with the 'screamshot' however, as instead of it a red cross is present.

 

I've given it a lot of pondering this weekend, and I took the advice of some truly great traders I know, and will spend the next weeks studying and observing price action. Filtering trades based on S/R bounces/reversals, etc., seems to be the another part of that artistic bit in trading.

[MadMarketScientist 11]

Welcom to the forum kookeboy. Glad you are getting a lot out of these tl threads. There's some amazing knowledge from our posters. Get some of your trading buddies to join in. The more the merrier. Thanks.

 

 

Gday guys

 

First post ever here :-) I swing trade Australian equities and have just started a bit of index trading.

 

Just thought I'd let you know this thread, and probably the last 6 or so, have been some of the most insightful stuff I've read.

 

I'm only 12 months into this gig full-time and will post more of my plight and thoughts, but the big ones for me are the ability to see some red without fear, and also "hindsight" where you look back and say "if only I got out there" when, in reality, you think that about every single pip. LOL

 

One quote I heard the other day which is apt. Fear drives the markets. Fear of losing, and fear of missing out.

[Justaguy 10]

Thanks for the clarification Justaguy, sounds like playing swing breaks. There's something with the 'screamshot' however, as instead of it a red cross is present.

 

I've given it a lot of pondering this weekend, and I took the advice of some truly great traders I know, and will spend the next weeks studying and observing price action. Filtering trades based on S/R bounces/reversals, etc., seems to be the another part of that artistic bit in trading.

 

 

Hmm..thanks. I used the wrong link I assume. I know you already know what I was referring to but to make my previous post complete...I have hopefully attached the chart

[1pipatatime 10]

NOT LETTING WINNERS RUN... On a seeming daily basis, I am in a trade in the right direction and immediately I am planning the exit rather that getting to B/E, THEN thinking exit. Since most of my trades achieve 50% or more of current volatility I simply don't get it any more.. .

 

Hi Attila,

 

I hope you dont mind if I share with you about the subject you mentioned above.

 

I got into this conversation with a few of the guy's that I trade with on a Monday night in Melbourne.

 

A few of them went down the same track making statements like you have "A child would manage trades better than I".

 

All this shows is that you wish you had a better system around managing your trade and at the moment of your post your mind was unwilling to look at improving your technique in this area, which without knowing you I would suspect that if someone offered you a suggestion that would impower you in this area you would have a look at it.

 

Basically its just a mind thing, when we as humans get into a right and wrong conversation, espeically as traders it disempowers our ability to trade at our peak.

We tend to start putting ourselves down and create limiting beliefs/structures around our self worth and then do our best to inforce these beliefs.

 

Let me put this in easier terms I'm starting to ramble too tired, if you are in a position where your trading system causes you to get emotional or to question your ability as a trader and you are unsure what to do about the situation and are totally blocked, ask yourself a question like "If I did know what to do now, what would it be?", this tends to unleash the creative juice's of the brian and you maybe surprised at what idea's you come up with.

 

One other thing before I log off and go to bed, the thing that helped me a lot was allowing myself to be present to what I had accomplished or learned from when I first started. Oh and I stopped giving myself permission to make myself wrong or feel inferior and started to appreciate the skills I do have.

 

Hope this helps

 

Cheers from the tired 1pipatatime

[TheDude 10]

Good advise 1pip.

 

If Attila is having trade management problems, but entry timing is ok, then perhaps a mechanical trade management plan should be enforced. Assuming the timing is discretionary, based around some criteria, once the order is filled, only adjust the stop according to strict criteria until stopped or target (if employed) is achieved.

 

This should give some confidence back over time.

 

Simple but effective I hope.

[Attila 10]

Good advise 1pip.

 

If Attila is having trade management problems, but entry timing is ok, then perhaps a mechanical trade management plan should be enforced. Assuming the timing is discretionary, based around some criteria, once the order is filled, only adjust the stop according to strict criteria until stopped or target (if employed) is achieved.

 

This should give some confidence back over time.

 

Simple but effective I hope.

 

Ok let me know when you're coming over to enforce it.. I'll bar the door!.. You know the next 10 trades will be 10pt NQ profits that revert back to break-evens, right? This IS WHAT the nut on the left shoulder guarantees will happen if I even think about it and will remind me every time a decent profit is sacrificed.

[Attila 10]

 

"If I did know what to do now, what would it be?", this tends to unleash the creative juice's of the brian and you maybe surprised at what idea's you come up with.

 

Oh and I stopped giving myself permission to make myself wrong or feel inferior and started to appreciate the skills I do have.

 

Hope this helps

 

Cheers from the tired 1pipatatime

 

My wife has walked in on me a couple of times and said.. "what in the world are you doing!!" She's caught me trend fighting a few times, which is basically what exiting early can mean.. not accepting the current direction.. Being able to see from outside myself something need to work on..

 

On the second note, I am an incurable perfectionist, unfortunately..

 

Thanks..

[1pipatatime 10]

Hi Attila,

 

If you are trend fighting as you say, it comes down to being confident in what you are doing.

 

With all trading systems theirs the begining, management and an end to the trade.

 

I'll explain what I do with defining the trend.

 

Whatever you are using to define the trend wether it be swing points higher/lower or tech indicators or multi time frames etc.

 

Ask yourself some questions like (relate these questions to identifying the trend for now)

 

What do I have to let go of to move forward with my trading? That I know all there is about trends and identify the trend and so on

What do I have to take on to have this endeavor become successful?That the anwser is out there somewhere and I'll have the anwser soon

What are my strengths as a trader?That I work hard and am a excellent trader and so on

What are my weaknesses as a trader?Sometimes get impatient, get distracted by friends and family at times and so on

What worked with the trade?Entry point was good, management was good, exit was good

What didn't work with the trade?I was going against the trend and got pig headed about it and tried to force the market and so on

What can I do to strengthen my trading system?Follow the rules for identifying the trend or establish rules that identify the trend with a higher probability of success and so on

Who am I being around my trading?At the time of the trade I was being a stubborn pigheaded SOB etc

What is the diference btw an elite trader and me? (then dealing with those difference's)I was trying to force the market etc, an elite trader would not be attached and trade to his/her criteria/trading plan etc.

 

Then explore what you see as a weakness in your system and see if you can turn those weaknesses into strengths, and above all you are only exploring the whats so of the way you are trading, so don't make it a right and wrong conversation or a good and bad thing its just the whats so which gives you an area that you can work with.

 

Cheers

 

1pipatatime

[youri 10]

Hi Kookeboy i am glad to see someone from Sunshine cost in here.Welcome.Good trading.Youri

[kookeboy 10]

Hi Youri, Sunshine Coast, Qld, Australia? There are a few around the place (none as good as here though!)

[MadMarketScientist 11]

A quick reply on something that has worked for me. I have found 3 times the Average True Range (ATR) over a 14 period to be a great starting point for a fixed target. Since some of this conversation is about getting out too soon I've found having that fixed target in mind to be very important for me and keeping it less subjective on exit. When I switch to forex, I tend to bump that to 4x of the ATR, and if I trade a market that is a bit more range bound 2.5x.

 

From there, if I also want to trail, I will exit half of my position at that fixed target -- and then I can let the second half run on a trailer -- to me that helps psychologically since you get to book a profit, and you make sure your trailer does no worse than a small profit as you attempt to trail.

 

Anyway, using a flexible target like the above to me is a lot better than trying to force a fixed target when market volatility changes daily.

[86834 10]

The biggest road block for retail traders is pandora's box. In my opinion and experience, 99.9% of retail traders are chasing and worrying about things that actually have no important relevence to profitable trading.

 

Most of the retail community are focusing on learning things that are going to get them no where. It's like building a house.... but focusing on the garden for the whole project... no matter how nice the garden is, it isn't going to build that house.

 

If you learn how to trade professionally, any self respecting firm won't let you look at any charts for a month at the minimum. This is why I call it pandora's box, as when a retail trader gets involved with trading, they're opening pandora's box and making all the unimportant things important, and all important things unimportant. Most have it completely back to front, but instead of realizing and accepting that, they'll say it's the mental side, or it's this or that... basically they're blaming themselves.

 

The truth is, if you're trying to make a cake with a sledge hammer, it doesn't matter how disciplined you are, how mentally strong you are, how devoted you are etc... it just isn't going to happen because you can't make a cake with a sledge hammer, just like you're not going to be consistently profitable as a day trader by just staring at charts and techncial analysis, or following indicators or systems. You need to learn how to trade if you want to make money from trading. Don't learn how to be an analyst, and then be surprised you've made no money. At the same time however, 99.9% of people on this forum have made no money, but as mentioned, most will think there's something wrong with them and that they're their own reason why they have not succeeded. Like I say, most of you are following the piper over the hill into the magical forest, so it's not a reflection on your personal ability to trade, it's just a reflection of the b.s that you're following...

 

Just my 2 cents

[Rande Howell 10]

This has not been my experience with traders. Certainly they initially seek to find the Holy Grail "out there". And somewhere along the line they find that their trading is shaped by the beliefs they hold about their worth, inadequacy, and fears of loss that have been embedded into their way of perceiving the world. And, until they take full responsibilty for the results they produce, they are not in a position to reorganize the self for more effective trading. Until they learn to manage their fear, growth of potential as a trader is compromised.

 

Part of this is biological (discerning uncertainty as different than fear) and part is psychological (the way they interprete the markets). The brain and mind were not built to trade, the brain and mind have to be trained into a new way of perceiving and acting to be successful in trading -- unless you got lucky and born that way; in that case, count your blessings.

 

Here is a link to an interview from the Money Show about this. MoneyShow.com: Video

Rande Howell

www.tradersstateofmind.com

Edited October 12, 2010 by Rande Howell
corrections

[zdo 20]

86834 and Rande are both right.... both...

both could be cited over in that old Edge First, Self First, or Both First thread...

(in particular, 86834, re trying to get there using someone else's edge)

... both...

[Rande Howell 10]

zdo

Certainly you have to break the herd motivation. In fact, a great trader is riding the wave of that herd mentality. Once the herd is heading in a particular direction the shift between buyer and seller shows up in the moment. For the vast majority of people, the mind of the trader has to be trained to disrupt the biological tendency to get sucked into the head mentality or the wave. It is at this point that the trader can learn to access the psychological skill sets that allows him or her to trade in the zone. This takes awakening to mindfulness. Until that is developed, traders will stay in their mindlessness and follow the herd. And lose like the herd.

Rande

http://www.tradersstateofmind.com

[86834 10]

This is what I don't like about trading... all the daft buzz words like the herd, the edge, the money show....

 

In my opinion it's all bollocks, there's those who know, and then there's those who don't know.... it's as simple as that really. This is all my personal opinion, and I'm not saying my way is the only way, by my opinion is based years of professional experience.

 

I know it might seem a bit grumpy, but I think most in the retail community just need to shut up and get on with it. I think people spend too much time trying to talk a good game, rather than spending that time trading. Instead of asking themselves why a trade didn't work, instead they spend their time seeking a buzz word to attach to it. Not that anyone is probably going to listen to me, but that's why 95% don't make money, because 95% think they know better than the professionals. It's as simple as that. Also when I refer to professionals, i'm refering to prop traders in the city, investment bank trading desks, hedge funds etc, not some guy sat in his bedroom trading 5 lots who thinks he's big time with his bingo bongo setup.

 

It really is so simple and it's a great example of the saying 'all you need is common sense, but common sense isn't actually that common. Like I say, 95% think they know better. An example would be, i've made posts before on this forum about the importance of orderflow if you want to day trade, and without fail, there's always some dounut that comes out of the wood work dismissing it, or trying to pull my post apart to give themselves the big I am. Fair enough I say, most people you can tell them exactly what to do, and they won't listen to you, and that's why most lose money, and only a few make money

 

Too much uncontrolled and unjustfied ego's in retail circles, which is fine by me... more people to take the back out of.

[Cory2679 11]

An example would be, i've made posts before on this forum about the importance of orderflow if you want to day trade, and without fail, there's always some dounut that comes out of the wood work dismissing it, or trying to pull my post apart to give themselves the big I am. Fair enough I say, most people you can tell them exactly what to do, and they won't listen to you, and that's why most lose money, and only a few make money

 

How dare they question you!

[86834 10]

How dare they question you!

 

I know, who do they think they are lol?

 

On a serious note, it does annoy me when it's clearly obvious that someone can't even tell their left from their right, yet they trying to tell people how to trade based on a 8 months experience and a handful of lucky trades they've had recently. In my opinion, when a new retail trader is researching the internet for trading ideas, they should just do the complete opposite to most of what they're reading. If you sign up to some crappy $500 webinar, then you'll probably make money if you sell when they say buy lol

[KalixMOR 10]

I think most lossers have to bit expectations. The people who are consistently making profit are happy with 20% a year. Maybe most of the lossers would not even trade for such a return, they are searching for the holly grail. This was my problem too.

[Rande Howell 10]

I think most lossers have to bit expectations. The people who are consistently making profit are happy with 20% a year. Maybe most of the lossers would not even trade for such a return, they are searching for the holly grail. This was my problem too.

 

Most of the traders I work with don't think in terms of a % return. Instead they see it as revenue. They are seeking a livihood rather than an investment. They often are in their late 40's, 50's, or 60's and realize they will never have another job -- they are not going to be hired. Trading becomes a viable option as a business or new career.

Rande Howell

www.tradersstateofmind.com

[MadMarketScientist 11]

Hmmm - interesting. I do agree that it is thought of in some ways as "revenue" but I haven't met many traders who don't quote percent returns.

[Phil-n-Texas 10]

MMS, saw this thread in my daily feed and your original post so thought i would chime in. In short, the answer to the original question would be fear and greed which still give me problems to this day. Also, I can relate to your story re: over optimization. I went through that phase along with trying to automate and mechanize systems. In the end I fell back on some rules that I've applied in other areas of my life. i.e. simplify...

 

in my endeavors as a musician, i decided a long time ago to not get too wrapped up in the latest gadgetry and so forth. my thinking was that i wanted to be able to perform well no matter what instrument or playing situation i was in, so i never deviated from insturments or gear that wasn't readily available or most likely to be handed to me if for example i was asked to set in with somebody at a moments notice. ok, maybe not the best example but that's just kind of the way i started working in my trading... and as such, i spend more time trading and making a buck than pouring over lines of code and so forth.