Your Mama Doesn't Trade ... So Wise Up to Yourself!

[MightyMouse 12]

  TheNegotiator said:

You misread the market, get over excited or over cautious. You could trade when you are a little tired or maybe sick. Perhaps the biggest thing is if you go through a change in your personal circumstances. You have a new baby or even get a divorce. You could just get really unlucky a number of times and start to question your reasoning. You might then get a little loose and to borrow a poker term, 'go on tilt' -which I can assure you markets like ES can do no matter how much work you do.

 

Experienced and wise traders can deal with these things and prevent them from affecting their trading overall. They isolate the issues. However, to another trader, this could be the start of a downward spiral into a trading rut or even a blown up account.

 

At times experienced traders act like inexperienced traders. ES will do what ES is going to do; an inexperienced trader will get out too quickly when they are winning and stay in too long when they are losing.

 

A lot of inexperienced traders read about trading plans that are flawed and falsely believe they are true and employ the flawed plan because they read about it in a book and that is what the author recommends and he is a lot smarter than most because a publisher was willing to publish his thoughts, so he must know what he is talking about. Basically, they create the situation that allows back luck to take advantage of them after which they will claim that trading is too difficult without knowing that they sabotaged themselves.

 

They begin to go crazy and seek psychological help to find out what is wrong with them because they are having difficulty executing their plan. I suspect that subconsciously, they know the plan is flawed, but consciously they believe they need to follow the plan because so many books tell you to follow the plan. Its an inner conflict or a case of bad ribs.

[Rande Howell 10]

  Ingot54 said:

... and his prices!!!

 

Your assessment is no surprise. May your trading be productive.

 

Rande Howell

[TheNegotiator 13]

  johnw said:

Very wisely put.

 

Am I to gather that you believe a Trader should know themselves sufficiently to know when they can apply FOCUS to trading ES and when they cannot.

 

Oopps, I mentioned FOCUS again ... unforgivable of me.

 

I believe it helps to know yourself better in all walks of life, trading included. However, I think it is more important to be able to recognise your current state and to adjust your trading based on this. Sometimes this means to subdue you own emotions, sometimes it means to escalate your trading if you are in 'the zone'(I use that term generically although I am aware I mentioned the MD book a couple of posts ago).

[TheNegotiator 13]

  MightyMouse said:

At times experienced traders act like inexperienced traders. ES will do what ES is going to do; an inexperienced trader will get out too quickly when they are winning and stay in too long when they are losing.

 

A lot of inexperienced traders read about trading plans that are flawed and falsely believe they are true and employ the flawed plan because they read about it in a book and that is what the author recommends and he is a lot smarter than most because a publisher was willing to publish his thoughts, so he must know what he is talking about. Basically, they create the situation that allows back luck to take advantage of them after which they will claim that trading is too difficult without knowing that they sabotaged themselves.

 

They begin to go crazy and seek psychological help to find out what is wrong with them because they are having difficulty executing their plan. I suspect that subconsciously, they know the plan is flawed, but consciously they believe they need to follow the plan because so many books tell you to follow the plan. Its an inner conflict or a case of bad ribs.

 

 

It is true that there are many rubbish strategies out there. However, a rubbish strategy or a great strategy alike can be given the midas touch by a great trader. Either one however, can be applied ineffectually by a should we say, less than aware trader. This is by no means to say that some published strategies cannot be a con. I do think though that when people attempt to apply someone else's strategy and fail, it is much easier emotionally for them to blame the author.

[johnw 10]

Every day one or more people mention "discipline" or "never give up" or "screen time" etc etc etc

 

If you want to be a painter, a Sculptor, a Writer you start more or less with a blank canvas and an idea.

 

If you want to become a Trader in the 21st century, you start with a PC, a trading program, a DOM and a google seach.

 

Already you are screwed because you take for granted the only few pieces of hard information available to you and direct what attention span you have, upon the peripheral items.

 

When you focus upon something, you become at one with it.

Otherwise you are not focused ... you only think that you are because you have forgotten how to focus.

 

That is why we read all these vague posts ..... they are the product of unfocused minds who think that they are focused.

[TheNegotiator 13]

  johnw said:

Every day one or more people mention "discipline" or "never give up" or "screen time" etc etc etc

 

If you want to be a painter, a Sculptor, a Writer you start more or less with a blank canvas and an idea.

 

If you want to become a Trader in the 21st century, you start with a PC, a trading program, a DOM and a google seach.

 

Already you are screwed because you take for granted the only few pieces of hard information available to you and direct what attention span you have, upon the peripheral items.

 

When you focus upon something, you become at one with it.

Otherwise you are not focused ... you only think that you are because you have forgotten how to focus.

 

That is why we read all these vague posts ..... they are the product of unfocused minds who think that they are focused.

 

 

Again, I agree and this is a very important point. But people must realise what they need to focus on. Learning every technical indicator and watching several markets every day is not going to make you a trading guru. It will probably help if you have what it takes anyway, but sometimes it can also hinder. Understanding what the indicator is doing and why. Why there is a pop in market X at 11:23 every day. That helps. But still, this is only part of becoming a great trader.

[steve46 12]

  TheNegotiator said:

Again, I agree and this is a very important point. But people must realise what they need to focus on. Learning every technical indicator and watching several markets every day is not going to make you a trading guru. It will probably help if you have what it takes anyway, but sometimes it can also hinder. Understanding what the indicator is doing and why. Why there is a pop in market X at 11:23 every day. That helps. But still, this is only part of becoming a great trader.

 

This is a rather important comment I think...What you are seeing in any venue where the public participates are vague ideas based on urban myth...If and when a skilled person enters the arena you may read more specific comments (within limits)....The facts are that in any endeavor there are likely to be only a few top performers, and they obtain their success at great expense (in terms of absolute cost in money, in terms of time, focus, discipline and other requirements). The results the rest of the crowd obtains are generally in line with their willingness to work hard, and their ability to think analyze and think critically....The one benefit that I see (that was previously unavailable to the public) is information that can be brought to bear on the subject via the Internet...Finally this profession has unique requirements in terms of psychological performance...and that is the one obstacle that remains long throughout the participants career. That is why I suggest that people devote resources to formal education whenever possible.

 

Good luck

[johnw 10]

  TheNegotiator said:

Again, I agree and this is a very important point. But people must realise what they need to focus on. Learning every technical indicator and watching several markets every day is not going to make you a trading guru. It will probably help if you have what it takes anyway, but sometimes it can also hinder. Understanding what the indicator is doing and why. Why there is a pop in market X at 11:23 every day. That helps. But still, this is only part of becoming a great trader.

 

 

A curious response indeed.

 

Any focused person, I imagine, will aim directly for the heart and build a plan from there.

They achieve this by simply peeling back the layers to reveal the source of the information that support the layers.

 

In the end "all roads lead to Rome" and the supports run out of steam and therefore become the base information.

 

In the case of ES trading I believe they are HLOC, vol,OI, time.

From this smorgasbord I use HLOC and of course time and leave the rest for others.

In no way would I remotely suggest that other people follow, it is just what I do.

 

If you believe that vol leads price then I believe you.

If you believe that price can be traded without vol, then I believe you.

 

I am only interested in what I do, but my curiosity is piqued by these head thingy threads and how quickly they and all other peripheral threads become derailed.

 

If this is not living proof of what is and what isn't critical to successful trading, then we must all believe in the Tooth Fairy.

[MightyMouse 12]

  TheNegotiator said:

It is true that there are many rubbish strategies out there. However, a rubbish strategy or a great strategy alike can be given the midas touch by a great trader. Either one however, can be applied ineffectually by a should we say, less than aware trader. This is by no means to say that some published strategies cannot be a con. I do think though that when people attempt to apply someone else's strategy and fail, it is much easier emotionally for them to blame the author.

 

I do think the authors are truly sharing what they think would be a winning strategy, setup, or plan and are not intended to be a con. I also think that they may not be entirely honest about their success at trading if in fact they did have success trading which you could call a con. The reader assumes it is true because he needs to believe. He needs to believe that he can easily turn 5k into 100k in a year.

[MightyMouse 12]

  steve46 said:

This is a rather important comment I think...What you are seeing in any venue where the public participates are vague ideas based on urban myth...If and when a skilled person enters the arena you may read more specific comments (within limits)....The facts are that in any endeavor there are likely to be only a few top performers, and they obtain their success at great expense (in terms of absolute cost in money, in terms of time, focus, discipline and other requirements). The results the rest of the crowd obtains are generally in line with their willingness to work hard, and their ability to think analyze and think critically....The one benefit that I see (that was previously unavailable to the public) is information that can be brought to bear on the subject via the Internet...Finally this profession has unique requirements in terms of psychological performance...and that is the one obstacle that remains long throughout the participants career. That is why I suggest that people devote resources to formal education whenever possible.

 

Good luck

 

Well, from perusing the internet, one quickly realizes that there so many choices of educational sources for an aspiring trader to sift through. Which source of formal education would you recommend?

[TheNegotiator 13]

  johnw said:

A curious response indeed.

 

Any focused person, I imagine, will aim directly for the heart and build a plan from there.

They achieve this by simply peeling back the layers to reveal the source of the information that support the layers.

 

In the end "all roads lead to Rome" and the supports run out of steam and therefore become the base information.

 

In the case of ES trading I believe they are HLOC, vol,OI, time.

From this smorgasbord I use HLOC and of course time and leave the rest for others.

In no way would I remotely suggest that other people follow, it is just what I do.

 

If you believe that vol leads price then I believe you.

If you believe that price can be traded without vol, then I believe you.

 

I am only interested in what I do, but my curiosity is piqued by these head thingy threads and how quickly they and all other peripheral threads become derailed.

 

If this is not living proof of what is and what isn't critical to successful trading, then we must all believe in the Tooth Fairy.

 

John, I'm not entirely sure I know what you are getting at by saying my response is curious. Some and in fact many people do not have the same ability to question and strip away as you put it as others do. They look at a candle and they see a candle. However, another person may look at a candle and see what the open was, whether there was high volume, whether key prices were rejected or broken, whether the action was in response to economic releases or global events and even what the structure was within that specific candle(i.e. on a smaller timeframe did the action make a double top for example?).

[TheNegotiator 13]

  MightyMouse said:

I do think the authors are truly sharing what they think would be a winning strategy, setup, or plan and are not intended to be a con. I also think that they may not be entirely honest about their success at trading if in fact they did have success trading which you could call a con. The reader assumes it is true because he needs to believe. He needs to believe that he can easily turn 5k into 100k in a year.

 

Good point. There is definitely a desire in us all to find the 'holy grail'. This was one of the first things I heard about when I started trading and certainly it was impressed upon me the dangers of this kind of mind set.

 

As for the point you make about which education to choose, well I was about to ask the same question. It's like some bloke down the pub picking a bottle of wine, or an experienced vintner. That is the problem people have with educators. How do you pick a good one if indeed you need to be educated??????????

[johnw 10]

  TheNegotiator said:

Some and in fact many people do not have the same ability to question and strip away as you put it as others do.

 

I would say that they are at an extreme disadvantage, but not all their "sight" has been stripped from them.

 

They could trade a longer frame placing a greater emphasis on slower methodical analysis.

 

All depends upon their open mindedness.

[Ingot54 13]

  johnw said:

On another thread a Poster said that he would not try to trade if he had plenty of money and could afford not to do so.

Someone else states that they want to learn to trade but not to make a great wade of money from it.

 

I ask you .... where on earth has all the focus gone.

All I see is half arsed convoluted trials that lead to nowhere.

 

JohnW - a very good post in many way - just as I see things, though you may have been a little harsh here and there. I do it too

 

Without looking at that thread, I think it may have been me who stated that I would not be trading if I could afford not to. On the thread, I attempted to be a bit more curt with my response than I usually am, and thus no qualification was added ... I thought it was just a poll thing with a little comment, and that would be the end of it.

 

Here is the qualification, though no one should really give a toss!

 

I love trading with a passion ... but I also love doing other things equally as much. I have ambitions to earn my private pilot's licence, and to write a couple of novels - have already started. I write poetry and play the guitar. I love panning for alluvial gold. I love reading the work of John Steinbeck. I want to study the Libertarian system of governance, and compare/contrast with Democracy and Anarchy. I want to understand more of what the Bible has to say about why we are here, and where we may be going. I want to become more spiritual and less religious. And so on ... there is also a bucket list of things.

 

So you see, not everything in my life is defined by how well I trade. My current commitments allow for me to trade and remain engaged in my career ... two of the loves of my life. I have a beautiful French wife whom I neglect a little more than a man should, and grandchildren in other cities who need to know their grandfather - but not as much as he wants to know them, and watch them grow.

 

It may be that none of these things will come to fruition as per their potential, but at least I will have had a fairly full life trying.

 

As far a remaining focused on trading ... much of what I write has an ulterior motive - in the act of showing that I have shortcomings in the way I trade, I am aware that there is an unspoken readership out there with identical struggles. The replies and responses I received have been fantastic - I asked for it because I understood months ago that this was a forum where one could safely ask simple questions and not get destroyed by the rush to be sarcastic and witty from a bored, old-boys gallery.

 

That assessment remains as true now as it was when I realised it.

 

People like yourself are making great contributions by staying on course and being objective - even if the truth stings just a bit sometimes. My self-disclosure exposes me to ridicule, yet no one ridicules me. Inviting the critique of others does not threaten me, though the human side of me recognises the vulnerability of doing so. Yet instead of falling, I feel I am actually providing a platform for others to feel secure in contributing much of the same.

 

In that respect, we are slowing building a powerful forum - not in the sense of a website ... but in the sense that members can post away whatever is bothering them about their trading, and do so in the knowledge that SOMEONE is listening and caring. Someone will respond, and someone will help. The "forum" I speak of, is a place in the collective mind of the membership of this site, where frank and meaningful discussion takes place without intentional detraction.

 

Isn't that great. Precious.

 

Now all the things in the last paragraph have NOTHING to do with live trading, or remaining focused on trading and its difficulties. But they have everything to do with the development of this forum as a place of learning. It is not possible to discuss ONLY trades and trading on a forum - otherwise the thing would die. We could simply use Skype etc to chat about live trades, strategy etc.

 

No - a forum has to be a place where traders can evolve from the newbie to the mature and successful practitioner of the art.

 

That's why Traders Laboratory would be the top forum in the world in my view, and that's why your comments are so very accurate and right in-context. It's all here - or at least someone knows where it is, if it is not.

 

My long-winded posts put people off reading, I guess - far too long. But I can not help getting it on paper, so to speak - I am compelled to ramble on!

 

I enjoy your contributions - and I welcome the cutting edge of your views.

[TheNegotiator 13]

We love your rambling Ingot!! In all seriousness though, I believe your critique of the site is incisive in understanding what we hope to achieve in the forums. Thanks for pointing this out for others and long may this culture continue!!

[johnw 10]

Hi Ingot54,

 

My posts are aimed at nobody in particular.

My writing style, which can easily be softened to any extent, is chosen because

it is my belief that serious readers should feel the words rather than just read them.

 

Everything I write is the result of my own evolution, which happens through the process

of embedding questions in my mind at night and at sometime during the course of the next few days, thoughts emerge which I translate and act upon.

 

I am a self taught Trader from years ago and my first positive act was to give away my library of trading books, turn off my PC, sit in the sun and think about what exactly was I trying to do..... the doors to my mind opened up, and my trading plan gradually took shape as my knowledge became more specific.

Eventually, I came to a point where I must have accepted that the financial gains were the rewards for my calculated risks and not for my hard work ... and yet I had started my own Companies when I was young[ish] and built them up through sheer hard work.

Obviously, I gave more credit to hard work whilst undervaluing Risk without realising it.

 

When you do have "a light bulb moment" Ingot54, and I am sure that you will, it will effect a lot more than just your trading .... but I suspect that you suspect this already.

 

As far as integrating trading into your future life plans, please let me pass onto you, that at 64 I still do not know what I want to do when I grow up .... therefore I have given away the silly notion of 'growing up" at all.

I always insist on a 50 year guarantee on all dental work for instance.

 

As for trading soaking up your valuable time, you can always trade more trending instruments that require attention once or maybe twice per day plus an hour or so in the weekend .... but all this will fall into place when you are ready.

 

Goodluck and please bear in mind that if I didn't care, I would not bother posting.

Edited March 25, 2011 by johnw

[MightyMouse 12]

  johnw said:

Hi Ingot54,

 

My posts are aimed at nobody in particular.

My writing style, which can easily be softened to any extent, is chosen because

it is my belief that serious readers should feel the words rather than just read them.

 

Everything I write is the result of my own evolution, which happens through the process

of embedding questions in my mind at night and at sometime during the course of the next few days, thoughts emerge which I translate and act upon.

 

I am a self taught Trader from years ago and my first positive act was to give away my library of trading books, turn off my PC, sit in the sun and think about what exactly was I trying to do..... the doors opened up, and my trading plan gradually took shape as my knowledge became more specific.

Eventually, I came to the point where I must have accepted that the financial gains were the rewards for my calculated risks and not for my hard work ... and yet I had started my own Companies when I was young[ish] and built them up through sheer hard work.

Obviously, I gave more credit to hard work whilst undervaluing Risk without realising it.

 

When you do have "a light bulb moment" Ingot54, and I am sure that you will, it will effect a lot more than just your trading .... but I suspect that you suspect this already.

 

As far as integrating trading into your future life plans, let me pass onto, that at 64 I still do not know what I want to do when I grow up .... therefore I have given away the silly notion of 'growing up" at all.

I always insist on a 50 year guarantee on all dental work for instance.

 

As for trading soaking up your valuable time, you can always trade more trending instruments that require attention once or maybe twice per day plus an hour or so in the weekend .... but all this will fall into place when you are ready.

 

Goodluck and please bear in mind that if I didn't care, I would not bother posting.

 

I agree with giving away the books. And, more importantly, don't just give away the books, forget the content of the books as well.

[johnw 10]

  MightyMouse said:

I agree with giving away the books. And, more importantly, don't just give away the books, forget the content of the books as well.

 

Quite right.

A couple of decent cognacs and they all faded into oblivion.

 

I have kept a signed copy of Welles Wilder's first book for it's nostalgic value and

because I admire the man and his work completed during 1970's.

[Ingot54 13]

Today being 11th August 2012 makes it exactly 18 months since the thread was commenced.

 

Everything that came up in this thread - the ideas ... the sides of the fence one chooses to sit ... and the ultimate test of sound writing and teaching ... the action one may have chosen to take after reading ... it all bears reading again.

 

I enjoyed writing the OP, and I have enjoyed going back over some of it, to see if what I wrote still holds true for me.

 

It does - resoundingly more so than at the time of writing.

 

Why? Because I have been able to apply the principles I discussed in the first page of the thread to a greater degree than before, and those things have rescued my trading.

 

I few months ago - November 2011 to be precise - I decided I was not progressing as a trader, and that breaking even was not a very smart position to be holding for months on end.

 

I quit.

 

Well, I did quit. I removed everything from my computer to do with trading - charts, trading platform, .pdf's, links and indicators.

 

Essentially I was finished with trading, having decided that my approach was not successful, and that I deserved to be seeing more reward for the effort I had put in, for the preceding 7 years.

 

The sabbatical lasted 3 months. Fortunately (in hindsight) I did keep in touch with a great friend of mine who is a member here, but who has probably fewer than 8 posts to his name. I followed his progress while staying aloof and basically disinterested for myself. We chatted via Messenger less frequently than in the past, where those contacts had been daily. Keeping in touch was the act of a friend ... not the camaraderie associated with a fellow trader - not then.

 

But my interest was for his trading rather than for anything I might eventually achieve myself - I remained "out of the markets" both mentally, and physically.

 

I can not even recall what it was that triggered my return - it was a gradual thing - but I do know that once I decided to take another look at it, my mental position was radically changed.

 

I can only put it down to the core beliefs that remained after the three months break, and the fact that I had swept all previous beliefs out of my trading life.

 

I invite you to re-read the thread from the beginning, if interested, and comment about your own experience ... if things have changed for you. I do not think anything can be gained through rehashing the secondary issues that arose.

 

But have the principles mentioned in the first few posts made any difference to how you see the markets? Has anything changed in 18 months in your own trading life, that you could say is due to a radical change in the way you approach your trading today?

 

Here is the link to the first page:

 

http://www.traderslaboratory.com/forums/trading-psychology/9278-your-mama-doesnt-trade-so-wise.html

 

Kind regards

 

Ingot

[DbPhoenix 42]

I've read only the first few pages (my apologies), enough to see the same old pattern emerging: defending one's favorite books, insisting that the psychology must be addressed first, reverting to the same old avoidance of responsibility for failure, all while whizzing right past the whole business of trading plans.

 

In twenty years, I have yet to encounter a failure who had and followed a trading plan. By the same token, every failure either did not have one or refused to follow it. So none of the waffle about psychology impresses me.

 

My counsel to those who continuously whine about their "issues" is that they develop a goddamn trading plan and follow it. If they can't write one, much less follow it, they really ought to just quit.

 

Db

 

Edit: P.S. I do have a few books on my reading list, none of which have been mentioned here:

 

General Semantics of Wall Street

by John Magee

 

The Nature of Risk/How to Buy/When to Sell

by Justin Mamis

 

Zen and the Art of Poker

by Larry Phillips

Edited August 11, 2012 by DbPhoenix
Add P.S.

[Ingot54 13]

Accurate summary, DbPhoenix, and reflects my thoughts at the time of the OP.

 

I have moved on from whining about what others do in the "trading support industry" eg book writers and psychologists, vendors and marketeers.

It's a waste of my time, and once said, it's best to just leave it alone.

 

Live and let live.

 

You can not make the journey for others - you can only make your own, and occasionally walk alongside others.

Rarely do you make that journey together.

 

But to wax philosophical for a moment longer ... what can and does help other traders, is to share those parts of one's journey that have led along an easier path.

 

But like the horse and the water, it won't happen until the trader is really thirsty.

 

Your mama doesn't trade ...

 

EDIT: Yes - the Trading Plan is one key - I had one for years - even posted one - but there is more to it than faithfully following one. The TP needs to be intelligently formulated, personalised, and adhered to.

 

I gave myself a fail there ...