The purpose of this blog is to provide a comprehensive compilation of articles and posts which have been of great help to me in the past, or that I find very insightful, wise or containing a great deal of useful knowledge.
The original author of the text will be mentioned, so that those who are interested in the subject can explore it deeper.
The blog will consist out of several categories, some more theoretical, other containing charts and analysis.
Finally, this blog is, in a way, a continuation of the journal
I started in the public section on another site.
The original author of the text will be mentioned, so that those who are interested in the subject can explore it deeper.
The blog will consist out of several categories, some more theoretical, other containing charts and analysis.
Finally, this blog is, in a way, a continuation of the journal
I started in the public section on another site.
Trading circumstances...
Posted 06-12-2008 at 06:59 AM by firewalker
Creating the optimal trading environment is important imo. I'm not talking about large enough screens on your desktop or enough processing power, I'm talking about several conditions which - in my experience - can influence your trading to such an extent that it has a negative effect on the outcome.
By enumerating these conditions, I hope to get more aware of them and realise when I'm not at my best that I should trade less, or even not trade at all when these conditions present themselves.
Trading on a Friday.
For some reason Fridays caught me out. A majority of my bad trades happen on a Friday. Whether this is because the markets because the markets behave differently, or because I am in a different 'state of mind' remains to be seen, but I'll need to thread more carefully on Fridays.
Trading before a holiday weekend.
If I don't have a trade before lunchtime, I won't trade. Often these days end in nothing but sideways drift or chop.
Disturbances...
I don't like people around when I'm trading. When I'm concentrating on getting the entry right I don't need telephone calls, mails, chatrooms,... Once I'm in a position I am still very focused, but after my stop has been moved to breakeven I am starting to relax already.
Annoyances...
I've often noted that when some element in my personal life distracts me or annoys me, I don't have the same mindset when approaching the markets. Whether I feel pissed or gutted or mad about something or someone, it seems like I'm unable to leave it behind and take it with me into the markets.
Time...
If I have limited time to trade, or need to leave the screen early, I find myself taking trades that aren't there or wanting to rush into an entry. I really need to have the day to myself in order to be able to fully exploit the possibilities in the market.
Setting profit targets.
Bad idea. Makes me overtrade or revenge trade. I need to take whatever the market offers, even if this is less than I would like.
Getting annoyed about missing the entry pre-market.
Often good opportunities present themselves in the 45-60 minutes before the market opens. I need to study these more carefully, but in the end I don't see any reason why I should refrain from taking these trades anymore. Especially since by doing so, I prevent myself from jumping aboard a moving train when the markets open.
By enumerating these conditions, I hope to get more aware of them and realise when I'm not at my best that I should trade less, or even not trade at all when these conditions present themselves.
Trading on a Friday.
For some reason Fridays caught me out. A majority of my bad trades happen on a Friday. Whether this is because the markets because the markets behave differently, or because I am in a different 'state of mind' remains to be seen, but I'll need to thread more carefully on Fridays.
Trading before a holiday weekend.
If I don't have a trade before lunchtime, I won't trade. Often these days end in nothing but sideways drift or chop.
Disturbances...
I don't like people around when I'm trading. When I'm concentrating on getting the entry right I don't need telephone calls, mails, chatrooms,... Once I'm in a position I am still very focused, but after my stop has been moved to breakeven I am starting to relax already.
Annoyances...
I've often noted that when some element in my personal life distracts me or annoys me, I don't have the same mindset when approaching the markets. Whether I feel pissed or gutted or mad about something or someone, it seems like I'm unable to leave it behind and take it with me into the markets.
Time...
If I have limited time to trade, or need to leave the screen early, I find myself taking trades that aren't there or wanting to rush into an entry. I really need to have the day to myself in order to be able to fully exploit the possibilities in the market.
Setting profit targets.
Bad idea. Makes me overtrade or revenge trade. I need to take whatever the market offers, even if this is less than I would like.
Getting annoyed about missing the entry pre-market.
Often good opportunities present themselves in the 45-60 minutes before the market opens. I need to study these more carefully, but in the end I don't see any reason why I should refrain from taking these trades anymore. Especially since by doing so, I prevent myself from jumping aboard a moving train when the markets open.
Total Comments 1
Comments
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FW I think what you have outlined here is highly important. If we have a plan that is anything other than systematical without any type of discretion, the trading environment is essential.
Especially the areas you mention in regards to disturbances, annoyances and time. I too find myself trading poorly if something in my personal life has triggered an extreme emotional feeling during the day. Some things are just too hard to shake off under 24 hours and separate from trading. I think these are some great insights into your trading and if you use them to improve your plan of attack with the trading day you are likely to see better results. Great to see your recent blog posts get into the areas I believe most traders find hard to assess. Keep up the great analysis. |
 
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