Today's Trading Hell

[studyolic 10]

AbeSmith

First, I have to congratulate you on your honesty and willingness to learn from the good people here. It would be easy to become frustrated, and think that these folks are "having a go" at you. As you are obviously aware, they are all trying to help, in their own way.

Here is my 2 cents worth.

I think you should invest some time reading "Reminiscences of a Stock Operator" by Edwin Lefevre; this is ghost written account of the trading life of Jesse Livermore, one of the old greats, who had many faults and demons to deal with in his trading life. Also, read one of Jack Schwager's books about some of the big traders. It gives an interesting insight into different personalities and trading styles.

Then, have a think about your own trading style. Do you really have to be a day trader? Have you ever considered using longer time frames? There are many traders who feel that the big profits are in the big moves, ie over days and weeks. You have to find out what suits your personality. If you feel that using longer time frames may be more to your personality, may I suggest looking at the trading techniques of Safety in the Market, an australian firm specialising in teaching the methods of WD Gann, who was active around the time of Livermore. The web address is;

http://www.sitm.com.au/

they have offices in the U.S., I believe.

 

Above all, be cautious. The primary objective of any trader must be to stay in the game. If you blow your capital, you're out.

 

Best wishes,

 

PS I have absolutely no commercial connection to Safety in the Market, other than being a satisfied customer.

[brownsfan019 17]

Make sure you guys check out my idea here - http://www.traderslaboratory.com/forums/f37/holding-yourself-accountable-idea-2039.html

[AbeSmith 10]

AbeSmith

First, I have to congratulate you on your honesty and willingness to learn from the good people here. It would be easy to become frustrated, and think that these folks are "having a go" at you. As you are obviously aware, they are all trying to help, in their own way.

Here is my 2 cents worth.

I think you should invest some time reading "Reminiscences of a Stock Operator" by Edwin Lefevre; this is ghost written account of the trading life of Jesse Livermore, one of the old greats, who had many faults and demons to deal with in his trading life. Also, read one of Jack Schwager's books about some of the big traders. It gives an interesting insight into different personalities and trading styles.

Then, have a think about your own trading style. Do you really have to be a day trader? Have you ever considered using longer time frames? There are many traders who feel that the big profits are in the big moves, ie over days and weeks. You have to find out what suits your personality. If you feel that using longer time frames may be more to your personality, may I suggest looking at the trading techniques of Safety in the Market, an australian firm specialising in teaching the methods of WD Gann, who was active around the time of Livermore. The web address is;

http://www.sitm.com.au/

they have offices in the U.S., I believe.

 

Above all, be cautious. The primary objective of any trader must be to stay in the game. If you blow your capital, you're out.

 

Best wishes,

 

PS I have absolutely no commercial connection to Safety in the Market, other than being a satisfied customer.

 

Thanks studyolic.

[AbeSmith 10]

Make sure you guys check out my idea here - http://www.traderslaboratory.com/forums/f37/holding-yourself-accountable-idea-2039.html

 

That's an excellent idea brownsfan019.

[tony1d 10]

Abe, i use Infinity/Sierra charts and i like it. It has everything you need and at around 25 bucks per month, its a value, you can add Market Profile later on for another 15 bucks and you've got all you need. As far as trading, we all been there and the advice you're getting is very sound. Trading the YM in the summer is very tough. All the markets will have choppy price action due to less liquidity n the summer. I actually refuse to trade August at all. REviewing my tradelogs shows thats the month i tend to trade poorly and lose money. All that said, a trading plan is number 1, it is your bible and guidemap on what you'll do everyday, every trade. Setups, stops, targets, its the number 1 reason traders lose money, lack of or lack of following a plan. I am a very conservative trader and have a very strict trading plan. I read all the books also but my trading turned around when i learned (or still am) learning to read the tape (time and sales) and follow price action. If you are daytrading and dont do this you have a very small chance of being successful. I look at how price is acting as it approaches major S/R points. I always need to know whos in control (buyers or sellers) I always trend trade unless price action tells me a reversal is coming. I follow the big money, watching the tape all those 1-3 contracts are the fresh meat for the pros. I trade the ES and wait for the huge buyers or sellers coming into the market and upon seeing follow through i trade with them. I can almost always scalp 1/2 point on my first profit point, now my trade cannot lose due to my stop losses, my next target is 1 point where more comes off and my last is allowed to run until it hits a trailing stop or i take it out. Indicators are fine but they all lag and are based on price action so i only use them for reference. Moving averages lag but do tell me direction. I look at 3 timeframes and entry is timed off the price action and 55t chart. The reason i tell you this is not so you trade like i do, its simply to show you i have a plan and a method and it works for me. you need to have one that works for you. I also am very quick to get out of a trade that isnt working. I dont believe in holding onto a trade until it hits my stops. If momentum shifts immediately, i was wrong and get out. After reviewing my trading logs, i calculated if i always did this going back i would have had shallower losses. Trading is not market hours only, it requires, pre market planning and research and post market analysis of what you did right and wrong and as markets change so do your trading methods need to modify. there is nothing wrong with sitting it out, some days are not trading days, plain and simple. The faster you learn to recognize that, the better off you'll be. Good luck Abe and dont get discouraged but do stop using real money if you are and get with the basics and build from there 1 pattern / concept at a time. Keep it simple.

 

tony

[AbeSmith 10]

Abe, i use Infinity/Sierra charts and i like it. It has everything you need and at around 25 bucks per month, its a value, you can add Market Profile later on for another 15 bucks and you've got all you need. As far as trading, we all been there and the advice you're getting is very sound. Trading the YM in the summer is very tough. All the markets will have choppy price action due to less liquidity n the summer. I actually refuse to trade August at all. REviewing my tradelogs shows thats the month i tend to trade poorly and lose money. All that said, a trading plan is number 1, it is your bible and guidemap on what you'll do everyday, every trade. Setups, stops, targets, its the number 1 reason traders lose money, lack of or lack of following a plan. I am a very conservative trader and have a very strict trading plan. I read all the books also but my trading turned around when i learned (or still am) learning to read the tape (time and sales) and follow price action. If you are daytrading and dont do this you have a very small chance of being successful. I look at how price is acting as it approaches major S/R points. I always need to know whos in control (buyers or sellers) I always trend trade unless price action tells me a reversal is coming. I follow the big money, watching the tape all those 1-3 contracts are the fresh meat for the pros. I trade the ES and wait for the huge buyers or sellers coming into the market and upon seeing follow through i trade with them. I can almost always scalp 1/2 point on my first profit point, now my trade cannot lose due to my stop losses, my next target is 1 point where more comes off and my last is allowed to run until it hits a trailing stop or i take it out. Indicators are fine but they all lag and are based on price action so i only use them for reference. Moving averages lag but do tell me direction. I look at 3 timeframes and entry is timed off the price action and 55t chart. The reason i tell you this is not so you trade like i do, its simply to show you i have a plan and a method and it works for me. you need to have one that works for you. I also am very quick to get out of a trade that isnt working. I dont believe in holding onto a trade until it hits my stops. If momentum shifts immediately, i was wrong and get out. After reviewing my trading logs, i calculated if i always did this going back i would have had shallower losses. Trading is not market hours only, it requires, pre market planning and research and post market analysis of what you did right and wrong and as markets change so do your trading methods need to modify. there is nothing wrong with sitting it out, some days are not trading days, plain and simple. The faster you learn to recognize that, the better off you'll be. Good luck Abe and dont get discouraged but do stop using real money if you are and get with the basics and build from there 1 pattern / concept at a time. Keep it simple.

 

tony

 

Excellent advice Tony. Thanks.

[brownsfan019 17]

Trading the YM in the summer is very tough. All the markets will have choppy price action due to less liquidity n the summer.

 

That advice is commonly found in books and message boards; however, if you take a look at the action this 'summer' it's been PHENOMENAL. Liquidity is NOT low and the action is HIGH. Perfect trading grounds if you ask me.

[Guest cooter]

That advice is commonly found in books and message boards; however, if you take a look at the action this 'summer' it's been PHENOMENAL. Liquidity is NOT low and the action is HIGH. Perfect trading grounds if you ask me.

 

200pt move on Thursday is case in point. So much for those summer doldrums. Wait till August rolls around.

[tony1d 10]

Most everything you read is in some book. there are certainly enough of them. Trading is personal as traders are all different. For me liquidity has nothing to do with how much a market goes up or down in any day, it has to do with your ability to get in and out easily with minimum slippage. Choppy price action occurs when there are less contracts being traded and the locals can move prices easier to hit stops and shake out all the weak hands. thats why its not advisable to trade dead zone lunchtime. That 200 point move the other day was a perfect trading day for a swing and position trader but not so great for a daytrader who looks for pullbacks as entries, especially at S/R levels which got taken out all day long. I am sure some daytraders did fantastic but my trading plan was not conducive to that type of day and i stick to my plan. The market grinded higher all day and everytime sellers tried to come in, buyers immediately protected price and sellers finally gave up. I watched that tape all day long. Theres no right or wrong trading style. It whatever fits your personality. Yep, thats in a lot of books but its also to me true. I keep reading 90-95% of futures traders lose money. I have a hard time believing that but if its true, i have to also believe the pros bidding and offering thousands of contracts on the ES at certain times and the locals have the upper hand. I only trade when i have a sense of what they are trying to do and follow them. so far, i been blessed, its working, and it certainly took long enough to figure that out. I get something out of every post i read in this forum whether i heard or read it before. Its a reinforcement. Especially the market profile and tape reading threads. every little bit helps/....

[Guest cooter]

For me liquidity has nothing to do with how much a market goes up or down in any day, it has to do with your ability to get in and out easily with minimum slippage.

 

And if you're trying to get in at a good price point, and out at a significant profit, you'll want the volatility to be there. Up and down - not a sideways snooze fest.

 

Otherwise, you're just chopping around, scalping for ticks versus trading for dollars.

[stanlyd 10]

Abesmith,

You need to stop trading and spend the next few months back hitting the books. Also look into some better charting. Are u using any market internals? Do you know how to figure a stop maybe even based on using average true range? Are you a breakout or a pullback trader? Do you play reversals? Are you a trend follower? What markets do you trade and why?

If you can not anser these questions without stopping to think for even a milisecond, then you dont know your plan and I think that is recipe of failure in trading.

[tony1d 10]

Absolutely, i use market profile and where we are relative to the value areas to get an indication of what type of day it may be. If the locals are just bouncing it up and down the value area and other timeframe is not participating, i just go to the beach. One good thing about living in Ft. Lauderdale.

[AbeSmith 10]

Abesmith,

You need to stop trading and spend the next few months back hitting the books. Also look into some better charting. Are u using any market internals? Do you know how to figure a stop maybe even based on using average true range? Are you a breakout or a pullback trader? Do you play reversals? Are you a trend follower? What markets do you trade and why?

If you can not anser these questions without stopping to think for even a milisecond, then you dont know your plan and I think that is recipe of failure in trading.

 

Hey Stanly. Thanks for the advice.

[WHY? 16]

BY all means buy the book The Taylor Trading Technique. by George Douglas Taylor. Since you studied law you should grasp the book in a jiffy:)

 

Linda Bradford Rascke bases much of her trading ideas on Taylor's concepts.

 

I have alot of books in my trading library. This one is the best. Learn it and put it into practice and with good money management you will succeed.

 

Check out the thread here on Taylor Trading Technique started by dogpile.

 

http://www.traderslaboratory.com/forums/f110/taylor-trading-technique-oct-2007-a-2623.html

 

You will make it if you act now. Losing 200.00 is nothing. Just take the steps to learn so you won't KEEP losing. As you get confidence play some more with real money. Nothing like real money to test your system and your abilities. Always ask why?

 

WHY?

[AbeSmith 10]

BY all means buy the book The Taylor Trading Technique. by George Douglas Taylor. Since you studied law you should grasp the book in a jiffy:)

 

Linda Bradford Rascke bases much of her trading ideas on Taylor's concepts.

 

I have alot of books in my trading library. This one is the best. Learn it and put it into practice and with good money management you will succeed.

 

Check out the thread here on Taylor Trading Technique started by dogpile.

 

http://www.traderslaboratory.com/forums/f110/taylor-trading-technique-oct-2007-a-2623.html

 

You will make it if you act now. Losing 200.00 is nothing. Just take the steps to learn so you won't KEEP losing. As you get confidence play some more with real money. Nothing like real money to test your system and your abilities. Always ask why?

 

WHY?

 

Thanks WHY? I'll look into it.

[Reaver 10]

Abe,

 

Hey I would suggest Trading Day By Day by Chick Goslin.

 

Even if you don't necessarily follow his method, the ideas in the book are second to none. The guy is a real gentleman. Hard core real deal too, 30+ yrs as a trader. not a theorist. He has statements posted on his website if you'd like to check for yourself.

[OAC 10]

Abe needs to read ALL the books himself and decides which one suit his personality the best. I wish there was one magic book and method. If there was one, too many people would catch on and the method would stop working. Stochastic and MACD were magic in their golden days.

[Reaver 10]

I agree. Glean what you can, formulate your own ideas and strategies. Stand on the shoulders of giants.

[AbeSmith 10]

Abe,

 

Hey I would suggest Trading Day By Day by Chick Goslin.

 

Even if you don't necessarily follow his method, the ideas in the book are second to none. The guy is a real gentleman. Hard core real deal too, 30+ yrs as a trader. not a theorist. He has statements posted on his website if you'd like to check for yourself.

 

Thanks Reaver. I'll look into it. Rgiht now I have lots of books that I'm reading:

 

1. Trade Your Way to Financial Freedom, Tharp

2. Mastering The Trade, John Carter

3. Millinaire Traders, Lien, Schlossberg

4. The Market Maker's Edge, Lukeman

[AbeSmith 10]

Abe needs to read ALL the books himself and decides which one suit his personality the best. I wish there was one magic book and method. If there was one, too many people would catch on and the method would stop working. Stochastic and MACD were magic in their golden days.

 

Good point OAC.

[Reaver 10]

Thanks Reaver. I'll look into it. Rgiht now I have lots of books that I'm reading:

 

1. Trade Your Way to Financial Freedom, Tharp

2. Mastering The Trade, John Carter

3. Millinaire Traders, Lien, Schlossberg

4. The Market Maker's Edge, Lukeman

 

 

I liked the Tharp Book. Carter's book is good, and Lukeman's has some good points here and there.......I haven't read the other one...but that's a good list.

 

Remember, the most important thing is not the exact methods you read in the books...but what those ideas can inspire you to figure out for yourself.

[AbeSmith 10]

I liked the Tharp Book. Carter's book is good, and Lukeman's has some good points here and there.......I haven't read the other one...but that's a good list.

 

Remember, the most important thing is not the exact methods you read in the books...but what those ideas can inspire you to figure out for yourself.

 

Good point Reaver. I agree with that 100%.

[AbeSmith 10]

Millionaire Traders is pretty good book so far. I only read about 68 pages so far but it has been very fun and informative book. There is a review of it here at TL where I found out about it.

[Reaver 10]

Millionaire Traders is pretty good book so far. I only read about 68 pages so far but it has been very fun and informative book. There is a review of it here at TL where I found out about it.

 

Glad to hear it man.

[januson 10]

Hi Abe

 

I'm a newbie like you, take a look at what I posted for 8 months ago: http://www.traderslaboratory.com/forums/f25/the-most-stupid-tradingday-ever-1454.html

 

I started with $10000, lost a lot :crap:, pumped in another $6000 and at the moment my account is as low as $1000 (it has been lower)

In addition to that I'm paying for different tradingservices (quotes, software), that costs me $100 a month :haha:

I won't even try to guess how much time screentime I've used.

 

But I'm learning alot from this site by reading what other does, I've also read a lot of books - the current book I'm reading "Your Money and Your Brain"

 

Well... I'm still in a good mood and I know I'm getting better, but damn it costs alot of money and a lot of frustrations. The frustrations are getting smaller and my my optimism is growing.

 

The time I read that it's normal to blow up your account I thought yeah yeah... that's because blabla... I'm better than the most, so that couldn't happen to me.

Well it did :doh: , but I've learned a lot by that (risk management, trading psychology, fear, greed, humility) the most important thing i've learned is that's it not easy, I'm still learning, but I'm getting a bit more clever for each hour, who know.. maybe some I can call myself a trader.

 

So don't worry, keep up the spirit and if you're willing to learn (you are otherwise you won't be here) then things will comes to you