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upullit4

The Learning Curve

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This post is something that i have been realizing the past few weeks.

Ive been trading ES now for 10 weeks when i first started everything was foreign to me. I didn't even know what a DOM was lol. So needless to say i am a newbie.

Going through this learning curve has taught me more in the past 10 weeks then i learned in the past year since i put my very first trade on. Above and beyond everything that i have learned (and still learning) like understanding momentum, whether we are trending or ranging, Knowing when to switch strategies, multiple time frame analysis, retraces, trading around levels, developing your market feel, and the newbies worst nightmare "The dreaded chop" (i can go on and on). I am understanding that dealing with your emotions is the most difficult of all parts of trading to me. Someone mentioned one time that trading is a combination of things coming together im sure that this is one of the factors. When you are stalking a trade you always second guess yourself whether it is a good set up or not. And when you pull the trigger you are wondering if i made the correct chose. And when the trade goes for you then comes back to B.E. should you hold it or take the break even (I've learned a good lesson about standing behind your position). And how about when you take a few ticks of heat and it comes to BE and you take it. then it just goes your way any way (that sucks). Or here is a good one you only hold for 2 points for it to just keep going for 4 or 5 or10 points without you (I'm getting better at that). I'm beginning to think that the psychological side of trading is the most important part of, the actual trading its self is easy. I read a part in DR. Tharps' book "trade your way to financial freedom" he says (this is out of context but he is talking about developing a system that's right for you and he was referring to short term traders) "Most importantly the psychological pressure could destroy you. Nevertheless, Its my belief that the largest profit percentages are made by short term traders who really have their psychology together. I've seen short term traders who could make as much as 50% or more per month (on small amounts of money such as a $50,000 account) when they were in tune with the market and them selves." So you can imagine how important the psychological part of the learning curve is.

So as i go through this learning curve im learning to control my emotions a lot better and i am beginning to gain a deeper knowledge of trading. And im realizing that we trade our selves not the markets. I think if i can keep my emotions under control i will be well on way to becoming more and more consistent. Well im out of here, hope this helps you guys. And please share some thoughts i think it will be helpful to your self and others.

Mike

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Funny seeing this. I posted this a long time ago and it just popped up in my email i get from TL. Glad to say im doing much better and i am well on my way to being a consistent trader. Its still a little bumpy from time to time. But i think the tough part is past me for now.

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Congratulations on your trading, and your improvements. You seem to be learning very quickly. What do you use for indicators? Do you ever run your trading stats? I'm curious as to how long your average trade is, how many trades you make in a day, week. Do you ever look at your stats for things like how big a draw down you took?

 

The other thing I'm curious about is what your strategy is for getting your orders filled? Do your entry orders ever go unfilled? Do you use market orders or limit orders? Do you scale out?

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I wouldn't say very quickly. I started the entire trading thing back in August of 2008 and i didn't get any real mentoring until July of 2009. So that year was just figuring out what shorting a stock was lol. I cant remember when i posted the original post but i think it was around August of 2009.

The person that mentored me fortunately didn't use any indicators (like MACD, Stoch Etc..) We did use the VB indicator in market delta to see divergences. He pretty much set my straight and on the correct course. I learned a lot from what he taught. And it has got me to where i am today. I did add a few things on my own because trading is about what works for you not every one else.

I do keep track of my stats but on a very limited basis. I find that the simpler i make my routine the more likely i am to keep doing it. I will track different things as i see the need. My trades are anywhere from a few minutes to maybe an hour or two depending on my expectations for the day. I usually take 2 to 4 trades a day sometimes one if nothing is going on. It really depends on what the market is giving for the day.

For my strategy i use market profile and TA and i will trade the auction process. I mostly use limit orders. Sometimes i will get left behind but thats how it goes. I will use market orders but very rarely. It really depends on what the market is doing and how it is setting up. For my entry's i try and get in at a spot where if i get stopped out i know im wrong and i use that as another data point.

As for scaling im not really at that level yet. I dont look for the Hollywood trade every time. I will look to take 2-3 points very quickly in the ES and sometime let 1 run for 4-5 points. The reason is that the way i see it trading is a game of size not points. If i were on bigger size i would exit most of my position for 2-3 points to reduce risk and bank something. If the market tells me that there is likely more to be had then i would leave a runner for what i see the market giving. Right now im not interested in getting 5 or 10 points. It would be nice but chance are i will not get the extended targets. I want to build my consistency and with consistency you can increase size. Then them 2 -3 point trades are as much as the average person makes in a month. And at that point i will let some run for extended targets.

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Hi upullit4,

 

I'm brand new to trading. I've been reading a lot and literally hours of research. I have tried learning several indicators. So far, I would say that I'm struggling as I'm sure many beginners do. What advice would you give a new trader like myself? So far I have only traded stocks and I have only made a few (unsuccessful) trades. I hear many people trading forex and other unfamiliar things and I am not sure if I should see what it's all about or stick with stocks until I gain more experience. I don't really know where I can learn to be a better trader. I am willing to put in the work, but I just don't know where to go from here.

 

Thanks.

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