Some thoughts related to Trading psychology (Part #7):
Obviously MM's decided to clean all stops and drive the Euro up. Was there fundamental reasons? I could not find. Yes there are times when pivots fail hence why I always say trade small and stagger your entries.
EA in particular is primed for correction. Can it go higher? Yes since I don't know the future that's possibility. Stay safe. Don't force trades
I have red positions on EJ EU EA none that are detrimental to account. If I think I should close these trades I usually go cutting in increments -25% then wait to see how PA is going. Basic idea is getting in incrementally and getting out same manner.
Trading any system requires good sample size. This is true for this system as well. Having some red trades are normal but you must look at the overall quarterly manner. Zoom out don't get depressed by your trades now. You must develop the confidence in trading. Rough rides and green rides all part of the game.
Some books influenced me greatly and this one in particular
From "Bird Watching in Lion Country"
"RISK MANAGEMENT
Lastly, but very importantly, the issue of risk management. How to take and protect your profits, how to manage your downside. Being able to manage your out-of-the-money positions and minimize your down-side is a crucial aspect of trading success.
Sometimes it is easy to make profits but hard to keep them. Exactly the same problem that keeps traders from being successful in general is also applicable to risk management in particular. It has become fashionable to bandy about the concept of stop losses and where to place them. My risk management actually starts with my 4x1 strategy, and particularly low gearing (small position size). It is no good having a sophisticated risk management strategy and then blowing it out of the water with too high gearing.
“Cut your losses and run your profits” is an old trader’s adage. I subscribe to it in principle but it is often misunderstood. The higher your gearing the seemingly more attractive the adage – you have to cut losses or you are dead. I don’t like that approach. It is unsophisticated. Again the mysterious impact of randomness will confound and confuse many oblivious to its prevalent role in any trading system, especially its destructive role in mechanical, mathematically formulated entry-based systems. I have a different approach using, multi entry, low gearing strategies that do not stop future profits by cutting existing temporary losses. Positions need time to mature and you can’t expect them always to be in the money minutes, hours or sometimes even days after you have entered a trade. Any trade should be able to spend some time on the wrong side of the tracks without you sniffing your nose at its potential profitability."
Traders who place stop losses 10-50pips are going to be taken out. Market is designed for that purpose separate you from your money and basically are sitting ducks. There is much randomness in lower TF and this is obvious. Point is to see the bigger picture and build a swing avoiding randomness all together or minimizing its effects.
The number 1 reason most traders lose is wrong position size. Marketers usually showing guys on hot cars next to beach house pressing buttons and turning 500 into 500k get seduced by this narrative and allow greed to take over common sense.
Your broker wants you to over trade because they want your money! That's the bottom truth. Be smart play small and overcome this urge.
Remember even forums like this is not safe from brokers pretending to make shitload of money. Its the narrative they are selling not the facts.
Most errors trading my system is not system related but trader's psychological issues number 1 not able to follow instruction.
Getting in early when the price is not in the zone 61-100 getting in without regard to what PA is doing. Not closing obvious losers early etc. These issues are beyond my system and its a behavioral problem. Sometimes bad habits carried over from other systems etc. This is not unique but very common problem in trading in general. Takes real effort to follow instruction and you must work on yourself. No system can help if you are unable to follow instruction.
stick with the rules and you'll do fine. lot of traders simply can't follow instruction. Easiest thing is to press the mouse hardest is to wait and press right time.
Went over every one of my trades thought about things, mistakes ,successes why's etc. Here is what I deduced in essence what trading is. Controlling risk and your own greed.
My control of my risk is trading small and spacing my entries however even then it’s necessary at times to pull the plug and close all losers. Have done this many times this year EG UJ AN etc. and that's normal since we are dealing with probabilities.
It’s important you stay focus whatever system you choose to trade 123, TMS, PASR, Naked etc. Does not matter which system you choose but once you choose it focus on it 110% and give all you have. Its keep learning, refining your understanding of a system and over time mastering it. Mr Pip mastered harmonics same as CNtrader but I am sure it took many hours of hard work. What I am saying is there is no magic system or formula in trading master whatever you choose to focus.
In ART usually if you are a painter you focus on watercolors or oils or acrylics and each medium takes years to master specially watercolor. If you jump from medium to medium without mastering any of them you would be sub par artist. Trading is an ART in my opinion and hard work. What you read in books is different in real life because in real trading you are faced with your demons.
Point of my post is focus on pivots and get real good at it. Its not the only way to trade but its logical to comprehend.
Obviously MM's decided to clean all stops and drive the Euro up. Was there fundamental reasons? I could not find. Yes there are times when pivots fail hence why I always say trade small and stagger your entries.
EA in particular is primed for correction. Can it go higher? Yes since I don't know the future that's possibility. Stay safe. Don't force trades
I have red positions on EJ EU EA none that are detrimental to account. If I think I should close these trades I usually go cutting in increments -25% then wait to see how PA is going. Basic idea is getting in incrementally and getting out same manner.
Trading any system requires good sample size. This is true for this system as well. Having some red trades are normal but you must look at the overall quarterly manner. Zoom out don't get depressed by your trades now. You must develop the confidence in trading. Rough rides and green rides all part of the game.
Some books influenced me greatly and this one in particular
From "Bird Watching in Lion Country"
"RISK MANAGEMENT
Lastly, but very importantly, the issue of risk management. How to take and protect your profits, how to manage your downside. Being able to manage your out-of-the-money positions and minimize your down-side is a crucial aspect of trading success.
Sometimes it is easy to make profits but hard to keep them. Exactly the same problem that keeps traders from being successful in general is also applicable to risk management in particular. It has become fashionable to bandy about the concept of stop losses and where to place them. My risk management actually starts with my 4x1 strategy, and particularly low gearing (small position size). It is no good having a sophisticated risk management strategy and then blowing it out of the water with too high gearing.
“Cut your losses and run your profits” is an old trader’s adage. I subscribe to it in principle but it is often misunderstood. The higher your gearing the seemingly more attractive the adage – you have to cut losses or you are dead. I don’t like that approach. It is unsophisticated. Again the mysterious impact of randomness will confound and confuse many oblivious to its prevalent role in any trading system, especially its destructive role in mechanical, mathematically formulated entry-based systems. I have a different approach using, multi entry, low gearing strategies that do not stop future profits by cutting existing temporary losses. Positions need time to mature and you can’t expect them always to be in the money minutes, hours or sometimes even days after you have entered a trade. Any trade should be able to spend some time on the wrong side of the tracks without you sniffing your nose at its potential profitability."
Traders who place stop losses 10-50pips are going to be taken out. Market is designed for that purpose separate you from your money and basically are sitting ducks. There is much randomness in lower TF and this is obvious. Point is to see the bigger picture and build a swing avoiding randomness all together or minimizing its effects.
The number 1 reason most traders lose is wrong position size. Marketers usually showing guys on hot cars next to beach house pressing buttons and turning 500 into 500k get seduced by this narrative and allow greed to take over common sense.
Your broker wants you to over trade because they want your money! That's the bottom truth. Be smart play small and overcome this urge.
Remember even forums like this is not safe from brokers pretending to make shitload of money. Its the narrative they are selling not the facts.
Most errors trading my system is not system related but trader's psychological issues number 1 not able to follow instruction.
Getting in early when the price is not in the zone 61-100 getting in without regard to what PA is doing. Not closing obvious losers early etc. These issues are beyond my system and its a behavioral problem. Sometimes bad habits carried over from other systems etc. This is not unique but very common problem in trading in general. Takes real effort to follow instruction and you must work on yourself. No system can help if you are unable to follow instruction.
stick with the rules and you'll do fine. lot of traders simply can't follow instruction. Easiest thing is to press the mouse hardest is to wait and press right time.
Went over every one of my trades thought about things, mistakes ,successes why's etc. Here is what I deduced in essence what trading is. Controlling risk and your own greed.
My control of my risk is trading small and spacing my entries however even then it’s necessary at times to pull the plug and close all losers. Have done this many times this year EG UJ AN etc. and that's normal since we are dealing with probabilities.
It’s important you stay focus whatever system you choose to trade 123, TMS, PASR, Naked etc. Does not matter which system you choose but once you choose it focus on it 110% and give all you have. Its keep learning, refining your understanding of a system and over time mastering it. Mr Pip mastered harmonics same as CNtrader but I am sure it took many hours of hard work. What I am saying is there is no magic system or formula in trading master whatever you choose to focus.
In ART usually if you are a painter you focus on watercolors or oils or acrylics and each medium takes years to master specially watercolor. If you jump from medium to medium without mastering any of them you would be sub par artist. Trading is an ART in my opinion and hard work. What you read in books is different in real life because in real trading you are faced with your demons.
Point of my post is focus on pivots and get real good at it. Its not the only way to trade but its logical to comprehend.
There is a method to the madness.