Journal of a Struggling Trader like You - I am pannet1

dear Exnav,

i am totally screwed up in the mind. yesterday, you know i was holding on to the long scout. After the news when the breakdown happened, when i the 1st sign of retracement came, i did not enter.

when the 2nd sign of retracement came, i entered and price turned against me. Almost exact price action is depicted in the US oil, below.

when the day close was nearing when the final attempt of rescue with 10X was pushed, there was not follow through, or i could not withstand till the 10 point retracement, in my favor.

As such when the end of the day approached i have turned with a net of -1, for overnight (1,3,-5). the overnight opened with the benefit for bear and that was paid back to the market when i tried another -4. Look at the noise on 5 minutes (right side).




dear phil,

consider me as a someone starting in trading with a small trading account (micro account) and relate all the below with that.

reg mm: i am trading with the least possible size as my 1x. attack and rescue is rigid. attack (1,1,2 ..) and rescue (1,3,8). with the demo account, i would not flip when rescuing unless the trend i am fighting against is exhibiting long legs.

market structure: i would mark my war zone with a channel and insert scout by the angle its making. whenever the war zone is breached, the maximum toleration level is till the channel becomes horizontal, cos usually this is where the final push back into the channel happens. if we are beyond this, usually it means we need to turn and mostly this will confirm with the opposite trend on higher time frame.

mindset: killing the scout is never plan and as chief said i could not lake the loss. however, when i am turning i am actually killing the scout + first level of rescue (1+3) and opening a new position (4).

after so many years, when i thought that i had the niche, somehow, it did not fall in place. seriously considering quitting.

ps: my wife is working hard in a regular job and instead of supporting her with another income, i am actually bleeding the family in the name of trading.

Dear Pannet,

I cannot be the one who would try to convince you... I've interrupted trading due to health condition. Not because I cannot see the screen but my mind is disturbed - I have another physical issue directly affecting my ability to trade (I'm not a robot). The same is regarding any judgement. I would afraid it could be inadequate from my end.

Perhaps, it would be better if you took a break and try to look at the things as objectively as possible, be critical and honest, don't jump to any conclusions at once, take that much time till you are in sound mind.
I would refer to John Hill's writings more than 40 years ago: "Many skilled...have reduced... price movements to an exact science. They are doomed to failure from the start, as human emotions are not an exact science...
Risk is the only thing you can control...
A person may have all of the finest technical tools available and yet be unable to make money at this business because of his personal psychological makeup... Personal financial decisions are highly emotional.
You must find out where you fit and what your psychological makeup is, if you want to be successful in this business. When you know your internal strengths and weaknesses, you can build on them".

I presume that you know that "niche" is very individual. E.g., maybe paradoxically, my best trading performance used to be when I was fully employed (had a permanent job not associated with trading at all).

Your own admitted statement might be a motivating (positive) and disturbing/ destroying (negative) factor at the same time.
Niche must be in making (developing or adapting) your life better and positive.

I wish you good luck.
Exnav

Thanks Exnav. I won't need to tell you that there are alternative ways to input the trade. Joystick, Voice, a Deputy or any technology to enhance the faculty that is affecting the trade. It is just a wish. Sorry if this was not needed advice from me. If so kindly ignore.

A sum of amount I am trading is already a part of my wife's blood money (don't know if this is correct word). Beyond certain point, whatever I may think or say may be irrelevant, because the bottomline will do the talking. The loss is quite manageable. Otherwise, in future, i have to stare at the NOW, only to realize that his was more financially sound moment.

True, this echos with what the master had taught me about the TA fallacy. With a variable lot size, when I am trying to average the basis, there is a thin line between scout is taken home and captured by the enemy. Master never told not to kill the scout when your view is wrong. This (not killing the scout) is just a doom, i have created for myself. Of course, this is where the problem is when the Risk is not controlled and quickly escalate. Amongst options writers there is a saying that they eat like a rat and shit like an elephant. This seems very true with my MO, where scouts earn like a rat and rescue shit like an elephant.

This is just an Avatar for this M.O. I am quite flexible. May be the demo account psychology did its part.

The script you told is very familiar. We have a group of local trader that often meet. One trader was making profit Year on Year and when he quit the job, the loosing streak started. Two things here, you did not have time to monitor the trade and had a strict stop loss. second, the comfort that you need not earn with trading for the living is a huge advantage. He also automated his trading, just to avoid the emotional part of managing the trade after the entry. But it ended up that he started circumventing the system by manually punching counter trades. In fact, my local trading mentor says this is the compulsory part (not to be dependent on trading income for living) before even start trading.

Hi pannet1

Sorry for the late answer but I am away sorting some other stuff out and this is the reason as I said my trading in mainly over a longer term ATM.

Reading your post to me I can see you have not fully understood most of the TAF thread as you said to me a short while ago you knew you were lacking in this area, I will not pick apart bit by bit your post to me my friend but I will give you a summery of my thoughts on your post that you asked me to consider.

In our friend fti’s thread he said we should not use more than 10% of our net worth for trading purposes and even that should be sub divided, with what I have read about your trading activities as a whole I am guessing you are at least near if not over your 10% by now, if this is the case my advice would be to at least take break and earn back that lost ??% somewhere else before you start again, that does not mean you can not still practice in demo when you have chance too and continue to learn during this time, our friend Exnav has also given you some very valuable advice and guidance.

I am sorry to have to so honest and blunt but you are not in a good place with what you have recently described as per your trading money and not being total open with your family means you have caused yourself a severe trading mindset issue for now, the fact that you have to produce an income only makes this situation worse for yourself and will lead you to make many mistakes and lead you to very dark places you really do not want to go, the end of the day it is only you that can make the decision for you and what you do with your trading, whatever you decide I will be here and you can contact me either here or my journal or other to try to help you with your trading at any time and I will do what I can to show you what I do, though a lot of it is already on my journal and I will continue to post more there when I can, so maybe you would like to study what I have done there first to get some ideas for yourself to help create your own MO.

Whatever you decide to do my friend, I really do wish you the best of luck as I said you seem a really nice person and we do not come across those as often as one would like.

Regards

Phil.

Dear Pannet,

You are welcome. And thank you for the feedback.
If I may, I suggest you appreciate and take Phil's generous advice and offer. I should re-read the post taking some time for reflection before any reaction (response).

As far as I'm concerned, I'm visiting my doctor this afternoon and will probably go through medical exams and treatment. After that or in between I'm going to travel for a month approximately.

If/ when I'm in good shape, I might re-start trading the following ant's way: a tiny scout and adding having all possible (technical/ fundamental) odds in my favour; not adding anything significant if mistimed; cut in adverse condition not letting loss exceed 3-day-profit; aggressive attacks only when foreign capital is accumulated. Remember, we agreed that we can control risk solely. Otherwise, apart from necessary/ mandatory discipline it's the only rigidity I must adhere to. Until then, I remain a theorist and reader on TAF and some other Friendly threads.

All the best.
Exnav

Dear Exnav,

Thank you. My heartiest wish that everything happens in life as you wish.

Dear Phil,

I agree that trading psychology has to be right. Trading with loaned amount and on top of that trading with a 14% loss. The 14% loss itself is luckily not on the full loaned amount. As mentioned earlier, I have loaned back to back to another trader who will return me a fixed guaranteed income month on month. There is slight problem with this arrangement. That is a different issue altogether. I hope that will be soon taken care of.

The Dance: Market will teach me and nobody can. I can read the pilot's manual here (your journal). Still I need to fly the plane myself, to learn. I am telling this to focus on what you can teach me or rather what I can learn from you.

Please really tell me exactly on what is wrong with my AA) Money Management BB) Market Structure CC) Mindset. which you emphasized in the earlier post. I request you to forget that i have a loan and I am down more than 10% of my trading capital, for a moment.

Having you decided to take the whip, this can further divided into two categories.
1) The difficulty for you might be, that certain thing may work for you but not for me. So you may be very careful not to reveal it so that I don't have a rigidity. Here you may hint at what you are doing and I promise you that I wont copy you.
2) This is the important thing, that I can simply adopt from you. You have now observed what I am doing (MM, MO, rigid breakout entries, wave counts, trying to align with the daily trend, etc etc, channel angles).

or without knowing to Dance properly all other things don't have any meaning.

I believe your reply will be last post on TAF i would every need.

Note: I may have to look at trading some other instrument (mostly options) with much higher R/R. It may take everlasting time. Immediately I may not be trading. I am traveling and will be away for a week. So strictly no trading but I will be visiting this place eagerly to hear from you. Please take your time.

Hi Pannet1

Sorry for the delayed response but only got back home to the UK late last night and this response will be long so I had neither the time or can type out long responses on a phone or laptop while I was away, tech is not something I enjoy playing with due to my age I guess, I am more comfortable here at home on my desktop doing such things, even trading is much harder from my laptop and impossible for me from my phone! Unlike some others who are very comfortable doing this on all devices… here goes..

Quote….
The Dance: Market will teach me and nobody can. I can read the pilot's manual here (your journal). Still I need to fly the plane myself, to learn. I am telling this to focus on what you can teach me or rather what I can learn from you.

--- Yes my friend, you understand this part very well now… I can not ‘teach’ you… YOU must learn from wherever?? (not only me) and by practicing what you see and read for yourself to see if ‘it’ fits with YOU.

Quote….
Please really tell me exactly on what is wrong with my AA) Money Management BB) Market Structure CC) Mindset. which you emphasized in the earlier post. I request you to forget that i have a loan and I am down more than 10% of my trading capital, for a moment.

--- now you want me to write a book many pages long? I can not do as good a job as our friend FTI and certainly would not even try too… but let us start with some basics on each point from the way I see it and trade… if you are consistently making money then do not try to fix that what is not broke and ignore what I say…

AA. MM.. all money management relies on YOU knowing how best to make use of you capital to create a favourable end result, there are many ways to do this, I can not list and deeply explain all again (it is already on my journal or what I know of it so far anyway), the whole basis is we use a scout to ‘test’ to see if we may be correct in the direction we have currently chosen, the scout MUST be expendable or it will not be able to do the job you gave it or you may as well just enter and ‘hope’ for the best luck wise, we want to not rely on ‘luck’ but ‘skill’ for our trades, so now hopefully you can see why we MUST USE AN EXPENDABLE SCOUT/S... then comes the actual entry/ies once the scout has proved you MAY be correct in your thinking on direction, there is a basic rule with the scout and your actual entry/ies, the bigger your actual entry or combined entries are relative to the scout size the better chance you have of making money, now this MUST be used in conjunction with your account size so as not to over expose yourself with your actual trade size at any time, you can only learn your own tolerance and best practice of this via testing and trading for yourself, first in demo then in live, so if you use 1 to 3 (1,3 or 1,1,2 or 1,2,1) you will roughly have that size chance (1/3) of making money (if you use your scout/s correctly), if you use higher say 1 to 16 (so anything like 1,16 or 1,3,5,8 or 1,8,5,3 or whatever to make 1 scout and 16 entered) you will roughly have that chance (1/16) of making money (if you use your scout/s correctly), there is also another trick (for what of a better word) that is too top load (this creates a better ‘average price’ if correct and may save entering all if wrong) and use different size scout/entries according to what you see and feel may happen, recovery should only be attempted when your market ‘read’ is very developed and top loading also gives you a chance of a lower trade to recover if the market goes against you after say the first ‘actual’ entry (not all trades should be recovered).

BB. MS, I have a feeling you are confusing market structure with the ‘market price read’ (as I call it -MPS), the market structure is the way in which the market is structured and how the money flows through its tiers down to us ant’s making our entries at the bottom of the pile (refer to FTI’s explanation of it here in the first 200 pages of TAF, in picture form it is the birds sitting on the poles pooping on the lower ones that he posts), the ‘read’ forms from the money passing into and out of the pairs we trade creating the charts. I am just starting to document the ‘read’ on my journal, but it is generally taken from the basis of the masters of T/A. Jupiter has and is covering it in depth in his journal.

CC. MS, ahhh mindset, for this you need to know yourself and know your enemy! Your enemy is two fold, it is the market battle you are currently fighting (market structure and the read) and YOU, I do not know you, all I can see are words that you tell me which gives me only a slight insight into what you DO, not who you are or your reactions to things, what is going on in your life now and how you are feeling and how this affects YOU and makes YOU do the things YOU do, my friend for this no one can help YOU, this is only something YOU can learn to control and understand, the mind is a balancing act of chemical releases, each of us triggers those releases that then cause us to react (in some way) at and to different things differently, you need to research how you/we work to know yourself and understand it and learn then to gain some control over the releases that cause TOU to DO the things that can harm your trading, mainly this about the ‘fight or flight’ mode we enter when doing something and broadening our own personal comfort zones to allow us to do things in a more relaxed way so we can ‘think’ logically what to do rather than react to something, it is like doing something dangerous.. say base jumping from tall buildings, I give you a parachute a just say now jump off this building, will you just do it? I suspect not! But many do and they enjoy it, they even think it is relatively safe to do….ask yourself WHY?

Quote….
Having you decided to take the whip, this can further divided into two categories.
1) The difficulty for you might be, that certain thing may work for you but not for me. So you may be very careful not to reveal it so that I don't have a rigidity. Here you may hint at what you are doing and I promise you that I wont copy you.
--- I am not so worried if someone copies me but I try not to let that happen by the way I post trades now because I have had people PM me because they could not handle the heat of what I do, not my fault but just altered the way I post my trades to stop this, if they do that and they mess up because of their lack of the same experience as me, then that is their fault, I keep saying you train well first before trying to trade, I have given enough warning and continue too do so, I do not use big trades for demonstration purposes so as not to attract the wrong attention, if you are able to use your own brain you can see what I am doing and how it can be multiplied up and adjusted to suit your own MO, if not then my journal is not worth them reading.

Quote….
2) This is the important thing, that I can simply adopt from you. You have now observed what I am doing (MM, MO, rigid breakout entries, wave counts, trying to align with the daily trend, etc etc, channel angles).
--- my personal opinion and please there is no offence meant here by what I say but on this it seems to me you are currently using these things mainly how the ‘mainstream’ teach you which is not in my opinion to our advantage, I will continue too and have already on my journal tried to show what I do and explain things the way I see these things and a lot more, as you said this may or may not be right for you, it is good you understand this. I myself went down this ‘mainstream’ road, it is hard to admit too yourself you have wasted so much time learning their rubbish…. But then you become to eventually understand you did not waste your time but could use this knowledge against them! My experience of it anyway.

Quote….
or without knowing to Dance properly all other things don't have any meaning.

--- the dance (to me) thing is a blend of all the notes of the disciplines being used in harmony to create a tune (your MO).

Regards

Phil.

p.s i am sorry but i will be away a lot this year and some of next, i am only back in the UK at my desk for about another 2-3 weeks before i have go away again for likely about 4-6 weeks. i will as said answer and try to help where i can and when i can.

Thank you my dear Phil,

Very kind of you. I don't know know if I will be trading any sooner. I did not get the part, if we use 16X, you say, we have 1/16 chance to win. Does that mean the more lots we use lesser the chance gets to win.

Rest, I will learn from your journal and post questions there, if that is OK, if not here.

My love and gratitude to you my friend.

Cheers.

Hi pannet1

Not sure if anyone can speed up the learning process over the internet as this takes experience of things only and trading has to be the hardest thing to learn to do that I have ever taken on myself, for a lot of it you have to find things and ways that fit with you and we are all different in our tolerances and judgements according to what we have experienced so far in life, but sharing our own experience with others may help a little.

Let me try to explain the 1/16 or 1/3 thing, the scout is the 1, the 16 or 3 is the entry, scouts must always be expendable, so let us use some fixed rigid numbers for the sake of explanation of this,

How many times in a row if you are reasonable at reading p/a will you be wrong? Maybe 4 or 5 let us say on a bad day/run (though after 3 wrong on one day I would stop to be honest), let us also say we only make 20 pips on each move and again for arguments sake only let us say we use stops at 10 pips, so take the max of 5 wrong entries X 1 entry (be it 0.01 0.10 or whatever), let us use round numbers of 1 lot here, your loss is 50 lots (assuming you do not get past scout stage), then on the 6th entry you hit the 20 pips, you win 1Xscout + 16Xentry, so 17X 20pips = 340 lots, so minus your 50 lots loss = 290 lots won.

So now do the same with 1/3 again we know we have a 50 lot loss from above, our win is 1Xscout + 3Xentry = 80 lots, you still win but only by a little = 30 lots won.

Making mistakes/getting things wrong is part of trading but which money management could help to build the account quicker?

This is just a very basic example and I am not a fan of always using stops or fixed numbers to trade, it is not how I trade and of course other factors play a role when using the skew entries.

The problem comes when you let your emotions control you and take a profit as soon as you see one instead of reading the p/a in the now to stay with the action, using stop losses at set targets will make you a target for the market unless you know where and why they target certain area, they try to always get you to do this so they can kill you with a thousand cuts, what I am explaining is the basic maths principle of the win to loss ratio according to the sizes you trade, you do not have to use all ??? (16 say) as the second entry, you see me break it down with the skews and adjust according to what I see/think the risk of the move is.

My friend post where you want and feel comfortable doing so, be it here or my journal or direct, you are very welcome to ask what you want and if can explain I will try to.

Regards

Phil.

Thank you Phil,

I read 1/16 like marks (as in mark sheet). I get now that i need to read it like in "chance". So more the lot size at our disposal the odds are in our favour. 1/3 will have only 3 chances for the run, while 1/16 will have 16 chances. Hope I am correct this time.

https://www.forexfactory.com/attachm...1&d=1566833278

Dear Phil,

W.r.t to badly time EU trade, the trigger for you to buy on was on M1 time frame after the spike down below showed you the presence of buyers right? You were into rescue mode once when it started to trade below and took loss on 1+8+13.

If we should not draw our bias from higher time frame because new trend emerges from lower time frame, then what is the purpose of having higher t/f screens alongside M1. only when the trade goes wrong we zoom to higher t/f. it is just for the convenience you have lined up additional M15, H1 and D1. Is my understanding correct?

You are essentially taking the concept of LL & HL and HH & HL to the smallest time frame possible. But are the smaller timeframe prone to more whipsaws? I think that you are using it anyway to enter your scout and test the battlefield.

Hi pannet1

Yes my friend, you are correct, I am talking about how to put the ‘odds’ on you side better with that very basic part of money managing.

When we start a trade we never know how long it will last, sometimes it is better to just kill the trade even when you have made the troop entry, especially if that trade is still very young and you can see it is going wrong, part of trading is totally accepting that you can not always be correct in your entries or timing and death is an inevitable part of war I am afraid. Better to walk away than fight sometimes.

From what I understand of our friend fti’s thread the basis that he uses is to watch the market wheel (USD) and trade from that as too where the money is flowing, it is impossible for me to show all my charts and write on them everything I see happening all the time, the nearest thing I can do is reference the USDX chart as I have done in some trades, daily flows are in the hourly charts, where we are in the current move is in the daily chart, our trading charts are the lower time frames, some choose M5, I like to use M15 and M1, it is just personal choice what you use and what suits you the most.

For me M1 is only any use to me when we are near a possible area of interest that I think I may find a trade in or if M15 is possibly showing a retrace for instance, as you say unless you are trading in the very short term then M1 is to noisy for the sort of trades I want and do, there is nothing wrong in trading in M1 but you must be constantly skewing in and out and changing direction very quickly, I used to do this and to be honest it is very hard work and mentally draining so I chose to trade over a slightly longer period of time, which means I may have to wait for trades to start to happen often, where as the M1 trader can sit there and find trades pretty quickly. I have actually now met with other tier one traders and they trade over very short terms day trading, rarely will they leave a trade overnight, but they are using millions (yards) to trade in so every pip is worth a small fortune to them. We cut our cloth according to our size as they say.

The way I try to trade is mainly based in dow theory and newton’s laws, I find this suits me personally, I do know and have researched all the other stuff but for me it just seems to overcomplicate it for me so I settled into the above things, maybe I am just too stupid to understand the rest properly? I do not know and to be honest I do not care, I just do what works for me and I am trying to explain that in my journal that is all, it is not meant to be a full on strip down of our friend fti’s thread, though that is where I learnt the vast majority of this stuff by trying out and testing the things I read there and could understand with some help from fti along the way which I will always be very grateful for, to be clear here I have never even exchanged so much as a PM with fti all that I was helped with is on his thread for all to see.

Regards

Phil.

Hello Pannet1,

forgive me if Im interrupting your thread. Maybe I can contribute some to the discussion.



phil,

I have a question for you if I may. Im just curious if you ever use the USDX to time trades/rescue . I know that watching 3-7k's pretty much the same thing by getting an overview of the market but I am wondering if you take hints from the USDX as well?

Hi dbrown101

How are you my friend, hope you are doing well.

Short answer …yes.

All currencies go through the market wheel to become the cross, I have found it to be a good lead to some moves (not all, nothing is the grail), when trading the USD pairs they often move after, there are also ???X’s for other majors but finding a good reliable source has been an issue for me, I find one that works for a while then they seem to have problems, most are not taken centralised unlike the USDX for most, the ones I found so far do not seem to last long, do not like paying for something to find it is not what it says it was, had that too many times when I started. The USDX I use is with my broker.

look at what it has done today...H1/D1. now watch retrace and other USD pairs. clue next --> (top should not be taken out).

Regards

Phil.

Pannet1,

Again, my appologies if I am interrupting your thread...



Phil,


I have posted on my journal as to not side-track your converstation with pannet1
https://www.forexfactory.com/showthr...1#post12481571

cheers,

no probs. you are free to do whatever you like to.

Hi pannet1

So been thinking, your issue is you can only trade certain things in your country, like I see you trade oil, so you should be watching oil related currencies as well, U/C and USDX come to mind and may help you see some moves maybe? Me talking about currencies is only of limited help to you my friend. I do not trade oil so have very limited knowledge of it but there must be a similar way you can blend the related things together as we do with the kingdoms.

Regards

Phil.

sure my friend. just suppose today morning (+17.50 GMT) when i look at the charts and find Canadian got beaten down by USD the previous session. so in the 1 Hour USD is strong and i expect CRUDE to go down, but on the minor time frame in which i am trading the now could be retracing the whole day, so my CRUDE shorts will go to deep waters. Of course, the skillful player would be cautious and i get your point. It seems the skill is the problem.

the basic price action should be same with all instruments, of course every lady will have her own character. i am presently looking at the stock exchange in our country where i could buy a stock for $1-$2 / share. i could use the fibo lots to my advantage. planning to re-average with rescue in the form of 1,3,13,34 and close everything at the end of day. problem with shorts is i cannot extend it (no short selling overnight in our exchange). futures are available but very costly (more quantity multiplier)

Hi pannet1

I used to trade stocks, my experience was not good, what about trading your exchange index and sectors? if I were to have to trade stocks again I would only trade the indexes and the sectors, not an individual stock ever again, the lower the value of the stock the worse they are to trade in my experience, please be careful doing this, at the end of the day it is your choice just saying about my experience of it.

You are correct I believe that whatever you trade it should be similar to trading currencies from a t/a point of view and yes each will have its particular slight difference, the skill itself is a combination of the read and your management of the trade in relation to your account size.

Regards

Phil.