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4% A Day Forever

  • #281
  • Sep 15, 2009 6:07pm Sep 15, 2009 6:07pm
Quoting PeterFM
The other question is - if you are a scalper what are you doing 230+ pips in the hole?
Thanks, Pete...

Panic. Was scalping E/U short and it was slow so I started scalping XAU. Made about 500 pips on 3 quick scalps on XAU and spaced out the E/U short I had, got back to it & it had spiked against me. Started adding to average down. Did so poorly. Did not take a few exits that presented themselves for bad but not terrible losses. That's not even all but basically just a chain of stupid decisions.

You are right, though. A scalper should not try to scalp more than one instrument at a time & any trade should at least have an emergency stoploss applied.

I am going to concentrate on developing a niche & staying within it.

Today, I am going to see what happens near the Tokyo open. There have been some bigger moves down in last few days near the open & if China or other big Asian players want to do that today at $36/pip I won't complain and it is worth the wait. If no such luck and it goes the other way then I am out.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #282
  • Sep 15, 2009 6:09pm Sep 15, 2009 6:09pm
Dude I read your thread all the time, you certainly seem to have a lot of potential as a scalper and seem to do well with the scalping end of it. But you absolutely need to stick to a firm set of rules, you seem to have a lot of talent as a trader but you have no discipline and without discipline you may was well give up.

There is no retrace in sight for the eur/usd get out now and start the recovery process now.
  • #283
  • Sep 15, 2009 6:17pm Sep 15, 2009 6:17pm
Quoting Jigsaw
Sad to hear this . . .

I read this thread all the time, literally every post. And I enjoy it and think you are a really cool guy. Clearly though - you have no trading rules, if you have no rules there is no way you can have any discipline.
Thanks Jig,

I would say you are spot on. I have had some consistent trading success but it has been punctuated by these blow-outs, and its all due to a lack of discipline, trading without rock-solid rules, complacency - all the usual culprits. If I can say one undeniably good thing about my current predicament, then it is that I am learning from it. Haha why did I not learn from the last one? It cost me about the same amount...

....so this is the test, isn't it? It is really no big deal to score pips but in order to keep them you have to know how to lose, as well. I am learning that, I know I am - it might take a few lessons but I will get that down.

Best Regards.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #284
  • Sep 15, 2009 9:19pm Sep 15, 2009 9:19pm
Quoting endroute
Dude I read your thread all the time, you certainly seem to have a lot of potential as a scalper and seem to do well with the scalping end of it. But you absolutely need to stick to a firm set of rules, you seem to have a lot of talent as a trader but you have no discipline and without discipline you may was well give up.

There is no retrace in sight for the eur/usd get out now and start the recovery process now.
I appreciate your thoughts endroute. I couldn't get no love at the Tokyo open, saw my drawdown hit 60%, and closed it all down.

I am working on, thinking about trading within a set of rules. Started a thread about it last week: "What Are Your Trading Rules"....

I won't be live trading again for a while, but I ain't giving up.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #285
  • Sep 15, 2009 9:27pm Sep 15, 2009 9:27pm
Quoting emtee
As you are a scalper and so am I, a golden rule is "HAVE NO OPINION".
Once you start having opinions, you end up HOPING when things are not working out - a recipe for disaster.

How I have overcome your current dilemma is as follows.

Have no stop losses.
Trade 5 contracts or more as your default quantity and never add to positions.
Following these two items keeps you focused and attentive to the market and scares you shitless when the market is not going your way, hence no problem taking the loss. Remember, another opportunity to enter is just...
You make some good points, emtee. Have No Opinion. I kinda like that. I think I can agree, too - the smaller the tf, the less an Opinion, the less the grand illusions of Macroeconomics even matter at all. Just you and the price action. I have been demo trading on the 5-sec chart lately (ala Tony112) and that's the purest form of pip-hunting.

Trading large enough to scare you out of complacency: hmm, you have something there, too, I think. Do you do so within the typical MM confines, ie, <1% per trade (or thereabouts)...? And do you shut down after a given number of losers?
"If The Fool persists in his Folly he will become wise." - William Blake
  • #286
  • Sep 15, 2009 9:37pm Sep 15, 2009 9:37pm
Quoting The Fool
I won't be live trading again for a while, but I ain't giving up.
Good move, Fool. And good attitude.

Have you had a chance to read Trade Your Way to Financial Freedom by Van K. Tharp? Snag a copy and read it during your down time.
  • #287
  • Sep 15, 2009 9:43pm Sep 15, 2009 9:43pm
Quoting opie999
Good move, Fool. And good attitude.

Have you had a chance to read Trade Your Way to Financial Freedom by Van K. Tharp? Snag a copy and read it during your down time.
Hi opie,

Reading it right now, as a matter of fact - along with "The Daily Trading Coach" by Steenbarger.

I'm gonna shine some light on this fuckup for a nice long while & see if I can't start to think my way out of some bad habits....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #288
  • Sep 15, 2009 9:49pm Sep 15, 2009 9:49pm
Awesome. Your journal will be waiting for you when you get back.
  • #289
  • Sep 15, 2009 10:12pm Sep 15, 2009 10:12pm
Hi "The fool"

It is neat. I do not have to read the wsj, watch cnbc or listen to anyone. I just pay attention to the news events via forex factory and stop 5 minutes short of that time and then pick up about 5 minutes after the news.
I have been trading demo now for 12 months and when I get my first month of at least 15 days of meeting my goal, then I will go live with $20000. To trade 5 full contracts, you use $15000 margin, so that will give me a cushion of $5000 to lose. If I lose that $5000, then I will go back to the demo. That is my plan.

I start trading at 7am cst. My goal is to make 20 pips/contract or $1000 and quit. If I start off badly, then I must quit when I am down $1000. The last 2 days I reached my goal before 8am, however I must admit, it is extremely difficult to quit so early. I do not quit trading just because I have 4 losers in a row, because typically 2 winners will wipe out the 4 losers. The important thing for me is the 20 pip total loss or $1000.

I am pleased for you that you took your big loss. When I used to get in that position often, my stomach would be churning for days and I finally figured out that you cannot trade if you are on the wrong side of the fence and you are not getting the enjoyment you should be getting if you were on the right side of the fence. It took me a long time to eliminate that behaviour.

regards
emtee
  • #290
  • Edited 10:38pm Sep 15, 2009 10:22pm | Edited 10:38pm
Quoting emtee
I have been trading demo now for 12 months and when I get my first month of at least 15 days of meeting my goal, then I will go live with $20000. To trade 5 full contracts, you use $15000 margin, so that will give me a cushion of $5000 to lose. If I lose that $5000, then I will go back to the demo. That is my plan.

I am pleased for you that you took your big loss. When I used to get in that position often, my stomach would be churning for days and I finally figured out that you cannot trade if you are on the wrong side of the fence and you are...
Well, emtee - you got stones for starting large. I hope your plan works out. I could tell you that there is a big difference between trading demo & trading real $, but I know you have read that & you'll just have to see that for yourself anyway. But if you stick to your plan I bet you will do well. Link me to your journal if/when you have one so I can follow along.

Edit: Oh, cool, I see from your profile you were a CME pit trader ~30 years ago? That must provide some perspective. It would be interesting to hear abou that sometime....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #291
  • Sep 16, 2009 5:46am Sep 16, 2009 5:46am
Just checking in.

Just use a hard tight stop and stick to your bread and butter-scalping.

Hang in there.
  • #292
  • Sep 16, 2009 6:28am Sep 16, 2009 6:28am
Fool, sorry to hear that 60% sucks, I've been there with more like 90% losses in a single well hour doing the averaging thingy against the trend it sucks for sure and blows your confidence well mine couldn't make any profit after that.

But you'd made some $$$'s so -60% doesn't put you to far off your 10K start figure does it ??

Emtee thats the bravest way to start I've ever ever heard of, nice use of the Margin to limit your losses to, still crazy though good luck with it
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #293
  • Sep 16, 2009 6:34am Sep 16, 2009 6:34am
We've all been there.

I blew two small accounts in my early days by letting losers run because I expected them to turn or come back, they NEVER do and they always turn AFTER you close out for a massive loss.

It happened very often in my demo accounts so what did I do? Never let a loser run on, take the small hit and take a step back, there's ALWAYS more trades waiting for you so why waste an account.

I now use very tight stops, 10-30 pips in reality, most are orders (yes, not mental) and they still work - in the right place of course.

It's the hardest thing to do, cut a loser and take the loss but traders must realise it's the ONLY thing to do.

Disciline is paramount to success.

Keep your head up, run with the demo and make sure you keep this journal up-to-date even if it is demo/sim trading.
"I made all my money by selling too soon"
  • #294
  • Sep 16, 2009 6:56am Sep 16, 2009 6:56am
Quoting Bleek
We've all been there.

I blew two small accounts in my early days by letting losers run because I expected them to turn or come back, they NEVER do and they always turn AFTER you close out for a massive loss.

It happened very often in my demo accounts so what did I do? Never let a loser run on, take the small hit and take a step back, there's ALWAYS more trades waiting for you so why waste an account.

I now use very tight stops, 10-30 pips in reality, most are orders (yes, not mental) and they still work - in the right place of course.

It's the...
Actually they often do turn back, Fool's been getting away with averaging down and enough market chop to get away with this a few times, it's just you only remember the one that margin calls you, risking 80% of your account each time you do this will eventually lose you 80% ofcourse.

You need a meaningful line in the sand, market moves over X then you know your odds on it going your way are low and thats where your SL should be, perfect no ofcourse not but better than this.

And you need to know that if you average down with that line over all you'll still be making a profit.
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #295
  • Sep 16, 2009 7:17am Sep 16, 2009 7:17am
Quoting Turveyd
Actually they often do turn back, Fool's been getting away with averaging down and enough market chop to get away with this a few times, it's just you only remember the one that margin calls you, risking 80% of your account each time you do this will eventually lose you 80% ofcourse.

You need a meaningful line in the sand, market moves over X then you know your odds on it going your way are low and thats where your SL should be, perfect no ofcourse not but better than this.

And you need to know that if you average down with that line over...
I think you missed what I was getting at, they never seem to turn back until you're out! I was referring to the psychological blow that these kind of actions create, it's unhealthy (in my opinion) to trade in such a way.

Of course it's highly probable they'll retrace at some stage, but that could be in a minute, tomorrow or next year!

I see little point in putting yourself through so much pain.
"I made all my money by selling too soon"
  • #296
  • Sep 16, 2009 8:00am Sep 16, 2009 8:00am
Quoting Bleek
I think you missed what I was getting at, they never seem to turn back until you're out! I was referring to the psychological blow that these kind of actions create, it's unhealthy (in my opinion) to trade in such a way.

Of course it's highly probable they'll retrace at some stage, but that could be in a minute, tomorrow or next year!

I see little point in putting yourself through so much pain.

I agree totally don't get me wrong, but its the few times you do get away with it which make you think you always will do, ultimately you'll get caught.

No body would of survived the drop in GU if caught on the wrong side last year, from 2.0000 to 1.4000 area for instance suicidal regardless of account size.
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #297
  • Sep 16, 2009 8:20am Sep 16, 2009 8:20am
Quoting The Fool
It's pretty hopeless at this point, T. Same weakness that got me into the averaging down trap keeps me from pulling the trigger on an exit. Currently sitting at -55%, margin call just about 50 pips away. Pretty close to the edge now, finally. I went out to meetings early this AM and was down about 40% at the time - came back 6 hrs later and more damage. I really picked a great time to fuck up. I keep waiting hoping praying for a decent retrace. Had one a few days back but it was just a quick spike down & I missed it. I could keep this up, closing...
Fool,

I admire your honesty and generosity in sharing your story. It takes great courage to come out and say that you made a wrong decision in front of other people.

Having followed your story a bit, I know you will move forward from this and trade again another day

Warmly,
Tanya
  • #298
  • Sep 16, 2009 8:23am Sep 16, 2009 8:23am
Quoting Jigsaw

I have it in my rules that whenever I make a mistake (Sometimes I put in too many lots by mistake, sometimes I put in market orders instead of limit orders etc) I automatically close the trade and take the spread loss for my stupidness, and it has actually cut down on my stupid mistakes over time I reckon.
What an excellent idea. I am going to start doing this, and consider it a 'training fee'.

Tanya
  • #299
  • Sep 16, 2009 8:48am Sep 16, 2009 8:48am
Quoting Turveyd
I agree totally don't get me wrong, but its the few times you do get away with it which make you think you always will do, ultimately you'll get caught.
I couldn't agree more, it's those times you get 'saved' that are the most dangerous in the long run.

It's healty to lose an account once (or twice) if it makes you a better, stronger trader.
"I made all my money by selling too soon"
  • #300
  • Sep 16, 2009 9:29am Sep 16, 2009 9:29am
Quoting babyleaps
Fool,

I admire your honesty and generosity in sharing your story. It takes great courage to come out and say that you made a wrong decision in front of other people.

Having followed your story a bit, I know you will move forward from this and trade again another day

Warmly,
Tanya
Fool,

Firstly, I agree with the sentiments expressed by Tanya - I also greatly admire your honesty to admit on a public forum that you went wrong.

I hate to see another trader lose, as we've all been there at one stage and know how much it sucks. I suffered consistent losses at the end of 2007, the period when I started trading full-time. I would advise you to treat this as a part of your tuition and move forward with your enhanced knowledge of the markets and how brutal and cruel they can, and will often, be.

The only other broad advice that I'd pass on is the obvious stuff, such as using firm s/l, drastically cut down on your leverage and place only a very small percentage of your account at risk with each trade. You are an intelligent guy, so you will be already aware of this, especially so since this loss.

Well done on cutting your position, though. I think you should take a couple of days away from the market, get your head together, perhaps write down your new trading rules, based on this experience, and pin them to your desk or somewhere you will always see them.

Finally, I look forward to seeing you coming back strongly from this setback. In the unlikely event there's anything I can do to help in terms of advice, please feel free to send a PM.

Best regards, Paul
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