Why you suck at trading

so... anyone is unclear here on those 4 random twitter screenshots and the two trade links... PLEASE let me know here, and i'll try to organize it better, or just give better examples later.

is that by having a mental "map" of where orders were likley to be, and what type, and also knowing what had happened recently leading up to this day, I knew that the drop had experienced a good opportunity for larger traders to cover with minimal slippage, but the lack of follow through would result in a need for other large traders to take price into the stops ABOVE the current daily high (asia highs), in order to close out their positions at a more "optimal" level without experiencing too much slippage.

so, knowing this, it gave me a great deal of confidence to hold my trade to basically the asian session highs, as well as about 3-4 pips off the absolute high of the day.

it's not always this good of course... and i did have some smaller entries that i took stabs at with tight stops, and they stopped out for a small loss 2 or 3 times before the real move kicked in...but all in all, a good, well considered, and profitable trade.

And... of course... knowing this type of thing helps me make money...

if you don't know how to see a chart through a similar perspective... it doesn't mean you won't become profitable someday... but, it is at least one reason why you still suck at trading right now.

Here's the joke:

A lawyer and a day trader meet up for a round of golf.

they start discussing the markets, and after a while, the lawyer exclaims:

man, that's just amazing to hear! how your doing so well, while the rest of us are losing our retirements! and you make as much as I do, but you don't have to deal with clients, or the courts, or the red tape... you get to work from home, and if you want you can take off any time you like, or just work a few days, and still do great!

Say... do you think I could come over some weekend and you show me how to do some day trading??

The trader thinks about this for a moment... and then turns to his friend and says... say... ya know... .that sounds like something I might be able to do... but first, do you think I could come over some weekend and you show me how to be a successful class action attorney??

...

If you don't get it... well, that's another reason why you suck at trading.

Not sure if this has been mentioned:

1. Overtrading: unfortunately this comes from trying to daytrade. I think you are best off to avoid that, if you have a day job and can only trade longer time-frames. It allows you to better reflect on your trades and make more thoughtful trades.

2. Revenge Trading or any emotional trade in general: again this happens especially to people who have plenty of time to trade. The ones that don't have that much time will probably tend to trade more conservatively. Also another important factor is the age factor. From my experience young people tend to be more emotional and aggressive than their older peers.

3. having a bad trading plan and sticking to it / having a good trading plan but not sticking to it / having a bad trading plan and not sticking to it. I guess 95% fall into the third category, and through system hopping will sometimes fall into the 2nd category. Main message: research your systems before employing them.

4. Overoptimization (if you program methods): if you programmed a system, then it gotta work over a variety of parameter and instruments. If it doesn't it's probably not worthwhile trading it.

and another one

expectations are not in line with actual performance:
wanna earn 1.000% a year or even more? Well, then you gotta trade a system / method that can deliver that (most systems can't deliver that performance). So what will you end up doing if you see yourself only having made 100% the last 6 months? If you are like most people who have much higher expectations, you will either overleverage to gain more return or you will hop to another system in the hopes of a better return.
What people tend to forget is that risking more doesn't always mean gaining more. There is always a point when risking more actually decreases profits in the long-term (due to the deeper drawdowns you get yourself into).
So, be sure beforehand what the system can deliver, so that your expectations are in line with the system you use.

oohhh... ya. these are all good points Cus...but I think 4 is really the "less obvious, yet more revealing" truth when it comes to trying to find that "holy grail"

robust. that's the word of the hour. learn it. use it. forget the rest!

you want an example of a robust system? find a market that is ranging, some form of consolidation that is somewhat more or less constrained between 2 horizontal lines.

the longer it remains between these lines... the futher one can expect price to move when it break out.

and this type of break out may not even retrace.

don't fade this move. ride it.

ok. so. that's the system. got it? good. go ahead, check it on your favorite stocks. on bonds. on 1hr charts. on daily charts. weekly charts. check out USD/CAD recently on a daily, or the USD/JPY this year as it moved off and up from it's lows.

check the eur/usd as it ranged last week between 2640-2740... and look what happened as it was broken to the downside.

see? this concept here works on all TF's, in all markets, and under all market conditions.

that's NOT TO SAY IT'S 100%!!!

but, it is a robust method that needs no "optimization"

some optimization may be a good thing. i'm not really a highly mechanical trader, so i can't say much other than the few areas i've used it in my own trading (maybe cus has more insight into this)....

but, if your "system" only works on the 1 hr charts of the gbp/cad during the first hour of london open on wednesdays and every other friday...

this type of over optimization is probably why your trading sucks.Well, that, and you have a system that sucks as well.

to put it more clearly: if you need to optimize your system in all but some of the more broad and robust ways... you are probably developing something thats just gonna help you suck at trading.

X

so...for those who haven't figured out what this looks like yet... look at a GBP/USD chart right about now... as it bounces off the 1.5550 low... that looks like a heck of a support level to me. and even more than that... we have 1.5500 that isn't all that far off below.

now..look at nzd/usd... check a daily chart. look at that bearish move on thursday.

now...see it pulled up to 7910ish? and has started reversing back down off that prior daily low?

well... i put 2 and 2 together, and came up with "long GBP/NZD"

I put a bit up about it on the blog, and will add more too it as I have time. here's a link: http://currencytraderx.wordpress.com...e-day-or-week/

see... it's about 30 minute later...and the gbp/nzd is already up about 20 pips from when i made that post.

but, you probably don't watch that market much, do ya? nahh... didn't think so.

again... things like this, are why you might still suck at trading.

X

P.S. it's about 2 hours to toyko open... and priceon the gbp/nzd is approx 9740. i think we'll keep moving pretty steadily on up to approx 9790-9802... then from there, we may get a bit of a stall. i'm puting this down here, both to gauge my own analysis, and to (hopefully) demonstrate how this type of "prediction" isn't impossible, but actually pretty easy once u get it down... but it takes more than this to actually do this for a living. at least, that's been my experience.

taht being said... a stall is pretty much all i can "expect"... because this seems to me to be a loaded spring... i usually don't see two markets that both look to be "on the verge" of moving pretty decisively for the next 75-100 pips. should be a cool little trade tho...

gee. you're quite full of yourself aren't you. Basically what you're trading is a "risk off" trade and could be taken advantage of on the majors where the lower spreads will likely result in the same or better outcome.

But you've set such a positive tone on your thread that I wouldn't want to interrupt you so please, carry on.

Slim, it's actually not that i'm full of myself. I just think it's really funny in an offhanded sorta way to be so crass and biligerant about why some of the reasons people who try to trade are not able to do it successfully.

check my OTHER thread, and you'll see i'm not exactly full of myself

at any rate, the GBP/NZD is up over 50 pips from marekt close on friday, and i'm up 32 pips in it myself right now.

simple? totally. Easy? like hell it's easy. if it was, it wouldn't have taken me 4 years to get it, 4 years to live it... and stil sometimes wake up feeling as if it might just all disappear tomororw.
really. check my other thread

hope you find this helpful tho, or at least mildly entertaining.

X

Well, just took about half the position off at about 30 pips. (spread kills this one)... and I moved my stop to about 28 pips below my entry price.

so now, if it stops out... i end up net break even on this thing.

if it goes and hits the 200 pip target I have for it... well, cool! then I make about 4:1 on half, and about 0.6: 1 on the other half...giving me a total of....
2.3:1 reward: risk...

and I can't lose on this trade anymore.

Do you do this type of thing? if not... well, that's why your not gettign a regular paycheck yet at it... are ya.

X

P.S. here's a link to the trade as it was opened and half closed so far...

http://www.forexfactory.com/forextra...trade967555839

That's a great reply and much more than I would have expected. Still, I can't help but think that you could focus more on "you could be a great trader if".

I guess it's really the same difference but some would suggest that we should try to keep negativity out of our lives (and trading).

Regardless, I'll trouble you no longer and wish you the best.

I like a little grit in my coffee in the morning. and I find it really funny.

but, if you want to see something on a more personal, serious note, check out my other thread. this one is aimed and helping folks learn where they might improve or add to their trading skill set... all the while keeping me occupied and entertained while I do it.

I suppose I could try to go for commercial member and sell the stuff!? LOL

but, it's worth more to me to use it as an outlet for humor and help.

besides, who wants to pay to be told they suck

just take it for what you can get out of it. and feel free to post up your own! custos did, and he raised at least a couple good points...one of which I totally connected with. Considering once upon a time... i tried to "optimise" some bollinger band thing that I had manually backtested on the 5 minute charts for the previous 20 days. worst part was, the darn thing wouldn't work for even those 20 days....never mind stand up to my "optimization" lol. ahh.... man. i used to really suck at trading myself.

No thanks. I've seen enough.

This is what you're probably going for?

I'll admit; you've been pretty funny so far.

besides, who wants to pay to be told they suck

OK. So far I haven't gotten much out of it. My biggest take is that you like to make fun. We can do that.

well, that's a good portion of mah motivation. anyway, see ya round slim.

X

well, that GBP/NZD long trade is working out pretty well. it's up about 52 pips... and i'm just kinda watching it. if we can get to 9815, i'll move the stop a bit above my entry price... therefore, if stopped out, i'll get a guaranteed 30 pips on half the position, and abotu BE on the other half.

making this essentially either a net +15 pip trade, or a 100+ pip trade.

pretty much of everything I listed in the other posts i've made... I didn't use much fundamental data here... and I didn't use much sentiment. mostly some form of techincal analysis, with an eye towards seeing how that played out in the context of liquidity areas as I have estimated them to be.

oh, and correlated markets of course. and trading the strongest market off teh weakest market.

so, i'd say for this trade, I used about 65 - 70% of the concepts i've listed so far, to determine that this trade was a "no brainer"

So, for anyone new to trading... who thinks they can use a moving average, and a MACD, or stochastic, and actually be able to make money by taking it from a guy like me (and i'm just retail. think about the larger, more experienced, better connected, institutional traders...) it's not gonna happen very often. it will sometimes of course. but, for every dollar I lose, you'll lose 10 of yours, if this is your idea of what will make you money in the market.

it will make money in the market. just not you.

Point here is... guys, this is a really serious, really competitive field. you need aptitude, maybe a little talent, an immense drive, a decent bankroll (as in, 10K + if you want to actually make a living on it within the next 24 months), and you need a great deal of experience.

you also need a wide array of analytical skills. technicals alone can do it... but, it's like fighting with one hand tied behind your back.

if you really want to make it rich, your gonna have to be at least as good as me. and i'm not rich. so, in fact, you will probably need to be better than me.

and once you learn all this stuff, get the expreience, have the bankroll, and the raw ability, as well as the many thousands of hours you will need to put into it if you really want to make it work well...

your now gonna need to find a way to make all of that work within your own emotional and psychological structure.

so, now you need to keep in mind all the math, analysis, mechanics, etc, you've learned, and start to get in touch with your personal weaknesses. if your impulsive, or trading because it's "reallly cool"... guys like me will eat you for lunch.

if you get nervous about losing, or nervous about winning, this will end you, if you can't work it out.

if you have a good method, and system, but can't feel comfortable with it, because on some core level you somehow can't "believe" in it... then you need to start over, and get another one...because you probably won't be able to change your nature.

of course, you can try... but your really gonna need to believe in it. once you do, then, i personally feel the rest CAN be over come..... but your going to need to be your own therapist. your own teacher, your own parent, your own mentor.

by the way. if you can get one. DO IT. that's the best advice i can give anyone.

so, now that you've spent a year or so learning the mechanics... now you need to probably spend at least another year learning how to incorporate those withing your actions, and within your psyche in a way that will not cause conflict.

if it causes conflict, you'll find a way to act it out in the markets, or youll probably need to find a really really top notch trading coach/mentor.

If you don't believe what your reading here, and think this is not as hard as i'm saying it is... or that you can find a short cut... be my guest.

the market is slower in the summer season usually... and us full time traders can use the extra pocket money that you'll provide us.

Because seriously. your RSI 15 minute pinbar off a moving average scalper setup is what keeps food on my table.

Now... to take a slightly different approach... i'd like to hear what you all have to say about this.

is this type of information new to you? do you still think you want to do this (trading) for a living?

are you willing to give it a few years? and a few painful disappointments?

are you willing to put down the booze, stop the self doubt, become a calm tree amid the wind, when your more of a "doer" who would much rather be the wind than the tree?

are you good with math? can you see inside yourself, as to why you do they things you do? why do you repeat actions that you know are not in your own best interest. have you been able to improve on this yet? if not...why do you think that with your future career on the line, it's going to be any easier?

i'm gonna open this up to everyone now. but, be forewarned. if the conversation is not constructive, i'll just ban you at my discretion. and you can feel howerver you want about it, or me. but you won't be able to feel it in this thread.

I look forward to hearing some of your real answers...

X

and, almost right on the money, you can open up a 1 min chart of the gbp/nzd, and see we hit 1.9790 exactly, and stalled out for the last 17 minutes.

Guys, trading is this easy. but it's also this hard. and take it from me.... i still have a long way to go. so... lets hear some thoughts...

X

P.S. if we drop at all, the turning point will most likely be 9770ish, or 9750-55.

Thank you for the confirmation.

Have a good one.

folks... this is how good i can be.

and i've still only made 30% this year, and only half my weeks were profitable.

look at the posts above, and you'll see the prices I called out that would be turning points.

and i'm only able to make this work about 60-65% of the time. and i'm not rich.

so. how good are you???

X

Ok, that's it for me for now. I wanna get some 2 way participation here...otherwise, i'm not inclined to make another post on any subject in this thread.

So, if you want to ask questions, get answers, debate a point or two, give your opinion, get my opinion, call me a douchbag, discuss the markets, or yourself, or myself, or anything else... do so.

Cuz i've got my own work to do on my own personal development as well, and i get nothing out of this one without your interaction. the good, the bad, the ugly, whatever. just post it... or this has been a humorous and stimulating ironic distraction for me, and maybe something you can re-read if you want to some time in the future.

X