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Most traders fail because of no discipline!

  • #761
  • Feb 5, 2017 8:05am Feb 5, 2017 8:05am
Finally using the balancing of time not on a day basis or chart basis but on a solar basis, on Monday the move down in the SP will be balanced in time by the move up. Because we measure times with clocks we are disconnected from the actual cycles that exist in our lives. The earth rotates around the sun, but the orbit is not circular it is elliptical.

Because we use linear time some relationships in time may not work out exactly correct on the chart, we also have weekends where the market does not trade. However, all traders are still thinking and reacting to world events even if the market is closed. Hence any analysis of the chart on a time basis will ALWAYS be flawed due to the non linear representation of time on our charts.

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  • #762
  • Feb 5, 2017 8:48am Feb 5, 2017 8:48am
Quoting Hurst
What is wrong with most ea's is that they actually have no connection with the market. To design an effective indicator or ea you first have to understand the rules that drive the actual price movement. Far from being random price has rules that it does follow. I would be more than happy to work with a couple of people on this to design an indicator based on this idea, I will however give an example of this in real time. This is just one of the rules I have found that price obeys. Gann I think mentioned it but never actually stated the rule, so...
What is root5?
What is root2?
This may not be the proper thread to ask these questions.
My Threads: Trading is as simple as 1-2-3, Highest Open / Lowest Open Trade
  • #763
  • Edited Feb 6, 2017 5:29am Feb 5, 2017 9:03am | Edited Feb 6, 2017 5:29am
Quoting Hurst
What is wrong with most ea's is that they actually have no connection with the market. To design an effective indicator or ea you first have to understand the rules that drive the actual price movement. Far from being random price has rules that it does follow. I would be more than happy to work with a couple of people on this to design an indicator based on this idea, I will however give an example of this in real time. This is just one of the rules I have found that price obeys. Gann I think mentioned it but never actually stated the rule, so...

Welcome on board Hurst !
That's an interesting approach, i'm not familiar with Gann theory and exactly that's the team-working beauty.
  • #764
  • Feb 5, 2017 10:37am Feb 5, 2017 10:37am
Quoting TooSlow
{quote} What is root5? What is root2? This may not be the proper thread to ask these questions.
square root of 5

so square root of 9 is 3
  • #765
  • Feb 5, 2017 10:58am Feb 5, 2017 10:58am
Quoting anax
{quote} Welcome on board Hurst ! That's an interesting approach, i'm not familiar with Gann theory and exactly that's the team-working beauty. Welcome on board Hurst !

I think I woud say its my theory rather than Ganns, Gann never gave away what he meant by squaring price and time, so the use of root values in price function are based upon my observations of price in the market. Its not as simple as it look sometimes the relationships are a bit exotic, but I know a lot of the common ones. This is how I think Gann converted price into time, certainly its one method that works. I suspect that price and time may well be related so in effect you can work backwards, if you have say a news event due and you want to establish the possible limit for the move, knowing that the move will possibly be a singular bar, you simply convert time into price and look for key levels to fade the news. In effect you have the time, and you calculate the price to relate to it.
  • #766
  • Feb 5, 2017 12:43pm Feb 5, 2017 12:43pm
CADJPY reversal point

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Looks like the CADJPY is at a price time point
  • #767
  • Feb 5, 2017 3:33pm Feb 5, 2017 3:33pm
@Hurst and Anax, it would be great to introduce and learn new concept in the technical aspect of trading but it would be inappropriate to discuss it in this thread.
  • #768
  • Feb 5, 2017 4:07pm Feb 5, 2017 4:07pm
Quoting techboy46
@Hurst and Anax, it would be great to introduce and learn new concept in the technical aspect of trading but it would be inappropriate to discuss it in this thread.
Trading profitably requires a lot of discipline, but it seems that refraining from posting off-topic comments requires even MORE discipline, hahahaha
  • #769
  • Feb 5, 2017 4:46pm Feb 5, 2017 4:46pm
Quoting RondaRousey
What about the moon? Can the moon affect prices as well?
Don't laugh but I read somewhere (I believe it was an article in Futures Magazine) that there is a high correlation between sunspots activities on the surface of the Sun and the price of wheat and silver Futures.
  • #770
  • Feb 5, 2017 4:59pm Feb 5, 2017 4:59pm
Quoting Mr Breakout
{quote} Trading profitably requires a lot of discipline, but it seems that refraining from posting off-topic comments requires even MORE discipline, hahahaha
I think being discipline in trading is much more harder than being discipline in any aspect of life that includes posting off topic discussions in the thread......
  • #771
  • Feb 5, 2017 5:02pm Feb 5, 2017 5:02pm
Early on in this thread, someone wondered how people were coming up with all these reasons for "failure". They asked (jokingly) if there were polls and surveys being taken to come up with these various reasons. So assuming it's hard to know what's going on with other people in general, all I can do is say why I have (so far) "failed".... or at least not moved beyond the "treading water" stage. And I'll have to agree with several others who say it's lack of discipline.

Most of the time my trading style is scalping. I'm happy to get in and out of a trade in an hour or less, often just a few minutes. I'm happy to make 5, or sometimes less, pips per trade. And I tend to "win" about 80% or so of my trades. HOWEVER, my biggest problem is that for every 8 or 9 winners I have 1 or 2 losers.... and those losers are usually bigger than the winners. Sometimes MUCH bigger. I know, I know... that's my own stupidity. I like to use "mental stops", which is fine most of the time, but all it takes is that one WRONG move and it wipes out all the hard work from the others. So maybe my "discipline problem" won't be as hard to fix as some others are dealing with. Maybe if I just start using HARD stops with more consistency? I think so, because from my money management / trade size calculations, my small gains on "winners" will easily outweigh my small losses on "losers".... IF I can just make sure they really ARE small.

So IS this a "discipline" issue? I think so, but someone can correct me if I'm wrong.

But one thing I've got going for me: I've never had ANY desire to just give up, and I've never gotten overly upset with losses. I'm just as confident now as I was when I first began that I CAN be successful at this. All I gotta do is work (harder) on the DISCIPLINE aspect.
  • #772
  • Feb 5, 2017 5:24pm Feb 5, 2017 5:24pm
Quoting Ratmach
HOWEVER, my biggest problem is that for every 8 or 9 winners I have 1 or 2 losers.... and those losers are usually bigger than the winners. Sometimes MUCH bigger. I know, I know... that's my own stupidity.
In other words you are not trading with very specific trading rules.

It is impossible to maintain any kind of discipline if your trading rules are not specific enough.

Not only that but you must be certain that these trading rules will give you a trading edge (think backtest...).

If you are trading with precise trading rules and you are 100% confident that your system has an edge, then discipline is much much much easier to maintain, believe me!
  • #773
  • Feb 5, 2017 5:31pm Feb 5, 2017 5:31pm
Quoting Mr Breakout
{quote} In other words you are not trading with very specific trading rules. It is impossible to maintain any kind of discipline if your trading rules are not specific enough. Not only that but you must be certain that these trading rules will give you a trading edge (think backtest...). If you are trading with precise trading rules and you are 100% confident that your system has an edge, then discipline is much much much easier to maintain, believe me!
++++++++
  • #774
  • Feb 5, 2017 5:37pm Feb 5, 2017 5:37pm
Quoting Ratmach
Early on in this thread, someone wondered how people were coming up with all these reasons for "failure". They asked (jokingly) if there were polls and surveys being taken to come up with these various reasons. So assuming it's hard to know what's going on with other people in general, all I can do is say why I have (so far) "failed".... or at least not moved beyond the "treading water" stage. And I'll have to agree with several others who say it's lack of discipline. Most of the time my trading style is scalping. I'm happy to get in and out of...
This is one aspect in scalping that must be addressed by traders because most scalping strategy requires bigger stop loss than TP so it is a must that you have a very high win-loss rate otherwise you will still come out a loser in the end, mental stop to me is not really a good choice to use unless you are already a very discipline trader, emotions will always comes in when your trade is in a losing situation, you will always have the tendency to hold on a little longer causing much bigger loss.
  • #775
  • Feb 5, 2017 5:45pm Feb 5, 2017 5:45pm
Quoting techboy46
{quote} This is one aspect in scalping that must be addressed by traders because most scalping strategy requires bigger stop loss than TP so it is a must that you have a very high win-loss rate otherwise you will still come out a loser in the end, mental stop to me is not really a good choice to use unless you are already a very discipline trader, emotions will always comes in when your trade is in a losing situation, you will always have the tendency to hold on a little longer causing much bigger loss.
Exactly. "Oh oh, this is going a little further against me than I expected. Oh well, it'll come back in the next few minutes." And then a few minutes later... "Oh no! Now it's getting bad!" So yeah, I KNOW what I'm doing wrong... now I just need to make a deal with myself to STOP BEING STUPID.
  • #776
  • Feb 5, 2017 6:00pm Feb 5, 2017 6:00pm
Quoting Mr Breakout
{quote} In other words you are not trading with very specific trading rules. It is impossible to maintain any kind of discipline if your trading rules are not specific enough. Not only that but you must be certain that these trading rules will give you a trading edge (think backtest...). If you are trading with precise trading rules and you are 100% confident that your system has an edge, then discipline is much much much easier to maintain, believe me!
True, when a trader choose to follow or use a specific strategy it must be fully back tested first before used in live trading, at least you are assured that technically the system works, now if you fail in live trading then perhaps it will be easier to trace what cause it, you can only confirm if your trading strategy has the edge if you follow the rule exactly with discipline
  • #777
  • Feb 6, 2017 1:45am Feb 6, 2017 1:45am
My view
N1: Trade only what you know. Your system, your strategy, your thoughts. If you use signals - use only signals!
N2: Choose your currency pair. Trade the related pairs.
N3: Use stops (loss and profits). Never deviate from the original.
  • #778
  • Feb 6, 2017 2:54am Feb 6, 2017 2:54am
Oh yeah, I know your points are right. But this:

Quoting RondaRousey
Your problem is that you focus on win rate rather then profit.
... isn't really the case. I know I mentioned what my win rate was, but that was just stating the facts, NOT that I was focused on it. Not if you mean "focused on" to the point that it was really important to me. No, I fully understand that if I start using stops more consistently, my "win rate" will likely go down. And I'm FINE with that, if it helps on the profit side. My whole point was that even KNOWING what I should change (start using stops more consistently), it's still hard to pull it off. But just in general, yeah, you're right that worrying too much about win rate isn't helpful.

Edit: Also forgot to mention, regarding my "small gains"... I realize that despite being small, they need to be (on average) larger than the losses.
  • #779
  • Feb 6, 2017 3:41am Feb 6, 2017 3:41am
Quoting Ratmach
Oh yeah, I know your points are right. But this: {quote} ... isn't really the case. I know I mentioned what my win rate was, but that was just stating the facts, NOT that I was focused on it. Not if you mean "focused on" to the point that it was really important to me. No, I fully understand that if I start using stops more consistently, my "win rate" will likely go down. And I'm FINE with that, if it helps on the profit side. My whole point was that even KNOWING what I should change (start using stops more consistently), it's still hard to pull...
This is all covered by Mark Douglas in "Trading in the Zone", what he calls the 4 fears of trading. You need to read this book. I have posted below a short sumnmary:

“Ninety-five percent of the trading errors you are likely to make—causing the money to just evaporate before your eyes—will stem from your attitudes about being wrong, losing money, missing out, and leaving money on the table. What I call the four primary trading fears.” -Mark Douglas (Trading int he Zone)
What Mark Douglas points out in his great book about trading psychology, is that the majority of traders lose because of wrong thinking, misplaced emotions, and wanting to be right. We know fear and greed drive the market prices far more than fundamentals do. The emotions of fear and greed are the key reasons traders often make mistakes. Fear makes traders not take entries and miss trends. Fear causes traders to sell winners early scared, of giving back paper profits, only to miss out on big profits when they are right. Greed is the driving force behind traders taking positions too large and risky for their account size. Greed keeps traders holding losing positions ,wanting their losses back instead of just taking their lumps and looking for a better opportunity. One of the most powerful things a trader can do to improve their trading is to overcome fear and greed. By becoming disciplined and focused on their trading, rather than relying on destructive emotions, a trader can survive and thrive.
Here are four great examples of fear over ruling sound trading strategies:
The fear of being wrong: Traders fear being wrong so much they will hold a small loss until it becomes a huge loss. Even adding to the loss in the hopes of it coming back and getting to even. Don’t do this; holding onto a loser after it hits your predetermined stop loss is like being a reverse trend trader. Do not be afraid of being wrong small, be afraid of being wrong big.
The fear of losing money: New traders hate to lose money. They don’t understand that they will lose 40%-60% of the time. We should come to expect the small losses and patiently wait for the big wins. Many traders fear this so much that they have a hard time taking an entry out of fear of losing. If you can’t handle the losses as part of the business, you can’t trade.
The fear of missing out: The opposite of the fear of losing money, is the fear of losing potential profits. This causes traders to watch a stock go up, miss the primary trend, and then get in late, just in time for the trend to reverse and lose money. Trade at your system’s proper entry point. Do not chase a stock because you are afraid to miss out on profits.
The fear of leaving money on the table: When your trailing stop is hit, get out of the trade. If your rules tell you to get out after a parabolic run up and stall, then exit. You must be disciplined about taking money off the table. Being greedy for that last few dollars when your system says to sell, could lead to major losses.
Let your winners run, but when the runner gets to tired to continue, bank your profits
It never gets easier, you just get better
  • #780
  • Feb 6, 2017 8:49am Feb 6, 2017 8:49am
Quoting Shabs19
{quote} This is all covered by Mark Douglas in "Trading in the Zone", what he calls the 4 fears of trading. You need to read this book. I have posted below a short sumnmary: Ninety-five percent of the trading errors you are likely to makecausing the money to just evaporate before your eyeswill stem from your attitudes about being wrong, losing money, missing out, and leaving money on the table. What I call the four primary trading fears. -Mark Douglas (Trading...
Pure gold.
My Threads: Trading is as simple as 1-2-3, Highest Open / Lowest Open Trade
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