Trouble is .... how do you know in advance if it is going to be a dead day. For example, Aug 19th. From 10:30 to 13:15 I did rather poorly losing 1.50 points on four trades. Three were losers, one a small winner. The range was 1108 to 1102.50 or so during that time frame. However, that was a great day....at 14:28 I put on a trade that I held for an eternity...40 minutes, but I made 6.30 points on that one trade and that made the day.
The last one and a half hours the range was straight down almost, no choppiness to speak of. The trade was not within my system, however, my system would have produced about 4 points in the same time frame had I waited for the signal. So....even when the market is dull....it can change in a hurry.
I will have to give this some thought as I review my trades to figure out what is going right and what is going wrong. Most of the time my system will keep me out of the choppy trades....but frequently I get antsy...as you know and I try them anyway. Thankfully most are small losses when I do this with a few small winners. Sometimes I get reamed like this afternoon, but not too often. Biggest loss to date is 6.00 points and it was because I was stubborn. The 4.60 today is the second and that also had some stubborness attached, however, I remembered the 6.00 loss and closed it once I thought about that, so I am learning. Both of the big losers were within the parameters of my system, so the only problem with them was proper exits within a fast market...which I blew in both cases. The SAR this afternoon would have been appropriate had I been thinking beyond just saving my bacon as the market was exceedingly strong and was yelling be long and be long now! Turned out OK as I got my head back on and took the retracement to the long side for a trade to get back the 4.60 loser. That trade was tough to put on, but it was within the parameters of the system, so I decided to take it.
Gotta figure this out more. I think I am doing OK, but leaving too much on the table at times and must improve my entry and exit strategies. I think experience will help.
The more I work on this, the more I think the main reason people lose in this game is they go into it thinking it will be easy and have no plan in place. I think many do it with real coin and just expect to be winners and then when they are not winners, they give up or try something else. The internet based paper trading is fantastic. I am interested to compare the results from the paper trading with the results real time with real money. Right now almost four weeks into it I am averaging 10 points a week approximately.
Seems to me the most important aspect of this type of trading is mental. If your head is in the game correctly, you do well with proper money management rules. If you head is not in the game, whatever rules you have are not followed and you get reamed.
I hope this works for me as I would love to take Hank's course and try to develop some longer term position trading strategies that can complement what I am already doing.
I am curious how it would be handled with more contracts as well. I wonder what impact that has on the mental aspect of the game. I like the idea of doing two or four as you can trade out of half and let the other half run if it will. Doing it with one is tough business. Many times I have let it run, only to have a winner turn into a loser. Many times I have taken it off the table, only to leave many more points on the table. Tough calls as to how to properly handle it with one contract. I think the key is to limit market exposure and whenever possible take the points and run....unless it really looks like it will continue in your direction. Attempting to improve at this aspect as well.
Thanks for your thoughts....
-Scott |
