Monday, December 12, 2011

Was this a difficult trading day?

Monday, December 12

Total gross profits:  $87.50  +1.75 ES points
Total trades:  12  [4 scratch]
Accuracy:  62.5%
Execution score:  75% 
Opportunity cost: $350  +7.00 ES points

New metric:
Execution Score.  % of trades that followed the plan based on: 1) trade selection and 2) trade management

I'm sure there were other folks out there that just shorted this market early and rode the wave down.  But for someone who is generally trying to scalp +2.00 ES points, today seemed to be a lot more difficult to find good setups that worked.  Somewhat surprising, especially for what appears at first glance to be a nice 18 point down trending day. 

When I did get into a trade, there were at least 5 of them that either went +1.50 or +1.75 and then stopped me out at break even/couple ticks profit.  Or, I made sloppy mistakes such as bringing down my trailing stop too soon, thereby stopping me out before my +2.00 profit target was hit.

When I calculated my opportunity cost today, I realized that there were 3 trades that accounted for total of +7.00 ES points, so I was quite surprised by this.  2 of those trades were scratched or had a small loss due to bringing in stops too early (or I panicked), and those could have had +2.00 profits each.  And the other trade was one where I entered the wrong order, got filled, realized the error, but decided to let it ride to a full stop loss.

It's interesting how these seemingly one-off trades can really make or break your day.  I'm just thankful that my day didn't end deep in the red.  Because these are the types of days that can test ones patience, and eventually make you take careless actions that you later regret.  In the past, I would have been chopped up by this market.  But now, I'm better prepared to mentally handle these types of days, although I'm far from perfect and still have a lot of room for improvement.

One big factor that helps me deal with these challenging days is by being in contact with the community of traders and with Renato in the Diamond Setups chatroom.  This has been huge.  In the past, it felt as though I was trading in isolation.  But now, if feels as though we're all working together towards the same goal.

Tomorrow's a new day, and I'll be ready, a little bit wiser.


Tomross58 said...

Hey Grove,,

It was a difficult day to be sure. I am sure there are people that did very well but I saw it the way you did and was cautious.I think you made a great point in that before you would get chopped up on a day like this but you were able to maintain your P&L and and trade another day.
Everyday I am believing that less is more with the DS method, and today was a case in point. As you say being with Rena and the chatroom you can see other traders as they all navigate the day and have the same goal in mind. Your last few posts are sounding like there is more discipline in your trading and that has to be very encouraging. Keep it up.


Anonymous said...

Hi Tom,

How is the DS method working out for you? I was going to sign up last weekend but there was a payment problem, so I will sign up later this week. Are you getting the hang of the system? thanks

Grove Under said...

Hi Tom,

You're right, it does feel like I'm getting to a point where the discipline of following a plan is becoming more "normal", although I'm far from being overconfident.

But still, I think this is the point where letting down the guard might start coming into play, which would then lead to problems. Always have to remember keep my guard up, and stay on my toes!

Thanks much for the feedback.

Tomross58 said...

Hey Grove,,Hector

I just saw Hectors comment and wanted to give a comment back.
I was lost the first few days or the first week. I was also learning a new platform as my previous one wasnt suitable for trading the ES . The second week I started to make sense of some of his calls but was looking and trying to put the pieces together. For instance,,,why did he take that trade?,,where did he find that level?,,what made him chose that price ?,,,,but slowly its starting to sink in. Repetition,,,seeing it over and over again,,,looking,,,watching,,,,and of course studying his DS methods. Asking questions,,,,reading past chat transcripts,,,,,if you love what you do it isnt work.
I didnt start to make a sim trade that I actually tracked until the third week. I did a few trades just to try out my new platform but they were just tests.
I am very seriously considering going live in Janurary but will take it one day at a time,,,I know its close.
When you watch the man call out levels day in and day out you want to see the market through his eyes as he is just a Master. Calm...very conservative,,,and watchful that members take some profits. Impressive,,,yes.
Only you can tell if its for you but for me,,,I am going forward everyday.
Hope this helps.


Anonymous said...

HI Grove and Tom,

Tom, thanks for the reply.

Grove, trader x practices meditation. Have you tried it, maybe it will leave you more calm during trading hours.

good luck trading,

Grove Under said...

Great feedback, I totally agree with you. Thanks!

After a day like today (12/15), I think I'll need to consider meditation or something to snap me back into reality.

I recall Trader-X's post on meditation got a lot of interest, and there's good reason for it -- more and more every day, I'm finding the mental side of trading is huge.

I did get a portable biofeedback type device that works pretty well called the Stress Eraser, but I don't use it often -- it's not a habit yet.

Instead of meditation, what usually works for me is to either leave the computer and drive away, or to work on other projects that are completely unrelated to trading. That usually helps to clear my mind.

But I'll have to increase my options on how to keep my "center" during trading hours.

Thanks, and hope to see you around in the DS chatroom soon.