Monday, March 12, 2012

Disciplined trading is like...being on a diet

Total gross profits:  $100.00  +2.00 ES points
Total trades:  1
Accuracy:  100.0%
Execution score: 100.00%
Opportunity cost: $0.00

One and done, all before lunch.  

Had a signal line up with Renato's DS alert, got my +2.00, and ran since I couldn't really make much sense of the choppy charts today.  Went out to lunch, hoping that when I returned, volatility would have returned.  No luck.  

But I had one new discovery, Taco Bell's new Doritos tacos are pretty good, although a bit gimmicky.  And it really made me feel like buying a bag of Doritos, so their marketing plan must be working.  

And to cap off the trading day, I actually fell asleep for a bit around the market close.  Yes, it was just that kinda day.

Disciplined trading vs. being on a diet
Speaking of junk food, I made somewhat of a realization today that trading well with discipline is almost like successfully being on a strict diet.  It's very clear what you need to do in order to maintain your diet, but very difficult to "stay on the wagon."

When I've tried to diet in the past:
  • I've always felt a bit hungry all the time (need action, trade more!)
  • Or craved certain fried/sweet/salty foods you're not supposed to eat (rogue trades!)
  • Or just decided at 11:00 PM that you're just going "F" the diet and finish a pint of Ben and Jerry's Chunky Monkey ice cream (go on TILT!).  
For the record, I've never finished a pint of ice cream in one sitting.

Probably because I'm not quite there yet with my trading discipline, I admit there are times when I feel a certain sense of missing out or very restricted when I'm trading according to my plan.  Sometimes, it seems like everyone around me is making great trades with money falling onto them from the skies, while I'm sitting on my hands, waiting while eating plain tofu and water.  

Or, I feel like I'm watching profitable trades go by that I've deliberately avoided, since they didn't quite meet the criteria for a valid setup.  And of course, I conveniently forget about all those trades I decided to pass on that ended up losing money.

But I realize that it's not about "others vs. me."  I am my own worst enemy.  So having a trading plan and being disciplined to that trading plan is essential for me, as I have just experienced over the past 25 trades with good results.  

Over time, I need to recognize that maintaining this level of focus and discipline is the nature of a successful trading business; this is what "normal" should feel with regards to the level of sacrifice I need to make in order to maintain the highest levels of discipline; this is one of the biggest challenges I have to overcome in order to become a consistently profitable trader.  

I'm getting there, slowly but surely.


Trading Arcade said...

Coincidentally, i just reminded myself to stay focused and trade according to plan. Yes, good trading is boring at times, but we just have to follow strictly to the diet. Good luck!

jaydee said...

wonder if you can post your entry price and exit price on your future blogs post, that would be helpful

ITrade said...

Hi Grove. I have been following your blog for a few weeks and really enjoy your posts. I am thinking of giving DS a try. Unfortunately, I have blown up my account and am having to start all over....again. With only 1contract....again. Do you think if a person were to follow the DS alerts only and leave him/herself out of the equation that he/she would be able to build an account up to an acceptable level? I am considering giving it a try but afraid to pull the trigger. Thanks again for your posts....very well written :-)

Grove Under said...

Hi Trading Arcade,
Great point, thanks much for the comment, and good luck to you, too!

Hi Jaydee
Right now, there isn't an easy way for me to simply copy/base the entry/exit prices, but I'll have to investigate, or include them on some trades. Thanks for the comment!

Hi ITrade
I totally understand your position. Been there, done that.

With regards to your question, I do believe that if you take all of the DS alerts and execute them properly, you will do well over time. But it's much easier said than done, especially if you're trading from limited resources and low confidence.

I would strongly suggest trading on demo/SIM for an extended period of time, and join a program such as what Renato offers with his Diamond Setups.

Your focus should not be on making money, but learning how to execute a solid system very well. Focus on executing well, and the profits will follow. And best of all, Renato is a great and patient teacher, simply one of the best.

Feel free to email me if you have any other questions, and thanks for your comment!