In the comment section you sound so confident in your system. You speak of a "positive outcome" over time. So why do you get so tilted when you take a losing trade or multiple losing trades? Are you being honest with yourself about believing in your system? Or are you just saying it to yourself in an attempt to convince yourself?Hi Bud:
IMO you are focusing too much on the psychological aspects of trading. This is a trap that I think a lot of newbie traders are falling into in recent years. It's like a Little League ball player seeking out a sports psychologist to help with hitting woes. The problem is not in the Little League'rs head, it's in mechanics and technique. Therefore working on the mental aspect is not going to help.
Based on your blog entries I'd say that your system does not work. Either that or you are not following it at all.
Thanks for the feedback, you have very valid points.
Yes, I am absolutely confident that certain setups I trade have an edge. After meticulously going through and honestly analyzing thousands of actual trades with a strong no-BS filter to help understand the probabilities of various setups (see examples here, or here, or here), I am very confident that certain setups I trade work well over time.
But you are absolutely correct, I am NOT following the system since I'm also taking unauthorized revenge/rogue trades that crush my profitable trades. If I was miraculously able to eliminate ALL my impulse trades, I would be a consistently profitable trader. The data proves it and I have a high degree of confidence in my analysis.
After the markets have closed and the dust has long settled, I review/grade my performance trade by trade, and it's quite easy to look back and see those revenge trades -- trades that just don't fit valid setup rules and usually take place shortly after I was stopped out of the prior trade. They really stick out, and they also stink bad. Some people have the inability to enter trades, but I have the inability to stay out of trades.
So the easy answer is, "If you have a system that makes money, then just follow the darn system and don't take any invalid trades!!!"
Yes, I have tried, and based on my ES daytrading P&L so far, I have not yet been successful. I can follow the system for short stretches of time successfully as I did here, and then I fall off the wagon. It's like telling a alcoholic, just don't drink. Or a smoker, just don't smoke. Or a gambler, just don't gamble.
I'm honest enough with myself to admit that it's likely some "wiring" in my mind needs to be modified before I truly become consistently successful. And that I might not be able to "fix it" myself. When you hit the wall enough times, making the same mistakes over and over and over, it starts to hurt. So even though it was just a couple revenge trades this week, the camels back broke.
Ultimately, what really bothers me is that trading is one of the very few areas in my life where I do not feel as though I have complete control over my actions and emotions. So at this point, my biggest motivation is not necessarily the P&L (although the P&L will reflect my success in how well I control my actions), but I'm motivated to learn and conquer how to gain better control of my actions. This is perhaps one of the biggest challenges I have faced, and welcome the opportunity to improve myself.
This is why I'm looking for help on the psychological side of trading. At a certain point, it's no longer about the mechanics and the fundamentals. It's all about the ability to execute consistently over time. Similar to how even the elite and best figures in the performance fields of sports, acting, or concert violinists have coaches / instructors / teachers / mentors, I'm looking to get the best possible help so that I know I'm doing everything I can maximize my success.
In the end, I want to know in my heart that I've given and did my absolute best.
Thanks again for your comment, it really helps to keep me honest. This also helps me to think through and better understand my current challenges, or at least what I think they are. And if there are certain experiences that you [or anyone else reading this far down] can share that helped you to overcome your challenges, I would really appreciate hearing about them.