Monday, September 10, 2012

Still chasing success, but...

Summer is over.  And I admit, even with my limited time for trading over the past couple months, I not only did some SIM trading as expected, but also had some real live trades on and off through July and August.  Yes, I shouldn't have, especially since I was experimenting with various trading methods, and ended up trading live a whole lot more than I should have.

Recently did a review, and I see I ended up down around 40 ES points at one time, recovered around 40 points, back down around 40 points, and back up a bit, for now, on mostly one contract trading.  Quite a roller coaster ride that I'm not proud of.  Ugh.

Why did this happen?  I admit, I'm still chasing success.

Taking the last week of August off for our family vacation helped to slow and settle my mind to reflect back and understand what (and why) I'm doing what I'm doing, which can often feel like I'm banging my head against a brick wall.  I'm still looking for something that works for my style over the long term.

Although I usually feel that I'm getting closer to that elusive consistent profitability, I often step back and realize how long I have been thinking that way.  I'm going through various stages of development such as the lingering "Trough of Sorrow", then there's the "Crash of Ineptitude" which happens too frequently, all the while getting faked out by the "Wiggles of False Hope."

I know there are more disciplined and effective ways of learning and improving. But for me, based on my past paths to success in other endeavors, the not-the-most-efficient-shotgun-and-grind-it-out method seems to be how my journey will continue.

Turning over stones

I will need to turn over as many rocks as I can, until I get to the stage where I feel I've done all that I can.  It reminds me back to my much much younger days of visiting the local 7-11 convenience store after school.  I would see so many different kinds of candy for sale and would spend an inordinate amount of time looking at each one, trying to figure out which one to buy.

Now days, if I even want to eat some candy, it only takes a few seconds to select it, and I'm done.  Unlike my trading, I've already turned over many stones over the years, and I'm done searching. 

I also used to spend hours in the record store every week, endlessly looking at both current and old albums from all various genres, learning about the various artists, figuring out how to best spend the money I made from my paper route.

Now days, my desire for music is much more muted, although my taste in music is better focused.  So with sites like Pandora, it no longer takes me a very long time to select something to play and just move on.  Although there will always be some new stones to turn in the world of music, gone are those days when I would obsessively spend many hours a day/week focused on turning over those musical stones.

And my biggest "chasing success, success story" is that it took many many years of turning over many stones before I met my wife.  But that journey is thankfully over and has resulted in a family with 2 great young children (as long as they are behaving!), for which I am very lucky and thankful.

Now days, the amount of work and effort to maintain my relationship with my family is greater than ever before, and continues to grow at a breathtaking rate.  So although I'm done searching, the real though work has only just started, and seeing the positive return from my efforts, watching my children grow, is something beyond measurement.

So back to trading -- I often see many people who are very successful in other fields say trading has been one of their most difficult challenges to master.  Taking my current path of experimenting/chasing success/turning over as many rocks as I can to become successful with trading is an expensive way to learn, both from a financial and psychological capital perspective.  But I'm not sure if there's any other way, based on how I operate. 

On a good note, I do think the rate of "turning over stones" is starting to decrease.  So maybe I'm starting to settle down.  Maybe I'll stop searching so hard and settle down with a specific trading method.  And maybe I'll finally start putting in much more effort to maintaining a successful trading process.  This will be a key "tell" that I'm moving in the right direction.

The importance of environment

But here's one missing piece I've recently overlooked.  I have discovered that my trading environment is a big factor in my ability to remain disciplined in successful.  When I was doing some random trading over the past couple months, I was pretty much on my own, operating with minimal structure, exhibiting a lack of self discipline.  Recipe for disaster. 

I now realize that I've done better in the past when I'm a part of a group all trading a similar methodology.  So for now, I need to be a part of a team again.  The best environment for me would to be physically on a trading floor with other like minded traders.  But since that's not realistic at this time, the next best thing is to be a part of a chatroom.

So here's my new plan based over the next few months:
  • To continue daytrading the ES, I've joined a chatroom which has a live streaming audio and video feed of the charts.  Most importantly, there is a full time moderator using a methodology that I've recently evolved towards and have been exposed to quite a bit since earlier this year.  Based on attending for only about a week, this seems to have instilled a new sense of confidence and discipline.
  • I've also joined a swing trading service for stocks, just to see if this timeframe might be better suited for my personality.  I've opened up a new equity account just for this purpose and will slowly ease back into stocks after taking a break from equities for nearly a year.
  • I will also continue to monitor the forex markets for swing trade opportunities.
Will this direction be yet more random turning over of stones and a continuation of chasing success?  Or will this lead me to more focus, more self discovery, and ultimately, bring me closer to becoming a consistently profitable trader?

We shall see.  I still believe.  The journey resumes.


Forex market said...

This post is so informative and makes a very nice image on the topic in my mind. It is the first time I visit your blog, but I was extremely impressed. Keep posting as I am gonna come to read it everyday!

Anonymous said...

I've been reading your blog for some time now, and I would like to make a suggestion:


It astonishes me that you know exactly - and I mean with surgical accuracy - what your mistakes are, yet you keep on making them. You keep switching methods, markets, instruments. What's the use? You've read Trader-X his blog. Don't chase success. Just pick something. And don't tell yourself as an excuse that this is just the way you learn stuff. That's a load of crap and you know it. Just pick whatever method feels the best for you and perfect it. Apply it to 1000s of charts. Once you do that, you'll be able to make money.

And seriously, get some discipline. Being part of a trading room is good to learn, but your goal should be to become an independent trader. In any trading room, you will likely just follow the leaders of the room and their opinions.

I hope you do not mind my blunt and straight forward opinion, and I sincerely hope for your sake that you pick a method and stick to it.

All the best.


Grove Under said...

Hi Forex market:
Thanks much for the comment. I'm still getting back up to speed with life's schedule/blog writing, but will do my best to get back up to speed.

Hi D:
I can not disagree with any of what you've said and very much appreciate the straight talk. You are spot on.

"Insanity is repeating the same mistakes and expecting different results" is a quote that haunts me.

I believe I hit the psychological capital wall hard last month, and finally got really tired of it all. I'm tired of sounding like a broken record.

But on a good note, I've made some changes in the past week or so. They seem to be working so far, and for once in a long time, I feel like my trading is actually changing for the better.

For the near term, I'm going to stop writing as much and start focusing on executing my plan. But I will do an update soon...

Thanks again, your comment is very valuable and appreciated.

umm_wasnt_i_supposed_to_get_72_virgins said...

just keep going man. make sure your family's all fed and taken care of but just keep going.

Liam Brennan said...

Hi Grove, still following and was good to see an update from you! Great to hear you're still at it.

D is about as subtle as a brick, but maybe that's what is needed. It definitely helps me to have someone talk like that.

It's great to have this blogger community but none of us (for the most part at least) know each other so we needn't sugar coat things.

I hope you settle and start trading again soon. As a suggestion, perhaps pick your method and post everything you trade on the blog. Start doing that again and it might help. Post the strategy for everyone to see. Then the rest is up to you.

Grove Under said...

Hi Liam,

Thanks much for the support, really appreciate it! Good point about getting back into a good routine with the blog.

I'm still a bit challenged with time (& energy), but good suggestion on just getting back to focusing on a particular strategy and simply sticking to it.

I'll start to get more focus this next week. Thanks again, and hope all is going well with you.

Scott said...

Hi Grove,

I hope your new year is going well.

I was curious if you are still joining in on the newer trade room you described here? Also, it seems like you like it more than the Diamond Setups room -- is there a reason why (i.e. is it a better fit for your personality or do the setups and method perform better)? Back when you were in the DS room and following the method in a more focused way, it appeared that you were doing well as long as the psychological part of trading stayed in place -- so just wasn't sure if you were changing the method for either of those reasons.

Thanks for your time,

Grove Under said...

Hi Scott,

Thanks for the comment. I'll have to write some long overdue posts regarding the latest and greatest.

One of the problems I've had with all the various chatrooms I have joined to date is that I'll be on track with the room for the first month or two, but then I would start to deviate and go on a random path.

It's the usual reasons -- overconfidence, thinking I can do better, using a methodology that works but might not be best suited to my style, thinking there's even better methods, etc.

But in the end, I think this has been a good experience. I needed to try everything I can just so that I can say "been there, done that."

So what seems to be happening is that I'm starting to look at the markets in a way that feels most natural to me, and being content with it. Not totally there, but seems to be getting closer.

Another big factor is that I've slowed way down -- no more daytrading, except on a very small scale on the forex markets every once in a while (and learning my lessons when I overtrade). Otherwise, it's all swing trading.

I'll have to get back on track with the blog updates, since there's a lot on my mind. Thanks again for the comment.