Feb 2018 Go-Live Support Group

[Carlos M. 232]

Robert H, you hit the nail on the head! I have been live since January and I have gone through so many different situations which I have read about not to do. Before going live and I would sit there telling myself these people are idiots why would they trade like that? Come to find out I have done everything I said I would not do at least once.. Still alive to trade another day and bad habits are dying and hopefully can continue to learn and grow.

 

I'll post my experiences after 3 months of live trading, you wont believe the pure craziness and "crackhead trading" I have done.

 

Carlos M.

[Robert H 455]

Thanks Carlos and fullmoonguru for reading!

 

Update: I've been switching in/out of simulator based on a reward system. I start the week off in sim. If I trade well and don't break any rules, I am allowed to move to live the following day. Each day that I don't exhibit crackhead behaviour, I am allowed to stay live. Otherwise, I have to go back to sim and 'earn' my way out. Seems to working so far--the Hulk hasn't been released in a couple weeks.

[Robert H 455]

Over the weekend I read some excerpts from Trading in the Zone and Mastering the Trade. I was prepared to approach the market with patience and discipline.

 

Market opens this morning. I sit on my hands for the first 10 minutes. Missed good ORBs on FB and NWL, but no big deal. Then I see a setup on MFGP. I check the volume, seems good. Bulls appear to be in control. I go long. Turns out to be a strong run-up and I take profit along the way. I check my P&L and am satisfied that I hit my daily goal by 10 AM EST.

 

Fast forward an hour. I'm typing in the chat, answering e-mails, etc. and I see another setup. I tell myself 'No, you're done for the day.' But as soon as the thought of taking that trade popped in my head, it was too late. I hit my hotkey and off we went. Long story short, I lost all my gains from the first trade.

 

Not so bad right? Back to a blank slate but midday is approaching. I take another trade and another loss. Finally at the close, I take one last trade for a small loss. What a turn of events lol.

 

Veteran traders weren't kidding when they said your biggest enemy will be yourself!

[Abiel 475]

What happened to that lock in your montage? I´m sorry to hear that Robert. It is very tedious for me to modify my records, so a way that has worked for me to stop trading is to journaling my day. Also, finishing my day early is a kind of reward for me.

[laurnew 0]

I really appreciate you guys recording all of your observations and experiences here. It's so cool we can do that together and feel the support of our fellow traders. This is such a journey and I've been on the same roller-coaster as you all have.

 

DAS is an entirely different animal to master with its own set of learning opportunities. I thought that once I switched from Lightspeed to IB and DAS that my trading would improve but at times, I've lost WAY more due to those sensitive buttons that I was so excited to use.

 

I often remind myself as I go back to SIM and training, that it takes time to get this thing down. Not months...but longer. It takes as long as it takes. My desire to be a profitable trader, along with plenty of stubbornness and perseverance is what gets me up every morning at 5:30 with excitement for a new opportunity to learn and to profit. If everyone could do this and be great at it in a year....wouldn't they?

 

We've got to be kind to ourselves. The SIM is a phenomenal tool and DAS is top quality. We have the tools...we just need to remind ourselves and each other to be patient. If we really want it, if we are realistic and willing to stick with it.....IT WILL HAPPEN.

You guys are awesome :)

[Robert H 455]

Abiel, the one day I forget to lock my montage this happened. At least that's what I am telling myself lol. My journal is quite comprehensive and takes effort to update as well. But when you're in the moment, all of that goes out the window. Maybe your composure will carry over to live better than mine has. I went from Dr. Jekyll to Mr. Hyde.

 

Laurie, your positive attitude is refreshing. I agree that hard work and determination are vital to keep fighting this uphill battle. Quitting is the loser's way out.

 

I like venting in the forums; it's therapeutic for me. To all the readers still in simulator: no we're not crazy. You will find yourself deep in this madness soon enough lol.

 

Update for yesterday: I traded FB 8 times. I have a rule to delete a stock from the chart after 3 attempts. This prevents revenge and over trading. It's just so damn easy to add it back and say to yourself 'just one more trade.'

 

Update for today: I only took 3 trades. 1 loser, 1 winner, 1 break-even. I'm finding it easier and easier to be patient and in control of my emotions. It really comes down to the moment. If you can fight the urge and resist the stupidity, then your inner crackhead will be held at bay.

[Robert H 455]

I had a pretty decent week. Monday I took a string of bad losses at the open and slowly clawed my way back to green. FB was behaving really well and I managed to trade it at the close to hit my daily goal.

 

Tuesday was awesome. I made one trade and was done by 10 AM.

 

Wednesday was a nightmare. Nothing was in play and I got chopped up really bad trading stocks which mirrored SPY--mainly TWTR and FB. It was a slow and painful death and I finally hit max loss by 2PM.

 

Thursday got off to a rough start. I took 2 small losses and stepped away for a bit. When I returned, I made 2 solid trades and hit my daily goal by 11:30 AM. I did some journalling and was about to lock my montages, but then the crack dealer showed up. I took another trade and gave it all back. I got emotional and took 3 more trades trying to chase the money. Those all turned out to be losers. At the close, I tried for a Hail Mary but ended up losing even more.

 

Dunno what it is. When I'm up for the day, it's really difficult to walk away. And once I return some, or all, of the winnings, I get emotionally tied to that money which used to be mine. My brain says 'you have to do whatever it takes to get back what is rightfully yours.' There's probably some psychological term for that feeling; I like to call it the Crack Addict Trading Syndrome (CATS).

[Robert H 455]

I was inspired by Robbie W to analyze 5-months worth of data that I have accumulated in my trading journal. Check out his awesome infographic here! My presentation does not compare aesthetically to Robbie's, but the exercise was very insightful nonetheless. The following is a comparison of how I traded in 3 months of simulator vs. 1.5 months live.

 

STRATEGY LEGEND

JUMP and CHASE are considered impulse trades. JUMP is getting in before signal/confirmation, while CHASE is where a stock is extended and/or reward-to-risk is terrible.

 

NUMBER OF TRADES

Accuracy has declined by 24% since going live. Facebook accounts for 22% of total live trades. This is a very high percentage over the time period. For comparison, MU accounted for only 11% of trades during simulator.

 

TRADES BY STRATEGY

Since going live, I have been taking ABCDs and Reversals twice as often. I have been taking less ORBs and VFBs which can be very profitable. Impulse trades account for 20% of all trades. Bad.

 

ACCURACY BY STRATEGY

Accuracy has gone down across the board. Impulse trades turn out to be losers more than 70% of the time. Only 1/3 of Reversals are winners compared to 55% in simulator. VWAP False Breakouts are pathetic. Probably because I stopped waiting for the price to test VWAP at least once before entering.

 

LONG VS SHORT TRADES

In simulator there was parity. Now long trades far outweigh short trades. So much for calling myself a 'short-biased' trader! I suspect this is due to excessive ABCD's and Reversal trades (which turn out to be wrong).

 

LONG VS SHORT ACCURACY

Despite lower win percentage in live, short trades are still more accurate than longs.

 

AVERAGE REALIZED RETURN BY STRATEGY

This statistic is slightly advanced. Going into most trades, I have an intended reward-to-risk of at least 2. I call this figure R-Target. However, the outcome is often different due to scaling out, selling before target, exiting after stop, etc. The realized reward-to-risk is called R-Real. R-Real is calculated as: P&L/Max Loss.

 

For a winning trade, anything greater than 2 means you returned more than twice of what you risked. This is called WIN-R.

For a losing trade, anything less than -1 means a loss greater than was defined by the stop. This is LOSS-R.

 

For both simulator and live, WIN-R is returning only slightly more than the dollar amount risked (1.1). This is bad in the long run. Since live, LOSS-R is less than -1 for majority of strategies. This means I am holding onto losing trades longer than my stop. In simulator, I would often exit before my stop and had a more favourable LOSS-R.

 

EQUITY CURVE

Mirror images!

[Robert H 455]

If anyone is still following this post, I have good news and bad news.

 

The good news is: I've seen the light! After focusing on the psychology of trading (discipline, controlling emotions, proper mindset etc.), I was able to reign in the losses and improve my trading considerably. In the past 20 trading days, I had an eight day green streak and a five day green streak. At times I felt like I was on the right path to true consistency. My average number of trades was around 4, and there were a few days where I only needed one trade to hit goal. One and done!

 

The bad news is that I am now on a two day red streak. My average number of trades for Thursday and Friday was a ridiculous 13! I believe the reason for this regression is that I stopped focusing on the psychology. I became complacent and forgot about what got me this far. I'm still in the early stages where I need constant reminders to keep me in check. Discipline is not my default mode (yet).

 

This losing streak has been a wake up call. Next week I will return to the habits and mindset that allowed me to be consistently green. I will report back on how that goes. Thanks for reading.

[Lee W 82]

Goal for the day, walk away!

 

Next week you’ll be back to the discipline. I think this is easier for some than others, and certainly easier said than done. I know you’ve got it down. I know I’ve got it down. Let’s make it lean and green!

[Joseph Fisch 5]

Robert I truly enjoy each of your posts. I feel like you're sitting in my brain and seeing all my weaknesses... The more I trade I see its mainly psychology, and the only way to acquire that skill is by practicing discipline.

[Carlos M. 232]

Robert, That's amazing! With the amount of work and tracking you are putting into your trading I am sure you will be back on another green streak ASAP.

 

Keep it up!

 

Carlos

[vic 11]

Amazing posts guys, thank you for that. \

 

 

 

This game isn't about understanding the buttons, understanding the market, understanding the setups,

 

that's just the 1%

 

the 99% of this game to make money is to control yourself.

 

Control Fear and Greed.

 

That's it.

 

That's why  SIM trading does not work for me, zero, nada, null, void. When I sim trade I lose interest have no emotion and say yeah sure whatever enter here exit there blabalbal, and all goes PERFECT in the sim account.

 

No folks, I need live trading, live trading where it messes with my brain, with my Greed, with my Fear, oh no another loser, oh no, I'm never going to be able to do this for a living, oh no, if this stock turns after i exit with my stop loss i'm never daytrading again!!

 

This is what it's about, be able to control yourself.

 

It's the only thing.

 

 

[Dima 10]

Just my two cents...

 

Being consistently profitable in a simulator is a necessary but not sufficient skill for being consistent in a live account. If you find that you trade differently in sim and in a live account, that seems suggest that you need more practice in a simulator to get a handle on your emotions, not less.

[[email protected] 2]

Is there a technical reason why you should finish your day as soon as you hit the "goal" assuming it is 1% to 5% of your account. I know it's a good practice that Andrew promotes. But I don't see any logical reason not to keep trading as long as it is a good set up.