Friday, December 05, 2008

Back to the drawing board


Since mid September I have been in a slump and it has taken a toll on my psychology.  Usually I have high hopes of making a profit every week and month but lately I am just trying to keep myself from losing money.  I have no set plan and it seems that I have been trading a myriad of styles but I have not mastered anyone of them.  I find myself breaking a lot of rules that I have set mentally, like no bottom fishing, picking tops, chasing, and forcing trades.  I need a comprehensive plan that can define clear actions  on what stocks to trade and what setups to take.  My plan should also cover psychological aspects like managing anger, anxiety, and fear.  I need to set my $ risk/share size and only increase them when my consistency increase.  I am going to peruse my trading books again to see if I can find some insights.

9 comments:

JMJAtlanta said...

From the picture, it looks like you have the same books on your desk as I do!

Here's my advice, remember what you paid for it:

You're making steps in the right direction. Next time, take those steps sooner.

Discipline starts with your trading journal. The numbers get filled in each day. Put something in the comments column on each trade. This helps spot problems on the weekly review. But they're not there just to find problems. They're there to fix problems.

2009 looks to be a great year for traders. If you're like me, you learned a lot. Don't let what you learn go to waste. Start 2009 smarter than ever.

Okay, Rah! Rah! session is over.

You've got a new year starting soon. Catch up on your reading, and get cracking on that business plan. Include in it specific actions you do to counter each problem that appears.

Dinosaur Trader said...

OBAT,

Sorry about your loss, but try not to think about the money. Think of it as a game that's scored with points. Take the money out of it because that's what'll make you emotional.

You're gonna get it if you keep trying. Have confidence in yourself.

-DT

Francisco said...

I agree. The times are a very serious crisis and that makes it very hard to win our buying and selling shares. We need patience and above all realize that is bought and action continues to fall ... is preferable to sell immediately to lose .. Doq hopes that EU will continue to rise

Marketology Group said...

Well don't you feel helpless. There various factors that we need to do inoder to reach our goals once we pass it then it would be easier for us to do the next time around. For instance with the eminiforecast
it can make life much more simplier.

JMJAtlanta said...

I hope all is well and that you are spending time preparing for a great 2009.

Jules said...

OBAT,
I remove the P&L column on my trading platform, and put it back on only after I've wrapped up for the day. It helps, most times. If you treat it as a game, it makes focusing on winning a lot easier.

If you feel defeated after a string of losses, do something that will make you feel you're in control (Example: torture someone who's been pissing you, and make him beg for you to stop, and then let him off). :-)

Am sure you are aware that the last 2 months of 2008 have been bad for many others too...

You'll have a great 2009 :-)

wincity said...

Wish you a good 2009.

Stewie said...

during losing streaks traders break ALL their rules. Not sure about you but during a slump, i look at my stats and i always notice two things: 1: I tend to trade MORE and 2: i tend to trade with bigger size.

This is disaster in the making. I highly recommend you do the exact of this, in other words, trade much less, much much less and trade smaller, much much smaller until you get your mojo back.

Trading is all about managing winning and losing streaks well. every trader has winning and losing streaks. The winning traders are much better at managing their losing periods by giving up as little of the mother goose as possible.

good luck pal.

OBAT said...

Jules,

It has been over a year since I removed my pnl. I think I still go over my pnl calculations in my head though and that still affects my trading. If all else fails. I might give your torture technique a try.

Stewie,

I have cut my size way down and have been trading a lot less. It is Jan 21 and so far I have finally recovered my $850 December. I think my mojo is coming back and I am able to see potential moves again.

About Me

I have been trading for 5 years. It took close to a year before I became profitable. I find that I am improving gradually each year. My method of choice is scalping. My edge lies in tape reading NYSE stocks and staying on the side of the specialist. That is the method I learned when I started. As I build up my capital I will try new styles and trade new markets. In late 2006 my trading hit a rough patch after the introduction of the NYSE Hybrid system. For most of 2007, I have been on a search for new strategies that would help me adapt to the market.