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Thread: question for the veteran traders

  1. #1
    Let's say you have a trading system. You have the rules for entry, exit, s/l, and cash management and so on. So that you enter your trades.

    Today you've got several postions open. You've observed them from day to day. One day every one of the places are up hundreds of pips, the following day it retraced somewhat, then the next day it is up a little bit. Basically regular it changes. However, the system you designed hasn't told you to depart yet.

    Do you guys believe monitoring your trades AFTER you opened them have negative plogical effects on the trader?!?! Because after seeeing up the trades for several pips, you think 'oh man, I might get some gooood cash if I close all of them' But then you think 'wait, it may move higher, I should stick to the rules rather than follow greed.' Then the next day the trades went down and you think 'damn it! I should've closed them all. Now I'm freakin worried of what the trades may do'

    So I want veteran traders out of the experience to tell me how to deal with such incidents. I've got a system that implements transferring s/l if price makes higher highs using fibs. However, I really don't know if I have to just close these trades to get a handsome profit or follow the machine. I know that the system is perfect but should I keep shutting the trades out of FEAR that it might retrace and potentially end in breakeven or minor loss, how do I know if this system wil ever get the job done? How would I know by shutting trades early that I'm cutting my profits in the long term?!?!?

    I really don't know if it would affect me more seeing that the market moves up even more after I close my trades to get a profit, or leaving the trades open and follow the machine and get stopped out for small loss or breakeven. I simply don't know

    I just have traded my system for 2 days , But I have been trading for close to 3 weeks. I have found that I'm more of a trend after rather than the usual range trader. Up to this stage, I am down close to 20 percent drawdown. Mainly because I have not stuck to any principle or program. But I believe my money management skills are advancing given that I have made over 1000 pips in reduction and just couple of hundred pips in profit.

    So earlier I babble more, someone please post their opinons, pep talk, or something!

  2. #2
    A fantastic query Hilmy83, I had exactly the same problems when I was starting out, I found one quite simple solution to the problem:

    Hide any reference to pips or money value from the trading platform, this implies hide your account equilibrium window and orders place when you're not using it (no celebrating is not using).

    It's amazing the power of seeing a profit in $$ has on the brain, when placing a transaction, there are no numbers to look in to effect your mindset, just some bars/candles on a chart and all these indiors you may be using, this is what you base your entry on. During the middle of the transaction exactly the same thing should happen, watch price, not your account balance and you will hopefully make your choices on what the market is performing, not what amount your account has attained. I know it seems simple, but it worked for me before I had my discipline into a level which was needed. I check my balance each morning that is all, and just cause I want to maintain a tabs on Money Management.

    Finally, if you're seeing your commerce constantly, attempt to check on it a little less often, the constant noise which makes a market movement can have the effect of you searching for reasons to exit a trade, instead of seeing a motive.

    My current price on the GBP is an example of a market tempting us to exit with a little profit, however the strongest moves come from congestion, therefore why exit once the potential of profits are so big and I can lock in break or a very small loss with a huge potential for benefit:

    http://img267.imageshack.us/img267/746/gbpusdrz5.gif

  3. #3
    Quote Originally Posted by ;
    A good question Hilmy83, I had exactly the same problems when I was beginning, I found one quite easy solution to the problem:

    Hide any reference to pips or money value from the trading platform, this means hide your account equilibrium window and orders place when you are not using it (no observing isn't using).


    Akuma....excellent suggestion...I was really contimplating forever shutting my account summary box and diminishing my open position box, so I could see what transactions were available and having the ability to use a close purpose on these on demand....this came following a lot of nailbiting now, knowing I was in great short trades with all the EUR and GBP, but have to wait out the pre-FOMC consilidation.

    It is tough to sit there watching negative daily PL in raw currency intervals, especially as I've been fortunate enuf to grow my account balance and increase lot sizes...I think that your thought confirms that this is a helpful plogical tool!!

    Thanks,
    Jim

  4. #4
    I believe that is some excellent advice. . .One thing I've done is types of trades. I've a trade I hope to hold for a month (or more). I hold it until I've a reason to depart. Afterward, I've classified other trades that I depart when I am happy w/ that the profit....may not be for everyone.

  5. #5
    Quote Originally Posted by ;
    Remember you can always exit PART OF YOUR POSITION and LOCK IN PROFIT.

    Let us say you are up 50 pips, depart 50 percent of your place to lock in profit.

    Then move your stop to breakeven on the rest 50%.

    Then if you end up up 100 pips, thenn depart 50 percent of the remaining position and move your stop until the 50 pip profit level.

    And so on...

    Change the numbers to fit your trade.

    It is called SCALING OUT.

    SIMPLE!
    My two pennies ....

    Scaling out may also be using to lessen your position in poor trades too. Some people do not like to take their losses. Thus, you can work on Scaling out profits on one place and scaling out a failure position too. If you decide to Scaling in and out of positions, do not get caught in the snare of wondering ... What if I left the whole place to run? ... since you are going to end up the same place you began. Scaling from trades also helps with all the emotions of trading too.

    Joyful Trading two U ...

  6. #6
    Quote Originally Posted by ;
    My 2 cents ....

    Scaling out may also be using to lessen your position in bad trades also. Some people don't like to accept their losses. Thus, you can work on Scaling out profits on one position and scaling out a failure position also. If you opt to Scaling in and out of places, don't get caught in the snare of questioning ... What if I abandoned the whole position to run? ... because you will end up the exact same place you began. Scaling out of trades also helps with all the emotions of trading too.

    Happy Trading 2 U ....
    Fucking genius. How obvious is that? I've sat on places which were clearly loosers, but I figured it has not hit my stop loss YET... I'm so doing that. I scale out to speak, closing 50 percent and moving s/l into b/e. Never thought about doing the exact same for rankings. Thanks.

  7. #7
    The dilemma is that you haven't back/forward tested your system . If you had, you would not have a worry about lost pips or anything, since you'd know that your system works good and whatever you breakeven on or lose will be fine as you'll make more in the long term.

    Breaking even is a triumph. It needs to be regarded as a triumph. Whenever that you breakeven, be joyful.

  8. #8
    Is a triumph?

    Does busting pay the bills? No. Does it raise your account? No. Breaking even is nothing, neither triumph nor reduction....nothing.

    Regarding the original posters question, have a goal before you put your trade and handle your risk accordingly.

    a roguetrader

  9. #9
    Is a win?

    Does breaking even pay the bills? No. Does this increase your account? No. Breaking even isn't anything, neither win nor loss....nothing. Surely nothing to be happy about.

    Regarding the original posters query, have a goal before you put your trade and manage your risk so.

    a roguetrader

  10. #10
    Quote Originally Posted by ;
    Breaking even is a win?

    Does breaking even pay the bills? No. Does this raise your account? No. Breaking even is nothing, neither win nor reduction....nothing. Surely nothing to be happy about.

    Concerning the original posters query, have a target before you put your trade and handle your risk so.

    A roguetrader
    Yes, breaking even is a win. And that's the issue with new traders -- they're really so worried about just how much they will make...

    If you are not losing money, you should consider that a win.

    To take it a step further, if you are breakeven following your first year of trading, you should consider yourself very profitable.

    Until you start thinking that way, you are going to continue to eliminate money on a consistent basis.

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