What do you do when you realize that YOUR the problem?

[MeiHua]

So I have come to the point in my trading career. Though short as it has been. Where I have a plenty of profitable strategies/set ups but am still a loser. Over the past few weeks I have noticed more and more that I myself am the core problem. How do you fix that problem? I always imagined that finding the system would be the hardest bit. But thats just the first hurdle, I knew this day would come and have read plenty of books and articles about it. But there's nothing as strong as realizing that the man in the mirror is your enemy. I know Ed seykota (sp) said "everyone gets what they want from the market." I sure hope it's not losing for me. Anyway, I hope that some other traders can share their story and how they over came this situation.

[soul786]

If you're the problem, take YOU out of the equation. Not by stopping trading though, I mean more of removing yourself emotionally. This is still system dependent but remember, if your system has showed it will work, trust it. Become systematic in your trading style: fixed formulas for lot size, fixed TP levels, fixed stop losses (these may be in the form of a certain number of pips from major S/R) and the main thing, is not to lose confidence.

Reason being: you've backtested and done the homework on the system, and hypothetically lets say it wins 70% of the time. Enter a trade and let it do its thing.

Also, I found myself come to this conclusion as I've furthered myself in trading: Not every trade needs to be a winner. Some will lose, some will break even, and some will win. If you're profitable after all that, then you tweak what you know to maximize return. First step, become profitable.

Good luck to you!

[Buckscoder]

Congrats for your self critics! Few are able to confess that.

In my opinion you have now two choices: You can decide to quit or you can decide to change your attitude regarding trading.

If you quit, that's everything but a wrong decision. Not everybody makes a good trader, cook, pilot, painter ... you get the picture. It has to do with desire.

If your desire to become a successful trader is big enough, you will for sure find out for yourself what you have to change. I can just tell you the common wisdom: Don't overtrade, don't be greedy, be disciplined, etc.

Just one word regarding systems: It is NOT true that you can make money with every system. Most systems are losers. They give you a false confidence because they might give you some winners short term and no or just a few losers. But they fail miserably in the long term. There is definitely a difference between quick rich systems, which gives you this false expectation and systems which work consistenly over the long run. Making more losers short term, but have a better long term result. And even those systems might fail at a point in the future. Trading gives no warranties. You are dealing with this risk until you end trading.

I give you an example for this regarding investments (trading is in my opinion just a sub style of investments) in general. The gold bull market lasted 11 years now. Somebody who bought the dips could make 25% on average every year. With compounding that's a nice profit and outweights most other hedge funds performance. However, that somebody made this 11 years in a row doesn't mean he can make it the next 50 years. Because the markets WILL change. A strat to buy on dips might then not work anymore for another 20 years and gives losses.

To invest profitably, you have to find out what system gives you an edge. You also have to find out what max. drawdown this system has. Because every system might fail in the furure, no matter if mechanical or discretional. You need a switch and an analysis to know when to "power off" with this switch the system and find another one. I am not speaking regarding system hopping every few months. That's another problem, not a solution. But systems can fail after a couple of years or decades. The turtles for instance used a system and if was very profitable. Today, it's not that profitable anymore, because the market adapted to it. That is what markets do. Adapting. If too many use one system, it loses performance.

The only exclusion from this might be a system with a statistical edge and kept confidential. Because human behavior is always the same. But this system then needs to kept confidential, at least in the core part, to avoid an impossibility: That everybody could be rich. Fx is a zero sum game and what some have to win others have to lose. And here comes the next thing into account: ALL profitable systems give you a drawdown from time to time. That's part of trading. And that's the very part most traders lose, because they then think the system is not working anymore and give up. That's why I said it is a key to know where your systems max. drawdown is. If it stays below that level, you can use it. If it overshoots with drawdown, the system obviously doesn't work anymore and should switched off the market.

[quizou]

I think Buck said it all.
When I was searching for a broker I came accross couple of different websites, with all of them giving you more or less the same free training, aaaaal over again. All but one who dedicated a very good part on the emotions, where they come from, how to fight them, and how this affects your trading. When you understand the role of your emotions, you understand why having a systematic approach to trading is important.

You need to listen this internal dialog in you when you analyse a chart "Ok if it goes there I go long or short", "Yeah but I've just lost 53 pips"....

Once you are fully conscient of this internal dialog, which is a real task in itself, you need to somehow change this internal dialog, by inserting Courage, Discipline, Impartiality and compassion in it.

Think about who could represent each one of those 5 areas, and keep that in front of you. If you've done the exercise to listen to your internal dialog, you will then be able to stop this, and look at your 4 icons/pictures whatever.

Because your brain is designed to avoid uncertanity, leading to ambiguity, leading to confusion, finally leading to FEAR!
And when you face fear, your brain stops thinking as all your energy is sent to your hands, legs, heart, to be ready to fight, or run.

As you know, a trade can go up, down or sideways. Which you will agree I guess that this is a big area of uncertanity.
As soon as you open your trading platform, you are fighting with yourself, and you need to find the weapons to calm you down (trusting your strategy is a fantastic one but not the only one), as now you are in conflict with hundreds of years of evolution. So calm down, breath correctly, no redbul no coffee, and mate, trust yourself, find the courage, discipline, impartiality and self compassion. This will help you dealing with the raise of your fears !

[bobmaninc]

Congrats you just completed step one of learning to trade. The market humbled you witch is not a bad thing because I bet you approach the market with a little more caution and you now realize thats its nobodies fault you lost money but yours. Buckscoder has pretty much painted a clear picture of what you should do now. Good luck in whatever your decision may be.

[petefader]

I love the thread title, had to check it out. My 2 cents? Get out of your own world. You can start a thread posting your live trades (perhaps not giving all the rules of the system if u want to keep it private). Post your PLAN on how you will enter and handle the trade. Stick to that plan and make follow up posts.

You know how it is in life..when others need help you can easily give advice, but when it's yourself, it's MUCH harder. If you think along the lines that OTHERS are following and may benifit from what you show them..then you kinda trick your brain into "giving advice" and taking your own advice that you're giving, rather than trying to do self help. At minimum keep a journal.

If you are trading a totally mechanical system, then set you SL TP and go watch a movie..it's a tough job but somebodys got to do it lol.

[Desmond Sterling]

Some very good words written here.

I too am my own worst enemy; the first confirmation of this was trading historic data by hand, where I couldn't manage to use a 'system' to the same positive effect it had for others. That proved it.

So, what to do about it, well, for me it is 'stay on demo and practise' and just keep at it, at it, at it, at it.

I was one of those kids that was really slow to learn to ride a bicycle too. Not sure why. Looking back it was more than the fear of falling; it was also some sense that I wasn't as inherently as good as the other kids, and never would be. Which felt so unfair.

This was balanced by dogged determination; eventually even the slowest kid 'gets there' if they don't give up and by the time I was in college I was leading bicycle tours (I left the racing for the fast guys, and one met more girls simply doing the rides by the beach &c anyway). Years later I got an old used 78 Honda Hawk, spent a long time with that, then got a ninja ZX7R some years later. Five years after that, people that didn't ride motorcycles would ask me about how I could do something so clearly dangerous and risky, yet with obviously sufficient skill... no one believes me when I tell them I was the slowest kid to learn how to ride a bicycle. I don't ride much these days because I have to drive my kids around a lot now but... well over 20 years and ridiculous miles and miles on motorcycles now, and not one crash.

So here we are again learning to ride bicycles. What's the rush? Take your time, practise, get good at it across years and love the journey. For me it was the same thing with small business. It took some years before I could stop consulting without worry, and live off sales. The #1 factor? Not quitting, or effectively quitting by 'rolling all the dice at once' ~ just keep on carrying on. I suspect what's bothering you is the *rate* of learning. Many people have said it has taken them years. I know it will take me years, too. And that's okay, really.

[alchemy7g]

Emotions only get in the way if you do not have a objective system. Every market is based on pure science and mathematical calculations. Once you can make sense of that theory then you've answer the million dollar question.

[Nikitafx]

keep redrawing or remodeling the part of your trading method that you know for a fact is messing up your game, or scrap the entire thing and start with something else until u find one that can gel with your psychology as a trader.

Not everyone can swing trade and not everyone can scalp. Then there are those who are in between.

They suit different people differently because of Psychology.

I followed ur trading log now and then.

I have pointed this out a few times. Your analysis on lower TF is ok. You just dont read bias of higher TF.

If you learn how to read where prices are going to end up for the day, then you can clearly take the leisure of picking trades with absolutely next to nothing as SL in the lower TF.

Your trading method seems to concentrate on supply and demand levels on smaller TF without looking at where its going to end up for the day on the Higher TFs.

I could be wrong because honestly I have never sat and went into the details of why you did all the analysis that you do.

Reassuring or mentally preparing yourself maybe?

All I know is you are over doing it and looking too deep at things that are not there or not consistently there.

U need to couple what you are doing with a higher TF analysis.

Otherwise you are going to be trading blind and start relying on statistical advantages to make a buck. That is the hardest way to make money.

Back test for 2 or 10 years and take every trade just because ur back testing says you will eventually have more profitable trades than not. All is well until you try sneaking in compounding and then ur chances just took a nose dive again!.

Unless u can read where prices are going to end up for the day, you are just guessing or gambling.

Even traders who read price at looking at the charts and tell you oh this is where I am buying or selling, are doing it because they know where its going to end up or atleast they have a reasonable idea on where its suppose to be by the end of the trading session.

that is what is lacking in what you are doing I guess.

[MeiHua]

Thanks for all the really good posts here. I am taking it all in at the moment. I am definitely not giving up or giving in at this point. Before I even took this break I knew i was going to come back, hopefully with a vengeance. Yes I am going put a cohesive plan together that only includes 2 basic set ups nothing more. Yes they can be used for long or short but that's not the point. Only concentrating on those 2 types of entries. I am confidant in the statistical numbers behind their back testing over several years in several different currencies. So we can continue to use focus on that.

But the trader psychology aspect of all this is also difficult. I think I have been running around a lot, picking up things I really thought would work or have seen work for others. Plugging them in and trying them out. Also my patience really sucks, I think I tried to counter act that by having 12 pairs that I would watch because my set ups are based on daily signals which obviously don't come that often. But the success rate is phenomenal. Also my 2nd strategy happens more frequently and can be utilized intra-day. Giving me the flexibility I need. But the key point here is no more just plugging in aspects into my trading system. Now I have added so many different things, its time to cut the fat.

Patience and Discipline are going to be more of a factor now that I can see their effect on my trading. Also I am going to continue live trading and try to evaluate my trading strengths and weaknesses. Also I need to determine how to trade focusing on my strengths and protecting my soft spots. For example, I know I have no problem pulling the trigger so that is a strength. In the face of falling knives I can still take that long. On the other hand, I miss manage trades, some winners become losers, or i over compensate by moving up too tight so on a small retrace i get taken out. This is definitely a weakness for me. So I will have to come up with a proper set of rules that will allow me to manage trades better or find a style of trading with minimal manipulation during a trade. I hope as I progress I will find more of these. But that is what I am going to focus on as well. Going over my journal entries and see if i can find some common threads.