Hey Lexy!
Nice to here from you! And thank you for the suggestion on the book. My first thought was to go and find it on Amazon. But, I simply can’t start on any more books now. I’m gonna have to put them all down. Unfortunately. But, it’s ok Lex…Heavy stuff coming my way. 2 more days, and it’s gitty-up time! All my concentration will be devoted to that.
Again, thanks Lexy!!
Mike
Hey Journal.
Well, it…is…on! Man, do we have a lot of work to do. 6 week course, 1 down & 5 to go. The amount of homework we have to do is crazy. Well, I surely don’t have much time to be typing in here, so I’m gonna try to get to the important stuff.
Well, we got going last Tuesday. It’s pretty much just like it was in the last class. Just different material. This is the stuff we are in the middle of now.
Trading culture. Basically we are finding and uncovering the reasons for [I]why do I trade? [/I] What’s the purpose of our trading? To put it all into perspective, we are building a foundation for our trading. And since I am the primary subject, in this trading business, that’s the place to start.
“Responsibility = Control” . We need to start out with responsibility first. That will give us control over our trading. And that’s what the [I]culture[/I] does for us. It helps us to understand and appreciate how much we have under our control.
Here’s some questions.
To what degree are you honestly satisfied with the results you’ve achieved to-date from your trading?
Starting with your first trade, how much have you lost to-date?
Approximately what percentage of your losses was the result of your behavior and actions?
To what degree do you manage your investment and trading activities as a highly valuable, personal asset?
A DEFINED, STRUCTURED, AND LIVED WAY OF DOING WHAT YOU DO.
This course is not going to be something you have invested in, walk away from it in 6 weeks, and think your gonna automatically make a lot of money. We need to think differently. It’s more than just stopping & preventing bad trades. It’s more than looking at the risk to reward ratio of each trade. Instead of looking at the returns and the amounts we are making on trades, WHY NOT PAY ATTENTION TO BECOMING MORE EFFICIENT AND EFFECTIVE IN WHAT IT IS WE DO RIGHT UP FRONT.
You can’t take responsibility (for your actions) unless you know what you are responsible for. Once you have defined what you’re responsible for, by definition, you are in control from that moment forward.
Traders tend to focus so much on execution of trades, and a methodology. But they haven’t mastered what they do now, and what they do best. That’s the premise of this whole course. It is understood that all traders do want the 3 C’s. Control. Confidence. Consistency. About Control, it’s about knowing [I]what[/I] you know, [I]increasing[/I] what you know, and [I]refining[/I] what you know, and becoming better at [I]knowing[/I].
Thinking. Thinking beyond, outside of the box, thinking and substituting things that you normally think about with others. About looking at different ways to adapt things, modify things, substitute things.
Do. Doing things differently, not always in the same way. You’ll always get the same results if you do the same old things.
Mindset. Definition is a set of beliefs or way of thinking that determines one’s behavior, outlook, and mental attitude. Do we have a fixed mindset, or a growth mindset. You have either one or the other.
We are focusing on becoming a trader, rather than the trading activities itself.
Everything will fall into place if you develop the most important aspects first. And this is the hierarchy.
Trader skills.
Trading culture.
Trading structure.
Trading performance. This will absolutely be there if those are developed properly.
There’s so much to becoming a trader. It’s [B]MORE[/B] about knowing ourselves, than it is about knowing the market.
“As to methods there may be millions and then some, but principles are few. The man who grasps principles can successfully select his own methods. The man who tries methods, ignoring principles, is sure to have trouble.” T.S Eliot
"No profession requires more hard work, intelligence, patience, and mental discipline than successful speculation." Robert Rhea (Dow theorist 1932)
The benefits of a defined culture include KNOWING
…what to do in literally every situation
…why your doing what your doing
…how to capitalize on your strengths
…how to manage your weaknesses
…what you need to know or learn
…what really fits and what doesn’t
…who’s congruent and who’s not
Culture …It’s HOW and WHY we do, WHAT we do.
The culture’s context is wrapped up in our purpose. We need to have a ‘purpose’ statement.
So this is what we’re working on. This is part of our homework. I did come up with something. But, we went over it, and I surely must refine it. On Friday I had a one-on-one meeting with Terry and Paul, for like an hour. We went over what I had. I guess I didn’t understand exactly how it’s supposed to be. So, this is something I am working on at the present time.
The only other subject matter we’re working on is VALUES. We need to come up with 10 trading values. What we’re doing is building a framework. All of this is, of course, being mind mapped. So, I have to come up with some values that I deem is important. Believe it or not I kind of am struggling with it. I guess, well I know, that I am such a perfectionist. And that hinders me from getting anything done within a short period of time. Which ones should I pick? Well, I did come up with 2. Here they are (were). ‘Live & Learn’. And ‘thorough’. Well, he took apart the learn from the live. That’s really 2 values. (I was wanting to expound on what that means as a whole, you know to live and learn about something ) But, we went over the learn one. I guess I’m just thinking too much into it. I need to pick some really simple values that I want to live by (and trade by).
So, if you don’t mind, I guess I will start thinking about this right now.
Learn is gonna be one. As a value.
I like thorough. Cause I tend to be too quick about things. I need to slow down and think more, instead of rash decision making.
I guess I will go with the one everyone will pick. (We talked about this in the webinar…but I simply don’t like to do what everyone else does). Honesty. Being honest with myself. True to myself. If I have a rule, and I break it, what are the consequences. What should they be? If I’m not honest with myself, that would be a flaw. If I cannot be true to myself, that will be a problem. Ok…so I’m gonna go with being TRUE, to myself.
Let’s see…what else is very important. A value that I want. To uphold. To become.
Oh, ok. How about DECISIVE. Yeah, that’s conducive alright. That needs to be explored.
Well, I don’t need to be worried about being lazy. I surely am not. Or determined. I surely am. Those things have been set inside of me for a long time now.
Uh, what about fear? Is that a value? I mean, like not being afraid of something. Of a result? Hmmm. I do want to operate without it. Fearless. Yeah…that’s a value. Ok. Definitely. I think I can get to the bottom of that one. Cause I do not want to be afraid of anything.
Wow. That leads me to be thinking of many other traits traders fall trap to. Greed. We all know about being greedy. So, what would be a value? Selfishness. What’s the opposite of being greedy? Not greedy. (ha!)
Contentment? Satisfied? Well, in the arena of trading, I keep thinking of the need to be smart. Smarter. It’s better to be smart than wanting more. Hmmm…I wonder if ‘smart’ is a value. You know what…I’m gonna make it one. I got to research that. Find the definition, come up with some synonyms and find out how I can be that way.
So, I need to recap. Learn. Thorough. True. Decisive. Fearless. Smart.
Let’s see…what else Mike. Ok, another one everybody knows, but I guess I need to own it. Patience. Sure, that’s a must. You know what, I just looked up at that one very good quote up there. From Robert Rhea.
Hard work. Intelligence. Patience. Mental Discipline. Looks like I’m thinking correctly because smart is another word for intelligence. Patience matches. So, what about mental discipline. What value is there? Uh…ok…I’m gonna go with it. Mental Discipline. That’s a value!
Yes! So that comes to 8 values. 2 more to go.
What about hard work. What does that mean? Putting in the time and effort. But, I honestly don’t have any problems or shortcomings with that. What I do lack, is a memory. My mind in general. Man, do I need to work on creativity. Well, I surely was doing that through that good book. Creativity…is this a value?
I’m gonna say yes. I need to work out of both sides of my brain.
You know, something just came to my mind. What I really need to work on (sometime in the future) is objectivity. Now, is that a value? Being objective about things?
I’m again going to have to say yes. I so badly want to have an objective mind. I don’t want to be bias, when I look at the market.
Ok. There it is. My 10 values.
Learning.
Thorough.
True (to self)
Decisive.
Fearless.
Smart.
Patience.
Creativity.
Mental Discipline.
Objectivity.
Wow. What a long post. That was not the plan. But, you know what, I accomplished what I was going to be doing anyway. That was, coming up with the list of the 10 values that I need to mind map.
You know, Terry was telling me about how much stuff we are going to be doing in the next 5 weeks. All of these 10 values will be counted as one mind map. We will be doing…20 MM’s, before it’s all done. I remember saying…oh…my…goodness. Oh, and you know what, he encouraged me big time. He said that him and Paul do talk about me. Terry said that he fully believes that I will become successful. From what he has seen of me and knows about me, it’s just a matter of time. The day WILL come. He says that this process will get you there quicker. Man…talk about feeling good about yourself!!! To know that it’s inside of me, is the greatest feeling of all.
I’m gonna work it on out.
So, if you will excuse me, I have some work to do.
Mike
The Trader
Hey Journal!
Well, it’s getting deep. Man, there’s just not enough hours in a day. I have so much work to do it’s not even funny. We are swimming in so much material. It’s virtually impossible to get it all done, with only a few hours a day that I have. It’s all of the mind maps that we should be getting done. Impossible. But…I can only do what I can do. I just wish I had more time on my hands for the task.
Well, the good thing is, I do understand what’s going on here. And I’ll take it from the top. Ready?
See, the single most important factor of a foundational component of your trading culture, is your PURPOSE STATEMENT. This is the reason why you get up in the morning. This is the answer to the question of why do I trade? This is very important to know. Talk about putting all things into perspective. This is where it all starts. This statement. And this is something that will take some time in coming up with. I had to revise mine, with a lot of help. But this is what I got.
TO FULFILL MY UNQUENCHABLE DREAM OF BECOMING A SUCCESSFUL, INDEPENDENT BUSINESS OWNER, BY MASTERING THE ART OF TRADING, MY PASSION.
Now look…I’m surely not saying this is completed, but it’s pretty close. See, this statement should include the 3 top reasons why you trade. He walked me through a mind map. And all ll I did was just throw out any and all reasons of why I trade. I put down so many words and sentences. Then you get to the point where your coming up with the same answers over and over again. Then you go back and take the top 20% of everything that you wrote down. (That’s using the 80-20 rule…finding the most important parts). And I got…my dream, business owner, passion for trading. Those are my reasons.
Anyway…I should be somewhere in the ball park with that statement. (I haven’t talked to him about it since I came up with it, just so much other stuff we’ve been talking about ) And I’m sure it will be revised down the road. But, in any case, this statement is the reason you approach trading the way you do. This is the representation of what I do and what I am trying to become. It needs to be clarified. Documented and visible. Because this is what’s gonna help me get there.
The next most important thing is your VISION. This is what you want it to look like. This is what you shoot for. Now, there’s degrees to it. Yeah, you have the big picture vision of what you want it all to look like. For me, I made a mind map of what the picture will look like. It basically shows you what my office will look like. All of the things I want in it, even down to a couple of plants. Well, I don’t know exactly which plants I want, but I do have in mind a couple of nice tall ones. Also how I will dress. Cause I will be looking like Wall Street everyday, even if I don’t step foot outside of the house. I call it ‘dress for success’.
But what needs mentioned here is that there is degrees to vision. Vision is what you shoot for. Yeah, I will be shooting for my day and the life in my office, (sitting in the most comfortable, overly padded, black, reclining, fall-asleep easily, chair) but also there are particular visions. These are the things that I want to accomplish. Actually these are goals. But on a bigger scale. It all needs to be put into proper perspective.
I will have THE vision, and also slightly smaller ones.
Then there are the GOALS. These are what needs to be accomplished in order to fulfill the vision. These are broken down into manageable parts.
Then there are the OBJECTIVES. These are what needs to be accomplished in order to full the goal.
It took some time, but I finally understood the hierarchy of all this. I believe this to be very important.
I’m gonna shoot out here what Terry helped me with. I think this is probably the most important MM I have.
In the center, of course, is my vision. And there are 5 goals, if accomplished, will get me to my vision. Now, what’s missing, is the objectives needed to accomplish each of the goals. See how big of a MM this can be?
Theoretically I could fill out a few of those already. Let me go through each of those goals.
Top right…that’s what is coming my way in the next 3 weeks of instruction. That’s all about the strategy. That’s the meat and potatoes of the trades. All the details.
Right…That’s all about what we’ve learned lately. My values, what I believe, how I conduct myself.
Bottom right…That’s the business related issues. What every business needs to know to keep it afloat. Like paying taxes, the regulations, laws, where the money comes from and goes, like the balance statement stuff.
Bottom left…Managing myself. It’s not just about KNOWING how I should act and react, keeping the emotions at bay, etc…but actually SUCCESSFULLY MANAGING them. There’s a difference.
Top left…is what I learned last session. Knowing how to think, learn, practice. Having an effective decision making process in place, along with information processing. All the fundamental aspects of what I do with information and knowledge. Basically getting better and smarter.
See, those 5 things are major stuff. So big that they will require much in the way of objectives, in order to accomplish them. There can be an objective #1, objective #2, objective #3, etc…all the way down in which all need to be accomplished, in order to achieve the goal.
See how much of a perspective all this stuff is? I think it’s absolutely great! For as hard a trade this is, I believe it’s necessary.
Oh, you know what Journal? I need to say this. Cause I remember a year ago, how I told you all of my goals. I was nothing but goal oriented. I laid it all out there. And I couldn’t achieve them. Well, I did for the first 3 months of my live trading career. And now I know, they were not realistic goals. That was my problem. Then I went through and learned that I should not be a goal oriented kind of person. Rather a process oriented person. Sure, that’s more important. The process, more than the goal itself. So, as Terry was talking, I was remembering this stuff I went through. And I asked him about it. He said that this was such a good question! And point. ‘What’s more important, the process or the goal?’
He said that this is all process setting goals. That’s why it all gets broken down into objectives first. To reach the goals. In order to reach the vision. Because of our purpose. That is it in a nut shell.
So, the way I look at it now, as opposed to before, is goals are good!! I’m not going to throw out the baby with the bath water. I will have goals. All kinds of them. Like everywhere. Cause I want to know where I’m going to. But anyway… what I have up there…that’s the cats meow. This is what I want more than anything in the world right now.
I have a purpose.
I have a vision.
I have goals.
And I will have the objectives laid out for each goal.
Oh, I remember also, what else we we’re going through.
See, I need to know where I’m at right now. This is important. Because if I know, my present state, present beliefs, and the fact of having a vision, then what will it take to bridge that gap? There should be a path to follow. I also should have a mind map of ‘my trading strengths, my trading weaknesses, my beliefs’. See? I can spend a very long time drumming up this stuff about myself.
Like I said, this is deep stuff. And guess what…Come next week starts the trading structure. Man…I don’t know if I’m ready for this. There just isn’t enough hours in a day. Too much to digest in so little time.
Guess how long this next stuff (section) will take me? A long time. I mean, I just want to go back and finish my values. I completed 7 of them. But, I need to keep up with the pace.
I keep thinking…you know…once this class is over, as long as I have all the material at my disposal, I can proceed at my own pace. See, there’s a couple things going on here. One, learning about myself. And two, learning the trade. I don’t think I’ll ever get to the bottom of myself. Then I got to get to the bottom of trading. That’s gonna take twice the amount time.
Geeeeez. You know what? I’m a perfectionist. I can’t help wanting to perfect each and every aspect as I go along. (boy, am I glad I realize this about myself)
I do remember the spanking I got.
And guess what?
It’s not going to happen again.
I don’t care if it will take me the rest of this year, or two, to get back into the market. Cause, I know that whenever the time comes, I will have to have a proven system in place. And that will mean that I will go back on demo. Again. And you know what? If it will take another 3 years of demo, like I went through already, then so be it.
No more spanking.
I’m gonna do the spanking.
(Ha!!!)
I’m out.
Got so much to do.
Mike
Hey Journal.
Don’t have much time at the moment, but I wanted to put out there a pretty good summary of what I’ve been up to. I would have to say, presently, this must be the most important MM. It puts a good perspective to what I’ve been learning, up to this point. And talk about perspective…I cannot emphasis this enough.
PERSPECTIVE. There’s so many variables, factors, and views to my whole trading business. And that’s what gets me the most, putting it all down in a way that I have the proper way of looking at everything. I’m gonna be talking so much about this. Because this is how I think, view, and approach my trading business.
There’s so much to it!
Let me throw this out there now. Believe me, there will be more to come, regarding my perspective.
Mike
Hey Journal.
Well, once again, not much time here now. I’ll tell you, and show you, in short.
I realized a lot this weekend.
It’s all about the journey.
Yes, I need to see it all in the proper perspective. But, what I really want to know is the journey I need to take. And I’m getting closer.
I’ll throw out what I got. This should be it in a nut shell.
Well, come Tuesday, and on out for the next 3 weeks, we will be working on the particulars of trading.
It will be the ‘process’, and ‘methodology’.
Gonna get interesting.
Mike
Hi Journal!
Ok. I’m gonna do some explaining to ya. I think I’ve been neglecting to clue you in on what I’ve been learning lately. Man Journal…I really think I’m getting somewhere. When I think about it, of all the stuff that’s been coming my way, compared to where I was a year ago, I definitely believe I am changing.
It’s my thinking that’s changing. And in particular, lately, is ‘confidence’. (This is one of my values, and plan on exploiting that much further down the road) . But, I guess I really never thought about this statement…‘Being in control of my trading’. That can be drilled down so very deep if you really think about it. There are so many factors in trading. And mostly everything boils down to …ME. That’s where it starts, and ends. Sure, the market is in between, but, I know that I am responsible for every decision that I make. And there are thousands that I make, in the whole process. If every decision is carefully made out, that leads to confidence, and control, of my trading. It is a beautiful thing.
Ok.
That’s nice.
Let me back it up and get a running start here. We embarked on what ‘Trading Culture’ is. That entails my trading values, purpose statement, my vision, my goals, and the objectives needed to reach the goals. This is the foundation upon which the ‘Trading Structure’ is built upon. The culture really is knowing myself. I must realize what my strengths are, to capitalize on; what my weaknesses are, in which to work on; know what my principles are; know where I’m at, and where I am going. And HOW am I going to get there. Now, if that don’t make sense, nothing does.
Upon the foundation of my culture, the Trading Structure is built. This is basically 3 things. First, it’s the business entity. I do need to know what kind of business I am building. Believe it or not, there are many different ways to do it. When I think about it, I guess I need to ask the question, “How long do I want this business to last”? Is this business for me and me only? Or do I want it to last longer than I am around. Meaning, do I want to pass it down and continue on even after I have passed away? A legacy. My footprint in this world. (now that’s some big picture thinking alright) . Or…is this just for me? And no one else. Meaning, this doesn’t belong in the hands of anyone else. Well, in any case, this is how I view it. I am building this business for myself. This is my baby. BUT…I plan on building this in a manner in which IF someone down the road comes along and finds this to be what they want to carry on, (like my kids) then they will be ABLE to. This will all be laid out, detailed, every aspect explained. This is just how I plan on building it. But, the bottom line is, it’s for me. I mean, of course, because I enjoy it! It’s my challenge. My passion. And I don’t care what happens to it when I go, because without me, it won’t be complete. My kids, or whomever, would have to personalize it. It would be built upon a different: culture, values, a vision, goals. But, they would be able to because it would be very clear and transparent, easy to follow, all explained.
Yep, that’s nice. So, the structure has 2 more components to it. First, is the [I]Trading Process[/I].
This is [B][I]how[/I][/B] it’s run. And that is broken up into 3 time periods.
[B]Pre-session // Session // Post-session[/B]. Those words are in the context of a day traders environment. In other words, what we do in preparation of a trade, what we do during a trade, and what we do after a trade. When you think about it, there is no other times available. Cause all trading activities will fall into one of those 3 times.
Then, the last component of the Trading Structure is the [I]Trading Methodology[/I]. This equals that previous [B][I]Session[/I][/B] broken down into 3 parts. Now, this, is the meat and potatoes of it all. You have the ‘entry’ of the trade, ‘trade management’ of the trade, and the ‘exit’ of the trade.
These are the million dollar questions.
Entry - What makes me get into the trade? Why do I believe this to be true? Why did I pick this way?
Trade management - Are things going good, or not? Where’s my stop loss? What’s my target? What’s the plan in place about whatever happens? Contingency plans.
This is what I have down so far. —The first action required should be to minimize risk. Looking for break-even. Then the second action should be to lock in profits. Meaning adjusting the stop losses, or setting trailing stops.
Exit - What’s the reasoning why I exit? Are they take profits? Or stop losses? Why? And it should all be according to the plan. There should not be any surprises, because I would have already thought about it. And will act accordingly.
It’s all about being in control of the trading.
Well, there’s much more to all of this. I’m right in the middle of it now.
Man did I have a good talk with Terry on Friday (the personal meeting time). It was encouraging. He said that come Tuesday (our webinar class) he want’s me (my mind maps) to be the focal point of the class. There’s like 5 other people in this also. We’re gonna be picking it apart, and everyone will be participating with questions. See, this is the plan for everyone, in the next couple weeks, but he wanted to start with my stuff first. We all will be actively participating in each others work progress. You know, we will be able to see everyone’s mind mapping work done on the subject.
I’ve accomplished some good stuff on it so far. But, far from being done. I am so looking forward to Tuesday. This should be very very helpful to me. And I am looking forward to seeing what these other guys come up with, because there are some who’s business this is already. I mean, one guy goes to work on the trading floor! I don’t know what this means, but something about ‘diamond’, about him. I think it’s like something good about a trader. But anyway, I feel like I can learn very much from just about anyone who does this for a living.
In fact, this is similar to some of the folks here in B.P’s. You just can tell who has experience. I love reading about what they say. There is some dominant names in here that you just have to listen to. Oh, and I did already mention our authors here. Absolutely geniuses.
Well, I’m gonna go now. I’ll be putting up some mind mapping of my methodology soon. But, I guess it would be better when it gets refined. Like come Tuesday, when the shredder comes. This is what I say.
"Don’t sing it…bring it! "
Mike
Your Driven Mike, thats for sure. Just stumbled on your journal, will go back thru and read it thru, I like your mindset and intensity to this career.
Keep Rolling!!
Hey Journal!
Well, it’s Sat early morning now. This is one of my most favorite times of the week. (Well, that’s when I don’t have to go into work, the once a month thing) But anyway, …listen…it is just so quiet…peaceful…I just love this time of day. I still wake up at 2:30 am. Everyday. But on the weekends, it’s just special. I’m sure it’s because I am not under the gun. Man, it’s like, every weekday, I know that when 5:30 comes around, that’s when I got to be getting going. Oh, and how the time flies every morning! And then I’m out the door by 6. But, look, this is what’s normal for me. I’ve been determined about my venture for 4 complete years now. I remember back in the first year, I would get up early, but not all that early. I would always need more time, before I went to work. I got it down to 3:30 wake up. But time and time again, I’m always like, “I need more time!!”. “Ok, I got to back it up.” Then I remember going to 3. Sure, it worked, but after more time went by I just needed …well…more time. So, then it went to this time now. That was like 3 years ago, now. And it’s the best fit. Oh, I do remember going through some very tough times before. (Tiredness) That was because I didn’t take advantage of ‘naps’. See, I have a half hour drive (straight highway) to work. And talk about getting tired. On the road. Boy…those were some tough times. Falling asleep at the wheel haunted me like you wouldn’t believe. I remember my youngest son used to get pretty worried about me. Cause, at around that time, he had a good buddy who’s Dad passed away. At such a young age. It was tragedy. That was crushing to him (his buddy, of course). But Ian got to thinking what it would be like to lose your father. And needless to say, no kid wants that, or should even have to think about that. (I guess I shouldn’t have let that out by mentioning that I get tired on the road) . I tried to put his mind at ease, by telling him that nothing was going to happen to me. No matter what. But, I was cognizant of all my actions. I had too much to live for. I was not going to let any accidents happen. See, I’m not talking about a few days here and there, of being tired. We’re talking months and months of that struggle. It was an era. And I got through it. After so long, it’s like, between my body and my mind, I adapted. I made the changes that made this lifestyle conducive. Look, I am on a mission. I need time. And the most that I can get, the better. Nowadays, it’s nothing but normal living for me. I don’t struggle at all with tiredness, on the road, or even at my work place anymore. So, it starts. 2:30. In the shower. Sitting at 3. Working on something. 3:30 …coffee pot comes on. Finally get up to get it very shortly thereafter. And I swear, time accelerates up to 5:30. I just cannot slow it down. But…on the weekends…ahhhhh…so sweet!! Shower? Hecks no! I’m sitting down at 2:35, after I go to the bathroom. And I’m in such a wonderful frame of mind. No time constraints. The sun eventually comes up. Then somewhere between 7-9, so does she (Trish). And my only question to myself will be… “What did I accomplish?” “Was I productive, on my business?” MOST of the time, it is a yes. (sometimes it does happen that I will fall asleep, nap).
Oh, I forgot to tell you Journal. Man…guess what I got for Christmas? I requested this some time ago before hand. A FIT BIT. This thing is awesome! I wear it on my wrist, like a watch. And it keeps track of the steps I make in a day. Also (and the real reason why I wanted it for) is it tracks my sleep patterns. All I do is look at the statistics on my smart phone. It shows me how much restful, or restless sleep I get every night. So, quality and quantity of my sleep is monitored. I don’t know how, maybe by movement or something like that. But, anyway, it’s awesome.
Well…sorry Journal…I’ve been typing away, and didn’t even get to what I really wanted to talk about.
Oh well… I love typing. This is my thread. And I’m gonna type away. (dog-gonn-it)
I’m coming right back. Cause, man, do I have some stuff I have to get out. I was just elated after my talk with Terry yesterday! Talk about exciting. That…I…am…
Mike
Ok Journal. This is what’s been going on.
We’re pretty much at the end of our class. This up coming week is the final week. I’m sad. Well…not really. In a sense, I’m excited. I do want to be over with it. And that’s because of all of the material I’ve been given, I must go back and refine a lot. It’s just impossible to keep up with this pace. This is normal. I mean, he as even said, like, ‘I know I gave you guys a lot of information to process and work through’… This is an on going thing. Everybody has their own pace.
It’s time to build.
I have a road map.
I have a tool chest.
I have building blocks to put together.
I have a vision, with goals, and a journey ahead of me, to accomplish them.
I have a foundation in which my structure is being built. (And that foundation will always be worked on)
Lately I’ve been struggling with my methodology. This has taken me back to where I left off, of trading. I thought I had a good idea. I’m talking about the approach. How am I going to approach the market? In what fashion? Ok, I thought the best way was by ‘the trend’. I’ll have the different states of a trend compartmentalized. You know, like, it will be either trending strongly, retracing, ranging, or reversing from the trend. So then, whatever the state is, I should have something down on what to do in that situation. I should have levels drawn on where I could be in, take profit at, stop losses at, etc…
So yeah, that’s an approach. Right? But…then it gets too complicated for me, when I look at the chart and try to figure out where all those lines should be. So, then, I get frustrated. Then, this past week, I had a great idea. (Actually, thanks to Pipsychology, his write ups always gets me thinking) How about approaching a trade by ‘probabilities’? I’m talking like, looking at any kind of entry and destination, on the chart, and put down all of the pro’s and con’s about it. This would definitely make me more objective about a trade. How about an open ended trade where the market would tell me it’s done moving that way. And come up with a probability on it. Basically, that was an idea. But when you think about it, it’s complicated, and hard. Surely a lot of work needed. So, I’ve been trying to find what approach I want to take. I’m getting frustrated. Not feeling good about anything.
Then…me and Terry talk on Friday. I wanted this to be front and center of our one-on-one meeting.
I showed him all the mind maps on these ideas. Told him, bottom line, I’m not satisfied and don’t know what to do.
He says…let’s make a new mind map. So, I did. Got it all ready to go.
He asks me one little question.
"Mike, out of the 2 possibilities, long or short, which way do you prefer to trade? "
I’m like…uh…hmm…well…man…never thought about that.
“Do you like trading going long, or do you like going short?” NOTHING ELSE, BUT THAT.
And then I remember a book that I read that posed characteristics of when the market goes north, than the market going south. Going north is like pulling teeth, as opposed to going south. Man…when the market wants to short, boy, it does, without hesitation. More farther and longer! Bad news really can bring out fear in people. But, when there’s good news, there will always seem to be a hesitation sentiment with it, at some time.
So, this was shooting through my mind when he asked me that question.
I said ‘short’. That’s what I pick. Out of the 2 possibilities.
He says, “Ok Mike…bring up your charts.”
"What time frame do you want to trade? "
So, I did. And brought up my one favorite pair. AUD/JPY. On the daily chart.
He then immediately guided me and had me draw out some lines on it. (I’ll show you a pic of what we did)
Oh, I remember, he then asked me if I knew what an ABC trade is. Or a 123 trade. Well, I didn’t. He says that I should research about that. But, he told it to me and showed me the basics of it, on my chart.
Well, I guess he seen it there, and showed me the outcome of when there’s ‘a high, then a low, a high again, and then the breakout low’. Man!! I was shocked. I don’t know. I guess I was shocked of how much he can read what’s going on in the market. And also how actually the market does obey some principles.
But, getting back to simplicity sake. He shows me that all I want to do is find the level of where I will go short. (It happens to be at a strong resistance level) He says this…"We’re traders. We don’t know what’s going to happen. And we’re not going to guess. But, at this area, you know you’re going to go short at. You have a stop loss in place. So, your prepared to take the loss, or your prepared to take it on down. "
It’s that simple.
And you can see there all of the opportunities that the resistance area was respected. The idea is to ride it on down, put in a trailing stop or just take profit when it consolidates.
I don’t know. It’s like I’m looking at the market for the first time. Honestly…I guess I don’t know that much. Look…I don’t care. What is is what is. And I don’t care what anyone thinks. I’m just amazed, that’s all.
I am looking too much into it. This is a simple way. You know, I’ve always have heard that you should not make it too complicated. I mean, I’ve known this! But, here I am, making it just too complicated!
And this is precisely what I told him. “This is why I need you!” I needed to see this, hear this, from someone who just knows about the market. You know, he doesn’t even trade the forex market. I remember him saying he tried all of the different ones, long ago, and this is just not his cup of tea. I guess it just goes to show that a chart is a chart. Principles are principles that stem across many financial markets.
So, we’re going back and forth from that chart to my new mind map. And this is what we developed together.
I’m not too sure why he had me put ‘draft #1’ in there. I think it’s because this is incomplete. Eventually he wants me to branch out. Like at different levels. Time frames. Etc…But I must get the basics down pat.
He kept saying to me, at the end, “Mike, concentrate! Stay focused! On this, and nothing else! Don’t spread yourself out but realize what you got here.”
You know what…I know how to obey. And that, I will.
I am, and have been, given the keys to know how to trade. AND in becoming a trader.
Do you think I’m gonna stray?
Nope.
It’s only a matter of time.
Mike
This!!!
Hey Journal!
Well…it’s over. Tuesday was the last webinar. And Friday was my last personal meeting. (Geeeez…I’m making it seem like I’m never gonna see him again) (I guess it could be, if I want)
So, on Tuesday, Terry talked. He did a class on ‘support team’ & ‘performance’. Yep, was good stuff, you know.
Then he opened it up for anything. He said he’ll answer any question, no matter what. So, yeah, we all talked. It didn’t end up with anything earth shattering. I’m kinda sad, sure. It’s in the air. Man…I remember now. Well, one guy there was talking and asking what he should do. He trades for his living. I guess he’s been crashing. And now he’s asking if/when do you get to the point where you need to scrap everything. Man…I never thought about that situation. Look…sure…he sounds a bit down and out. Pretty sad. And Terry talked a bit to him and basically came around and told him that he needs to start over. I’m thinking…like yeah…like why not? If it ain’t working, do something. Now, the situation he’s in is something I haven’t quite put myself into. He’s making his living this way. And…I don’t know…I was confused. Cause in my mind…look…there’s a saying, and it goes like this. ‘A bad day on the golf course is better than a good day at work.’ I think that guy is having a bad day, but in my mind, that would still be better than one of my good days at work.
See, I have that as a goal. And precisely that. I’m not necessarily wanting to make it rich. As long as I can continually keep my trading business going. That’s my plateau!
But in any case, I feel bad for the guy. See, that’s why my plan is to have 6 months of living expenses accrued before I start it full time. (someone smart in here gave me that idea…thank you!..I forget who you are, but your very intelligent! ) I don’t want to trade for the next days dinner.
Ok. Yep. That’s nice.
And so, we ended. Sadness in the air. Everyone pretty much gave a thanks to Terry. But, at least there will be one more one-on-one meeting on Friday. And I’ll tell you how that went. Pretty interesting.
So, I got to thinking about it a lot. I was going to pose him a question. I wanted to squeeze more out of him.
I mean, I am talking to someone who has 24 years of trading experience, who has been a facilitator to business people for over 40 years, and who is old. Those are who, I respect the most, in this world.
So, I had something in mind, leading up to the meeting.
Then time came.
Got the formalities out of the way. Then, pretty immediately, he wanted me to pull up my trading chart.
He asks me, “Mike, show me your anchor trade”. (That’s the one and only trade that you are best at. Can always rely and count on. Your go-to trade.)
At that moment in time, it was like I was face to face with God.
It was judgement day.
It was like he was asking me what my sins are.
And what am I going to do? Lie? Throw some bs out there? Well, I can’t, cause he’s all knowing.
I’m a straight shooter anyway, and now…it’s confession time.
“Terry, I don’t have one!!! I just do not know. I’m not done with it. I’m not happy with what I got. Sure, getting close, but not done. I’ll show you where I"m at, and what I got so far.”
He’s quiet.
And he’s understanding.
I showed him my mind maps on entry, management, exit. All that I had on it so far.
Then he asks me…“Well, where are you getting in? And when?”
And that, I could not answer.
So…helps me.
See, the one thing he has always said from the beginning. They will not tell you how to trade. His job is to give you the tools in becoming a real trader. He knows that there are many ways to trade, and we need to find our own particular way.
And so, I guess what he did was, shown me some things that he would do. He gave me some good ideas.
We spent some time looking at my chart. We went back and forth on what was going on in it.
He brought up about the A,B,C trade again. Did I look into that? Well, I did. And I told him that that led me to the Elliot way principle. He says that he doesn’t subscribe to that because the problem with it is that it constantly changes as time passes. Now, I don’t understand what he said, but I do agree with him that it’s not my cup of tea either. Then, he shows me something. But first, I just need to say that he was explaining a lot of good stuff on the charts. Things like what’s the context, content, condition. I couldn’t believe he even mentioned that it’s good to know price action. What?!!! In my mind, I guess I kind of throw out the baby with the bath water. Big subjects like that I go one way or the other. And I counted that one out. Thought it wasn’t totally wholesome. Maybe because of the books on market profile. There they are looking into how price moves in the intraday time frame. And I know that he’s the author on that subject. After all, he developed ‘windotrader’.
Ok, that’s nice. Anyway. He is showing me, and telling me a little bit about a lot of different things. But then he shows me something that I definitely like. And I’m going to adopt this.
The subject is retracements. I asked him if he subscribes, uses, the FIB tools. Does he believe in all those particular %'s. He says no.
He tells me to draw a line from the highest swing high (on monthly chart) down to the lowest swing low. He tells me to find the 40% up from the bottom and the 40% down from the top. So, I just change the fib %'s to 40, and 60. And so, we can see on the chart, that in between those two lines (in the middle) he calls that the ‘doubt zone’. The trend happens to be on a down trend. And where price presently is, is right in there.
I guess I should put up the chart.
The first one there is the monthly, where the lines were drawn. Then the next one is what the daily chart shows.
So, in between those 2 lines is where I don’t want to be trading. Anything can happen there. And since I am picking to short a trade, I would want to go short at the 40% line (bottom). Meaning, the probabilities would be higher there, for a continuing of the trend.
I said, "so…therefore, I won’t be trading, until I wait for price to go there. This is the daily chart. And it could continue on up, or just zig zag there for a while. "
He was quiet. I was quiet. Then he said that this is the daily chart. (I know he was saying that I picked this)
And I do realize it.
So, I learned something. What more can we do at this time? I do think this is a principle. From a high to a low, 40% on either end is where I would want to trade. A continuing of a trend or a break out (new) trend.
Oh, another thing I caught from him. Talk about bottom lines. He would say this, on many occasions.
“You want to know where you will be getting in at, and when.” That’s probably why he came up with the 40% levels. That would be the ‘where’. The ‘when’ I guess comes down to knowing stuff. Like knowing the market will retest a level (one of the things he mentioned). Also price action, as I have mentioned already.
You know what Journal? I think that right there is some good stuff. I did come up with something afterwards. I’ll spell it out a little later.
So then, when we were at a pause, and all was quiet, I changed the subject.
I posed my question.
I’m coming back for this.
Mike
Ok Journal.
This was my million dollar question.
"What would you do if you were in my shoes, right now? You just have been given the building blocks on how to build your own trading business. Been through tasting defeat, starting all over, and searching for your trading strategy. Knowing all of what you know now, what would you do, in my shoes? "
He proceeds with telling me, in general, how we went through it. How he took someones advise, and tried it that way. Then someone else would come along and tell him a different way to go about it. He would try the different markets. He lost so much money on the journey. He basically listened to many different people, and nothing really worked for him. I guess it did take a long time. But eventually found his way.
And this was his answer to me.
[B]“Find out what works for you - and just do it!”[/B]
[B]“Learn one market.”[/B]
[B]“Find your methodology - find the zone”[/B]
[B]“Nail it down to simple - Anchor trade”[/B]
[B]“Take it slow, & do it.”[/B]
Then I asked him about building up the capital that I need. He says “Isn’t it possible to be in the Forex with just a few dollars?”. I’m like yep. He says why don’t you start out with say $50. Take it slow and build it up. And every month, you just put in a little bit more. Work with what you got and just build.
That’s some awesome stuff.
You know…I just want to say. I was hoping to get something different, from my question. Kind of like what to work on, which is more important than the other. I don’t know, something more specific. And as he was talking, I was writing (as fast as possible). This is some of the things that I hear much on BabyPips. Because there are some real gems in here (people), and I appreciate them!
I am not belittling anything Terry has said, because it is sound advise. The thing I need to realize is this has to be done my way. I have been given many different tools. I just need to use them.
There is something I’ve been wanting to articulate. Cause this is something very important, that I learned.
It hit me like a ton of bricks, when I saw it, on one of his teachings. I’ll have to dig it up sometime, but this is it in a nut shell. We need to trade on principle, more than just by a methodology. Man, I thought about that. People just try to find a way to trade. How about finding your principles first, then a methodology that backs that up? Oh, I’m remembering some of this quote that addresses this. It goes something like ‘there are thousands of methods to trade, but not many principles to trade. Find your principles’. (I’ll find that quote later)
Anyway, ok, yeah, that is nice.
Bottom line. I am excited. He did say that any time that I want to reach him, I could. He also wants me to participate in their monthly round table discussion. And there is other things they (many other traders) do to keep in touch.
But, look, I know what to do. And I’ve been doing it. Not now, but I’m going to show it. I do believe I came up with my anchor trade. Thanks to his input. I have a trail of mind maps that details (and reasons) every particular point of it.
Stay tuned Journal.
Mike
Journal.
Dug it up.
And while I’m at it, gonna throw out some other good ones.
In the following. The road map, explained. So, the plan is this. 24 squares. 1 square a day. Spend one hour meditating, viewing, thinking, refining all of these areas. It’s a way to touch on all of the important aspects of my business. I’ll hit everything in a months time. Then month after month.
This will be a routine of mine. But, first, my concentration is on my strategy. And I’m definitely close to the end.
So, basically, this is what my class was all about.
Continuing…
Lots of good stuff. There were hundreds of good screen quotes like that throughout. It only takes a serious look within to make any real change.
This is how I operate.
Mike
Hi Journal!
Well, I guess I have to back things up a little. And actually it all started from the last post I did, you know, me & Terry’s last meeting. See, I’m searching for answers. It does help when I reread my experiences. And lately, I’ve been pretty bothered. It’s the same old thing…like it’ll be my last endeavor…finding my strategy. I remember going through this last year, and now, after going around a huge mountain, here I am again. But anyway, I kept reading what I wrote last time. And I noticed something. It was his story, then his advise! The biggest thing with him (in his early years) was trying out other peoples methods. Nothing really sits right for you unless you find your own way. That precisely was his point. But here I am trying to adopt his ways. Yeah, he showed me some techniques and I’m wanting to follow them. I started realizing this. Then I read his words of wisdom. Find your way, and just do it.
Ok, that’s nice.
This is how it happened, for me.
You know, many things roll around in your head, for such a long while. And you never know when your brain shows you some really good stuff. Whether your driving a car, going to the bathroom, or eating lunch, when it throws it at you, you just have to remember it. So, this is what hit me.
After all of the teaching I went through. Since the beginning of Nov. Where did it get me? Right now. I’m right where I was at from last June - Oct. Racking my brain about the way I want to trade. But it hit me. I did learn something. It goes back to my ‘core trading values’. Ok. Well, maybe I need them now. Yeah, what a novel idea. I’ll throw out there what they are again. Learning. Practicing. Thinking. Decision Making. Information Processing. The Kaizen Process. Time/Energy/Money Management. Well, you know, what are these here for? I absolutely need a few here, like Decision Making, & Thinking. So, I went back and utilized those MM’s I have of them. Did some research. You know, got to working, with those tools. And guess what? (You probably thinking that I’m gonna throw out there something really good, right about now)
Nope. Dead end. The only thing I realize is that I need to re do my mind maps on those things, because their not really effective. No help. Then, something else kept nagging me in my mind. I think this has been nagging me for a long time now. Ever since the beginning, there was one quote that I remember. And this quote Terry said is his absolute favorite. I’m going to have to find it.
Rudyard Kipling…“I had six honest serving men. They taught me all I knew. Their names were : Where, What, When, Why, How, and Who.”
I did spend a lot of time mulling that over in my head. But now, I’m going to put it to the test. I mean, if this is true, then I’m going to find it out. All I need to do is ask these questions. Over and over again.
My idea is this. I’m going to have mind maps with this simple formula. A central idea in the middle, and the six serving men around it. Then, for each of those 6 legs belongs their own mind map with the same format.
And so on.
I realize that what’s most important is asking the right questions. What a big help, in uncovering stuff.
Another thing helping me lately, is that I do realize also that I do know how I want to trade. I mean, you would figure, after so long of internalizing how I approach the market, what I see in the market, my likes and dislikes, just everything…the answers are already there! I just needed the organization and format to get it all down in.
Boy, I wish I could put in here all my mind maps that I did on the subject. I just can’t. But, I’ll just throw out my first one, the most important one.
I started from the top right and moved my way around clockwise. There’s a total of 10 mind maps I have so far. Believe me, everything is questioned, and answered. It’s truly amazing what you uncover when all you do is keep asking those 6 things. The first thing pretty much always has to be asked is ‘What’. That’s the subject matter. Then it seems to lead to ‘How’, the content and the steps. ‘When’ has to do with time. ‘Where’, the physical place. ‘Why’ always gives you your reasons behind your answers. It could get backwards with that one because if you don’t come up with a satisfying answer, then your gonna have to start over with the ‘What’ again. The ‘Who’ not always gets answered. Either you have to get creative or it will be a ‘me’.
But anyway, another important thing I always need to remember is what’s in the middle. That is what everything is centered around. So, on that MM, it is looking at my strategy as a whole. Big picture. That’s why I was forced to answer the question of ‘Where’. Well, it has to be my broker, of course. That is where I am presently at right now. I’m trying to find one. I can’t use the one I did before, they merged with another broker. So, I’m kind of at a stopping point now. Well, actually where I’m at now is, trying to demo the strategy under the same conditions that I will be doing when I go live again.
Ok…yep…
Anyway.
My view of the market has always, always, always been --“Risk on, Risk off”. I’m not going to deny myself.
But, what I have realized is that I want to trade risk off. That’s a fear sentiment. That’s under the conditions where money is fleeing to safe haven assets. And in the currency market, that would be with the JPY. It’s funny that every one of those pairs, on the charts, will be going short. I established that already. Short is what I want to trade. But… (I’m sorry Terry, I’m gonna spread my wings somewhat from the mold you have shown me). Anchor trade. Sure. I do believe in it. That means one trade. Ok. That’s nice. Well, what I want to do is trade the JPY. I refuse to wait on the sidelines, if I only am looking at one particular pair (AUD/JPY), for say weeks on end till it hits. Then get in with very minimal position sizing. This is my plan in a nutshell.
I have the possibility of getting in on one of the 7 JPY pairs. Only getting in on one.
The market will have to be in a risk-off mode.
I will pick which is the best pair to get in with.
I am using the 40, 60 retracement levels drawn on the monthly chart to give me the ‘zone’.
I will place a trade at the bottom line. In fact, that will be my stop loss, the entry will be just below it, after a confirmation of going lower (a retest).
My first action will be moving the stop loss to break even. Risk management.
Second action will be locking in a profit, by putting in a trailing stop.
Third action will be compounding profits. I will be doing two things. Moving trailing stop closer to price and adding more position sizing at the same time.
So, my take profit point will always be where my trailing stop hits.
I believe that’s my way of riding out a run while cutting short losses. Only tampering with the stop loss level.
So.
It’s all spelled out in detail.
I’m going to practice this on demo.
Man…I got to run.
Mike
Journal.
I’m gonna try to get these MM’s on.
This one is the ‘What’ from the original MM. (JPY)
You can see that there are MM’s within this one also. But all with the same format.
Only have time for this one right now.
Mike
