Trading journal

Mondeoman · December 30, 2021, 10:44pm

Hi my friend. Some ideas for consumption:

1 I expect (but do not know) that Forex trading activity between Christmas and New Year is about the least predictable of the year, and likely to be low volume. For this reason I would be taking a rest from Forex trading like most of the world. I am trading, but I think Crypto is different than Forex - nobody seems to ever sleep in the Crypto world.
2 Are you trading one strategy or more than one, and do you write in your journal which strategy you are trading on each trade? The reason I ask is that I trade with trend and don’t use S/R at all - if you are trying to catch top or bottom of a trend, I understand that to be trend reversal trading. It is my understanding that statistically, the odds of win from trend following is higher than the odds of win from trend reversal trading.

dushimes · December 30, 2021, 10:50pm

I’m trading two: momentum/reversals, and S/R. As far as S/R, I draw everything on M1, then tighten it on W1 and D1.

I have problems on S/R when I watch tiny trend lines that I’ve drawn on D1. I should probably focus more on W1 for that. Less market noise.

Thanks!!

dushimes · December 31, 2021, 6:24am

I hear you, but during this period of consolidation I’ve grabbed some decent entries. I might be wrong and get stopped out, and that’s ok. But the entries are crucial in my strategy.

An early entry is the difference between 1:6 risk/reward and 1:2.

So, I’d rather get in early.

Also, there are some nice moves going on that I really need to pay attention to.

JPY crosses are interesting for me right now. GBP/USD is moving nicely.

I’m not missing these trades for some egg nog.

SovoS · December 31, 2021, 12:28pm

Hi @dushimes, and Happy New Year to you

I don’t comment much here as we trade very differently but I do follow your thread.

As we are about to start a new year we tend to both look back on the past year and look forward to what we are going to do in the new one.

You started this thread back in March this year and I am wondering what kind of changes/developments/improvements have you recognised so far. I.e. how would you compare your trading style now to how it was when you started the thread?

I am also wondering what kind of changes you are thinking of for next year. Are you, for example, looking to develop your strategies, or your risk management, or your journaling, etc.

I always feel that trading is about personal development no matter how long one has been trading. Both markets and us people change all the time and we need to keep ourselves in synch with what we are doing.

I wish you every success with your trading in 2022 and look forward to reading more here as we go!

dushimes · January 3, 2022, 9:39pm

i haven’t done this for a while. This is my P/L for my account for the past four months. Not sure what it means. Prior months fluctuated so much

september -11.90%
october -11.96%
november -11.92%
december -11.00%

However, my current profit margin is up approximately 20% right now. Of course, those profits aren’t mine until I close the trades. I think I have to go thru a few losses in order to catch a good swing, and once I catch that swing, I have to wait quite a while (a few weeks, perhaps) to close. I think my losses are getting steady–meaning, there’s some control. And the first step is to stop bleeding money.

Those percents above only displalyed part of the picture. My trading lot size hasn’t changed as my account grew smaller.
I looked at the dollar amount that I lost each month, compared to my September balance (because I’m still trading the same 0.5% of that month’s account balance)

september -13.5%
october -11.9%
november -10.49%
december -8.54%

This is more accurate. You can see that even though I’m losing, I’m starting to lose less. December had fewer losses only because I saw less opportunities. I sat more on the sidelines. Waaaay more.

That’s a big development for me. Learning when NOT to trade is just as important as knowing which trades to take. Another problem I have it knowing when to hold and when to close.

@SovoS I didn’t forget to respond to your post. I wanna respond when I can think it thru.

Mondeoman · January 3, 2022, 10:08pm

Yes, that is pretty good progress. One question - I assume this is a live account, and I can understand that you need exposure to the real world. But is there any reason why, for the next few months from -8.54% down to 0%, that you can’t just do these trades in a demo account and know for sure that you will not lose any further actual money?

SovoS · January 4, 2022, 8:51am

You already answered quite a lot in your last post! Very interesting!

If I have understood correctly what your data is indicating then, primarily, it shows an excellent attitude towards the core principle of running your profits and cutting your losses promptly. If so, then well done!

Since you often mention working from longer term charts, even monthly, then I have always assumed your aim is to catch trends that will often last a long time and eventually pay you handsomely for it. And in that sense your figures are currently showing success in this in your open positions.

The good point about your monthly closed figures is that they are consistent, even improving, even though they are negative. If these basically reflect just the fake outs then these are showing a consistent feature in your trading. By definition, closing out the fake outs will be losses and will only be covered by the eventual closing of the long term winning trades.

If this is correct (which it probably isn’t! ) then it seems to me that the prime focus needs to be on your entry criteria? Are you entering too soon before a trend is really clear? Can you develop some additional filters that might reduce these fake outs?

I can only really think of two main reasons for losses (excluding trades outside your strategy): 1) wrong entries that fake out before getting anywhere, and 2) right entries but looking for too much profit and outstaying your welcome in the trade and giving it all back.

The first might be reduced by filters and/or more disciplined entries, the second by some additional exit criteria such as moving to B/E or trailing stops (either auto or manual).

Of course, whether one can identify the causes depends, once again, on how diligent is one’s journalling!
I think you are doing just great!

dushimes · January 4, 2022, 11:29am

It could be desperation. But that doesn’t discount the emotional/psychological coping-mechanisms I’ve had to develop to tolerate losses. I learned to see losses as part of the game. Also, my dwindling account forces to me into a different position of desperation.

A new kind of desperation. I used to take so many trades out of desperation–bad trades. Bouncing this, bouncing that. “Oh, price is hitting this, I should take that trade.”

But, because my account has dropped so much since I first went live, it has forced me to be so desperate that I’m willing to not be desperate.

I’m so desperate, that I’m willing to trade less.

That’s something that I don’t think demo can offer. The emotional sting from losing fake money may not burn the same way as losing real money. I guess this is my segway into my next post…

dushimes · January 4, 2022, 12:10pm

Yes! This is the goal. And one thing I’ve learned is that I’m not trying to catch a profit–I’m trying to catch an idea.

Let’s say I expect GBP/EUR has been bearish for three months, and I expect it to reverse and turn bullish. I get a great entry, and it starts going up for 4 days. I have a decent little profit so far. What if I see a bearish engulfing candle? Not a big one, but just engulfing enough for me to be concerned.

In this case, I can’t close my position. Depending how far price has gone from my entry, I can only move my SL to BE. If price hasn’t gone far enough, I may need to keep my SL in its original place to give price room to breathe in case it wants to retest my original entry price.

If price is retracing, I can’t close because I would sacrifice my entry. I might have to take the loss, and watch for another entry signal to present itself.

If I chase money, then I’d close at the retrace and lose my entry on a two-month swing.

I don’t have it perfectlly, but I’m improving every month. I can look back at how I was trading just one year ago. Those demons are still there. Taking those trades compromises my venture in trading.

I seriously believe that the market can literally become an ATM. The money is there!! You just gotta know when to put your hand and, and when to take it out.

I’ve taken so many bad trades. Trades that it felt like I was grabbing for coins in a blender.

Then, I had a month where I was stacking 10% profits PER WEEK!! I that’s a lot of profits for me. I was like, “This is it!!! Here comes daddy!!!”

Then the following month, I gave ALL those profits back. ALL of it, and more.

The profits were nice, but not replicable. There was nothing steady about it. I forget how many trades I had that month, but it was over 20. How can I be right over 20 times, and I can’t seem to do it again? 20+ winning trades is not luck that’s skill. Isn’t it?

How could I have done so well, then do so poorly? I decided to assess my losses as usual. But this time, I assessed my wins, as well. The winning trades were made AFTER bounce confirmation (for the S/R bounce trades).

I took more and more losses before I realized that something wasn’t working. Adversity introduces a man to himself. I was starting to beat my desperation into submission.

For me, I learned that just because price bounces something, that doesn’t mean I have to trade it. I can’t draw a bunch of lines on D1 and trade it because price bounced it. Often that happens by coincidence only. I have the red numbers in my balance sheet to prove it.

So, I take less of those trades now. Sure, profitable trades can turn you arrogant and wreckless, but taking bad trades will set you back so far that your profitable trades won’t even get you out of the red.

If I enter a good trade that lasts one week, and during that week I take 5 bad trades costing me $100 in losses, then the one good trade yielding $100 only brings me to $0 profit. What a waste!!

This is what has been killing me. The bad trades. I had to identify which are the bad trades, and what was their nature? What was happening in the charts at that time?

I started studying charts again. I would stare at the same chart for 45 minutes. Drawing lines, taking notes, taking tallies.

I had pieces of paper scattered on my desk. But the charts don’t lie. Everything I need is in the chart.

I tried watching a price action video online, and after the first 10 seconds, I realized I didn’t need it. I just needed the chart. It’s all there. I just have to learn to read it.

I don’t want someone else’s interpretation. I want to dissect what I’m seeing. Following my thought and mixing something faulty will create incongruency in my thought process. I needed to do this alone.

Doing something alone is scary. But it’s empowering. Trading and trusting only yourself is quite a nasty process. I don’t want to hear someone else’s opinion about whether or not EUR will go up or down this month. Sure, we could talk about it, but I have to follow what I see in the charts.

I don’t care if the talking heads are right or wrong. That has nothing to do with me. I need to make the decision on my own. I’ve had problems with that in the past–doing what people told me and not thinking for myself. The best way to think for yourself is to shut out the world. Go silent, and do your work. If I was right, I need to know why I was right. I need to know why I was wrong.

That’s why I don’t like taking straddle trades anymore. If I think price is going up, then I should trade it that way. Most of the time, my strategy doesn’t allow for straddle trades.

Oh man, this is really long…time to stop for now.

SovoS · January 4, 2022, 1:58pm

On the contrary, I think you have only just started! Thank you for such a detailed description of your journey so far. It is commendable how well, and how objectively, you have been able to identify the weaknesses as well as the strengths in what you have been doing. But this is only the start, the next issue is what to do about it. What changes to make and to what!

You have clearly looked into your losing trades very thoroughly. Two other areas that might be worth looking at are:

What instruments to track and how many. For example, have you found certain pairs or groups of pairs are more reliable and have fewer fake outs? Is it worth looking at some commodities or index instruments as well as forex pairs? Is it better to follow a few products intensely or as a blanket template-type appraisal across many instruments?
How much to look for from the trades that do “take off”. Optimising target levels is in my opinion one of the hardest tasks in trading, and yet is perhaps the most important in terms of the final overall results. As you say, a string of even small losses can soon eat up a chunk of profits from one good trade - and if those good trades are cut off prematurely then the impact is even greater long term.

I also struggle with this aspect. In fact, so much so that I ended up changing my whole focus on trade expectations and I only seek a set profit amount in pips per set-up. I do change my position size often but not the target pips apart from some minor tweaking. I only mention this as an example of the process of clarifying one’s target policy.

I fully agree with this. I do not read or listen to any commentaries. My only input from outside my chart is the event diary. I want to know what is upcoming because it can affect how my market trades in the run-up to the event. e.g. NFP or a US holiday etc.

But I think we also need to be careful about what we interpret and conclude from our own charts! And I firmly think there is a danger that we can develop thought patterns based on what we see, which then repeat whenever we see a similar chart set-up. If these thought-patterns are often wrong then we need to eliminate them. I could imagine this being the case with studying breakout situations.

We need to remember that, whatever we look at, there are only two aspects visible - where the price is coming from and where it is right now. Our job is to extrapolate from those two aspects the one thing the chart cannot tell us: where is it going next.

So we all have the same three common tasks for every trade we take:

What is the probability of the next direction, and is it high enough to trade?
If it is, then how far is the next move likely to go?
If it fails, where to exit?

As you say, you do not need Joe Blogg’s views to do this even though it is comforting to here that someone else is thinking the same. But that is purely a psychological comfort pill and, considering 75% of traders lose, it certainly has no add-on value to the likelihood of your trade succeeding!

Just some thoughts, trying not to be just another “Joe Bloggs” here!!

dushimes · January 7, 2022, 6:39am

This is really difficult. I’m starting to think that closing a trade is more difficult than opening one. Do you close your 5% profit now, or risk breaking even to get 10% profit?

Sure you have your signals, but you never know for sure which exit signals are true signals. Your exit signals are as trustworthy as your entry signals.

But, if you can close with some profit, you’re coming out ahead. Hopefully, I can regain the 2% loss I took trying to catch this trade… then, I’m truly gaining some ground.

Yes. Some pairs have clean swings, while others zig zag as they swing. Those are annoying. So, for those types of pairs, I’m trying to only trade when they hit a major S/R line. Something you’d see on M1 or W1. Not a trendline that formed over the past few months. Those types of trendlines have eaten me alive again and again.

So, those kinds of pairs have entries maybe a couple times a year. Which isn’t much, but when there are 10
charts like that, there are a few more opportunities. Yet, still pretty scarce compared to trading D1.

But I’ve learned that it’s better to trade when the odds are in your favor. Just because you can imagine a scenario in which you win, that doesn’t mean it’s likely to happen.

A trendline bounced twice over the last 10 years is more reliable than a trendline bounced twice over the last three months.

Yup!! That person doesn’t know any better than I do. Even he does, I have to learn to think for myself. Otherwise, that just makes me dependent. No thanks.

That’s what backtesting is for!! Haha

Of course, if you’re often wrong, are you the problem or the strategy? If I get a signal, and get stopped out, was I wrong? What if I’m wrong again? Am I still wrong?

What if after that, on the third try I get scared and reduce my position size to half and then I’m right? Well, ain’t that a kick in the pants?

I give that example because I’ve done it.

All we can do is play the odds and try to build the confidence to follow our strategies in the most profitable way possible.

dushimes · January 7, 2022, 6:57am

Yesterday, my laptop got weird. I opened it up and it got stuck in an auto-repair loop.

Basically, it’s supposed to self diagnose and repair itself, but then it tells your to restart. Then it self diagnoses and tells you to restart.

I would just accept the loss, but my beloved excel spreadsheet is in there.

Sure, I could recreate it, but doing it from scratch is a pain. I have a back up, but it’s so old that it’s practically irrelevant.

I’m trying to see if I can figure out a way to access the files…

There’s no extractable hdd. With this model, the drive is built into the motherboard.

So, yesterday was spent messing with it. I have a recreation laptop, and my trading laptop. At first I was trading on my phone. That was a relapse to bad habits.

I ended up trading on my recreation laptop. Which was really a minor change to my routine, but I got flustered and made a bad decision. I closed my GBP/USD long position because I saw a reversal signal near a resistance trendline. I closed with profits, but I regretted it after, so I went short, stopped out, then went long…you get the picture.

It was a mess. I hadn’t traded like that in a year.

I got my head back in the game and just reviewed the pairs I have set up in my account, but with no spreadsheet for reference. I just focused on JPY crosses. I had been waiting for those.

This morning, I still have no spreadsheet. So, I had to exercise extra caution and not be hasty.

You know what though? I realized that the real thing of value isn’t in my laptop screen size, not the spreadsheets…but in my brain.

I can recreate everything else. I can buy a new laptop, re make new spreadsheets. But the experience is where the true value lies.

Mondeoman · January 7, 2022, 12:29pm

Hello my friend
Some months ago I decided to update my IT hardware skills - long story, but I am so much the better for it. Your laptop motherboard has either a solid state drive or an EMC array (if it is like a Chromebook).

I strongly advise you to take it to a local IT repair shop (in particular if you have one whose staff you trust to be competent). Far too often these days, the “almost constant” system updates from Apple iOS and Microsoft Wintel - and Google Android have had insufficient backward compatability testing done, and more than 50% of the time the error is in a misconfigured operating system, not in the hardware itself.

Our local IT guy would probably charge something like £50 for a look and would be able to tell me within an hour whether it was a software (operating system) configuration error, or a hardware issue. Even if it is a hardware issue, he would then move to the next step of determining whether the SSD or memory chip data could be read on a slave machine.

Please keep us updated on this one. Our local shop has saved me from corporate IT death twice.

Oh, and if and when you recover, please subscribe to MS365 for £85 per year, for a family licence for up to 5 users up to five end use computing devices per user and a cloud service (OneDrive) with up to a terabyte of storage per user. For the full MS office suite it is about the cheapest service you can buy anywhere - for official software.

Best of luck with that one.

SovoS · January 7, 2022, 1:24pm

I know this doesn’t belong here on this thread but I would like to add one comment here. I always delete Onedrive from my laptop because it seems to always save anything and everything it can find on your PC without asking and I do not trust the security of such cloud services one little bit.

I don’t mind saving photos and such like there but when it always tries to save every document and accounting file one creates then one starts to realise that there is little about oneself that MS doesn’t have info about!

And it always tries to save everything to Onedrive by default and it is a pain to have to manually input the path to the right file every time to avoid Onedrive.

For my purposes anyway, it is enough just to regularly back up sensitive material to an external device.

Maybe I am just over cautious and overly private, but the excessive enthusiasm of MS and Google, and any other cloud sources, in collecting as much random data as possible about everyone is very disturbing and the motivation for it rather suspicious…but that’s just me!

The only time I see value in cloud services is if one needs/wants to access material from a variety of devices and from a variety of locations - not just to save data.

Mondeoman · January 7, 2022, 2:12pm

Hi,
Each to his own. I have spent much of the last 20 years installing and testing security services for FTSE100 companies. Whilst it is true that the corporate versions of cloud services have different use cases than a personal vault, I installed a pilot cloud service for Shell in 2009, so that over 500 software developers could share their global work.

So cloud services as a standalone service for a consumer may have some limitations, but you have to weigh up the risk of your data being compromised, and by who (thief, government, court of justice?) against the obvious benefits such as:
Diversity of geographical location - your external hard drive is no good if your house burns down or a thief decides to steal it if it is connected to your laptop
Ability to log on to could services when you are away from home - telecommuting from hotel or even from abroad.
Protection against local end user computing (EUC) hardware failure - you can log into your OneDrive from an alternative EUC.
It backs up automatically, same as MS365 apps saves your files to cloud automatically unless you set up manual save only.

SovoS · January 7, 2022, 2:38pm

Exactly! And I prefer to determine myself what is saved and where rather than leave it to MS.

I spent my career days in risk assessment, primarily financial. In all cases it is worth assessing the probability of an adverse event occuring v. the seriousness of the consequences if it does occur v. the cost and effectiveness of the solution.

Photos are irreplaceable and I would not wish to lose them - they are in google cloud. Financial, banking, trading transactions, tax and other such spreadsheets can always be reconstructed if necessary from the original data sources and a separate storage device (in fact two) are fine for that.

Another similar area of concern is a password vault. I do use one for many passwords which, if compromised, would not cause any headache (such as Babypips access). But I would never entrust password access to anything related to sensitive material or assets to an external password vault.

Practically anything can be hacked into nowadays and identity theft is a huge problem if and when it happens - and convincing a bank that one didn’t empty one’s own account personally or in collaboration with a third party “thief” is not so simple. I recall there having been a couple of such cases described here on BP some years back…

So, yes, security is indeed a matter of tailoring to fit one’s needs. The big issue is, of course, to actually carry out the assessment regularly and to actually implement it - and then maintain and review it!!!

These are all pre-emptive issues and If one does not look after them then one has to accept the consequences and hardships that ensue!

But I’m encroaching on @dushimes territory here, so I leave. I just thought this is an interesting and relevant side-issue!

darthdimsky · January 7, 2022, 2:58pm

I’d initially suspect a recent Win update that went bad. You can rollback the update from the advanced boot by selecting this option:

You can follow the rest of the steps given in this guide to uninstall the last update applied:

If that doesn’t work:

You can try the system restore option from the same blue screen to go to a previous restore point. Even if you don’t manually set restore points installing some programs prompts the system to build restore points that you can roll your system back to in case of emergencies. Ref screen shot below. Option on bottom right of screen reading “System Restore”

The same guide earlier gives you the steps to navigate to this menu.

If that doesn’t work:

The error may be caused by a corrupted or missing system file in which case you might be able to fix it by choosing the command prompt option and following the steps here:

If that doesn’t work:

Prepare or get a Windows USB boot drive. Navigate to your BIOS/UEFI and change startup sequence to enable USB boot first. When you reboot your PC it’ll attempt to boot from the USB drive and give you the option to repair Windows. That’s described as method 2 in the guide below:

If that doesn’t work:

If there’s no physical drive failure you may need to format the drive and do a clean WIN install. This is the extreme option. It will remove all your personal files.

You’ll definitely need to get access to that excel file. You can do it using the command prompt and transfer the file to another USB stick (the Boot USB shouldn’t have any other files written to it). The fact that you’re getting the blue screen means you’re file’s still very accessible and easy to recover with a competent IT tech.

dushimes · January 7, 2022, 5:43pm

No! No! Not at all! Thanks for taking the time! @Mondeoman also. Thank you!

I appreciate you guys taking the time to read and respond. And yes, a cloud totally makes sense. I get it. I understand the convenience.

But I’m actually unreasonably paranoid about putting my sensitive data in the cloud. Then again, if google or Apple wanted it, they could take it from my phone without me even knowing.

That being said, I owe you guys an apology. I didn’t mean to make so much noise.

All this talk about cloud storage, and frankly, I’m talking about a couple MGs of data. 5mg at the most. It’s my most important organizational tool, but something of this size, I can just email myself.

If I were travelling and trading on a tablet, I told myself that I would email myself this spreadsheet as a backup.

And here I am. I never did it.

But I have my old journals, and it would be nice to keep them and look back, I guess.

But it would cost me $75. I want my files, but I don’t wanna pay that much for it. But that’s what it costs…

dushimes · January 7, 2022, 5:48pm

This is what my screen looks like. I’ve tried so many things. But I’ll take a look at what you suggested. There’s probably some stuff in there that I haven’t tried yet.

Thanks for digging up that stuff for me!!!

darthdimsky · January 7, 2022, 6:02pm

There’s another option to consider when trying to recover the file. That’s enabling “safe mode” or “safe mode with networking”. Believe safe mode doesn’t disable USB ports, enabling a USB backup option. If it does you can pick the networking option to see if you can back it online (email it to yourself maybe).

These options can be selected if you hit the F8 key as soon as your PC starts. You get access to a menu like this:

The issue is if your system files are corrupt this option won’t work. It’ll keep looping back to the blue screen.