Trading journal

[dushimes]

I was about to start chart work late at night, but decided to go for a walk before starting. I live on a quiet street. There are just a few houses, very little lighting, and it’s quite dark. It was perfect.

It was a little chilly, so I zipped up my sweatshirt, and I put on my crocs. The night was perfect. It was dark, no one was around. I had the street to myself, and I was free to walk in circles and talk to myself as much as I wanted.

I’m not sure how long I was out there, but I walked in circles for a while. I was reflecting on some recent trades and the cycle I’m stuck in.

I miss some trades, then I get frustrated, then motivated, and I tell myself that I won’t miss trades like that anymore. A few weeks pass, then the cycle starts all over.

Basically, the hiccup in the cycle is the moment of taking the trade. I reflected on why I have trouble taking the trade. There was no major a-ha moment, but I saw my cycle clearer.

I could feel the impulsive trading habit die a little bit more. That’s a good thing.

[dushimes]

I’m reviewing some charts. Subconsciously, I think I wish I had traded differently based on the results, not actually based on my strategy.

This is very frustrating and confusing because that’s not strategic at all–that’s completely random.

I’m preparing a chart and I’m adding correction arrows. I couldn’t decide if I should trade each candle in the retracement and be wrong four times, or wait until a support zone and trade once. Generally, my strategy says to trade each candle.

I guess I’m stuck between two strategies: taking shorter trades and profiting/risking mroe, and trading longer trades risking less but possibly watching some profits drop to $0.

There’s no way to do both. It’s one or the other. I think this is a big part of my confusion, deep down. Sure, I’d love to ride a trend to the moon. But some retracements are not worth holding on to. Sometimes, a retracement could retest your entry and trigger your SL. You’d probably wish you had closed.

I think I should consider something more systematic. During what kind of set ups I should consider jumping out despite a recent entry, and when I should hold despite the retracement.

Oh boy. It might be time to take a walk…

To help me understand which retracements might be worth riding out or not, I should try to understand any signs (if any) for retracements.

[dushimes]

I’m going thru my strategy again. Step by step. My first step is to read the chart and identify what I see until the most recent signal, and identify S/R.

No problem.

Once I identify the most recent signals, I can identify the direction of the major trend. Once I can identify the major trend, I’ll know what signals to wait for. If the major trend is bullish, well, I just have to wait for a bullish sign. Simple.

It’s soooo easy. WHY DO I HAVE SO MUCH TROUBLE FOLLOWING THIS LIVE?!

When trading live, the expectations jump thru the roof, and I’m just aching to jump in on the trend, and I lose patience. That’s why I get confused so much. My brain is so anxious that every candle seems to have significance and it confuses me. This candle is bullish, that candle is bearish. Well, sure, you can give meaning to ANY candle!

Any candle can be confusing if you allow it to. But that’s not the way to go. Get in at the designated entry, and wait. Watch, but sit back and chill. If you get in at support, and the expectation is to hit resistance at a determined zone, just wait. Price is gonna take a random walk.

If you don’t see a sign (and confirmation) that price is gonna reverse, then leave it alone!

I just walked thru these steps on a recent AUD/CHF chart. It’s the easiest thing in the world! It’s so easy, that you can’t help but think ¨Why can’t I do this live?¨

It’s so easy, you wouldn’t UNDERSTAND why you’re not doing it live. This is something that shouldn’t take more than 10…no…15 minutes per chart. And that’s assuming the chart is new. Once, it’s done, you should know which signals to wait for.

If you’re dealing with a bullish trend, and you’re waiting for the bearish retracement to end, you mark your chart and you wait. ¨Is there a bullish signal yet? Nope? Ok, I’ll check again tomorrow.¨ Trading done for the day. Come on! How long does that take?! That’s two minutes max! If you follow 10 pairs, you should be done in less than two hours. There’s really no reason for it to take longer.

The only way it takes longer is by giving significance to insignificant candles. That’s when big confusion starts, and the plan goes off the rails. You know the trend is bullish, but now you’re trading bearish signs and you’re stuck on bearish signs. You get a little profit from the short trade. Next thing you know, price goes bullish again, you miss the bullish signal, and you get stopped out.

Now, you’re going back to your strategy as if that’s where the fault lies.

I’ve done that so many times. I’m still doing it. My first step should be determining the major trend direction. Is it retracing now, or is this a major trend reversal?

Marking all the signs is the first step. Next, connect them to give context to what’s happening currently. It’s all telling a story. The confusion comes from examining every single candle. Just mark the important stuff, then wait. Simple.

[dushimes]

I just finished my trading. It was different today. I took a step back and reminded myself to try to assess everything and determine what direction it’s going in. I took note of recent S/R bounces, and possible S/R target zones.

Of course, target zones are just guesses. Meaning that price could reverse before that. But if it doesn’t, that’s the zone I should be waiting for signs near.

But regardless, I felt less confusion today. Not a big decrease in confusion, but just enough for me to notice. It’s nice. A bit of a relief, actually.

I’d like to continue practicing walking thru this strategy on some more charts.

[dushimes]

I’m making charts with corrections. So, now, when I practice trading, if I miss a trade for whatever reason, the next picture will show that I should have taken it.

I’m trying to align my thinking with my strategy.

I missed some beautiful trades. Blah blah blah. Same story as I’ve posted before. I’m trying something different this time with these new corrective charts.

With all the other practice charts I’ve made, I never trade them the same way twice. Every time, I’m doing something different.

When a pair hits some resistance it either breaks or bounces. I should have a rule about how to handle this. I currently don’t. I just say ¨it depends¨.

Ok. That’s fine. But depends on what? I need to make some better rules. A pair I was watching hit some resistance, but all-time high resistance. It hit a resistance level from a long time ago. I was stuck. Either it’s gonna bounce or break. It already gave a sign that it was about to bounce, but I have seen similar trades that it was a fakeout and I shouldn’t jump at the first sign.

Well, I was wrong and price bounced. It wasn’t a fakeout. I need a better way to handle my trades. Something more concrete.

[ProfesorPips]

That is why I use EA’s in trading, there is no discussion to take trade or not to take

[dushimes]

@ProfesorPips

That is why I use EA’s in trading

[dushimes]

I’m preparing a chart with a correction, and I realized that I didn’t have much of a set rule regarding bounce/break S/R trades.

My goal shouldn’t be how to execute every top/bottom. I should be looking for an average. That’s it. If there are 10 bounce/break trades, and nine of them bounce, but just one of them breaks and goes to the moon, will that make me an ineffective trader for not catching the ONE trade that continued like crazy?

I’m reaching the conclusion that I’m being flexible in my strategy to catch certain trades. But that doesn’t help. It only creates confusion for me.

Here’s the catch, though. There are many trades that bounce, then give a clue that it’s actually gonna break S/R.

On a few occasions, it bounces and gives no sign that it will continue. It just goes!

And you know what? I shouldn’t focus on the exceptions. What’s the point of catching the one exception, if that inconsistency is affecting my other nine trades? There isn’t one!

I just sucks to exit a trade, then watch it fly without you. And if I want, I can always place a straddle order, just in case. No big deal!

[dushimes]

I’m preparing some charts, and I’m thinking that I don’t have to focus on the BEST time to enter a trade and ride it to the moon.

I just have to worry about entering and exiting at favorable times. And repeat that.

That’s it. Sometimes, I focus on riding the trend forever, and if I get out, then I failed.

Not so. Some trends are not very volatile and go up without many opportunities to enter and exit. Those are the trends that, yes, I should just leave alone and ride.

Other trends, are very volatile and offer several opportunities to enter/exit. Such trends are worth it to enter/exit repeatedly. Doing so and slightly increasing risk while conmpounding is quite profitable. Much more profitable than just watching the trend pullback halfway to entry, then to resume. If I can profit in both directions, why shouldn’t I?

[dushimes]

Also, I recorded my account balance for last month. A small decrease from last month. That’s a good sign.

[ProfesorPips]

@dushimes

That’s it. Sometimes, I focus on riding the trend forever, and if I get out, then I failed.

Hi, maybe can you use an oscillator for exit, like RSI?

[dushimes]

Thank you for the recommendation!

My trouble is accepting that it’s ok to exit a trend when I get a retracement sign. I used to have trouble deciding to get out or hold.

But if I don’t have to have expectations of riding trends to the moon. My expectations should be a favorable entry, and a favorable exit. That’s it. It’s ok if a trade lasts 5 days. It doesn’t have to be two months of straight bull action.

That’s wishful thinking.

[ProfesorPips]

so use ADX to measure trend and filter entry

[dushimes]

Good idea. Thanks!

[coreygude53]

Never give up don’t stop compare. to chemistry keep mixing until u find the right connection .

[dushimes]

Thanks, bro!! I appreciate it!

[dushimes]

I browsed the beginner question section. It’s great that there are so many helping hands over there.

The thorn on that rose is that if you have a particular strategy, there could be someone giving advice based on a strategy that’s different from your own.

The good thing is that it exposes you to different (probably even better) ideas. People might point out something that you missed.

But the hard work falls on us. If I ask a question and someone says to adjust the MACD, well, I have a decision to make, don’t I? Such advice could send me in a different direction, but it’s a direction worth exploring. They all are. You don’t know what’s gonna work until it starts working!

[dushimes]

Working on some charts with corrections. Of course, the answers are in front of me, so I wanna place corrections that will avoid losses. But there’s gotta be consistency.

A big problem I have is bounce vs break trades. When price hits resistance, and shows bearish signs, I have to trade short. BUT…BUT…price sometimes will break resistance and keep running for a few days. There might be signs; there might not be signs.

Unfortunately, I have to approach each trade the same way. I can’t change my approach based on the results that follow. Trading live offers no such luxury, of course.

I can’t say ¨don’t take the first sign at resistance¨ in the charts that price breaks resistance, then trade the first sign on trades when price BOUNCES resistance.

It can’t be both ways. It’s gotta be one or the other. That’s it.

It’s a struggle because that means I often miss big moves when price breaks resistance. Sometimes there are signs, and I can switch to long. But I can’t switch short to long to short to long because price is acting weird.

Go short once, and wait until price decides if it wants to bounce or break. If it pushes resistance, I have to keep shorting. I could be wrong five times. And that hurts. It’s enough to convince you your strategy is faulty.

Usually, the market rewards such persistence quite well. The interim is psychologically challenging, though. I have to include such persistence, and losses, when preparing my practice charts.

And that’s when I have to remind myself that the goal is not to avoid losses completely, or to catch every move in price. The goal is to be systematic with the strategy. The strategy works well in backtests, and I’m excited about the results–despite the small losses. So, I just have to follow the strategy, and the money will take care of itself. Focus on the process, not the money.

The goal is to be profitable, not perfect.

[Worker_Bee]

@dushimes

I can’t say ¨don’t take the first sign at resistance¨ in the charts that price breaks resistance, then trade the first sign on trades when price BOUNCES resistance.

It can’t be both ways.

Why? I do it both ways. I just wait for a pullback. Not a pullback all the way back to resistance, but in case of a break i want to see sellers stepping in and fail. When it bounces i want to see buyers stepping in and fail. Pending order above/under the so formed high or low, SL above/under the pullback.

My first signs are the break and or the bounce itself so to speak. Think about it.

[ProfesorPips]

You can try to test this approach. When you draw resistance area, set up stop orders above and below this area and exit after X bars after open transaction.