16 losers in a row and done

16 losers in a row. Not a joke and not an exaggeration.

I came in early this morning to trade GE and Bank of Amer. earnings. They barely missed and there were only small opportunities that I found riskier than the reward.

I waited from 5:15am until 7 am until I made my first trade. Oil had popped on Citigroup's earnings, which were BS because all the gains were from the sale Smith Barney. I sold oil right near the high, and took a tiny loser. Oil then sold off and came back so I sold it again. Again, I took a small loser and watched it melt down 60 straight ticks. I sold again when it retraced one more time, and took a very small loser, only to watch it sell off. However, I was starting to think that maybe this isn't so bearish. I keep selling and it comes back.

I changed my opinion and bought a low, again, took a very very small loser and watched it rally. I bought another low and held it for a while, and got out because the timing of it wasn't so great. Again, another small loser. The market sold off a little, I bought what I thought was a 3 lot, but luckily was only a 1 lot, and it tanked 25 ticks. I took a 25 tick loser and I only knew I bought a 1 lot when I clicked out and ended up short at the low a 2 lot, and it popped back up against me.

After that I waited a while because I wasn't seeing anything and I wanted to wait to see how the markets reacted after equities opened. I was noticing that as oil was rallying, 10 yr would sell off and SP would rally. However, oil wouldn't rally unless heating oil and gasoline would either. I waited and watched as the SP sold off on the open. I saw the 10 year rally a little and oil popped, but heating oil and unleaded gas did not. I sold oil, and sat on it, took no heat, and put a stop in for a scratch. After a few minutes, I was out. I tried again when oil made new highs, but heating and unleaded didn't, SP were selling off, and 10 yr was rallying. Again, it was a winner at first, but then I took a scratch. This should have been a warning sign. Oil made new highs, again, nothing else was rallying, in fact, now the euro looked weak, so I sold oil a third time. This time it popped and big size came in and I took a 15 tick loser. That was it, I was done for the day. I lost too much money.

After reviewing my trades, my first 6-7 I noticed that most of them would have been winners. In fact, I only got out because they either came back to scratch or went just a little bit against me. They never even reached my stops. I just panicked and got out. This is very frustrating. This led me to take bigger risk later when I was frustrated and making poor decisions. Ultimately, it was a combination of bad decisions and bad risk management that caused today to be painful.

In retrospect, oil was strong, by far the strongest market, yet that was the one I was fading and selling because nothing else looked very strong. Everything else told me it was all bullshit, but it was my lack of identifying what was going on that was bullshit. Ugh. One day it works and the next day it doesn't. Yesterday the relationships I noticed made me money and today they cost me.

At least today was a manageable loss, and not out of hand. I have a lot to clean up and look at.

For next trading session, here is what I need to do. Wait more patiently for my entries. If the range is from 10-20, I cannot buy in the 15-20 range and I cannot sell in the 10-15 range. My risk is too great. I need to wait so sell near the high of the ranges and buy near the low of the ranges.

Also, I need to look at getting out of oil. Oil just frustrates me. Its a product where I lack so many edges, thereby making it so difficult to be profitable. If I can start trading more 10 yr or Eurodollar, where the playing field is more equal, then I can find decent trades and set ups.

I need to forget about the day and just focus on the weekend and taking a little break.

Frustrating Trading

Better tone it down a little bit. I was really heated the other day. Just made so many mistakes and didn't follow any of my rules. I have no one to blame but myself, and that only makes it harder. Its like pushing against a cement wall, and then trying harder to run through it . . . it just hurts worse. I gotta slow down and take it easier. I have to definitely take it easier on myself and let the market show me what it wants to do, instead of forcing it.

I was just clicking away, fading without reason. I have to find better reasons. ugh, what a tough way to earn an easy living

Some Light, Finally

I spent hours last reviewing my trades since June 1, 2009. I learned a great deal about what I am doing right and wrong.

First, ill talk about the bad. The past few days I have been gambling. I just trade to trade, all without thought. I am not a scalper, so this is very destructive. There is a rush when I right, and a crushing feeling when I am wrong, but I know better. I made 58 trades, 48, 54, 46 and 49 trades on the days I traded without any thought or game plan. I lost $1000, made $2500, lost $4000, lost $1200, lost $2200. Clearly this does not work. I looked back and noticed I had been doing this a lot. I just got away with it at first, so it reinforced bad trading habits. I also saw I was buying highs and selling lows without thought. I took big losers where I did not know when I wrong. I reversed and just jumped into the markets blindly.

Now for the good. When I put together ideas and thoughts, and wait for my entry levels, I can make money. When I am patient and limit my trades to around 15-20 trades, and really wait for good setups, I can do really well. I can definitely earn a nice living if I keep this discipline. I must be honest, it can be very boring, and that my problem. Also, when I know where I am wrong and I just get out, I do well too. Bottom line, I can find good scenarios and make decent trades with thought and patience.

Today I came in with a very easy and simple game plan. start small and build from there with good ideas and scenarios. I was trading smaller than I normally do, but obeying my plan. I finally caught a 25 tick winner in the euro and made about $1,000. I then sat patiently and followed my rules for a little while longer, adding a little to my day.

However, I lost it a bit at the end, got pissed off and took some very big swings. Luckily, and I stress luckily, I made it back and called it when I got right near my high. I walked out up $1300, and it was great because I basically followed my rules and I still had a lot more to do right. I can do this, I can make money when I do the right thing.

I am going to tweak my plan for tomorrow and add some new things. I need to keep this up and do a lot more of the good and less of the bad. Patience and thought are the keys to this. Avoiding the gambling is also very important.

Lets try one more trade and one more day of good things. Patience until at least 8:30 or when oil stats come out. Small size and build from there.

Worse Monday

Monday could be the epitomy of what I do wrong. I came in late, with little sleep, and as soon as I got to my computer, I jumped into the market. I was bearish and I sold it without thinking or finding a good entry. I took a loser, and took another loser selling it. I sold it again, and the market swept down my way. I then waited patiently, and turned around and bought it for no reason. In fact, I chose so poorly that I took a 30 tick loser in about 15 seconds. I did it again, and again, and I was down $1500 within the first 15 minutes of trading. Now my limit is $800, and I know I made some bad mistakes, but I convinced my manager that I could trade small and make some good decisions.

I actually battled back, to where I was down only $400. I told myself if I got back to even I would leave, or if I got down $800 I would call it a day. Then I heard the guys around me say that CIT had just jumped about 40%, from $1 to $1.40 and it looked like the government might bail them out. Without hesistation I bought the market and it instantly sold off. I bought the high. I figured I wasn't alone, so I reversed and sold and the market popped up to new highs. I lost $1500 in about 20 seconds. I was down $1900. I put on one more trade and lost and left down $2200. Again, my limit is $800. Ugh, here I go again.

Needless to say, this is very bad. I am losing so much and I cannot control my downside limit. In fact, I blow right through it. I am creating this little disaster myself, and it is totally in my control. I needed to figure out what was really going in my trading. I needed to dig deeper. I am just do down in the dumps.

Rough Friday

Well, Friday was a tough one. I made the changes I wanted to make for the day, took my time, and started off on a good note. I was fairly patient, and kept my losers small. I managed to get up about $800 by lunch time, and thought I would call it a day. My worst case scenario was that I lose the $800 and walk out even for the day.

I wish that was what happened. I lost $1900 very quickly, making 12 losing trades in a row. What a disaster. I traded the money, chased the money, and put no thought into my trades. Basically, I kept chasing the last up move, and I kept buying highs, puking the trade and reversing, only to be pissed and buy the high again. Ugh. I made 32 trades, and I would say that I put almost no thought into anything I did.

Now the worst part is, I had all weekend to think about it. To think about what I did wrong and what I need to right.

Bank of England and 30 year re-opening

So I went in early this morning to trade the Bank of England news at 6 am. I slept horribly last night and made a huge error before the release. I pulled up my Swiss Franc book and I was about to trade it, but luckily I noticed about 10 seconds before the release. Anyways, the release came and went, and I lost a little because I traded the Euro and Crude Oil. Whatever. Bottom line, it was frustrating, and it put me in a bad spot before any markets were really moving.

I made so many trades today, in fact, I made way too many. I was chasing money all day. I was up, then I was down, and then up and down. I went into oil, euro, 10 yr, and back and forth all day. It was not very productive.

I was bullish most of the morning because the bank of England basically put and end to quantitative easing, and most markets were up early. Equities and oil had been selling off the past few days, so it felt like today might start retracing. Anyways, I was buying oil from 61.80 to 60. Clearly that was a mistake, and my bias was wrong. Thankfully I was not down too much.

I finally sold it a few times and took some decent winners and then bought near the low when I saw some strength in heating oil and gasoline. I actually managed to get up a little bit. I was starting to find a few 10 cent winners and got up decently.

I waited for the 30 year re-opening, but traded that poorly. I was up and down after it, and only made a little bit after it. I walked out when oil closed, right near my highs.

I made 58 trades today in 5 different markets. Granted oil moved a lot during the day, I think this was excessive. I lacked a lot of discipline today and I failed to put together any great ideas. It is hard to gauge what I did right and what I did wrong because I made money. Actually, I made $2500, a lot more than I should have. Maybe I am lucky . . . who knows

I need to review, I need to really spend some good time reviewing. When I make too many trades, it is hard to separate the good ideas from the bad ideas.

Tomorrow I want to make only a few trades and write down all my reasons. I need to put together what is working and what isn't.

New Post

Well, I managed to go on a good streak. I was able to straighten out my June, and make a little bit of money on tiny size. I covered all expenses, my draw, and chipped away about 20% of my debt. I felt like I was on the way to getting out of debt, and figuring things out to a certain extent.

I stopped writing in my blog, and I also became lackadaisical in my review and preparation. These last three trading days have been a total nightmare for me. I knew that when I was trading last Friday, I was not making good decisions, but felt alright because I kept my loss within my limit. I had been making about 2-2.5 times what I was losing, so it was an acceptable loss. I knew I was making very bad decisions, but I left believing that it wasn't that detrimental because it was a small loss. I did not review my trades, but I felt like I should have.

So then I came in Tuesday. I was very tired and on edge. I felt like I should take it easy, but I did not. Instead, I completely over traded. Made some very bad decisions and some ok ones. I managed to get up about $850, and I had almost made back Fridays loss. Then, I made one losing trade and kept chasing and chasing and chasing. In a matter of a few minutes, in three different markets, I lost $2,000 and walked out down $1200. I was really pissed off. I printed my trades, saw I made about 50 trades with no reasons, but failed to review again.

Today my goal was to not do anything until oil stats, watch the tour de france, and review my trades the last few weeks. Obviously, I did not do what I planned. I got in a little late, saw a move developing, and jumped into the market. I had a nice 20 tick winner in oil, but never got out and took a small loss. I bought the high of the move and then watched the market move lower. I tried selling a few more times, but only managed to lose. I was frustrated to say the least. Before I knew it, it was 8 am, I was down $670, and pissed off. I then bought two highs, and lost on both, and I ended up down $1500 before oil stats. I was livid. I extended my limit for the day to about $2000 and waited for oil stats. Of course when oil stats came out, I bought twice what I was allowed and took a massive 40 tick loser. I lost $2500 on the trade. My limit is $800, so it was very bad. Normally I lose 5 ticks and get out when I have a bad trade, but I froze and just hoped the market would come back. Instead, I took it in the teeth. I lost $4,000 today, about 5 times more than I allow myself to lose on any given day.

I need to get back to what got me on the right path. I need to review my trades everyday and keep up my blog. The hardest thing is keeping disciplined when things are better because all I want to do is take a breath, relax, and enjoy the good days. This is such a mistake. I need to keep the same intensity and work ethic when things are going well as when I am trading poorly. This is just another test in this survival time.

I have a lot of work to do tonight, a lot of reviewing, and I need to figure out what I have been doing well and what I have been doing poorly.

Without reviewing, I am guessing that I am buying highs and selling lows without reasons. My entries are very poor. I have bad risk management. I am taking too big of losers. I have no reasons for my trades other than that I feel like things moved to far too fast.

What I need to do is slow down, wait for my reasons, take my quick losers and get out and just book profits. No need to look for big moves, just do what I do best. Have multiple reasons for trades, go with trend, wait for scenarios to develop, and keep my losers very small.

Time to review and see what I find . . . . .

Real Bad Day

I had a very bad day today. 1 winner and 10 losers.

I tried staying patient this morning. I was waiting for any sort of setup. I then saw the SP drift lower after the open and I thought oil would follow. I sold it and lost.

SP then moved higher, and I thought I saw a triple top, so I bought a high in oil and took a quick loser. I tried it 3 x, took losers on all of them. And I also tried selling a low when it did not work buying it. Ugh

Finally, I caught a winner in the euro, while I watched oil rip higher. Oil then sold off, what appeared to me as very aggressively, so I sold a low. It went about 7 ticks my way and then ripped to a new high, so I got out, reversed and watched it move right back to where I sold it. I lost so much in about 30 seconds.

Today was just terrible for me. Maybe because it was quadruple witching in the SP, and maybe because oil rolled while HO and RB did not. I do not know.

What I do know is I lacked a lot of patience and I had no real set ups. I need to be able to sit here and do nothing.

I bought hi's and sold lows. I reversed and took 3 losers that were way too big. It was obvious what I was doing wrong, especially on a terrible day like today.

I need to review this weekend and see what I have been doing well, and focus on that. Its a frustrating way to end the week, but life goes on.

Doing well, but need to clean it up

I had a decent start to the morning. I bought ES and Eurostoxx on the Continuing Claims data, but put on too much size and scratched it very quickly. I had very little to show for it, even though I think I saw a great opportunity.

I was patiently waiting for places to sell oil after the oil market sold off after the the open. I actually chose decent spots and took my relatively small losers. I then got the feeling someone had the 9am Phili Fed release early, and I was correct in my assumption. Bloomberg released it early and thankfully I was able to buy a little oil on the early release. However, it was very small and did not get back my losses from selling it.

I remained very patient and waited for my spots with multiple reasons. I was able to make a pretty good day of it, but then got a little sloppy and sold a low and bought a hi for no reason, and took my 10 tick losers. It was frustrating to say the least, but I buckled down again and got back to my highs around 10:30. I have found that from 10:30 ish to 12 or so I get very beat up and have a hard time seeing the market. I took a break for about 2 hours and just decided to sit and wait.

Sure enough the US fixed income market had tanked and I saw a great opportunity to buy. I traded Eurodollar for the first time in about 7 months. I made some decent trades, ones that would have been huge winners on small size, but I just wanted to make quick stabs and take quick profit because it has been so long since I traded it. Oil went a little crazy and I took some losses that forced me to cut my size. I was able to use that size to get back to new highs, and walk out of there at my high.

I noticed today that I started to feel a little sloppy with my trading. I feel like had I prepared a little more and set up some trading tools, that I would have had a better chance to capitalize on some great opportunities. Also, I lacked focus in my own trading. I did not trade with that killer urgency. I am not sure what to make of today. It feels great to walk out up more than I have in the past, but I feel like I squandered many opportunities today.

For tomorrow and the end of the week I plan on keeping it really tight. I would be thrilled to walk out up anything. I know it will be a late night tonight, and its a summer Friday. I need to be extra cautious and patient. I need to set up everything and really bear down and stay disciplined. It is unacceptable to slack off because I am doing better, because that's what leads to my draw downs. I am trying to keep the same mentality no matter how I do.

More of the good, less of the bad

Today felt a lot better than the past few days. Granted, I started off the day up a little bit and then lost on some trades and found myself down more than I wanted to be. Obviously, no one likes to be down, but I have started off up at first and then down the last few days in a row. This is a little frustrating to say the least.

I managed to get a little back before DOE oil inventories. I actually sold it right near the top, but I was afraid of a big sweep out of nowhere, so I took my profits and watched the market tank. Maybe going forward if I have a little more confidence in my trading, that is a trade I can hold part of longer . . . just a thought.

Anyways, what really made today a success and feel good was that I was very patient and I waited for my setups. I stayed out of the choppy messes and took my quick profits. I am trying to to risk 1 unit and make about 3 units. Right now that is my simple strategy, and its working. I know I am not taking out the whole move or riding or holding trades, but I dont think it matters right now. What matters for me is that I need to take my profits and just hit singles. I think that in time it might change, but for now I must learn to crawl before I can walk or run.

It is really amazing that after 5 years of trading I am back to the very basics. I need to continue to stay patient and wait for my spots. There are many opportunities in there, and staying calm and patient are some of the keys to my success.

Also, doing my work in the morning is paying off. Some of the levels I look at are helping find great trades in different markets.

I must also say that no move would really surprise me. I wouldn't be surprised if oil was up or down $2 tomorrow.

Reoccurring Theme

It seems as if there is something happening that I cannot identify in my trading. Today, I made a few quick small losing trades to start, but managed to make it all back with one decent winner. I then had one more winner and I was on my way to having a very small winning day. However, I lost and lost and lost and lost, and before long I was having a bad day. In fact, I was almost at my limit again for the day.

In regards to yesterday, I figured out what set me off on my downward spiral. I was having a good day when I clicked on a headline that I thought should have been a winner. However, I was putting too much emphasis on this one tiny headline and took a small loser. I then tried to chase that loss and made some very careless trades that were all losers.

Today, I didn't make a big mistake. I just wasn't seeing it all that well. Maybe I got a little fast, maybe I didnt take a break after 3 losers in a row, and maybe I made too many trades with no setups.

I do know I was early on one spot selling the euro. But that trade alerted me and I was able to wait a make a very good second trade.

In oil I started off buying it because heating oil and gasoline were so strong. However, I was losing every time I bought it. I started making money selling it and felt like we might trend down all day. My spots were pretty terrible today. I sold it numerous times and took many small losers. Maybe I am picking bad spots, and maybe I keeping too tight of stops. I dont know. It is something I need to think of an keep track of.

Bottom line, I managed to have an ok day, but not without some stumbling along the way.

Finally, I re-learned one lesson again that has cost me big time throughout my career. I listened to someone else's idea and just executed the trade based on what that person said. I didnt know where I was right or wrong, and I ended up taking the biggest loser of my day. In fact, I almost gave back half my day on it.

Still have a long way to go and lot more to work on.

Interesting Start to the Week

Well, I did not post on Friday, but to sum up, I ended up having an ok day by taking quick losers and waiting patiently. It felt nice to start the weekend on a decent note.

My goal this morning was to come in, stay patient, and try to put together some good trading scenarios. I followed my goal very well for the first part of the morning. I was patient, I took quick losers, and I was finding reasons for everything I did. I was fading oil most of the move down because there were very little retracements worth selling. I did not lose money, but I did not make any either. I made most of my money in the euro, so that was nice.

Something around 10:15 happened and I snapped. I don't know what it was, and I need to figure it out. I was having a decent day, up more than most of my down days, and I made some trade, or some poor decision that led to a losing trade. From that losing trade, I lost everything I made and continued to lose. Not only that, but when I got to zero on the day, I put on a euro trade that was initially positive, but then went wildly against me, and I froze. I puked it right when I was $0.50 away from limit. That is the closest I could possibly get. I was livid. I knew I shouldn't be doing what I was. Ugh.

However, things turned much brighter after that. One of my fades in oil worked out nicely, and I was able to get back to even on the day. I took a break, cleared my head, and was very thankful that I wasn't down any money.

When I came back from lunch I was very careful with my trades, I took my profits quickly and waited for my setups. Before I knew it I was making new highs, and I walked out right when oil closed.

I am not pleased with today's performance. I made a few classic mistakes and I need to figure them out. Clearly, I cannot take big losers, and I took one big one that almost put me out for the day. But what was really bad was when I went from having a decent day to losing. I need to go back and review what it was. I think there is something that sets me off, and I have a few thoughts.

First, when I am up money I take a quick small loser on small size on something stupid. Today, I think it was when I heard a marginal headline, I clicked with small size, and lost. When I got out, it went the way I thought. I am very confident this was and is something that sets me off.

Second, when I do take a small loser, I am looking to make back what I lost. I think sometimes I lose small, make a quick trade to scalp back the money I lost. This is not part of my strategy. When I do this I don't trade for reasons, I trade for money. This is very bad because then it is snowball effect. I make it back a few times, and that gives me false confidence. I then do it one last time, and lose, and chase that loss, and lose, and chase that loss, and lose, and I force everything when there is no opportunity.

Finally, I think I make a few ok trades and get over confident and my rules disappear. I don't trade for reasons and I start buying highs and selling lows. I just start clicking and make a ton of trades. Most of the time they are bad trades.

I need to stop these three things. I need to stop them immediately. I will stop them. Tomorrow will be a better day and I will figure out what leads me to make these mistakes. I am starting to find the path in the dense forest. I can see the path, very faintly, but I think its there. Hopefully I will get on that path and it will lead to a more clear defined path that gets me back on track.

Birthday Troubles

Another limit down day - brings the total to three in a row.

After reviewing my trades for the day, I made the corrections I wanted. I did not sell lows or buy highs, and I did not take big losers. So where was the problem?

Maybe it was my impatience? Did I over trade? I dont think so. I did my prep work, I had reasons, and my ancillary markets informed me that I was correct in my ideas.

I had a few trades where I had 20-25 tick profit into them without peeling out of any, but I felt there was a lot more to the move. Maybe I need to book profit. Its hard though, because I book profit and I feel I shouldnt, but I do it anyway. Then I watch the market keep going and going and going the way I thought it would. However, when I dont book profit, I scratch or lose, never never never does it continue to go my way.

I looked at the past few days and the line between having great days and ending up limit down is very fine. Its almost scary how close I am to figuring it out. The pronblem is, I am not figuring it out and I am losing every day.

This has gone on for about a year now. I am at a new mental low, and I dont know how much moreI can take of this. This slow bleed out, coming in a lot of the days and losing small, but losing often is really getting to me. I am trying to stay positive, it just gets harder and harder to do so with every losing week and month.

I am trying to keep positive. I am trying to concentrate on the fact that I can find winning trades. I dont know what needs to change, but something needs to. I need to find something good to keep hold of and not let that go.

I can't follow my own rules

Once again I have a plan and I cannot even come close to executing it.

I started off on a great note. I waited until nearly 9 am to make my first trade, and it was a 10 tick winner. Then I took two, 5 tick losers, followed by another 10 tick winner. I was patient, and I was waiting for my spots. Then I had a 30 tick winner, and I was up on the day pretty good. I figured if I remained patient, I could continue to have a decent day.

Oil appeared bullish, so I bought at many different retracements. I ended up losing everything I made and I was down about 5 ticks when all was done. What set me off was that the last time I bought it, I bought the low, but took a scratch and then watched the market rally almost 80 straight ticks. I was fortunate because I was able to buy the eurostoxx, so I had something to show for it.

I dont know what it was, but something set me off and I ended up making just horrible trades. It may have been buying oil, taking small losers and watching it just go where I thought it would. Or maybe it was when I bought the euro and scratched and watch it rally like crazy. This pissed me off so bad. I was so impatient and angry, so I just bought the euro and without a question, I marked the high of the move. I ended up losing 3 x more than I wanted. FUCK.

So then I jumped into oil, added in euro, and took a small losers on both positions. I did it again, and I was just furious with my losers. I kept buying oil and losing. So then I sold it, and every time I sold it, I lost. I heard my own voice telling my to just get up and take a break, but I didnt.

Obviously, you can guess what happened. I sold oil again, watched it rip against me and come back so I scratched. It then sold off 40 ticks where I got out. So I waited for another retracement, sold again, held it agian, and took a huge loser. Of course, after I got out, oil just melted. I smashed my mouse and said some unchoice things, and quit for the day.

I think I am just horrible right now. I cant seem to do anything right and I cant follow my own rules. It feels like I am not making progress and any day I feel somewhat positive, I just get kicked in the teeth.

Here is how simple my rules are. Be patient - wait for multiple reasons to execute a trade. If you lose more than 3 times in a row, just take a walk. I also told myself not to sell lows or buy highs, but thats exactly what I did today. Not only that, I held big losers (something I dont want to do, but seem to do all the time). I jumped from product to product and I had no set ups what so ever. I just clicked and clicked and clicked until I took one big last loser. I really cant stand the way I trade, and I am trying to change, but just failing misserably.

Well, tomorrow is another day. I wish I could follow my rules. I dont know why I cant. So, lets see what happens tomorrow. Right not I want to smash my screens and computer.

I cant sell lows or buy highs and I need to write down my reasons for each trade. I need to slow the fuck down, and get my act together. Holy shit I sound like a broken fuckin record. What a fuckin joke. Why cant I follow my own rules? Why does this job make it so fuckin impossible to follow my own rules? Why do I allow myself to make these fuckin just horrible decisions every day and lose every day. It doesnt have to be like this, yet I cant fuckin stop. FFFFUUUUUUCCCCKKKKK!!!!!!!!!

Monday After Payrolls

I felt this morning that today would lack direction and market participants, especially since it was the first day after Non-farm payrolls. In addition, it is kind of the start of the summer, and could be the start to stereotypical summer markets.

I was fairly patient in beginning, taking a few quick losers, and then I was able to make it all back and give myself a cushion to trade with. It felt good to start off with a few small losers and then have one big winner that was twice as large as all the losers combined. I had done my reading and knew my expectations for the day. I then made a few more trades, all for scratches, and thought I saw something in oil. I was dead wrong, and I ended up selling the low two times in oil and taking losers twice as big as I wanted. I waited for a decent retracement, and sold again, but took another bigger loser than I wanted. I was near my limit, and a little frustrated.

I messed up and was not able to take quick losers. I actually lost 2 x more than the max I allow myself to lose on two consecutive trades. Then on the next trade I lost 3 x more. Ugh, what was I doing. Well, I cut my size big time and just waited. By lunch time I was able to get back to almost a scratch for the day.

When I got back from lunch, I found myself clicking into the market, and as soon as I put it on, I knew I should have waited. Instead of taking a very quick small loser, I just sat there and hoped for a scratch. Instead, the market swept very far against me, and I lost more than half of what I had made back all morning. I figured this gave me good insight, and I would wait for a retracement in the move that just swept against me to get back in and join the trend. However, it was just a sweep, and my initial instinct was correct, and I ended up taking another big loser. I was almost at my limit in 2 trades on tiny size.

I waited for the Apple conference, and watched the stock sell off when Steve Jobbs wasn't there. However, I didn't look at the rest of the market, and while I thought that news on Jobbs would be bearish, I sold the ES and it went up. I took a loser and lost my limit for the day.

This was ok today. I learned a few good things. First, I had terrible entry points - selling the lows. I learned that I need to take much quicker losers, and just get out. Also, I suffered from tunnel vision today, and I didn't take a look at my ancillary markets. This was very evident when I sold ES because I was thinking about Steve Jobbs. In retrospect, it was asinine.

For tomorrow I have to look at my screens and find my reasons. I lacked a lot of thought and patience with my trading today, possibly because I was over-confident from Friday. I know if I keep doing what I am doing, things should continue to get better. Oh, one last thing, I lost my limit today, normally I make my limit and lose 2 -3 times more than I make. It sound so simple, and I hope it is, but I need to keep my losing days small like today, and ride my winners so I make about 3 times more than I lose. That is my biggest step towards success!

Delayed Post - Good End to the Week

I ended last week on a great note. I had some wild P&L swings throughout the week; good day Monday, gave it all back Tuesday, then had a really bad day Wednesday, arguably my worst of the year, and then had a good Thursday. It was nice to finish a volatile week with a good day.

Unfortunately, I was not able to take advantage of the Non-Farm Payrolls report. However, I was very patient and was able to find a little opportunity in oil. I saw the stock market sell off and felt like oil set off stops over $70.00, so I was very bearish. After selling it near the high and making nothing, I waited and eventually bought it. I took a very quick loser, but this was a great loss. I learned that the market was even more bearish than I thought, so I turned around a sold it, and made a great quick trade.

While I was short oil, I was fading the euro. This normally proves to be very very bad for me, but every time I faded the down move and bought, I would get 20 ticks or so into the trade and scratch. I actually bought it many times while it moved down almost 300 ticks. Because I took quick loses and was able to capitalize on a few fading spots, it was ok for me. I have to remember that if I fade, and I take quick losses, and I have my reasons and exits before I fade, I can go ahead and do it. Its when I fade for no reason and I have no exit strategy is where it becomes hugely problematic.

Once oil and the euro sold off very far, and started to turn back around, I was able to buy oil near the low on a retracement, and then add to my long by buying eurostoxx. I held this trade a while , and waited for both products to hit my targets. I entered and exited my trade very well, and before I knew it, I was having a great day. I called it a day after that, I wanted to just leave feeling good and start my weekend.

Some good lessons in there. I can fade with reasons and defined entries and exits. I am seeing the market better. I can actually make more than I lose. Trading is a lot like golf, you may hit bad shot after bad shot and wonder why you even play that game, but one good shot, and you love it more than ever.

Followed My Rules

Today was a much better day for me. I have come up with a new guideline to help me in my trading. This is something I created, and I use it to slow me down. It helps me prepare myself properly for the day's trading - fundamentally and technically. It is rather tedious, but I find that when I slow down, and force myself to look at many different trading factors, I can analyze them all and figure out what will make a trade a success or a suckers bet.

Anyways, I came in this morning and caught a lucky break with a trade in the British Pound. I never trade the product, so I was thrilled when I was able to make a little on tiny size. From this trade (which was the first time all week I had started the day off on a positive note) it helped reinforce my belief that I must follow my guideline. From there, I did my readings and looked at my charts, and sat patiently. It wasn't long before I found a nice 30 tick winner in oil. I entered the trade because I had multiple reasons. I made a few more trades in oil and the euro, and then found a decent 2 handle winner in the ES. This winner was solely because I was looking at many different markets and was able to see a false breakout while my ancillary markets showed something different. Again, I attribute this to slowing down my trades and looking at the bigger picture. This is something my trading guideline helped me with.

After reviewing my trades, there were two things that really stood out for me. The first was that I had reasons for almost every trade. This made it so easy to take a loser, and a quick loser. I noticed that when I had my reasons, and they didn't work, it was time to exit the trade. Conversely, I made a few impulse trades (its part of my trading personality) and I had no idea where or when my exits were. This was the second thing that stood out for me. These impulses were my largest losers for the day. It was amazing to look back, and see that when I had good reasons I took small losers and let my winners run. And it was even more amazing to see that when I made impulse trades without thought, I had tiny winners and big losers. It is hard to fight the impulse, especially when I miss a big move and I feel I need to fade it because it has become over-extended. Fighting the impulse has become a goal of mine, and I am sure with time, I can fight the urge enough, so it wont take me out of my day.

For me, the hardest part is sticking with my rules. Typically, when I have a good day or decent run, I become lazy and lackadaisical, and it leads to a very bad trading stretch. I need to forget about today, and continue to work on following my rules. From all my reading and research, I have found that if someone can do something for 60 days, it will almost always become a habit instead of a chore. Its like going to the gym, the hardest part is starting to go, but after some time, it becomes a habit and a part of your personality. I am hoping that I can take from my readings and translate it into trading success.

The Importance of Following You Rules

I told myself the other day that I was done taking big losers. It's been a problem that has plagued me for years. I had one goal, and that was to get out of my losers quickly. I managed to follow my goal well, and even though I had another losing day (which happens in trading) I consider it a success. The good thing from the day is, I was able to identify something else to work on. I took a look at all my trades for the day, and the one good trade I had (one of the few winners) was when I sold oil because I waited for a retracement in oil, ho and rbob. I had many reasons to sell it, and I was patient with my execution.

After that I trade, even though I was long ERY (a triple short oil etf) I kept buying oil at points I felt were acceptable. I had some reasons for most of my trades, but as I watched 20 tick winners quickly disappear, I became agitated. I kept buying the whole way down, and after 15 - 20 losing trades, I had taken enough small losers to finish down at an amount I was comfortable with. While I faded the big move in oil, and even faded myself (long ERY) I can come in the next day and work on my patience and avoid fading the trend.

I can work on identifying ancillary markets and finding multiple reasons to trade. I am going to work on a guideline sheet to follow every day. I hope by following this, it will slow me down, help me stay out of the market when there are not great trading opportunities, and provide a sort of outline to my thoughts. This should make it easier to develop more of the good and watch out for the bad.

I must also remember, this is a race, not a sprint. I need to learn more from mistakes, take decisive action, and move forward and improve. This is a test and the low point of my career thus far, but after reading and re-reading Market Wizards, many great traders had numerous set backs . . . and they survived their blow ups and defeats to see brighter days.

Self Sabotage

I am my own worst enemy. I am the only one holding back my own trading potential. Today I made the same mistake that has kept me from progressing over the past few years. I hold losers until they are so big, that I have no choice but to puke them because they are so crippling to my account. Not only that, but I am losing more than 3 times than I make on a decent day. I just make it so bad for myself, and making it so much harder than it needs to be.

I still cant figure out why I do it. I believe I am so desperate to kick start this trading slump that I am willing to hold losers until they become winners. I do this because I just cant stand losing anymore. However, this is proving to be absolutely horrible, because all I keep doing is making it worse and worse for myself. My problem is that I have to get out because my losers are adding up and it is becoming nearly insurmountable.

Every day, I give myself an amount of capital to trade with. Lets say I allow myself to trade with $1000. Well, on a good day I am making about twice what I allow myself to lose, but on a bad day I am losing between $3000 and $4000. My ratio is looking like 1.5 : 4. What I need to do, to make money and grow my size, is change this around and get my ratio to look more like 3 : 1.

I am starting a new strategy, one that I feel will be more profitable. After looking at all my statistics, I am temporarily stopping my equity trades. In the last month, they have led to the biggest losers. From looking at my stats, I am only making money in oil and the euro. This is the part of the market I need to focus on. I am at a point where the pain from trying to force my equity trades is so detrimental that it is taking away from everything else.

Obviously, I need to stop taking massive losers. That is my absolute biggest problem.

Tomorrow is a new day, I need to take what I did today and try my hardest not to repeat it. Self sabotage is my current track and its time to change courses. I pride myself on saying that actions speak louder than words, so its time to put up or just shut up.

Good Start to the Week

Today was an interesting start to the week. When I came in this morning, there was very bullish Chinese data that had rallied almost every global equity, commodity, and currency market. In addition, the cash sp made new highs and moved past the 200 day moving average. Clearly, the market had a bullish bias. I had a horrible night sleep last night, all because of thunder and lightning storms, so I was on edge very early.

I was patient this morning, did a lot of my readings and looked at my technical levels. Oil was up over $1.25, trading around $68. I waited until the release of the US ISM data at 9am to make my first trade. The number came in right around expectations. I tried making a trade off the euro, but I was too early in my execution, and I traded too large of size. I made the mistake taking too big of a loser, when I could have clearly gotten out sooner. This immediately put me near my limit. I lost way too much of my trading capital on my first trade. I had 25% left and to make it last, I cut my size and waited for good set up to ensue.

I made a few good trades, and a one or two just absolute bonehead mistakes, but by lunch time, I had made back everything I lost. What I need to take away from all this, is that by cutting my size, and staying disciplined (well, relatively disciplined) I was able to get back to even and put myself in a position to take advantage of the markets later in the day. Most of the time in the past, I chase my losses and end up losing a lot more that I had planned.

Typically, from my all my reading, I have seen that when the market opens up past R2 (second level resistance from the pivot) the market trends all day. I kept this in mind and tried trading from the long side all day, especially after taking a long break over lunch to recollect my thoughts. I finally was able to get long oil and trade it as it made new highs for the day.

There are a few good lessons to take away from today. First, dont risk more than you can stand to lose on any one trade. This seems obvious, but it is a problem I, as well as others, have. It is easy to say that the market should or shouldn't do this or that, but thats not important, whats important is how I (or you) react to what the market does. The biggest mistake, the one that takes me out of my trading the most, the one that led me to have the worst trading of my year so far, was when I held a loser when I thought the market shouldn't be doing what it was. When I trade well, I just react to the market, and if my position moves against me, I just get out.

The second lesson of today is having good reason for each trade. Again, this seems obvious, but it isn't so easy to follow. Many times, I hear that a market has gone too far, and someone decides to sell a rallying market. I am guilty of it. The question is, where are you wrong? If you sell it after it breaks through a resistance level, and elects stops, and hits an old hi, then there is resistance and reason behind your thought. Clearly, you have to execute the trade well, and know what you are risking. When you have reasons, typically you clearly know where you are wrong, but when you just sell a rallying market because you think its gone too far, you risk too much. Where are you wrong? If you aren't sure, then it becomes hard to get out. One might get away with this a few times, but as one keeps fading and letting trades move against him, inevitably one always get away.

One great thing I realized today was that if I cut my size and look for those good trades, I can make back a lot on smaller size. Not only that, but I ended up having a good day because I put myself in a position to take advantage of trades later on in the day. I figure there are several good set ups a day that if I am patient, I can take advantage of them if I am in a good mind set.

For tomorrow I need to continue to do my readings and wait for logical setups. Volatility is going down as the market continues to grind up. It becomes harder and harder to buy the market up at these levels, but it is also hard to fade and sell it. By staying disciplined and patient, I am sure there will be opportunity tomorrow. Keep following my rules, do my preparations, and look for those good spots.

Good Finish to the Week

I started the day like I do every day, I read my fundementals and looked for my technical areas. I was patient this morning as well, and I did not make my first trade until the GDP release. The equity market never really made any clear directional moves today, despite Oil breaking over $66 and the Euro rallying to 1.41. There were a few decent opportunities in the morning, but without much market movement, the day dragged on. I made a few good trades in the morning and I was on my way to having a positive day. (My only goal, after yesterdays complete lack of discipline, was to walk away positive.) Once again I lacked patience, and blindly clicked into the market without having a good trade scenario. I sold the bottom of a consolidation, and the market quickly moved against me. When I should have exited, I froze and tried to rationalize that the market would sell off, but it did not, and it rallied further against me. I lost more than what I wanted, and puked my sell about 12 ticks higher.

Puking that euro trade for 12 ticks was actually a great step for me. Normally, or as I have done this past week, I would have held it once it was past where my out should have been. Today, I got out, and even though I was very angry and frustrated, I sat back and watched as the market moved up another 40 ticks. I would have lost so much, and I saved myself from losing so much by just getting out. Not only did I get out, but I waited and sold at a price that I had severak reasons to get short. This trade was the best trade of the day for me, I held it for a very large winner, riding 30% of it over 50 ticks. This put me back on track.

After that successful trade, I found a few entry points in oil where I was just a little early in my execution, and did not make or lose anything. However, I knew I was seeing the market well, so when I finally waited and found a spot I really liked, I was able to hold on and add another 50% to my profits for the day. Before I knew it, I had made back more than I lost yesterday, and I was able to scratch the week.

The big lessons for the week are 1) holding massive losers takes me out of trading for the day and takes away multiple profitable trading days 2) when I am calm and patient and have reasons, I can identify multiple trading opportunites in multiple markets 3) when following my rules, I can make good money, and 4) when I keep my trading losses small, and let me winners run, it is amazing how fast and how much money I can make on tiny size.

For next week, I need to remember these big lessons and try to adhere to my own rules.

Obey your rules

Today was very rough trading day for me. I was trying to carry over some momentum from yesterday. Every morning when I come in, I have a sheet that I try to follow that helps me prepare for the day. I identify key levels, old hi's and lows, pivots, resistance and support. In addition, I like to read as much as possible, and look at overnight news events. Once I have done all my preparation , I feel I can keep an open mind and wait for trades with good risk reward.

I was patiently waiting for the opening of the SP market, when some news wires announced that GM bond holders had agreed to swap their debt for equity, in hopes of avoiding bankruptcy. I bought eurostoxx and sp futures, without looking where I bought or identifying where I would be wrong. I just sat there, like a deer in headlights, and watching as the market moved against me. When the pain was too much, I puked my positions. I clearly did not understand the headline, and I was hoping on this trade. In addition, I bought too big of size, and with too much size invested in the trade, I reacted emotionally by thinking about the money. If I had kept to my trading size, I feel I could have exited the trade quicker once I realized my logic was wrong. Just to reiterate, I traded with too much size and without a clear plan for the trade. I put myself behind the 8 ball way too early in the day.

I told myself this was a set back I could overcome, and I could still make it a successful day by coming back and focusing and finding good trades. I was patient after that GM trade, and waited for my spots. I was trading on edge, and knew my spots would have to be perfect. I put on my first trade, and the market didn't move much, so I scratched it. I realized I sold near the low of a consolidation, but my ancillary markets told me it was the right time to sell. Once I exited the trade, the market sold off. I waited again, bought oil, and instantly realized I was wrong, so I quickly scratched. I tried fading the big down move in the eurostoxx, and realized that I didn't have any good reason to trade there, so I scratched very quickly, and thankfully watched the market fall immediately after. Finally, I saw some decent order flow in the ES, and managed to get a 2 handle pop on small size to give me some confidence.

I was jumping markets, and after looking at my trades, I was trading on emotion, and not with clear thought. I went from equities, to oil, to eurostoxx, to ES. I was just looking for a quick scalp. Once I was aware of that, I waited until Natural Gas stats came out @ 9:30 central. Natural Gas inventories were down, and Natural Gas rallied off the release. I was bullish energy after this release, and looked for places to get long. Oil moved back into the consolidation 8:30 - 9:00, and once in this range, I felt strongly the market would make a run at new highs. I waited for the consolidation to set up, but mistakenly bought near the high of the range, and not near the bottom, and was stopped out very quickly, only to watch my idea play out. The market popped 30 cents as soon as I got out. In this trade, I was impatient and my entry was horribly planned. If I had waited and bought near the low, with a much better defined risk reward, I may have been able to capitalize on the trade.

I made several trades in oil before and after the release. Upon reviewing them, I would enter at decent spots, but I was so afraid of losing money, that I would scratch them and watch the market move the way I had predicted. This happened 5 times, and it started to wear on me mentally. I finally said to myself, I need to give it a little more room to breathe, and see how it plays out. With that logic, I lost my edge. I wasn't doing what I had planned, and this made my trading sloppy. I kept trading on emotion, and became more and more agitated with every scratch and quick loser. I started making very quick decisions and lost all my discipline. I would find good ideas, but execute them so poorly that I wasn't able to capitalize, and then watch my idea would work. The writing was on the wall.

My best trading days are when I am trading patiently, waiting for setups, and executing with reason, and good risk reward. However, by mid day, I was trading without any reason, with poor execution, and changing my thoughts very quickly. I was forcing my trading, looking to make a quick buck, and I was trading the money, not the idea. In a span of 3 minutes, I was short oil, then reversed, only to get out of my long where I had initially sold it, so I sold again (another reverse) only to watch the market pop 50 cents in my face. I sat there and just watched to market move against me, until the pain became too much to take. I lost more than I allowed myself, two times more. If trading successfully is all about capital preservation, then I did the opposite, I just gave money. I took myself out of the day, and gave back too much of profits from the day before. I had no thought process and lost all discipline. Whats the point of making rules for the day if I cant even follow them?!?!? Its like an alcoholic who says he will go to the party and not drink, only to have one drink and then lose total control and get completely hammered, and wake up feeling like shit . . . My goal is to follow my own rules and obey them, when I do, I can make great trades, great money, and go on great streaks of success. What is missing?

10 yr yields soar

Upon opening up my trading screens, the market had not made any clear directional move, and consolidated into a tight range. Early on, there were very few opportunities, and most traders were sitting on their hands until the open. Once the market officially opened, the market remained in a tight range. It seems like someone got the 9 am number (Existing Home Sales) early. Home builder stocks rallied appreciably before the release, as did XHB (home builder etf). This was eerily reminiscent of yesterday's Consumer Confidence. On the release, ES and Oil rallied, but since it was apparent a bullish number was expected and the release was fairly close to expectations, the move after the release retraced very quickly, and presented a great opportunity to fade the knee-jerk pop. I found it easier to fade oil than es, and the market never looked back. The ES market consolidated after the release, and remained in a tight 5 handle range for the next 3.5 hours, which presented very few trading opportunities. It seemed to me that there were no clear signals, and it was more of a mean reversion trade. I try to stay out of these tight ranges and wait for a trade to set up. During that time, Reuters released an ECB source story about buying more covered bonds. The trade was to sell the euro, but I mistakenly bought Euribor instead, and scratched the trade. This ECB story did little to move US markets, and the real news and move of the day came later when the 10 yr price tanked and yields rallied like crazy. No one was sure if it was from convexity hedging (http://www.investinginbonds.com/learnmore.asp?catid=7&subcatid=72&id=366) or a continuation of fear of US debt eventually being downgraded. There were many opportunities to sell and fade with very tight stops. This fixed income move pulled most markets down with it. However, recently, oil has taken on a life of its own. Everyone says fundamentally that prices shouldn't be here, so it was no surprise that oil eventually rallied while the equity and fixed income markets sold off. ES moved lower, consolidated and made another leg down to finish near the lows of the day, all while oil made a run for the highs and squeezed out more shorts.

After a very rough day yesterday, (I held a loser way past my exit and blew through my personal limit) I kept very tight stops today. My only goal was to prove that I can make money and remain disciplined. Yesterday, I re-learned, again, that I need to have my exit planned before I put on my trade. This has proven to be a very expensive lesson that I just refuse to learn. This is my achilles heel, the one problem I seem to run into time and time again. I would attribute most of my losing days and big losing trades to this one problem. Today I obeyed my stops, and kept my losers very small, while allowing my winners to run. I slowly peeled out of my winners once certain targets were hit. When my reasons for putting on the trade stopped working, I exited and looked for the next opportunity. I made most of money from fading big moves, just waiting and watching order flow, and finding pull backs. I failed to capitalize on selling equities with the massive sell off in fixed income. I figured that if US yield sky-rocketed, then the dollar would become more attractive. The euro has rallied strongly the past few weeks, so I figured it might sell off with ES and 10yr. The initial reaction helped me believe that (the euro sold off initially) however, once the move kept extending, and the euro started to rally, it became clear that my logic was wrong. There are many problems lingering here in the US, so it made sense (after the fact), that people were buying / moving to a safer currency as they punished US equity and fixed income markets. Oil was and is doing its own thing, and I am done trying to rationalize that market. I haven't been trading well in the past few weeks, so I am happy that I was able to capitalize on a few opportunities and make back most of what I lost yesterday. Tomorrow is a new day, and I hope to continue the discipline from today, and wait for my entry points. 7:30 am numbers tomorrow, so I will see how and if they set the tone for the day. DOE energy stats are at 10:30 am est, so I will wait to see how oil reacts to that. Patience patience patience. Wait for setups and trade defensively, its still capital preservation right now.