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System Trading Now: Position Update 20130926
DISCLAIMER: NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL, OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE DISCUSSED WITHIN THIS SITE, SUPPORT AND TEXTS. IF YOU DECIDE TO INVEST REAL MONEY, ALL TRADING DECISIONS ARE YOUR OWN. TRACK RECORD SHOWN IS FOR AUTHOR OWN LEARNING PURPOSES. THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. RISK OF LOSS IN TRADING FUTURES CAN BE SUBSTANTIAL.
Kok mING, today quote is for a new trader whom I met yesterday. He always doubt his trading decision and constantly looking for external evidence to support his position. When he is reluctant to take a small loss after being in the wrong direction, he will look for news, comments etc to vaguely support his losing position, only to deteriorate his account further. This causes his trading to be unprofitable.
The Daily chart shows me downtrend signal and I shorted. But cash market run up and FKLI follow as well. When this happen, I will panic and keep checking on what's wrong.
In fact, Hang Seng 40 and Shanghai is green with little percentage but Japan 225 is red with 0.6% negative. Then I keep my trade (Short), but it is possible today can go beyond 1780 and negate the Daily chart which drawn based on yesterday data...
After the day end, when the trend change, I will be trapped and keep looking for down trend related news like US debt ceiling, Fed representatives public speaking and etc to support my Short is correct move.
Slowly, if market continue to go up and my Short is losing more and more money, then it just keep going up until I face the reality and cut big losses.
The Daily chart shows me downtrend signal and I shorted. But cash market run up and FKLI follow as well. When this happen, I will panic and keep checking on what's wrong. Do you have initial stoploss for the short position? If market moves against your position, as long as stoploss still safe, why panic? But before that, do you accept the fact that there is possibility that this trade may be a loser? If so, do you financially and psychologically accept the initial risk you took in this trade?
In fact, Hang Seng 40 and Shanghai is green with little percentage but Japan 225 is red with 0.6% negative. Then I keep my trade (Short), but it is possible today can go beyond 1780 and negate the Daily chart which drawn based on yesterday data... Is what Hang Seng, Shanghai and Nikkei performance part of your trading strategy? If so, do according to your strategy (Inter-market analysis). Otherwise, why bother check on them? Prices above 1780 will invalidate your view that daily chart is bearish. Then you should make sure you are out of the short position if price exceeds 1780, nothing more.
After the day end, when the trend change, I will be trapped and keep looking for down trend related news like US debt ceiling, Fed representatives public speaking and etc to support my Short is correct move. You mentioned trend change. Then by the time trend changes to bullish, you should already cut your short position. Why holding short when you already viewed market as bullish? Again, do US debt ceiling, Fed representatives public speaking etc part of your strategy? If yes, proceed with your strategy. Otherwise, trash them out.
Slowly, if market continue to go up and my Short is losing more and more money, then it just keep going up until I face the reality and cut big losses. You should face the reality from the very beginning. Big losses??? Why big losses? You should only risk what you can accept financially and mentally, nothing more.
I wish I had met you earlier and let you speak to me the above before I learn it the hard way.
At the moment, I try not to repeat the mistakes I made. Hopefully I can see a better path ahead.
I am still a learner at the moment. I do have a trading strategy but not sure if it is comprehensive.
About your reply, if you don't mind, I would like to ask a few questions.
1. I am using US30 index to gauge the next movement of FKLI. I usually used it to time my entry (Long or Short) and exit (Take profit or Cut Loss). Is it a good practise?
2. What do you think about market sentiment? The check on regional markets give me a estimation overall environment changes, in order to react for sudden news. Again, this can be avoided by having a target TP price and SL price.
3. About the news, I used to move by it but no more... Now, it is more like an indicator for me to liquidate my positions when there is news to be released or published. I find that holding a trade while there are important news pending release is a gamble. Unless I can know the news in advance otherwise, don't take the risk. Do you agree?
4. I can financially accept the losses. The mental part is difficult, do you have any advice for it?
I noticed that you are giving free consultation, can it be a not face to face consultation?
I appreciate it and I hope to learn more from an experience trader.
About your reply, if you don't mind, I would like to ask a few questions.
1. I am using US30 index to gauge the next movement of FKLI. I usually used it to time my entry (Long or Short) and exit (Take profit or Cut Loss). Is it a good practise? I don’t know whether it is a good practice. You may back test Dow Jones and FKLI in terms of correlation whether this practice can give you advantage to your strategy. Google Inter-Market Analysis to find out more.
2. What do you think about market sentiment? The check on regional markets give me a estimation overall environment changes, in order to react for sudden news. Again, this can be avoided by having a target TP price and SL price. IMHO, price discounts everything. Therefore I don’t usually pay attention to other market to gauge sentiment. For market sentiment, a lot of traders like to use Market Breath, TRIN and VIX.
3. About the news, I used to move by it but no more... Now, it is more like an indicator for me to liquidate my positions when there is news to be released or published. I find that holding a trade while there are important news pending release is a gamble. Unless I can know the news in advance otherwise, don't take the risk. Do you agree? I have different view. Speculating in the market is a game of probabilities. News or no news, market will move the way it likes. No one know where the market is going even they know the news in advance. In speculating, risk control aka money management is more important than entries / exits.
4. I can financially accept the losses. The mental part is difficult, do you have any advice for it? Psychology management plays a major role in profitable business. It is impossible to give any advice on just few sentences.
I noticed that you are giving free consultation, can it be a not face to face consultation? Not necessarily face to face. You may leave comments in the blog or write to me directly at bmdtrader@gmail.com Hope it helps.
I like today's sentence.
ReplyDeleteMay I know why you say so? :D
Kok mING, today quote is for a new trader whom I met yesterday. He always doubt his trading decision and constantly looking for external evidence to support his position. When he is
Deletereluctant to take a small loss after being in the wrong direction, he will look for news, comments etc to vaguely support his losing position, only to deteriorate his account further. This causes his trading to be unprofitable.
Ya, I had a hard time to deal with this problem too...
DeleteIf you don't mind, give me an example.
DeleteI been into the situation like today's market...
ReplyDeleteThe Daily chart shows me downtrend signal and I shorted. But cash market run up and FKLI follow as well. When this happen, I will panic and keep checking on what's wrong.
In fact, Hang Seng 40 and Shanghai is green with little percentage but Japan 225 is red with 0.6% negative. Then I keep my trade (Short), but it is possible today can go beyond 1780 and negate the Daily chart which drawn based on yesterday data...
After the day end, when the trend change, I will be trapped and keep looking for down trend related news like US debt ceiling, Fed representatives public speaking and etc to support my Short is correct move.
Slowly, if market continue to go up and my Short is losing more and more money, then it just keep going up until I face the reality and cut big losses.
I been into the situation like today's market...
DeleteThe Daily chart shows me downtrend signal and I shorted. But cash market run up and FKLI follow as well. When this happen, I will panic and keep checking on what's wrong.
Do you have initial stoploss for the short position? If market moves against your position, as long as stoploss still safe, why panic? But before that, do you accept the fact that there is possibility that this trade may be a loser? If so, do you financially and psychologically accept the initial risk you took in this trade?
In fact, Hang Seng 40 and Shanghai is green with little percentage but Japan 225 is red with 0.6% negative. Then I keep my trade (Short), but it is possible today can go beyond 1780 and negate the Daily chart which drawn based on yesterday data...
Is what Hang Seng, Shanghai and Nikkei performance part of your trading strategy? If so, do according to your strategy (Inter-market analysis). Otherwise, why bother check on them? Prices above 1780 will invalidate your view that daily chart is bearish. Then you should make sure you are out of the short position if price exceeds 1780, nothing more.
After the day end, when the trend change, I will be trapped and keep looking for down trend related news like US debt ceiling, Fed representatives public speaking and etc to support my Short is correct move.
You mentioned trend change. Then by the time trend changes to bullish, you should already cut your short position. Why holding short when you already viewed market as bullish? Again, do US debt ceiling, Fed representatives public speaking etc part of your strategy? If yes, proceed with your strategy. Otherwise, trash them out.
Slowly, if market continue to go up and my Short is losing more and more money, then it just keep going up until I face the reality and cut big losses.
You should face the reality from the very beginning. Big losses??? Why big losses? You should only risk what you can accept financially and mentally, nothing more.
Do you have a comprehensive trading strategy?
I wish I had met you earlier and let you speak to me the above before I learn it the hard way.
DeleteAt the moment, I try not to repeat the mistakes I made. Hopefully I can see a better path ahead.
I am still a learner at the moment. I do have a trading strategy but not sure if it is comprehensive.
About your reply, if you don't mind, I would like to ask a few questions.
1. I am using US30 index to gauge the next movement of FKLI. I usually used it to time my entry (Long or Short) and exit (Take profit or Cut Loss). Is it a good practise?
2. What do you think about market sentiment? The check on regional markets give me a estimation overall environment changes, in order to react for sudden news. Again, this can be avoided by having a target TP price and SL price.
3. About the news, I used to move by it but no more... Now, it is more like an indicator for me to liquidate my positions when there is news to be released or published. I find that holding a trade while there are important news pending release is a gamble. Unless I can know the news in advance otherwise, don't take the risk. Do you agree?
4. I can financially accept the losses. The mental part is difficult, do you have any advice for it?
I noticed that you are giving free consultation, can it be a not face to face consultation?
I appreciate it and I hope to learn more from an experience trader.
Thank you.
About your reply, if you don't mind, I would like to ask a few questions.
ReplyDelete1. I am using US30 index to gauge the next movement of FKLI. I usually used it to time my entry (Long or Short) and exit (Take profit or Cut Loss). Is it a good practise?
I don’t know whether it is a good practice. You may back test Dow Jones and FKLI in terms of correlation whether this practice can give you advantage to your strategy. Google Inter-Market Analysis to find out more.
2. What do you think about market sentiment? The check on regional markets give me a estimation overall environment changes, in order to react for sudden news. Again, this can be avoided by having a target TP price and SL price.
IMHO, price discounts everything. Therefore I don’t usually pay attention to other market to gauge sentiment. For market sentiment, a lot of traders like to use Market Breath, TRIN and VIX.
3. About the news, I used to move by it but no more... Now, it is more like an indicator for me to liquidate my positions when there is news to be released or published. I find that holding a trade while there are important news pending release is a gamble. Unless I can know the news in advance otherwise, don't take the risk. Do you agree?
I have different view. Speculating in the market is a game of probabilities. News or no news, market will move the way it likes. No one know where the market is going even they know the news in advance. In speculating, risk control aka money management is more important than entries / exits.
4. I can financially accept the losses. The mental part is difficult, do you have any advice for it?
Psychology management plays a major role in profitable business. It is impossible to give any advice on just few sentences.
I noticed that you are giving free consultation, can it be a not face to face consultation?
Not necessarily face to face. You may leave comments in the blog or write to me directly at bmdtrader@gmail.com
Hope it helps.