FWIW, I went through the same journey. Learn as much as you want about trading and you will ultimately always be in the same place - lost in your own pareidolia. When you take a step back and instead focus on fundamentals, macro, and have a well defined thesis, you also get the conviction that comes with that.

For me, it also required trading on higher timeframes. Some people can be successful with scalping, but it is a game mostly for algos now. If you know how to program algos and bots, even better. But for most normie traders, I would say learn the fundamentals inside and out and make it a mission to understand the macro picture, then work your way down.

My two cents.

The arguably most accomplished trader of all time Jim Simons, would walk in the office on Mondays and say- "this is the week it'll all blow up ............" this after a 36 year run of outpaced returns. I don't think it speaks to the lack of confidence on Mr. Simons part- but to the humbleness that it takes to respect the power and randomness the market wields. I've read that it's frustrating for accomplished people to become traders, as the skill set and mental discipline it takes to be a great trader is different then any other thing they've accomplished. Doctors, especially surgeons, whom by the way usually never lack confidence in any degree, will get frustrated by their inability to master the trading game. Just because a surgeon is in rarified air in the medical field they feel inside they should also have the tools to join the rarified air of successful traders. I couldn't imagine being a discretionary trader- I wouldn't know what that looks like- but drawdowns are drawdowns they are humbling and disappointing- but the fortitude it takes to get to the other side itself is omnipotent, good luck to you.

Hi all Harvey’s here.I am experiencing the same problem.I have undertaken many ventures in my 74 years of life to get me to where I can now retire reasonably comfortably.Every venture was an extremely hard task as each one ended in a black swan event,so I had to salvage what I could.I have always had a huge belief in myself.Perhaps to much.I have never been able to achieve the degree of success that I set out to do.This brings me to trading,Both shares and futures.I have been trying to do this for over 35 years,all be it unsuccessfully.It is not that I have put the effort in.To put it bluntly if I had put the amount of study,practice and effort into any other field I probably would now be a brain surgeon.I now have finally come to the conclusion that there are some things in life that you should not attempt as they are likely to destroy you.Trading for me is my black dog.in my early days I was told that I was to nervous a person to be a successful trader by the presenter of one of the many trading courses undertaken.I have come to the conclusion that I should have listened and taken his advice.I now give up absolutely defeated.Sorry for such a long and negative discussion,but it may help the previous person to understand he is not the only one.

This is totally correct.But if you do all of the above as previous research has shown would be successful about 50%.and when I do it I am stopped out at levels previously researched to be good.Tell me why I am stopped 70% and more often than not within minutes.This relates to thousands of
Trades in many different markets in many time frames.This is cannot be overcome.I have been trying for 35 years

chipwitch 

This is a question directed at self-described successful discretionary traders. How does your confidence in your trading profession compare to the confidence most people feel in their non-trading profession? To clarify, as a trained ultrasound tech, I had a high degree of confidence in my ability. While I wouldn't say that I have confidence in my ability to trade, there have been moments where I did. But then, some series of losses wipes it all away. I began to wonder if having the kind of confidence one generally has in their abilities in most careers is even possible with discretionary trading. I understand that there are various aspects that can give one confidence. I have confidence that I can manage risk and make sound decisions around that. This is about having a high degree of confidence before entering a trade, only to find out 10 seconds later that you just bought at the high, sold at the low, or some other equally humbling result. I don't expect perfection of myself. One such loss, meh, I made a mistake. Oops. Move on. Next one, similar. I start trying to figure out where I went wrong. It's in that scrutiny that I begin to realize, after 4 months eating and breathing trading, I have no better clue than when I started. Sure, I still get those trades that restore some small measure of confidence. But it comes and goes. Does that ever go away for you successful discretionary traders? At some point, does it just come, and not go? So, this question is about the feeling of confidence. Do you consider yourself in possession of it in the same way a surgeon might feel about their career? Does a series of losses above some anticipated threshold shake your confidence? Please describe your confidence and compare it to the confidence you had in a previous career, sport (golf?), hobby etc.

I have a lot of confidence in my discretionary style trading. However, I don't do this sort of trading with high risk trading vehicles like futures. I do this sort of trading generally writing (selling) options. For instance, recently, I wrote a put option in IWM, the main Russell etf. I don't believe that the market is going to crash, so I was able to write an option that would put me in shares at 27 percent down. If it runs down over the next 80 days, I end up in shares. Its a very large, low risk etf, so I could afford to hold the shares if I'm wrong. In other words, I have to have the money to buy the shares, and I can't use margin or take lots of risk. Options are a very weird investment vehicle if you learn more about them. They call them wasting assets, so their value just wastes away over time. Many times, even if things go against it by a bit, I can still close out the trade in profit. Another thing about options is that, part of the valuation of options is based on volatility. So, I tend to want to write options at times of great fear. So, I'm essentially buying into the greatest fear. To see how great the fear is, one can even look at the fear and greed index on CNN business. The higher the fear, the more expensive options have become. So, I'm selling options at a very high price. So, if that fear begins to wear off, the option values start to decline. This factor allows to often make money even if the price of the underlying asset runs against me. When it comes to futures and shorter term trading, I really am not much of a believer in discretionary trading. I feel like there is just too much risk. One must develop a system that they believe in. The system must keep them in the right direction so that they don't take massive draw-downs. They must run the system consistently, and make sure that the system is generally keeping them in the right direction that the market is running in. In other words, the system takes losses in order to keep the them in the right direction, and to eliminate the risk of large losses in the wrong market direction.

Astronorm 

You say you get stopped out at researched levels? It sounds like those are price levels? Most traders are focused on price. And as we know. 95% of those who trade, don't make any money. The great W.D. Gann, considered to be the great market technician of the 20th century, said that time was more important than price. If you can determine when will be the key times, the key times will give you the key prices, and then you will know what to do and when to do it. For example, if you had a time machine and know that September 03, 1929 would be a major change in trend date for the stock market, would you need to know what price the market would be at? I say no. You only needed to know the right time. Given that the market had rallied strongly into that date, with Newton's law of reaction in mind, you would sell everything and go short, which would probably result in you're making a fortune. I think the formulae for making money is a mirror image of what most traders pursue. It's not price, it's time. Timing is everything. Price is irrelevant without the context of time.

Sounds simple, however, it seems like there is no real good way to go short without taking a lot of risk. Timing that downturn is not something many people are ever going to be able to do. If they could, someone would have all the money by now, (all the money in the world I mean). Buffett has bought into crashes, but he have never timed them very well. Soros has shorted everything in the book, and ended up holding hundreds of millions of dollars of shorts over very long periods. Sure, he can do it with his bankroll, but you or I will end up in the gutter. Neither one of them could time markets at all. You can buy put options, which will likely expire worthless, which is why most people lose money buying options. You can short shares. That requires margin, which will end up with most people getting a margin call when they don't time the down turn correctly. Why not write a naked call option. Now, that is just asking to have all your savings go down the toilet. Now, its pretty obvious that most people are doing something seriously wrong when it comes to trading. I've always thought that the real actual big problem is that they just don't know how to control risk, and they don't know how to trade systematically in areas that require them to take too much risk to do anything else. Every person is different. It seems that most tend to want to buy after most of the action has already occurred. I always tended to want to take the other side of their trades. Both tendencies just generally get most people in big trouble when trading. Sooner or later, if I'm not controlling high risk, either tendency will end me up taking a massive draw-down and ending up breaking my account. Shorting a big upward movement would be the way to enter earlier than most anyone else. However, I don't feel that's the approach that most good traders that make money are going to end up taking. They are going to end up somewhere in the middle. Early, but not too early. Sometimes, they are going to be wrong, and they are going to have to take small losses according to their system so that they can keep on the right side of the market and avoid major draw downs.

Harveys 

This is totally correct.But if you do all of the above as previous research has shown would be successful about 50%.and when I do it I am stopped out at levels previously researched to be good.Tell me why I am stopped 70% and more often than not within minutes.This relates to thousands of Trades in many different markets in many time frames.This is cannot be overcome.I have been trying for 35 years

If we're talking intraday trading, expect all levels to break. Especially the researched ones. Bet on them to break rather than hold, take your scalp, and get out. I hate the term "hunting retail stops" but fact is you have to do the opposite of what everyone appears to be doing in order to be successful. Contrarian styles always come out on top. Goes for the daily, weekly, monthly as well. Sell euphoria, buy fear.

datahogg 

This is just my opinion. I trade the SPX verticals near the money with 1 or 2 days to expiration. These are traded with very little stress. Often losses can be very small and gains can be large. GAMMA can be your friend.

Sorry to hijack the thread but I don't suppose you could take the time to explain what you mean? I have dabbled in options analysis, have listened to SPotgamma and quickly get overwhelmed with all the buzzwords and technicality of it all. Are there a few core concepts you can somehow distil it down to in order to provide a (very!) basic understand of a core concept? No problem if not and happy trading!

Keab 

Sorry to hijack the thread but I don't suppose you could take the time to explain what you mean? I have dabbled in options analysis, have listened to SPotgamma and quickly get overwhelmed with all the buzzwords and technicality of it all. Are there a few core concepts you can somehow distil it down to in order to provide a (very!) basic understand of a core concept? No problem if not and happy trading!

Find a good book that explains option GREEkS, and then apply to the TOS platform.

chipwitch 

However, from a discretionary perspective, there is much more subjectivity. Something I can't quite put my finger on, to spell out in explicit detail. I can be looking at 5 different things looking for qualitative signals and have to make a decision to trade or not trade based on them. A systematic trader looks for signals that can be quantified. With discretionary trading a sense of "something is just not quite right but I don't know what it is" is one of those qualitative signals. Of course there is probably some algorithm that could be written to quantify what I concede I'm not smart enough to. BUT, it wasn't the point of the thread. The point of the thread is about a feeling. A feeling of confidence, and how it might differ for a trader than it does for someone familiar with the confidence of a more traditional career. My expectation was that they were one and the same. But, I'm beginning to discern that they are not. Confidence in ones risk management skills, not withstanding, confidence in trading isn't so absolute and certain. I think you will agree on that point?

I think you might be getting a bit lost in details ('the "feeling" of confidence versus actual confidence?) which might not be important.

As described, discretionary vs systematic trading is not so different, the latter are simply able to put their trading rules into definable terms. Discretionary traders do not.
You/they are not trading on things that are totally ethereal, unfixed and floating around. There will be similar rational thought processes that systematic traders follow that will have to be met in this more subconscious discretionary reasoning system.
There just might be (a lot) more of these processes and you just don't necessarily know what they are and can't write them on a piece of paper. It is not a 'simple' check list like a systematic trader, but there will be mental reasoning based on recognition of various factors like a systematic trader.

So in the absence of defined rules (it's discretionary!)it can't bear a resemblance to your existing tech career, or golf, or sport, where the end goal is clear and defined. As are the rules and parameters of the chosen sport/tech where the the skills and knowledge required to become skilled (and what you need to practise to become so) are defined and clear.


You stated in your initial post:
"I began to wonder if having the kind of confidence one generally has in their abilities in most careers is even possible with discretionary trading.....
Sure, I still get those trades that restore some small measure of confidence. But it comes and goes. Does that ever go away for you successful discretionary traders? At some point, does it just come, and not go?

So, this question is about the feeling of confidence. Do you consider yourself in possession of it in the same way a surgeon might feel about their career? Does a series of losses above some anticipated threshold shake your confidence?"

The feeling of confidence that you can have as a discretionary trader vs a traditional career (or sport) is fairly simple. As you don't necessarily know why you're entering trades your confidence will be tied to your trading results (as it should be!) as you never break any rules as such. Whether you can define what you're doing or not doesn't really matter as long as your trading results are consistent across time. Simple.

Same if you were playing golf/basketball/soccer. "Hey I don't know what I'm doing or why but I'm going round 9 under par so what does it matter/I've just shot six three pointers in a row and I don't know what I'm doing or why/I've just dribbled past 5 players and scored a goal and I don't know what I'm doing or why." Who cares about whether you know why? Your results show you that you're doing the right thing.

Whether you can ever have confidence in that approach will depend on your personality and how comfortable you are with not being able to define what you are doing. This is not the same as your tech career or with sport.

In the arena of discretionary trading the answer regarding confidence (or the 'feeling of confidence?') cannot be defined or reached or dealt with by anything other than consistent success over time. If this doesn't seem right/simple enough to you then switch it around a bit with this statement: "I am confident in my discretionary undefined trading and I lose money on a consistent basis." Does this make sense at all?

Aaaand I'm done. Happy trading!