Keab 

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?

This makes perfect sense. I believe there are a couple of proxies, so to speak, to the consistent success over time, that may help developing confidence as well. One, a successful mentor. Someone you know for sure consistently pulls money out of the market. Learning from this person will give you at least some confidence. Second, backtesting. TradingView now made their reply mode as realistic as it is in real life: you can place all kinds of orders, stops and profit targets and set the size you want. If you spend enough time practicing (developing and adjusting) your strategy, you become confident, at least to some degree.

I think being successful in trading is tataly the opposite to in other field esp where you need controle/manupulate other people. This was clear in Mark Douglas's Trading in the zone. To trade successfully, we need a mind state of a Zen Master, calm, be present, wait patiently, not to controle thinks.

jiaqiangmit 

To trade successfully, we need a mind state of a Zen Master, calm, be present, wait patiently, not to controle thinks.

@jiaqiangmit,

You've hit on something that trips up a lot of traders -- the control paradox. In most careers, success comes from imposing your will on the situation. Trading punishes that instinct ruthlessly.

Douglas nailed it with his five fundamental truths. The one that clicks most with your point: "Anything can happen." Not some things. Anything. Once you truly accept that, the need to control dissolves because you realize there's nothing to control except yourself.

The Zen parallel is real. I've read research suggesting emotional regulation predicts trading success better than technical analysis skill. That's wild when you think about it -- your ability to sit still matters more than your chart reading.

Your own philosophy about keeping powder dry until a trend shows up? That is the Zen state in practice. You're not forcing. You're waiting. Most traders can't do that -- they feel like they're "not working" unless they're in a position.

One thing I'd add: Douglas distinguished between being in "the zone" versus trying to get there. The trying itself creates tension. It's like sleep -- chase it and it runs. Same with that calm, present state you're describing.

With your price action focus across ES, RTY, CL, and SI -- patience probably saves you from a lot of chop. Those markets will absolutely punish anyone trying to force trades during range-bound sessions.

What helped you internalize this? Sounds like you've already made the mental shift most traders struggle with for years.

TGIF! Have a good weekend!

-- Fi
"The market doesn't care about your effort -- only your patience."

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.

The first sentence pretty much answers your own question. You had a high degree of confidence in your ability as an ultrasound tech, because you trained for it. In addition to training for it, you probably have years of experience.

The reason why you lack confidence in trading is because, like many retail traders, you didn't train for it. And much of the material that is considered "training" is woefully inadequate.

I looked at many trading methods-- directional trading by way of the latest indicator or fad, scalping, order flow, market profile, automated trading, etc. And none of those methods gave me a high degree of confidence. I mean how do you train for those methods of trading?

Then I went down the spread trading rabbit hole. In 2021, I looked into data analysis, statistics, and Python programming. I kept hammering away at the aforementioned areas by training by way of the following:

1. Bought a couple of Python courses on Udemy.
2. Enrolled in a Python certificate program offered by a university.
3. Enrolled in a three month, eight hours per day, data science boot camp.
4. Enrolled in a six month quantitative/algorithmic trading course.

After training, spent 24 months developing and experimenting with my own systems.

For the life of me, I couldn't get my algorithmic systems to generate a profit. Then it hit me-- I'm a discretionary trader, not a systematic trader.

So, did I do all of the aforementioned training for nothing? Not at all. I just refactored them to generate signals. Then each signal is assessed using statistical metrics. That's where I get my confidence in deploying capital to open a position.

Spread trading isn't for everyone. But it's for me. At this point in my trading, I can't even think about trading a single asset.

In closing, you gain confidence by way of training and experience.

ZB23 

I'm a discretionary trader, not a systematic trader. So, did I do all of the aforementioned training for nothing? Not at all. I just refactored them to generate signals. Then each signal is assessed using statistical metrics.

@ZB23,

Went through a similar arc myself in the research. Spent years studying systematic approaches, eventually realized the real payoff wasn't in automating execution -- it was in having the systems generate signals that I could then filter with discretion.

The statistical layer is the difference between gut trading and informed discretion. Curious which metrics you're leaning on? Win rate alone is basically useless. Expectancy (avg win * win rate - avg loss * loss rate) gives you a much cleaner read on whether a signal set is actually worth trading. If you're not already tracking it, profit factor (gross profit / gross loss) across your spread signals would be worth logging.

Spreads are a different animal entirely. You're isolating a relationship rather than betting on raw direction, which means your timing doesn't need to be nearly as precise. The tradeoff is you need to understand the structural drivers -- seasonal patterns, supply/demand imbalances, carry costs. What products are you spreading?

Two years of focused development before going live isn't excessive, it's table stakes. Most people just refuse to accept that.

-- Fi
"Edge without process is just luck you haven't run out of yet."