Re: Post #47
This trade has been nagging me because, at the moment when I exited the trade, I thought that I had exited based on my early exit criteria. I can't shake the feeling that I didn't. I think that I need to more specifically define my early exit criteria. I think I'll spend some time drawing out the price action that I want to look for as an indication to bail early on some graph paper today and keep it next to the computer for easy reference throughout the trading day.

I think that what I exited on was a potential reversal formation, and while it looked similar to what (I thought) I defined in my rules, it was off just enough to disqualify it as a legitimate signal. Oops.


Cattywampus Ramblings
I've heard (so it must be true!) that the majority of market participants are algorithms of some kind. I think I've heard (even less reliable) that some people have blamed algorithmic trading for the markets becoming more difficult to trade. Maybe not, I might be getting things mixed up. Anyway, I would think that if most of the trading is done mechanically, then the markets should be easier to trade, and maybe easier to predict. If the programs basically boil down to: If 'x' then 'y', then you have traders doing the same thing, over and over again, without deviation. The market becomes more predictable, as trades are based entirely on logic and are absent of emotion. Every time 'x' happens, 'y' will follow. In theory anyway, and assuming that the bulk of the systems would be that simple. I don't know if this line of thinking is valid or not. Just something I was wondering about!

Weekly Goals:

1. Follow The Plan
Same deal as last week, but now I have rules in place, per setup, for Stop-Loss management. PTRs and PTCs will rely on the Intermediate timeframe for Stop-Loss adjustment, while PTUs and PCTs will rely on the Minor timeframe for the same. I printed out my current collection of rules, with General Rules at the top of the stack, followed by the rest of the setups. At the caboose is a sheet of graph paper with the formations that will signal that an early exit is necessary. If it's not on the list, it isn't valid, and if I exit based on an invalid concept, then I'll have broken the rules.

I do think that there need to be consequences for breaking my rules, more than just "whelp, I didn't do too good today!" I'll bounce around some ideas in the ol' cranium and see what I can come up with.

2. Detachment
Getting to a point where I don't care if the trade is profitable or not is a goal. I want to be able to execute the plan, and not give a s*** about the outcome, regardless of loss or gain. Whether or not that's realistically achievable all the way through, since I'm not devoid of emotion, well, I guess we'll see. Working towards that goal, and focusing on centering, calming, and then detaching myself from the outcome, day in and day out, may at least lead to a more efficient trading mindset. I'll be reading some Douglas soon too, so it'll be nice to see what he suggests.

3. Finish Darvas' Book
Easy enough, just gotta' do it.

Concerned about overhead supply, starting at 4,282.00.

Edit: Also, a little between yesterday's high and 4,282.00.

Looking for a potential PCT short. The profit target will be 4,273.50 if the setup is triggered, although that target could change if the setup becomes invalidated.

Short 1 contract.

Target hit. Edit: Fees are not included in the PnL, and it was done in SIM.

Daily Review of Weekly Goals:

I'm not in my usual trading environment today and in light of wanting to make sure goal no. 3 is reached this week, I think I'll spend some time reading Darvas and call it a day.

1. Follow The Plan
There were some things that I did (plotting markers for highs, areas of concern, etc) that made me wonder if I wasn't following the plan since those procedures weren't written into the ruleset. As far as entering the trade and managing the trade, I'm fairly certain I followed the rules. We'll see if I feel the same way after I've had some time to think about it.

Since my current trading is relatively fast-paced, it's clear that I need to get to a point where I internalize the rules, that way I don't have to consult each written step. It'll take some time to get the written rules up to where they need to be though, because I'm sure I didn't think of everything when I wrote them out (Stop-Loss adjustment and plotting extra things on the chart come to mind).

2. Detachment
I was a bit too enthusiastic when the trade worked out. Didn't focus on trying to center and remain calm prior to entering, or after I was in the trade. This might end up becoming a permanent goal rather than just a weekly goal.

3. Finish Darvas' Book
In progress!

Fade 

Daily Review of Weekly Goals: It'll take some time to get the written rules up to where they need to be though, because I'm sure I didn't think of everything when I wrote them out (Stop-Loss adjustment and plotting extra things on the chart come to mind).

For sure it will take time to get your rules up to where they should be.
Do you have the discipline to not trade until you have written rules in front of you?
That might stop you from procastinating about putting your rules on paper.
Just by writing them down will play with your emotions. Fear & Greed come into play.

Look at your trading plan as an operators manual. It should answer the question "What do I do now"

For instance you have no open positions. Look or scan for set-ups.
How do I know what set-ups? they have to meet certain criteria (you make up the rules)
I find a set-up that meets all my criteria what position size do I take. (you should have a formula to determine this)
Where will I exit? (more rules)
you close the position. Review the trade. Did I follow my rules? If not why not? What can I do to prevent breaking or bending the rules.

Rince and repeat.

deaddog 

For sure it will take time to get your rules up to where they should be. Do you have the discipline to not trade until you have written rules in front of you? That might stop you from procastinating about putting your rules on paper. Just by writing them down will play with your emotions. Fear & Greed come into play. Look at your trading plan as an operators manual. It should answer the question "What do I do now" For instance you have no open positions. Look or scan for set-ups. How do I know what set-ups? they have to meet certain criteria (you make up the rules) I find a set-up that meets all my criteria what position size do I take. (you should have a formula to determine this) Where will I exit? (more rules) you close the position. Review the trade. Did I follow my rules? If not why not? What can I do to prevent breaking or bending the rules. Rince and repeat.

I do have a kind of skeletal list of rules that I printed out the other day. The first sheet has General Rules, followed by four sheets that have specific rules for each setup I look for, and lastly, a sheet of graph paper with early exit signals that I doodled up the other night. Buuuuut, there are things that I didn't think about beforehand, which I've been adding to the rules as I discover them. I might need to go ahead and read what John Carter has to say about trading plans like you recommended before I transition over to Douglas, that way I can compare the structure of my plan with his. Edit: Reading Carter now, and holy s***. That's what I want my plan to look like.

Cultivating discipline is important to me, and I do want to have a more fleshed-out plan. I do think I'll take a step back from trading until my plan is more robust. I agree that that should incentivize me to stop procrastinating, haha. Thanks for the advice, and for the examples you listed in bold above!

Daily Review of Weekly Goals:

No trading today. I've spent the day working on my trading plan and finishing up Darvas' book. What a phenomenal book by the way! It will definitely be an annual read from now on.

1. Follow The Plan
"I'm sorry, the person you are trying to reach has a voicemail box that hasn't been set up yet. Goodbye!"

2. Detachment


3. Finish Darvas' Book
"The end of a melody is not its goal: but nonetheless, had the melody not reached its end it would not have reached its goal either. A parable." - Fred Neitch