Following on with the new feature of blog posts from beginners, sharing their journey and experiences, we have Craig Sanders back with his 3rd post. I managed to meet Craig when I was over in Australia a few weeks ago and one thing that stood out was that his determination was plain to see, and more importantly, the structures - both mental and physical - he was creating around himself to make sure he achieved his goals. I have no doubt his trading journey will be an exciting one to follow!
I hope you've all had a great trading week!
Craig Sanders - Post 3
Back again
guys,
First, a
quick shout out to the course itself and to state how amazingly well structured
and informative it is and a heads up to Decisive Trading for having designed
such an easy to follow awesome ‘Zone Trader’ course.
So jumping
right back in where I finished from my previous post regarding identifying
common mistakes I had made in November 2015 upon completing the Zone Trader course
and charging full steam ahead!
This is a
basic highlight to remind you and just explain to any aspiring beginner traders
that mistakes do and will happen…. and that its ok! Its normal! Frustrating but
its normal. The only real secret behind it all is to “learn” and push on
forwards.
“Screwed up bigtime. Traded
against 12pm UK news and shouldn’t have! Then re-traded without following
trading plan and doubled my trade. Went to bed & left trade to run, causing
another losing trade!! -74 points, Don’t
trade the news!! No doubles!! Topped up account to 10k”.
As in the Zone Trader course, there is a document module alone with an
explanation into why trading the news isn’t advised and how to avoid it. Also
throughout alternative modules, the ‘news’ is spoken about and also builds part
of the puzzle for when approaching each trading day and what times to avoid or
be mindful of depending on the trader’s preference.
So, I’ve done the course, iv then decided I’ll do the course again and
now break it down with my own key notes in a bigger educational diary for quick
and easy access when needed (highly beneficial btw).
This I have found highly useful as you don’t need to hurry and log into
the member’s website to then gain access to the course notes you want to
clarify or double check. Chances are you would have already missed the trade
you were about to enter or miss the internal management process you were
thinking about doing but wanted to double check yourself. Having a note book
beside you with key points written down from completion of the course will and
can only but aid you on acting when necessary with the knowledge needed in the
present moment whilst entering or in any individual trade. This is a huge tip
for all newbies, otherwise I guarantee you will be scrambling to log in and
seek info on what to do on 1 particular day, it will happen!……. When it
happens, smile, say hi5 Craig, buy a diary and plot your notes! Or take my word
and just do it and smile when you save your arse J
My first 2 weeks in November after finishing Zone Trader were
outstanding to say the least. Outstanding to the point where I’m slaving away
in the 40+ sunny desert out in the beautiful outback Australia :-/ in my day
job, half way into my shift and mentally talking to myself and almost
convincing myself that I shouldn’t be doing this anymore, I can trade and make
a reasonable living fairly easy whilst sat in the air-conditioning at home and
answer to no-one but myself.
Another week slipped by in the markets, religiously there I was trading
each evening after my 12 hour shifts, racing back to my mobile camp after
dinner to get showered and set up for the market opening and continuing to make
good progress following my trading plan.
Then it happened…..
Out of nowhere, the markets didn’t play ball on this 1 particular
evening and I made the error of ignoring my rules and what I had learned in the
course regarding trading around the news.
The course specifically advises with logic reasoning why it’s best to not
trade the news, yet I thought differently or should I say I didn’t think at
all?! Or I knew better?? (this sounds about right).
I remember it being around 4 hours into the FTSE opening and I still
hadn’t got a trade-off yet. Feeling frustrated and the clock ticking and
bedtime approaching fast, I was eager to make a trade, just the 1 trade when
the sign shows itself I thought. Then at 11.55pm (GMT) a beauty of a bullish
Pin bar forms before me in a high probability key zone and within seconds I had
convinced myself that ‘everything’s in line Craig, yep’ Are your rules met
Craig? Yep, all met. Without hesitation
I entered the trade with a ‘long’ position at what I thought at the time a
perfect time and then before my eyes watched as the 12pm UK news un folded… Now
aware of but not until the large bearish spike dashed before my screen like a lightning
bolt jumping out my laptop and striking me as a sign to say WAKE UP, I was
instantly stopped out of the trade and due to the slippage factor I was -2%
negative of my trading account. Sheer disappointment and anger that the news
could do this to me and un-willing to accept that it was me breaking my own
rules.
Within minutes of another candle forming I would show this market who’s
boss and what looked to be a bearish continuation of the news spike, I had
re-entered into a bearish ‘sell’ position, hoping to win back my previous 2%
loss. In order to achieve this and for the fastest time to achieve this was for
me to double my trade and what I thought at the time, ride it into the below
key zone. This way I will be in profit and can go to bed!
The markets didn’t perform as Id ‘expected’ and seemed to be staggering
sideways for a further hour or so. Due to being frustrated, tired and disappointed
(although un-aware at the time) I had decided to leave the trade running (plain
crazy) and go to bed with a stop loss set of a further 2% and a limit order set
of 2%. All in the hopes of waking up fresh as a daisy before work and seeing a
2% profit before the day gets started. However, having pulled myself together
and staggered over to my laptop in desperation of loading my charts up and
expecting to see a profit, there it was, a further 2% loss! Yay NOT! Totalling a 6% draw down on my account, I was
fuming, fuming to a point where I refused to go and get breakfast like a spoilt
kid and decided to head straight to work frustrated and hungry.
The above description in theory is a very straight forward process to
avoid and yet when the time comes its surprising how silly the choices us individuals
actually make and act on!
It’s clear I was impatient, tired, eager etc … basically its very clear
I was in the wrong frame of mind and really shouldn’t have traded at all on
that particular evening! As a beginner and when hitting a few winning streaks,
it’s so easy to become over-confident in one’s ability to read the markets and
make not only costly but emotional mistakes as I did above. This of course set
the tone for the remaining few days thereafter and caused further rushed
decision making and the chasing of irrelevant signals, which of course
resulting in further negative results!
Towards the
very back end of November, early December I had thankfully regained my calmness
and level headedness and began to climb back out of the hole I had created for
myself. This is where the very first matching of my chart screenshots and diary
log combined for the same day came together. Resulting in a self-analyse at the
end of the month and each day checking over what emotional state I was in prior
to and after.
Although
some would say that the above is obvious and having done the course then one
shouldn’t trade the news! However, this is of course what I also thought at the
time when things were going great. What my point is and with any rule, not just
the news…. It’s very, very easy to skip particular rules dependent upon one’s
emotional state in the heat of the moment! This isn’t always identifiable and
clearly wasn’t in my case and needs much attention and focus for mastery.
Regardless
of the emotional state I was in during this particular trading day and without
diving into the ‘mindset’ realm of what should and shouldn’t have been done…..
I hope the basics of the above clearly highlights just how easily one can land
in a sink hole and continue to self-sink themselves even deeper.
I can openly
admit that 1 year on (coincidence and I better not trade today now) that I have
never made the same mistake of ignoring this particular rule and trading on and
around a high priority news event. This isn’t to say I haven’t made repeated
errors with other rules, but it’s a fact with the ‘NEWS’ rule – don’t trade the
news, simple’s guys ;)
Overall,
not only did I ignore the news but I also dropped into an emotional trance that
made me act and re-enter another trade with a very poor signal, if no signal at
all and also I encouraged myself to double my risk management principles all
because of ignorance and my un-willingness to accept a loss.
I hope to
clarify further problems I’ve faced in the months after the above to the point I’m
at today in hoping to give you some further valuable insights into how easily
one can sabotage themselves. Thus hopefully creating part of an avoidance tool
for your progress moving forward with trading.
For now and
until next time J
Thanks Craig. there is a definite human urge to ignore the rules and go ahead with something you 'feel is just gonna work'. I've done it and still feel a real compulsion to just 'go for it'. in retrospect I don't know what or where this compulsion comes from, I know it's not greed. If you find out do tell us. Although I find it slightly easier to deal with when you recognise it.
ReplyDeleteOh...I can sooooooo relate to this !!!
ReplyDelete