Thursday, 23 February 2017

Beginner Trader Blog Series - Post 8 by Craig - Rome Wasn't Built in a Day


Hello Traders.

Continuing on with the beginner series blogs, we have Craig back with his 8th post. 

I hope you all enjoy and have had a great trading week.

James Orr

Rome Wasn't Built in a Day

Well, where the heck did January and February 2017 vanish to I hear you say? Maybe it’s just called ‘life’ or maybe it’s the old saying ‘time flies when you’re having fun’ OR maybe the ‘time flies when you’re getting old’ saying… I’ll let you decide which one is for you.  

As crazy as it may sound to an outsider and even with all the losses a beginner can experience, I do massively enjoy trading the markets and I get pumped when knowing the opening is coming back around again, day after day. Even after a few losers under the belt, we all know they don’t make you feel pumped if not annoyed and frustrated, however I do strongly feel that I’m slowly becoming more and more weathered and have learnt there’s always another day for the trading plan to have a stab at the market and that this attitude is far more stable than the unknown ‘over-trading’ to re-coup a daily loss attitude/approach.

So, throughout the entire period of being a turned ‘live trader’ which is just shy of 8 months’ may I say, (touch wood) I still haven’t committed financial suicide on my account (just yet) & (never intend to either) and I can confirm I believe to have positively adapted to the euphoric streaks iv came across and have the confidence in pointing it out.

However, at the end of January 2017 I sat down and did my performance calculations based on December and January combined. I usually do these at the end of each month individually as a reminder of how my progress and education is performing and so I can write my coming months educational plan up from what I’ve learnt and where I need to improve. However, due to a hectic end of last year and early new year I smashed out the two together this time around.

My findings were that after 7 months of live trading, July through to January, I was 2 months down and 5 months up over the total 7 traded. These 2 negatives or ‘learners’ as I like to call them were not as bad as I had initially thought, as the 1st was from my 3rd month in, which was the big psychological education month for me and the 2nd month was that of January just gone which was a measly negative 0.77%, but still a loser and that’s ok providing I accurately acknowledge why this was and if it can be rectified in any way to improve.

It’s safe to say that over my last 8 months trading a live account I haven’t made those huge amounts of profits (yet ;)) nor have I been out and purchased my new Ferrari 488GTB or my Bugatti Veyron 16.4 just yet dammit! …… Just yet, I still will say, however for now I shall continue at my Wednesday evening auctions looking for that bargain bid of an economical diesel dream of a car with 1000km+ per every $70 bucks per tank consumption ha-ha.

All jokes a side, I’ve never been a big dreamer with the whole “get rich quick” type expectations, as appealing as the thought ‘once’ was back in my teens, realty as I matured this was just never the case. I guess I’ve always had an understanding from a young lad at what it takes to become successful in any aspect of life and how one even sees himself as being successful. Yet of course I still hold a firm belief in visualisation and huge goal setting and then the ‘how to’ steps in order to reach one’s desired outcomes. I’m just not one of the ‘if I invest this much $$$ then what am I certain in gaining in return’ type of people.

I believe with the (right attitude, plus a multitude of experience and mindfulness = positive achievable outcomes) for anybody in life. I guess it all comes down to desire.

So, its confirmed in writing and in digital reference that I’m in no way a ‘Warren Buffet’ billionaire just yet. Although recently I do have a similar ‘coca cola’ diet unfortunately and that I am still the same Craig as I was many months back, yet with a heap more knowledge and emotional intelligence to continue the fight/love for another trading day, month and year to come.

Naturally, one would love to have 7 nearly 8 consistently profitable months trading live and I guess this is what I may have been starting to ‘expect’ back in September just prior to the stab in the chest after my 3rd month being a big fat loser of all my first 2 months’ profits. Let’s say I hadn’t really tasted ‘euphoria’ correctly during this time and therefore suffered the consequences lightly, which in turn makes me able to stomach it far better today. I do believe there’s differential in the thickness of the lining in how good one’s stomach handles something and I’m mindful of not ever forgetting this again as I know there are different levels of euphoria and quite possibly heaps still to come my way.

Just over half a year trading live 7/8 months of consistent profits just wasn’t the case for me and I understand my results are far from great but the way I see it which is of course of most importance, is that its cost me nothing thus far in monetary value to gain the experience and knowledge I’ve achieved in nearly 8 months live trading. This could and I guess still can be the other way around and seems that most folks suffer substantial losses in order to then try and bring themselves back on what they have learnt. Therefore, I see myself as having done actually quite well and I feel comfortable in saying so.

I’m not really a guy to share figures and times and didn’t right this post with the intention on doing so, rather just to point out to any struggling beginner newbies that win/lose its all ok providing you stay on track and continue to have an open mind with a good learning approach with the added formula of strong discipline.

Rome wasn't built in a day" is an adage attesting to the need for time to create great things……
Nor was “Decisive Trader Craig”, the highly consistently profitable trader, but all in good time.

Thursday, 16 February 2017

T-Model Trader Blog Post 8 - Beginner Trader Series (With a beach shot to make everyone jealous!)

Hello Traders.
T-Model Trader is back with his 8th blog post in the beginner trader series. I have included a picture of a beach so we can all get a little hint at how difficult it must be knowing that view is waiting for you only a few minutes away!
I do believe if I moved to Australia I would need to find a way to have high speed broadband for my laptop on the beach!
I hope you've all had a great trading week.
James Orr

Blog Post 8 From the T - Model Trader
I have to admit that it has been a very slow start to the trading year for me. As I recall, I wrote how I was looking forward to the new trading year in the last blog of 2016. Reality has it that I am seriously in summer holiday mode and the call of the beach (3 minutes’ walk away) has got the better of me in the late afternoon heat on many occasions (trading time for me here in Oz). 


So, in this last week and a bit, I have put on my trading cap (a DT one of course), wiped off the sweat and have sat to write this and launch myself back into it all.

Sometime in 2015, a few months prior to studying with DT, I read an article about getting to know the market that you trade, authored by a very (Very) successful Australian trade. As my trading knowledge and understanding at the time was several bucket loads short of bugger all, then most of it entered and exited the brain department without much of a fanfare.
I did however get the general gist of what he was writing about, even if I thought that getting to know a markets personality was bordering on being a bit ludicrous, as it all just seemed pure randomness. How on earth I wondered, does one even go about doing such a thing?
In that article, there was one thing that has stuck in my mind thou. He stated that the “market rewards the specialist, not the generalist”. In those first few months of teaching myself trading prior to DT, I had untold numerous forex pairs set up on the trading platform, as quantity equaled…..well…..something better than what I knew at the time. I recall being so stressed out trying to figure out how to remember what was what.
The thing was, that at the time I was doing what so many do (I am assuming), which is to listen to endless Youtube clips about trading. I would see these videos and when they go to pull up a forex pair to illustrate some point, they would have a squillion of them to choose from. And that is what I thought I had to do as well. Damn near killed me thru neuron overload!
So when DT popped into my life with just one market, although somewhat relieved, I was also a bit puzzled. As I thought (lead to believe/assumed) my trading diet should be one of maximum consumption, then one and only one market seemed like a bone trimmed clean.
So, over several months (besides the occasional dally on the ASX 200 (my daytime), the Ftse was the only market that I looked at. Due to the timeframe difference, I would get the market open to around about lunch time (GMT) before wandering off to bed. I rarely missed a day. I sat and watched it all, candle by candle. No alarms set to tell me when a zone was being tickled. It was dinner at the screen.
Besides the inevitable numb bum, what I didn’t realize at the time was that I was getting to know the market through an interactive osmosis. I would not have said that at the time, basically because I didn’t understand it all enough to see that it was happening.  
Now the interesting thing is that if the Aud/Usd (A$) had not come along, I wouldn’t have realized this to be the case. It was in seeing an entirely different market that I began to appreciate the fact that I had actually started to see the Ftse markets “personality”. This was a really great thing to acknowledge.
What is also intriguing, is that I felt so uneasy and uncomfortable on the A$ for quite some time. I didn’t appreciate or understand this at the time, however after watching and interacting with the Ftse for many months, I was in fact relating to a new “personality” in the A$. The way it wiggled unhinged my Ftse derived sense of safety (without knowing so).
I don’t recall how long this went on for as I have no record of it in my trading journal, simply because I wasn’t aware of it to write anything down. In casting my mind back, I would say that most of last year was spent being uncomfortable with the A$. I had come to like the notion of a market with its previous day’s highs and lows, open and close. All very neat it feels.

Then over the break time something very interesting took place. A few days before Xmas, I was out walking and rolled my ankle on the edge of a pathway. At the time it seemed just a simple strain. About 24 hours later, my ankle looked like a balloon, with a very painful knee as well. The outcome was that I spent around 2 weeks being quite immobile and very home bound.
I had planned to not look at charts during this time, so as to have a break and freshen up for the New Year. Instead, to combat boredom, I did very little else but….yes you guessed…..look at charts.
To inject some newness into this enforced lay-up, I chose to do some investigation and branch out into some other currency pairs, working out zones and seeing what then transpired based on the trading plan. Part of the reason for this is that I have wanted to find a market in which to trade during the daytime here. Given that I am in the Asian session during this time, then price action can be very (very) slow and tried to find the better preforming pairs during this period. By the time that DT got back online in January, I had logged up lots of hours on a couple of forex pairs. So much for the trading break!

In an interesting reversal, I now find myself rather disconnected to the Ftse and its personality and the A$ seems far more familiar to me. The only reason that seems plausible is that due to the many hours spent looking at the forex market over the Xmas period, that I have now shifted my identification to the A$. I have truly come to see that each market has its unique characteristics and what that author was meaning by becoming a specialist (thou far from it I need to say).
The only way to know a market, as far as I can see, is to spend many hours engaging with it. It was I feel a really great exercise to go thru, firstly because I can see that I have gained a level of understanding and secondly, I have enough experience now to be able to discern the different qualities that each market has.
The other aspect to this is that because of my initial YouTube training, lurking in the back of my mind was this constant…… “What about all the other markets”. This thinking was constantly dispersing my attention that I was “missing out on something”, which was completely incorrect.
I feel that the best way to describe this is through that old chestnut….. “It’s about quality …not quantity”.
Amazing what a bung ankle can do!
Till next time
T-model.

Tuesday, 14 February 2017

My Morning Routine For Trading


Hello Traders.

I got asked last week if I would mind outlining my typical daily routine. I never thought that would be of any interest to anyone, but here goes:

I wake up feeling charged and ready for the day at 4:30am…

Ok, not exactly true. My alarm goes off at 4:30am and I lie in bed for a good couple of minutes thinking about crying and wondering who sped up time throughout the night. I am most certainly not one of those odd few who are ‘morning people’.

I drag myself out of bed, feeling pretty annoyed that my girlfriend is still sound asleep. I step over my dog, who has contorted herself into an impossible yoga pose and is also fast asleep. Not for the first time I contemplate sending an email to the London Stock Exchange asking if they wouldn’t consider shifting their opening time to somewhere around midday.

I start to wake up once I grab a shower, and the coffee jolts me the rest of the way. I’m at the charts by 5am.

The analysis is done over the next half an hour. I already have a good idea of what is going on from the previous days trading, so I am really just looking for overnight changes and what that suggests for the day ahead. I also spend a fair bit of time picking out the strongest trading levels for the day, making sure they are the correct ones.

By 5:30am I am putting together the Aud Usd Review for subscribers and filling in the information on the login page. Between 6am and 6:30am I do the FTSE 100 also and get that all posted up and sent out.

By now it’s around 6:45am. My girlfriend is still snoring. My dog is still snoring.

I think my dog has picked up my ‘not a morning person’ personality, because the next part of my day is waking her up and taking her out for her morning walk. There is a lot of yawning, rolling onto her back, eyes opening and then closing again and sometimes a bout of sighing before she finally gets up and decides that yes, I am allowed to take her outside, but I had better make it quick!

Once I get home from her walk there’s just time for another coffee and a seat at the computer. I look for any changes in the Ftse 100 and the Aud Usd. I also scan through my emails, find the ones that need a fast response and get those out. The others I mentally file for later.

That’s the morning routine and I am usually ready to start trading at 7:30am. The actual trading day is so varied that attempting to put together a routine would be impossible!

But I suppose that is why I love trading so much. Every day is completely different. Some days I am finished before 10am, others by lunchtime and on some days I’ll wait the entire trading day and see no setups at all.

I hope you all have a great trading week!


 

Thursday, 9 February 2017

Beginner Blog Series - Craig Sanders - Heads or Tails?


Hello Traders.

After a brief pause in the beginner blog series last week - due to me having email issues! - we are back with Craig's 7th post.

I can still actually remember the email he references in this post coming into my inbox. And I am delighted he managed to figure a way through his issue!

I hope you're all having a great trading week.

James Orr


HEADS OR TAILS

I’ve been going over the whole of last year in my head and looking back over some of my past screenshots, showing some of my successful trades and some not so successful trades, also my diary notes and even diary scribbles.

I came across a few different scenarios and various struggles and have decided to pick one out randomly and go onto explain it in a little more depth as well as mention the ridiculous method I chose to use to overcome the problem at hand during that particular time and maybe it could be applied by someone going through difficulties after reading this post. Be warned it’s a tedious if not obvious activity I chose, yet effective and it worked for shifting my mind back to a healthy state and moved me forward to continue my trading today. Regardless of what it takes and how silly it may seem, it’s all about SURVIVAL (makes me feel better about myself anyway)

Prior to coming up with this method I’m about to explain, not to mention how insanely weird it actually felt doing as I recall and smile thinking back – “yes Craig you still did that, move on” …  The method was yet another outcome from my many experiences with different losing trades and different emotions.





So, back last year during this particular time above there was a period of me going well for over a few months or so, losers and winners but more importantly my equity was increasing overall. I actually still remember the feeling of joy, the feeling of maybe I’m different from the majority, a sense of individual success. I even recall contacting James via email and blurting out in words but trying to act calm and collected at the same time as though I wasn’t really fussed but really I was excited to say the least and wanted to talk to someone.

‘I’m Struggling to accept the same % for both months but it seems true to the decimal which is odd. I’ve checked my figures and they seem fine.
(This was me being over confident and explaining that both months were the same, + 6.7%)

Reading the above statement today makes me cringe! I guess it’s normal, I guess its natural when one is doing well to only but feel confident in one’s own ability! I actually wrote much more within the email, I guess it was just my way at the time to inform James of how well I was doing. Like showing a teacher how good and how fast you understood them in class! If only at that point then I could have foreseen how the following month would have played out and how my mindset took a dive for the worse, would I have felt differently and acted differently in my approach to the losses I was about to embark on.

The graph below is the result of the month following on from above.




It’s very clear to see the reversal in not only my trading results but also the reversal in my mindset. This all started off from a few losers stacking up on top of one another and eventually causing a shift in my thoughts, leading to negative outcomes, over and over again! The thing that made it even harder was the fact that I was well aware of the downwards staircase I was creating but yet felt like I couldn’t stop it. Obviously, I could have halted my trading and in some situations wish I had of done before continuing on. However, continuing on lead me to that activity I decided to then try.

So, it became apparent after looking back at my results and acknowledging I was doing something wrong somewhere. It was either my technical ability, my mindset skills or even both combined. I was hypnotized by my downward equity loss and feeling disgusted, yet It was an ongoing feeling of disappointment from the start of the losing month through till the end of the losing month.

Then came the realization that it was clear I was not correctly working in probabilities nor did I fully understand or better to say, was ignorant to what exactly working in probabilities fully entailed. I found this difficult to accept about myself at the time and I remember thinking... ‘You dickhead Craig’. It was clear I was placing so much emphasis and emotion on trying to be in control of each individual trade that I had completely forgotten what the meaning of probabilities fully meant! Sounds nuts hey? Somewhat stupid even? I know, I know, I guess I had got so caught up with feeling a success on demo for months on end previously with no emotion due to it not being real monies traded, to being over confident, then having a few good months transitioning over to a live account and then BOOM – REALTY CAUGHT UP WITH ME

I ended up reverted to YouTube and other endless sources of material based on mindset and thinking in probabilities and realized that in order to rectify these mistakes I had been making then I needed to fully understand and start acting in the correct manor or else trading could never really take off for me.

Then it came to me, super simple but damn was it affective! I needed something quick sharp and I knew it needed to be a repetitive process in order to drive it into my head as quickly as possible and for it to stay there and digest!

HEADS OR TAILS CRAIG?

I went shopping for a whiteboard, blue-tac and a whiteboard marker pen.

The whiteboard was placed on the wall straight in front of my trading desk, I would literally look up from my monitor and boom there was the whiteboard smack bang in my face.
On the whiteboard, I made 25 lines in a row which I then called my ‘sample size’. I then went and raided the coin jar for a dollar coin and began tossing the coin in my seat over and over.

I continued coin tossing and scribbling down on a tally chart on paper my results of how often heads or tails came out and in what sequence. I did this for 25 times and transferred the results onto my whiteboard each time. This would then complete my 25-sample size and show the random result of each outcome. I continued to do this whilst trading, my motive being I needed to sink the term ‘random outcome’ in my mind.

It was at the time, the only thing I could think of to try. Of course, I knew tossing an even sided coin each time would only ever show a random outcome each and every time. I knew this but I wanted to get it into my head so that if I had a ‘proven EDGE’ and then approached the charts with the correct mindset knowing I shouldn’t place any more emphasis on any one particular trade and that I should base my results on a number of trades, like a sample size of 25 trades for instance. Then over 25 trades, with a proven edge, would I then begin to see better results and have a better understanding of the workings of probabilities.

Trading as we all know, has random outcomes. It’s so easy to place so much emotion and control on any 1 particular trade no matter what we are taught from the beginning, which is where I believe many people run into difficulty.

I eventually over did the coin tossing and writing the random sequences down on paper, yet it instantly made me record each and every trade result on my whiteboard and within the 25-sample size. I would write either a W for Win or a L for Loss on each line until the 25 lines were complete with trades I had taken on the FTSE. I did this over and over again for weeks on end and my mindset shifted to the point where even though I would have 3 losers marked on my board after one another, I knew a winner or winners were only around the corner providing I trade my edge accurately!

The above method sounds a bit ‘simple’ I know, I’m the poor bugger who actually thought up the process for myself and would even hide the coin when my partner came home from work. The last thing I wanted to look like being sat at home each day was a mad man, tossing a coin and recording heads or tails on a whiteboard in his living room. Eventually I had to explain my madness to her but that’s a whole different story for another day.

So there it is, a simple method anyone can apply if they feel the need and are in what I call struggle city. Its just a learning curve like many others and everyone if persistent enough will find their way regardless in the end. The above clearly shows I had a mixture of issues I needed to sort out, from over confidence to a clear understanding of what it means to work and think in probabilities. Sometimes it’s the most basic of things we can get wrong depending on how we view or see something from the start.

Before finishing up with this post, I’d just like to mention that I also believe I ran into difficulty alongside the above issues by trying to ‘subjectively’ trade. Trying to subjectively trade and having the above confusion on probabilities running parallel with emotions and over confidence is a nightmare waiting to happen. Therefore, I’m a big believer that if anyone was to have the same issues or confusion as I did then it’s always worth reverting back to a mechanical approach of trading and ironing out the above prior to mastering the art of subjective trading!