October Monthly

Month was an odd one. I dont think I had a single day I spent more than an hour and a half trading. Usually 45min to an hour in I knew I was going to be done. Its just the trader I am finding myself to be. Finding my lane and staying in it. Lots of review work to do here.

This month I started keeping track of my A B and C game performance around Trade performance variables, and emotions. 

Late last month, I was keeping track of them on a 1-5 scale, but it wasnt consistent enough in record keeping. So I changed it to A B and C, Or just 3 for A game, 2 for B, 1 for C. 

I want to retype out everything here to try and solidify it better in my head on what exactly it is im keeping track of. 

So for Trade Grades, 

Daily Setup

    -Clearly, some are A+, some A, some B. If its A or better, It gets an A game grade

    -B game is good enough to watch for, but not A grade. 

    -If I have no business even looking at the name, C game

Entry Criteria

    -If trade entry was at proper location, under appropriate conditions, it gets an A grade. 

    -If I chased, Was late, or too early buying a dip. Thats my B game grade. 

    -If I really chased, or was late, or buying random blind pullback, C game. 

Risk Grade

    -If trade was not over/under sized from OG entry, and MOMO adds were not oversized or undersized. A game. Looking at around $50 risk for starters. 

    -If trade was not perfect and a bit outsized to either side, B game. ~$30,$80

    -If trade was A+ and I was undersized, C game. Or if I was totally unaware how large size was due to exp day, spread, etc. C game

Profit Taking 

    -If I took correct size off, at correct time, under correct conditions, A game

    -If I took partials too early. Not respecting PT rules. Didnt take partial at all, B game

    -If I let a win turn into a loss, C game

Cutting Adds

    -MOMO related, If I cut them for loss on lack of momo, or took partials on range break in favor, A game

    -If I fail to cut momo adds at any time I am supposed to, B game

    -If I let a MOMO win turn into a loss with clear warning signs, C game

Exit Grade

    -Overall exit grade, looking at proper partials, cutting adds for loss or win. No mistakes A game

    -1 Mistake B game

    -2 or more C game

 

I have started grading my trades now based on Selection, Risk, and Management. It adds another layer to checking my compliance on trades, and I can be a bit more specific about where I went wrong. 

Emotions, 

Too add even another layer, and im finding out this is the most important one, is tracking an Emotional Grade. 

Ive been reading this book, The Mental Game of Trading, Honestly been a burden to get through, I have not been doing well reading everyday. BUT there are good points in here I am trying to get as much out of it as I can. The big one from it is keeping track of emotions. Finding which ones are my big problems, which ones arent. Trying to discover what emotion leads me to make certain mistakes. From there I can dig deeper and find trigger words/feelings/emotions in real time. And hopefully stop myself from making that mistake before it happens. 

Everything I have here is still a work in progress. I used to measure it on a 1-5 scale, with 5 being most emotional. But I cant measure that well or consistently. So I switched to A B C game here as well. 

Greed

    -A Correct Risk. Correct Partial Taking. Correct Loss. All at proper locations and conditions.

    -B  Not Cutting on Warning signs. Finding myself in a state of hope. Sizing risk too big.

    -C Letting W turn to a L. Not taking Profit at PT. 

    Greed can also happen my taking a dumb trade, but I rarely do that now a days so mainly Greed happens to me during my managing of my trades. Failure to follow through with one of my rules when it comes to 

    -Cutting momo adds on lack of momo

        -Greed wanting it to still be a winner and hold full size

    -Not taking partial after PT hit. Holding for more

        -Greed through hope. Thinking im smarter than market. Not trusting my process. Not following rules because I want more. 

    -Size up on lesser setup

        -Greed from forcing more from market

For the most part, I recognize my greed from a lack of taking size off. Wrong or right, I get greedy from not accepting what the market is telling me. Through warning signs and not cutting my momentum adds off. A refusal to accept that I am wrong, in danger, and wont trade like it. Holding and hoping. Not cutting losses short. 

Fear

    -A Correct Management, Partial Taking. Correct size, not undersized. 

    -B Low risk, Undersized. Took partial/size off too early/on noise. 

    -C Took TRADE off on noise/too early. Not letting OG entry pullback and retest.

 Fear mainly happens in my winning trades

    -Fear of giving it back

        -Taking it off too fast, not waiting for proper cues

    -FOMO

        -Entering trade early from fear of missing it

    -Fear of larger loss.

        -Letting trade pull into stop area, cutting early on breakdown, not giving it chance to shake out. 

    

***Looking at past trades and rating, Nearly all of my fear problems came from winners and taking size off too early. Not trusting my process and plan, and letting the stock do its thing. And this is my biggest problem. This is the chocking point I am having in my trading. Too many trades cut in half, some not even caught at all because I am trading with fear. Not focused enough on following my process, to concerned with winning and losing. Trying to be right. Not thinking in terms of probabilities. ***

If im going to take the loss, it has to be under the right trade circumstances. Size has nothing to do with the trade I am in. Risk is supposed to be considered before entry. Trade exit rules have nothing to do with size. And if I find myself wanting out ahead of proper exit rules, I must remember this. 

Anger

    -A Total Calm. Not feeling overwhelmed, clear headed. 

    -B Taking a trade NOT clear headed, angry, pissed off

    -C Revenge Trading. Boredom Trading

Anger is the least of my concerns in this. I know I get pissed off while trading everyday, but it doesnt lead me to enter into any bad trades. It happens during managing trades, seeing it pull back, expectations not met. It is something to look out for though. Perhaps getting angry can be a trigger for me to check myself, make sure im not going to exit any position prematurely. 

Discipline

    -A All Rules followed. No mistakes. 

    -B 1 Mistake, Feeling lazy. Tired. 

    -C 2 or more, Changing plan mid trade for no reason

Discipline is a matter of following my plan. If I followed my plan, I was disciplined. If I did not follow my plan, I was not disciplined. It comes before and during the trade. Making sure my risk is correct. Making sure im managing the trade correctly. 

It also can be a feeling though. If I am feeling slow sluggish or lazy, that can easily lead to a slip in following the plan. 

Confidence

    -A Good setup, Good conditions, Good execution

    -B Shaken out, Under confident, Overconfident, entering early, taking profit early, Lesser Setup

    -C Letting W turn into a L. Didnt take partial at PT. 

Overconfidence > thinking you are smarter than market > holding trade for longer past PT, or Cutting W short because you think market/stock is gonna stop here. 

Underconfident > Less risk on, Take trade off on pullback, not letting some ride

Confidence is good to keep track of but its not the best reason to look at why I made a mistake. Taking partials off a winner early does mean im under confident, but more so it means I am fearful. 

MENTAL GAME REVIEW

Trade A-C Grades

66% of my trades this month I graded as an A. That means a third of them were a B. Luckily for me, I keep track to know where im lacking.

Of 38 Total

Daily Setups 74% A 

Intraday Entry Setup 95% A 

Risk 84% A

Profit Taking 87% A

Cutting Adds 82% A

Exit Grade 92%

So the question is what does this mean. 

Daily Setups 3/4 of my trades were A grade, meaning I could more than likely go without a 1/4 of the trades I took. I had 3 wins I rated a daily setup of B. Totaling +$190. I can go without the B setups. 

Intraday Entry Majority were all at proper triggers and where I needed to be getting in. Im going to be a little more strict on this next month and in the future now that Ive done the work to know what else to avoid. This is to make sure im not settling for less intraday entries.

Risk Majority I was sized correctly. The ones I did not though, just those 6 trades, the losers account for -$900, and the 1 winner I was undersized was a $400 win that could have been twice as big. Just have to do better knowing what my risk is and sizing appropriately. Quick maths. 

Profit Taking, well you only take profits on winners. So the ones I cut short get a worse grade. Tough to judge how much money I choked myself off from, if took profits correctly, didnt let fear get to me, and waited for proper exit cue, at least $1000

Cutting Adds, making sure im cutting momo adds off if I need too. 

Recognizing an inconsistency here. I do not need to be giving all of my trades a grade on profit taking or cutting adds, if those situations never came about. I will fix this going forward. 

Exit Grade, separate from momo adds, this is when I completely exit the trade if I followed my rules. Overall did great. Its the momo adds that the focus needs to be on for next month. 

Emotions A-C Grades

A little more detailed. Runs on scale of 1-3. Each 2 effectively takes .2 away from 3. So if I made a mistake, I take away a point on emotion that caused it or it was affected by.

Greed 82%

    -Either sized up, didnt cut momo adds, not taking profit at profit target.

Fear 74% 

    -Cutting size too fast or at all at improper spots. 9/10 this is where fear comes in. I do not suffer from FOMO very often. Fear of taking loss also comes into play when I get slammed very quickly. But majority, it is taking size off much too fast, not letting winners run

Anger 92%

    -I know I curse a lot when I trade. But I dont really have issues with anger affecting my trading. I dont revenge trade anymore. I dont enter trades out of anger. Sometimes I market it to a B game grade if im feeling extra pissed off

Discipline 58%

    -Not exactly an emotion but a sign of control, or lack of it. If I made any mistake at all, I get a mark off, if multiple, then C game grade. Fear and Greed are the killers. 

    -Its all over. Problems come from any and all angles. Entry, risk, management, exits. More discussed later. 

Confidence 71%

    -Lack of, or overconfidence. Applies to discipline as well. Again more below. 

NUMBERS

+$133

-.5R

16/38 42% WR

25 A grade trades

13 B grade trades

66% A Grade Trades

2.7 Avg Emotional Grade out of 3 90%

2 Breakeven Ttades

7 Full -1R losses out of 22

4 more than -1R

+$159 Avg win risk $152

-$110 Avg loss risk $132

+$267 Avg win Day

-$174 Avg Loss Day

-Compliance 66%

    -Part of this is from me being much more aware of what mistakes im actually making where as beforehand, I didnt know I was making them. Im being more critical of myself

    -Most common was settling for less, being too early and Exiting on random PBs rather than holding. 

Breakeven month. 

-Biggest losses were from 

    -Sizing momo on short, into vwap on trade that needed time to build

    -Buying random dip long, well under vwap after HOD failed break

    -Option Exp day, huge size

    -Buying under vwap. 

-Biggest misses from

    -Not prioritizing watchlist. Breakouts over pullbacks

-Biggest chokes from

    -Cutting momo adds off on noise, not waiting for 1min low to break. 

Fortunately, I have plans and fixes for all of these. 

PROBLEMS

-Momo adds. Cutting too short, and not cutting off at all. 

-Failing to watch stocks

    -Premarket triggers

    -Reclaim of vwap

-Fear

-Risk numb on exp day. 

-Distractions

    -Family Pictures and Videos recording still. I have to finish them before I can really focus on coming up with new trading solutions. Its too much of a mental take up plus my desk space is not clean. 

-Not focusing on correct stocks at open

-Not being specific enough on what kind of breakout and how to trade it.

    -2nd day, 1st day, into, at, pullback

        -Continuation/2nd

-DEEPER TA. Longer term view with TLs. Old major ones. It matters. It adds edge or removes it. It allows me to better rank setups for best focus. Better After hour analysis

    -Some trades need time. Some are great to trade right at the bell and go for gold in less than a minute after the open. Others are not. They need more time to develop. They may have already made a large move the day before and need more MAs on HTF to catch up or more PA at different levels. 

-Not paying enough attention to SPY and Q. It matters. I trade names that are influenced by there PA. It is important to have levels marked and trends known to have more edge around the timing of my trades. Can be big +++ if all lines up. 

SOLUTIONS

-I have to be disciplined. I have recognized the emotional problem is fear. When I get that feeling. I have to breathe through it, deal with the noise and follow my plan. The plan is to wait until I get the proper signal to execute. 

-Its been hard to cut the losing momo trades. Very easy for me to convince myself that my risk is fine and ill just hold through. Just that thought has to be my trigger its time to exit. 

-Fear is part of the game. I am better learning how to recognize it and manage it. Elimination is not possible. Management is within my realm of control. 

-Bit me too hard to ignore option exp day risks.

-Distractions are gone! Pictures and videos done. Nice clean desk and workspace again. 

-Solution for prioritizing, describing, ranking, analyzing and managing below

PROCESS FOR RATING WATCHLIST AND SETUPS

-For better focus on better setups

-This is necessary because I have had problems this month choosing between the lesser of 2 setups. 

-Not being aware of which stocks are most important to trade

-I already keep track of the 10 most important variables in my setups in my stats, but I do not track them the night before. Thats the simple fix. 

-Further than that though, I also had situations where I would prioritize pullback trades over breakouts at the open. And others continuation into the BO, rather than the actual BO. 

So I need to list out what kinds I have now and organize it.

Symbol

Setup Location

    -Top, Mid, Bot, Continuation

BO or PB

        -BO, PB

Score

What am I missing?

Setup Location

    -How about setup condition. Location can be the same, but condition is next part to check in the process.

Setup Condition 

    -Breakouts (Pre Breakout, At Breakout, 2nd Day post BO)

    -Pullbacks (After Failed BO, At BO retest, 2nd Day post PB fail or retest)

So I need to create a new column. Setup location, continuation needs to be a condition

These 2, setup location and condition are decided and noted before the market opens. It is defined from the daily close candle. 

Intraday trade entry location, is a separate part of the process, and is labeled in a separate column near intraday variables. 

Time to go back over the trades and fill in the new gaps in stats. 

And done. Neither sticks out or seeing anything notable. All 6 roughly the same. PB on BO levels though 4/5 huge wins. 

PICK ONE THING AND WORK RIGOROUSLY TOWARDS IT

Prioritize, and execute

Obviously thats a lot of problems. A lot of them are one offs, others are life conditions that cant be helped. Some are frequent and daily habits that need to be fixed. 

Coming up with ranking watchlist at the open, and building risk plan around it is the most important thing right now. This is where my focus needs to be. 

Ive done good organizing and separating what type of trade I am wanting to take. Now to rank them.

There are thousands of variables I can run through and check before each open, but Ive done the work to know what my most important pieces are. 

I need to create a questionnaire, or checklist of each name to find ranking. 

On every trade I should answer these questions about the setup

    -BO or PB?

    -What is the condition?

        -Is it at the BO, into the BO, a 2nd day after the BO?

        -Is it day of pullback to BO, day after Failure, or continuation after failure/bo retest?   

    -Check Weekly, Options, News, Past significant BO level confluence, and TLs. 

    -Industry/Sector Theme?

    -Check * / 10 Most important Variables 

    -Does it need time to build out before considering adds? Time? Other HTF variables to catch up?

These questions alone will give me my ranking. BO takes priority always. But depending on other variables, one will take priority over the other. I will know which breakouts are most likely to be winners. 

But now the Risk plan. 

PBs do not get 3* risk rating unless some serious stars are aligning. So can get that out of the way now.

I need to take a look at my Hall of Fame best wins, and tally the conditions. Will do this months wins as well.

HoF

Pre - ///////////////

At - /////

2nd - ///////////

Sep/Oct

Pre - /////

At - //////

2nd - ///////

Nothing telling here

And maybe that is telling. Perhaps Im overthinking it. Now my plan is, if its 10/10 I size up. 100$ risk on OG and each MOMO add. If its less than that, then its 50$ for OG and 50$ for momo adds. 

HOWEVER. Time is the issue. Not risk. Its when I put the risk down that is the problem.

In my HOF trades they are mainly after failed pullbacks in tight ranges that bust out. HTF MAs and PA is super tight and coiled right under price. The move has not happened yet.

When im looking at these other BO trades like the continuation or 2nd day after the BO, those HTF MAs and PA candles are far away from recent ranges/consolidation/MAs. Mainly the 20/50MA is what I like to see, juuuuust under price before it makes its move

In these 2nd day / continuation plays, the MAs are playing catch up. There is no rush to get in the name because the longs are already involved. They do not chase. They wait for Price to come back and reset so they can load up on the dip for the next move. 

My issue is im trading the open like the breakout hasnt happened yet. Like Im expecting the already broken out stock, to breakout again right at the bell. Then I get sucked in long while no other traders want to get long, because they are waiting for the pull in. Because the pull ins happen. 9/10 they do. Thinking in terms of probabilities.

I will always enter the trade at my trigger. Its my momentum adds that need to be re-thought. 

BO

-Pre. Acceptable OG entry and MOMO adds

-At. Acceptable OG entry and MOMO adds

-2nd

    -Heres where price can be too extended. This is where I need to be cautious about momo adds. MAs on HTF need to catch up. These setups are the ones I need to let time pass before I go for momo adds. 

PB

-BO Acceptable OG entry and MOMO adds

-F Acceptable OG entry and MOMO adds

-Continuation

    -Same scenario. Price has already made a run, Im chasing a bit so time needs to pass and catch up. Take on trigger, but no momo adds. 

It is ok however, if the stock has had good premarket action, not just from close to open with 0 pmkt/ah trades, to go for the momo adds. Pmkt can allow MA on HTF to catch up faster. 

 -------------------------------------------------------------------------------------------------------------------------

So this is good.

I got my process for determine setup and condition

Process for determining risk

Process for determining management plan

Process for determining ranking watchlist

Can be more fluid and consistent in trading, stat and record keeping. Good. 

NEW COMPLIANCE MISTAKE LIST

-A+ HOMIE

-Risk not planned. Too small or Large

-Too slow to cut MOMO adds

-Didnt cut after VWAP loss on time

-Didnt cut/keep after warning signs

-Didnt keep win

-Exited Trade on PB when should have held through

-Took profit too early on noise

-Entered Trade too early

-Settled for less on daily

-Settled for less intraday entry

SUMMARY

-Mental Game

    -Settling for B grade daily setups, and cutting profits short were biggest mental game mistakes. 

    -Fear is biggest problem. Cutting those wins short hurt the end game P/L to the point of a small Green month instead of a decent one. 

-Prioritizing stocks at open is key.

    -Since all of my winners came from the first 30 minutes of the day, it makes sense to have a ranking system to know which setups take priority over others at the bell. To prioritize the most probable winners at the open over others that may need more time. 

    -This also helps with missing trades at open. I wont miss the ones that have higher priority over others

-Stopping my greed and overconfidence, biting the bullet and cutting my failed momentum adds will prevent larger losses. 

-Dont buy stocks that cant hold vwap, until they hold vwap, and then jump on it. 

-2nd day breakouts, and Pullback continuation trades do not get momo adds until later in morning, or if there was significant premarket trading. 

LAST MONTH GOALS

-Cut MOMO adds when there is no MOMO after expected MOMO.

    -Not perfect, still getting better

-Find out more with Compliance and Emotions. Mistakes and Causes. Why am I ok with Less than 90% compliance. Why does it keep happening? Be specific. 

    -Doing better. Much better. Much clearer. Next month I anticipate ill have a better grip on things. 

-On vwap fail at HTF locations, put size on. Risk up. 

    -Did not have many opportunities for this. But when I did, still did not execute on it. Literally all 16 of my wins this month happened in the 1st 30 minutes of the day. Not much time for a vwap range to build. 

-Take profits often. Be out of the trade before it reaches breakeven. 

    -Too focused on this. To the point it hurt me. Goal is not specific enough. Taking profits at correct points under correct conditions. I did do good being out of trades before pullbacks and resets though.

-Get back on track. Back in flow with the market. 

    -I am in flow. Watchlist building is great. Needed work and work is done to be better. My management and control of fear needs the most work. 

GOALS

1 - On every trade I should answer these questions about the setup to determine ranking. 

    -BO or PB?

    -What is the condition?

        -Is it at the BO, into the BO, a 2nd day after the BO?

        -Is it day of pullback to BO, day after Failure, or continuation after failure/bo retest?   

    -Check Weekly, Options, News, Past significant BO level confluence, and TLs. 

    -Industry/Sector Theme?

    -Check * / 10 Most important Variables 

    -Does it need time to build out before considering adds? Time? Other HTF variables to catch up?

    -What risk plan do I apply?    

    -What is Ranking of watchlist

2 - 2nd day Breakout trades, no momentum adds until price has clearly pulled in, and reset at vwap. Minimum of 15 minutes after the bell. Only if there has been plenty of pmkt action, then it is ok for early momo adds. 

3 - Chart SPY and Q everyday for edge on direction. 

4 - No longs under vwap

5 - 100% prepared to trade every morning. Watchlist ready and in order by rank. 

6 - Let my wins work. Do not take the adds off until the proper cues. 

7 - Trade without Fear. 

8 - Rethink Mental game grading system? 

FINAL THOUGHTS

I have come a long way already in my mental game progress. From starting keeping track of it last month, to having a much deeper understanding, and way to grade it and rate it and improve it. 

Process over outcome always. The process of elimination never stops. Im still finding myself trading less and less, focusing on less yet at the same time, more. Quality over quantity. I fear the man who has practiced 1 kick 1000 times, than the man who has practiced 1000 kicks, 1 time. 

Keep goals in mind everyday, get to work.