September Monthly
The word for this month is distraction. I was distracted this month so bad. What should have been my biggest day of the month ended up being a huge miss because I was not prepared by the time the bell rang. I was scrambling trying to get my order windows up and ready and missed a few trades and butchered the ones I was in trying to play catchup.
The other issue is more housework. I finally buckled down and just pounded out digitizing old family photos. And finally finished it on Oct 1st. Out of sight out of mind. It had been taking up mental space for too long. Now the other issue is getting the rest of the junk out of the basement, and preparing it for me to move my desk down there.
Also have people coming to fix flooding in basement so needing to get things cleared out to move around. Also new doors coming.
I also dislocated my patella at BJJ halfway through the month. Obviously thats caused problems among day to day activities. It is fine now. Probably 80% back to normal.
Also had a gender reveal party this month. Its a boy!
And got lost in researching family history and ancestry. Found out a lot of really cool info. Great Great Great Great Grandpa Johan Heinrich Klingsick came from Germany in 1859 and settled in Washington MO. Very cool stuff.
And lastly baseball. First playoff game is Oct 3 but we had a lot of make up games this month.
I feel very spacey. Im not all there. I dont have that usual picture memory of what happened this month. Its a blur. And the main reason is because I was not totally focused everyday on the market. Had too many other things on my mind so the review this month is going to be tough. Trying to catch myself back up on what happened.
A few things I know happened this month
-I am not swing trading at all.
-I came to the conclusion I need to be cutting my momentum adds, when there is no momentum. But still keep my OG entry on and re add the momentum adds, at proper locations and proper conditions.
-Taking trades around previous days/weeks VProfile areas is an excellent way to get into bullish setups.
-Being 100% prepared at the bell is crucial to success
-I am way better off by eliminating stocks that are not day tradable.
-Entering a bullish intraday setup early is ok if
-Clear bullish action
-VWAP holds and or Failure
-Clear market strength
-High RVOL and Option RVOL
Its ok to be distracted. Its not ok to be distracted and trade. I believe I allowed myself a lot of slack these past couple weeks as I dealt with other things. I didnt focus crazy on trading. Didnt review a ton. Didnt trade everyday. Just let it be. Super super selective. If it was there id go for it. If it wasnt, I was doing other things anyways. Onto the next month.
So talking about things I learned.
-Swing trading was garbage. Loss after loss. 10 for my last 63. Not worth it. Abandoned dealing with it mid month. I remember an old SMB vid with Dr Steenbarger. They were talking about Swang who is one of there best traders and scalpers. He was getting involved with swing trading as well. One of the takeaways is a quote. Dont let your swing trading, get in the way of your swang trading. And I felt that this month. Im way better at controlling and making money off of the next 15 minutes, rather than the next few days. It wasnt worth the mental effort, and clearly not worth the risk. So done with that for now. Until I start recognizing that my daytrades are carrying on multiple days consistently. Sticking with what I know im best at.
-My 2nd week I was struggling a bit. Recognizing a bit of greed in my trading. My process is to get in on trigger, then add with momentum if it works. Ill repost what I wrote in the 2nd week.
-I enter the trade on the daily trigger, then I add size with momentum if it works expecting it to run and break hard. If it doesnt break hard that means I am wrong about the momentum. The trade triggered on daily basis so it makes sense to keep it on as long as it continues to hold proper levels, but the size and momentum part of the trade, it doesnt make sense to hold that extra given size, if the stock has failed to continue that breakdown right then and there.
My best trades I dont ever have to worry about it. But these recent trades that have shown warning signs, failed breaks, weak pushes, why do I need to hold that extra size on the position?
I hold it in hopes it can continue that breakout at a later point. But im wrong. I dont know that it will ever come back. I add size expecting it to run. It doesnt run. I keep size on? Doesnt make sense from risk management standpoint. It makes sense to keep trade on given technical triggers. But not size on. Im right, but not right here, not right now.
I have to start implementing this in my process. This will help prevent larger losses while still keeping skin in the game, to try those adds again at a later point.
-Its become clear that in order to protect larger losses, I must humble myself. Swallow the pride. Abandon the hope, and play to the probabilities. Cut my momentum adds, when there is no momentum where there should be. These are warning signs, and seeing warning signs are signs I need to reduce risk. Not leave risk on.
-I need to be 100% ready at the open. Charts up, tape for options ready to enter on, charts on TS marked up. OBS ready to record. Half of my trades this month took place in the 1st 5 minutes. Also the majority of my profits also came from these trades. If im not ready at the bell, I risk missing the majority of my profits.
-Somewhere in the month I made a new watchlist. Ive been creating and recreating what I want to look through everyday. Since Im not swing trading, it doesnt make sense for me to look at stocks that are only swingable. Swingable meaning, spready spread, low option rvol. Un-daytradable. I have a fast list of sectors that I consider fast movers, and slow movers. I have a leaders list that is the best performing stocks in both Fast and Slow. And now I have drilled it down even more to my Daytradable list. Every stock on that list is daytradable/scalpable with options. It doesnt make sense to pay any attention to any other stocks that arent daytradable anymore. This saves time and mental effort.
-When I chart my stocks. I label the prev D hi line, Breakout lines. And other D highs in-between. I am selecting these stocks because they are at the tipping point of imbalance or a breakout or a move outside of what has been accepted as the value area or the point at which shorts are wrong and about to feel more pain. Or longs are very happy and want to add or get in like me. My entries dont need to be strictly limited to a prevD Hi break or the breakout line. There are other week long/couple days long value areas, of other traders that have been getting involved the past few days. That creates another value area, or balance area, or also tipping points. Ive been marking those through volume profile on a lower time frame with just a simple box of the top edge of it. Sometimes price interacts here and there is a notable bullish action. Bullish setup with bullish intraday action at a bullish location. Take the trade. Its not a bad trade just because its not occurring at the usual spot. Just another indication balance is tipping or shifting
So certainly learned a lot this month.
MENTAL MAP
Earlier a couple months ago I got a new book. Mental Game of Trading by Jared Tendler. Its giving me a way to keep track of my emotions and help recognize problems around them better.
I added a new section to my spreadsheet.
Greed. Fear. Anger. Discipline. Confidence.
Each trade I take I put a number 1-5 on each. 1 being not emotional at all, or numb, careless. 5 being overly emotional. Hyped up. Not thinking straight, acting on emotions. 3 the stable middle ground. I only started this right at the end of the month so dont have any data on anything yet.
Greed
1. Means I am unconscious of risk. Throwing size around not aware of actually calculated risk.
-This is BEFORE trade
5. Means I am sizing up huge on lesser setups. Is also not taking profits at profit taking locations. Or not cutting trade on clear warning signs to keep win. Holding out for more
-This is MANAGEMENT
Fear
1. Means failing to cut a loser. Improper trade management, lack of control to cut loser
-MANAGEMENT
5. Cutting a winner short for no reason other than not wanting to give it back. Improper management
-MANAGEMENT
Anger
1. Boredom trades. Trading outside of edge. Random trades
-BEFORE
5. Clear Anger while trading. I know what this is.
-BEFORE
Discipline
1. Lackadaisical process/planning/action. Not caring.
-ANY
5. Overthinking. Thinking about abandoning process.
-ANY
Confidence.
1. Taking a trade because I feel like it. Taking a lesser setup cause I feel like I might miss it.
-BEFORE
5. Falls in line with greed. Thinking I know better than the market. Not taking profits when I should.
-ANY
I think all of this is going to help me take a deeper/further step into compliance. If I can attach an emotion to compliance problems. It may help me identify trigger words/phrases/thoughts so that I can prepare myself to adapt to the situation, refocus, and follow the process.
AND on top of this. I have also been grading my trades finally. A B or C. Daily Setup Grade. Entry Criteria. Risk. Partial Taking. Management (cutting adds, profit taking, exiting on warning signs). And Exit. I wanted to separate management and partial taking because I need to be more specific on cutting adds and taking profits. In fact, Im just going to name them separately. Management alone is not specific enough. So now its Profit Taking Grade. Cutting Adds Grade.
This also helps me look at my compliance issues and see what part of the process I messed up on.I did just add Risk, Profit Taking, and Cutting adds to it. So data is incomplete again. Going to have to cycle through these trades and re grade.
NUMBERS
+$674
+7R
Compliance 65%
16/37 43% WR
Avg Win +$173 Risk $125
Avg Loss -$100 Risk $141
Not bad numbers. Compliance is bad
This is kind of where my mental map comes in handy. I have my mistakes clearly labeled, but digging deeper into the emotions, I can recognize which compliance issue is related to what emotion, and from there recognize trigger words or phrases that lead to that.
My issues weren't one sided. Of 37 trades, I made 13 non complaint trade decisions. 5 of them related to pre trade things. Risk, Settling for less, Early. The other 8 on management things. Not cutting after seeing clear warning signs. Not keeping win, not keeping OG entry trade on through pullback.
Im now grading my trades so that I can see where I am failing or lacking. Selection? Risk? or Management? Taking tallys now. Have a lot of new stat boxes to make.
Took 37 trades, Half where in the first 5 minutes of the day. No surprises there. All the action for me usually happens fast at the bell.
GOOD THINGS
-I am being selective in my watchlist
-I am catching good winners. Good moving stocks.
-Taking action to step up my mental game. Become better with compliance. Recognize weak points in my game. A game, B game, C game.
-Didnt force myself to trade and start burning out. Life has to come first sometimes.
PROBLEMS
-Not cutting add size off on failed momentum moves.
-Distractions.
-Not keeping my wins. Letting it pull against me too much, giving back too much premium
-I am scalping. Clear intraday setups and move to move is where im performing best. Not by holding as long as possible.
-Not pressing.
-There are some cases where I get the stars aligning and super clear RR scenario right at vwap and HTF levels. When I see that fail its time to put down the risk and deal with it.
SOLUTIONS
-Plan is implemented. Time to follow through with it. Cut the momo adds that dont go. Restart later if resets.
-Clear mental space first so focus can be on trading. Be 100% prepared to trade at bell
-Take profits. I am scalping. Take after new HOD/into Daily Breakout levels. Exit the trade when the move is done. There are always clear signs. Trendlines, MA loss. Market. Wedges. Tape.
-When vwap is lost trade is done.
-Follow +2/3R rules.
-WR is good because my selectivity is good. These are good names that make good moves that are daytradable. Maybe once a week I get something really special where stars align. I know what it looks like on the chart. I need to be ready for it.
GOALS FROM LAST MONTH
Cut Day trades at vwap loss.
-Failed a lot 1st 2 weeks, after that was fine.
Swings 1 lot on trigger, add at EOD if worthy
-Abandoned swings completely.
Bring A game
-OK. Not everyday. Couldnt do it, life getting in the way.
-Avoid size on trades w/no trigger
-Did good with this. Only a couple trades I got in at awkward times and lost small.
NEW GOALS FOR OCTOBER
-Cut MOMO adds when there is no MOMO after expected MOMO.
-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.
-On vwap fail at HTF locations, put size on. Risk up.
-Take profits often. Be out of the trade before it reaches breakeven.
-Get back on track. Back in flow with the market.
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