how to *act* disciplined in market? help needed!

[Happy_Singh]

I Want to solution on this problem .....i am really happy .. HOW to control my VAMPIRE MIND.

Try this . . . .

On the day that your behavior is uncontrolled, you make a payout request for 10% of your capital from the broker.

Next day same . . . payout 10% from balance money . . .

Next day same . . . payout 10% from balance money . . .

Increase the capital by 10%, only after a week of good (acceptable behavior)

Trading smaller than you can afford is a good enough punishment for the mind/ego to remain in control . . .

Don't worry if your balance goes so low that you cannot even trade 1 lot, switch to cash scrips, trade small quantity . . .

Discipline is a habit, it needs to be inculcated, cannot acquire it by reading books/watching you-tube videos or just wishing for it . . .

Behavior modification is far tougher / difficult than learning new skills . . .


Cheers


Happy

 

[saakk]

I think I understand markets well but I have a big problem with discipline.

I know exactly what to do but I end up passive or actively start making all known mistakes!

Its slightly bizarre for eg:

When I see my trade start faltering and turning into loss,
I *know* I should exit or atleast I should lighten up the position but
I find it hard and often fail to cut the losses.

I *know* one should cut the losses instead of praying and hoping but
I fail to do it when losses start to mount up and eventually bail with huge loss!

I *know* I should not revenge trade but after losing I go 'all in' to recoup the losses
ofcourse risking beyond feasible level will always end in loss its simple math.

I find a huge gap between knowing & acting, which I am not able to cross.

whats worse, I have even read 'disciplined trader' and I *understand* things
(such as pre-planning trade, defining risk prior entry, following trade plan/MM blah blah) but
I find it hard to act on those understanding.

well you may ask, if you know what's right then why the hell you can't go ahead and do it?
am asking the same question to myself and other successful/learning traders with answers!

In the heat of the moment, it seems my logical brain shuts down and I become logic blind!
How can one avoid such 'logic blindness' ?

I can see this problem in me and others but have no solution so far!
This situation seems to have another parallel, a drug addict who understands his addiction but have no power to overcome it!

Sir it seems you are trading the SIZE that is bigger then your risk tolerance, Your brain can't take the pain of loss because your position is BIG, cut it down to "I Don't Care" size and trade it for 12 weeks consistently. Even if you have a capital to take 100 lots size position you cant manage it properly unless you are ready MENTALLY. You will get out prematurely if price moved in your favor and will hold it beyond your SL if it moved against you.

Trade well.... :thumb:

 

[anuragmunjal]

hi

The problem could be, somewhere deep down.. u dont trust your system in totality or you may have a feeling that you are smarter than your system, or the system that you trade is not suited to your personality.
when trading, Imho, if you have complete faith in your system, it is better to surrender totally and let the system takeover your trading.

regards
Anurag

 

[vishal7176]

Try this . . . .

On the day that your behavior is uncontrolled, you make a payout request for 10% of your capital from the broker.

Next day same . . . payout 10% from balance money . . .

Next day same . . . payout 10% from balance money . . .

Increase the capital by 10%, only after a week of good (acceptable behavior)

Trading smaller than you can afford is a good enough punishment for the mind/ego to remain in control . . .

Don't worry if your balance goes so low that you cannot even trade 1 lot, switch to cash scrips, trade small quantity . . .

Discipline is a habit, it needs to be inculcated, cannot acquire it by reading books/watching you-tube videos or just wishing for it . . .

Behavior modification is far tougher / difficult than learning new skills . . .


Cheers


Happy

@ HAPPY

thank you sir ...thanks a lot .

by profession ...i am scalper ...i trade more than 200 trades per day....i am working on profit sharing basis....then payout issue is not here.....butt ..i will your advice keep in mind.

any other valuable advice for me sir .....plssss

thank you .

 

[onlinegtrash]

anuragmunjal, saakk , Happy_Singh,
Thanks guys for your valuable inputs.

@anuragmunjal is right the problem is related to confidence on my system.

I have not backtested my system except I have some basic rules based on support/resistance/pullbacks/breakout failures etc.
I lack clarity and hence lack confidence on my system.

I realize my problem is more related to emotions and awareness.

So here are some steps I am going to take:

Although I don't have plans to become system trader, am going to practice simulation and visualization of trades: www.chartgame.com should help for this.

Am going to cut down my position size and have a strict upper limit for risk exposure.
To trade comfortably within my pain limit.

As anvy said... I will avoid 'heat of the moment' decisions and plan my reaction to multiple scenarios before the events happen.

I am planning to trade in Higher time frames so that life will be less hectic and there will be lesser noise trades.

I have been searching youtube for trading psychology in youtube and found a good one to share!
http://www.youtube.com/results?q=Andrew Menakers

Andrew Menanker this guy talks about exactly my problem!

........

I never thought trading would require so much internal and external work,
as some trader said "Trading is the toughest way to earn easy money!"

thanks guys for your inputs.

 

[toocool]

I think I understand markets well but I have a big problem with discipline.

I know exactly what to do but I end up passive or actively start making all known mistakes!

Its slightly bizarre for eg:

When I see my trade start faltering and turning into loss,
I *know* I should exit or atleast I should lighten up the position but
I find it hard and often fail to cut the losses.

I *know* one should cut the losses instead of praying and hoping but
I fail to do it when losses start to mount up and eventually bail with huge loss!

I *know* I should not revenge trade but after losing I go 'all in' to recoup the losses
ofcourse risking beyond feasible level will always end in loss its simple math.

I find a huge gap between knowing & acting, which I am not able to cross.

whats worse, I have even read 'disciplined trader' and I *understand* things
(such as pre-planning trade, defining risk prior entry, following trade plan/MM blah blah) but
I find it hard to act on those understanding.

well you may ask, if you know what's right then why the hell you can't go ahead and do it?
am asking the same question to myself and other successful/learning traders with answers!

In the heat of the moment, it seems my logical brain shuts down and I become logic blind!
How can one avoid such 'logic blindness' ?

I can see this problem in me and others but have no solution so far!
This situation seems to have another parallel, a drug addict who understands his addiction but have no power to overcome it!

Only today I saw this post /thread of yours, for very 1st time.

I am not surprised that you are acting as a typical newbie........... Tell us more about you, how many years experience you have as a trader?

What exactly do you think about markets......... Do you fear the markets?

What kind of trading you do? Intraday....... Or positional and have you applied a proper back tested system or not?

When did you last time read the "disciplined trader" ....... And what time did you take to complete it? And how many times you have read it?

What's your expectations from the markets? Are you totally dependent on markets income? Or doing a job or business besides it? Are you a full time trader?

 

[onlinegtrash]

Only today I saw this post /thread of yours, for very 1st time.

I am not surprised that you are acting as a typical newbie........... Tell us more about you, how many years experience you have as a trader?

What exactly do you think about markets......... Do you fear the markets?

What kind of trading you do? Intraday....... Or positional and have you applied a proper back tested system or not?

When did you last time read the "disciplined trader" ....... And what time did you take to complete it? And how many times you have read it?

What's your expectations from the markets? Are you totally dependent on markets income? Or doing a job or business besides it? Are you a full time trader?

It all started as fascination towards markets in late 2010...

I am more like a random trader, usually some intraday trades occasionally positional trades.

My expectation towards market actually is nothing
I find markets as fascinating and one of the toughest problems to crack.
and I think it won't hurt if I happen to crack the code and become richer

I don't have a backtested system except some rules for trading.

I listened to 'disciplined trader' a year before and again a month before, so twice.
I converted text into mp3 with textaloudmp3 so it will take only 3 days max to listen a typical book.

I don't depend on markets for bread am software engineer by profession.

What I think about markets?
like a typical newbie I tremendously underestimated the work needed to succeed in markets at the start!
My thought about market has been constantly evolving and I have been maintaining a journal.
Here is a small snippet from my journal each line is a separate topic on its own...

Support and Resistance is enough!
Discovering hedging and optionality
Orderflow and time compression 
Expectation and buying hay stack
Spikology - how options price moves in spikes
Traps of early entry trades
Big R trades during expiration & big news days
Understanding Position Sizing
Understanding Scenario planning and failing it to follow only 1% of time.
Position Sizing Aha: We need huge chunk of money in RESERVE mode (75%)
Understanding Streaks/Drawdowns and diversification effects on them
Understanding Forced Liquidation
Understanding Anticipation
Understanding the power of small position sizing
Understanding Parrondos Paradox
Understanding 'Focusing matters'
Keeping track of mistakes in R

and I have been recording my trades too... The journal is getting fatter and fatter but my wallet has not!

 

[Price Pattern Recognition]

Dear,

It is a common problem during initial years of trading or investing.

If you really want to understand it completely, you have to read and research a lot. I am just trying in short.

You need to know the details of human brain's biological evolution and how 'rat brain/reptilian brain' still effect investors or traders traders mind. It is a big topic of psychology that how we can overcome this 'rat brain/reptilian brain' slowly with experience of facing adverse situation again and again.

If you search google you will get some interesting knowledge about this.

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

Another one suggestion for you, you have said about
http://www.chartgame.com

Have you tested it continuously for longer term (say 5 or 8 or 10 hour constantly), trade after trade, chart after chart with only and only goal how much money you can generate with 10k initial money?

Believe it or not when anybody is able to increase the profit constantly for longer term like 8-10-12 hour with out loosing concentration. Psychologically he/she is ready to handle a system with discipline, can start real life trading with small capital slowly.

During paper trading even with such real life trading like game, our mind don't face much pressure (adverse condition) like trading with real money. But if any one try it for longer term like 8-12 hr constantly, brain will start to feel the pressure at some point even with paper trade, when you set approx profit target of 50k or 1Lak etc with specific time intervals.

Just play it accordingly and you'll see the change within you slowly.

Best Wishes.
Cheers.

 

[dhinakar113]

I listened to 'disciplined trader' a year before and again a month before, so twice.
I converted text into mp3 with textaloudmp3 so it will take only 3 days max to listen a typical book.


Can you tell me how to do it? Thanks.

 

[onlinegtrash]

I listened to 'disciplined trader' a year before and again a month before, so twice.
I converted text into mp3 with textaloudmp3 so it will take only 3 days max to listen a typical book.


Can you tell me how to do it? Thanks.

export your pdf into plain text file or simply copy paste pdf content into text file.

(Optional) Cleaning the text:
I use Vim editor to remove headers and footers (such as Page number title etc) in each page

tr -cd '[:print:]'  //this command will remove non printable chars

If you are a geek you can go ahead and try the following groovy script too...

dictFile = "C:/Dictionaries/English/dictionary.txt" //this is english word dictionary, you can download from internet or already you should be having one
dict = new File(dictFile).getText().split()
println "loaded dictionary..."

input = new File("c:/tmp/v1.txt") //takes v1.txt as input file
output = new File("c:/tmp/v2.txt") //this is our cleaned text
output.write("")
println "Processing ... "
int i = 0
input.eachLine{ line ->
        words = line.split()
        Double score = 0
        words.each{ w ->
            //println "word: $w"
            w.split("\\.:").each{ sw ->
                if (sw.toLowerCase() in dict) score++
            }
        }
        //println "Line: $line\nScore: $score"
        print "Lines processed: ${i++}\r"
        if (score/(words.size()) <= 0.2){
            println "rej: [$score] - $line"
        }
        output.append(score/(words.size()) > 0.2?line+"\r\n":"\r\n")
}
println "Please run \"gvimdiff v1.txt v2.txt\"to see the diff!"

Above groovy language code processes the text file and removes lines that doesn't contain atleast 20% of english words in each line...i.e non english garbage will be removed in v2.txt.

This step involves knowledge in regular expressions, some unix utilities, groovy script etc.
If you don't understand them then you have to settle for less quality text or start working your computer skills!
After cleaning its simply straight forward...

use the program:
http://thepiratebay.sx/torrent/7359232/Nextup.TextAloud.v3.0.42.Incl.Keygen-BRD
It has an option to export mp3 audio files out of text input.
(optional) Install "Natural voices" to get human like speech instead of robot like speech.
----
Then when you become rich, stop pirating and pay for the softwares you have downloaded!
You can skip optional things and still get the audio version but it won't be enjoyable to listen. Happy listening.