Tuesday, June 12, 2012

Getting closer to consistency

"Boom and bust cycle"
Hi there, sorry for not posting for a while, however I had lot to write here. But I resisted to do that, I believe I have found my behavior pattern related to my inconsistent trading results. It stuck to me, while reading again (~3rd time?) "Trading in the Zone" by Mark Douglas, that I was in the "boom and bust cycle" for very long time, and I believe right now that I am breaking out from that behavior. What I have noticed is the relation with this cycle and my posting in this blog :)  Positive post -> Negative post -> Positive results -> Negative results -> Boom -> Bust ... So writing a positive post would had mean that I am getting overconfident and preparing for bust cycle.

Some quotes from "Trading in the Zone" by Mark Douglas about this

"The largest group, the remaining 40 to 50 percent of the active traders, are the "boom and busters." They have learned how to make money, but they haven't learned there's a whole body of trading skills that have to be mastered in order to keep the money they make. As a results, their equity curves look like roller-coaster rides with a nice, steady assent  into a steep drop off, then another nice, steady assent into another steep drop off...
... As your confidence grows, the more likely that at some point you will cross the threshold into euphoria and start the cycle all over again."

In short the cure is to take full responsibility and accept the risk, at last I am willing to do that. Who did not read this book, I highly recommend it.

Growing my account
I was never growing my account bigger, because I always lost it all when I was trying. At the time I am growing it successfully. However I can see getting resistance every time then I reach certain amount, after new highs I get pullbacks, but I don't give up and grow it again, I am trying to keep on myself  pressure all the time, somewhere read/heard that the only way to learn/do something uncomfortable is bravely force yourself to do it.
Whole last year I had only 100-200 in my account. At the time it's 700, and I am willing to grow it to 1k in this month. Bigger account does not mean bigger stakes and profits, it also means smaller losses and smaller gains compared with your account size, which adds more consistency in our minds. It's a big difference to loose/win 20% and 2% of your account in one certain trade. Read this somewhere in the books, and got a remainder in this nice blog "http://tradingaprofit.blogspot.com/".

April, May and 1/2 June results
Results seems more consistent, and I am very happy of that. Still not making big amounts, but most importantly they start to look CONSISTENT! Bigger numbers will come in time, no rush, no hurry...

Well, I had few extremely profitable days, and one evening is shockingly good, somebody was giving free money! New PL record is +703.03 EU

However my average profits is 10 times lower, and my dream/goal is to reach 150 on average daily. Maybe I will make it this summer at least for one month?
Ok, it's enough bragging, cause will get another "boom and bust cycle" ...

What's next?
I can assure you that I will be trading pre race bf horses this summer for sure. I will try hard to improve  my trading.
At the time I almost finishing reading great book "Market wizards" by Jack D. Schwager . Great one! I highly recommend this book.
After this one I have another 4 big tomes about price action for serious traders to read :) Gonna read a lot this summer! I plan to start trading Forex again in the Autumn, but first I am gonna make better preparation.

That's it folks, good luck in your trading.


2 comments:

  1. Well, as you indicated, consistency is one of the key words together with discipline. To see all your trading efforts in a business vision is crucial, otherwise there is no way to keep the good results going on. Sooner or later you relax , dont care too much about your trading and booom. Trading is one of the professions that room for the error is really really narrow.

    I am glad to see that you are back on track.

    Why not let me know if you can pay a visit to Budapest this summer ? We have a small trading business organization here which might attract your interest !

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    1. Hi,thanks for comment.
      Please write me more about that to zuikiscool@gmail.com :)
      Thanks

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