Saturday, April 09, 2005

The reasons behind this Blog

I’m reposting a comment I wrote to the Cheese, but as it tells a lot about the reasons, why I write this blog, I think it fair for those, who missed it on Cheese’s Blog to copy it here.

Reading this Blog, you might ask yourself, why I’m writing it at all?

Because I like to read my own ramblings? Sure not. I usually don't reread something I have written.

Because I want recognition and comments?
I think, if I wanted that, I would sit in a corner full of despair. I'm getting just a meagre number of comments in my blog and Cheese refused to give me the Ego-Booster, which would tell me how many people are reading my blog. (Even if I really asked him politly.)

No, I'm not looking for your comments, but I more than appreciate comments like Tack's or Racer's Edge on my Stop's or Scale-In article. They provide the answers to the unasked questions I pose with my articles.

I write the Blog to focus new ideas I got from others or had myself, to see if I have understood them, if they have merrit and if I have actually found something, which I can implement in my trading plan.

And if you decide to answer, taking my idea and showing me where the flaws are, I'm more than gratefull. You have saved me money, you have told me some old miners lore and decided to show me, why in your oppinion my idea will not work as I think it should. Sure I might decide I will try it none-the-less, but I'm forewarned. I know behind which corner you think the beast will be waiting and I can be prepared.

My defense article series brought me back to the old trotten path. I will again trade with Stops, but in the process of trading it realtime I started the first babysteps learning how to scale-in and manage a multi contract position. And it has cleared a lot of things, which were unclear just a week before. I couldn't have done it without writing the blog, without focusing my thoughts and without your comments asking the questions, which were nagging until I found an answer to be implemented in my trading plan.

But does it mean I recommend you follow my path, does it mean I think you can trade as I do and be successfull, sure not. Every trader has to develop his own system. You need to take responsibility for your own trading decisions.

As long as you trade someone elses system you will ultimatly fail (unless you have a successfull automatic trading system).

Cheese, you can't trade Kiwi's plan. But you could have made it your own and be successfull. But as long as Kiwi is responsible for your loss, you will fail.

So you lost 2 days in a row? You lost big time? Sorry about that. But maybe you should take a look at a longer term Euro chart and ask yourself, if you are made for this type of environment? Euro is vicious right now. We are eventually changing a midterm trend and the midterm bear traders are fighting the longterm bulls. And both sides are up to their own games, giving ground here, gaining ground there, attacking at one time, retreating the next second, when the batallions are not yet ready.
Either you are right or you will lose more than your shirt in such a battle of the giants. That's the beast you decided to trade. You don't know it yet, still you complain having lost 2 battles. Stand up and fight.

Euro can be a calm water at times, trending nicely, but it can run 100 ticks in 5min, it can reverse 80 ticks and continue another 100 in the other direction and it can stay in a 30 tick range for hours. That's the way it is. You need a lot more screentime on the Euro than the few weeks you have. You need to make your experiences, you need to learn when to go with the trend and when to fade it. But changing the plan will not help you in this regard. In a trend everything will work, be it a cci ZLR, be it a Stochastic sling, be it plain 50% Pullback trading. But you need to have a plan and then start trading it.
If you see flaws in it, correct them, if you feel unsecure with certain entries, take them in Demo and if your feeling proves to be correct look for and define a filter, if it's wrong, you have learned that you can override this particular feeling in a similiar future situation.

Make Kiwi's or any plan your own plan. But that's, what you need to do, that's your homework. Not throwing out the teacher, because his system gave you two losing days in a row.

Hope you will some day be able to say: "Yes this was really relaxed trading."

That's how I understand Marc Douglas, when he speaks about trading in the zone. You feel sure, you are relaxed and you just act to what the market is telling you.