A walk though of my Trade Journal

A walk though of my Trade Journal

I got these tweets during the past week regarding my trade journal.

This post, is going to take a look at what data I collect and how I organise it.

The purpose of a trade journal is to provide data to answer questions, therefore the data collected will depend on what the questions are.

My trade journal does vary depending on what questions I am trying to answer but I will focus on the main areas.

Obviously some of the data I am tracking may not be relative to questions other traders are asking of their own performance.

If a trader is just starting on the process of keeping a journal then this is very likely over the top for their needs.

But I will write an article on how to start a journal and what I would consider the very basics to get started with.

This journal was made in excel and started very simply and has morphed over many versions and a period of 2 years. Google has been a great resource in learning how to make this journal.

I am not going to cover how to generate the formulas and the pivot tables etc which make up the engine to this journal.

If people are interested then I will produce an article on how to approach this with links to good resources for learning how to write an Excel trade journal.

Main Trade Sheet

I have had to split this into 2 sections as the image will not fit neatly in the post.

Trade Journal

1. Trade number. Starts at 1. Enables me to easier see how many trades that are making up the sample size.

2. Date of trade. As I am a day trader and keep no positions over night, I have no need to have a date of exit. But if you hold overnight then you will need an exit date.

3 and 4. Time in and out. This allows me to monitor my performance at certain periods in the day and how long each trade is.

5. I trade 2 markets. So I have a column to indicate which markets this trade is.

6. Com. How much the commission / cost for this trade is.

7. Setup. I have 4 primary setups so I split them up plus a bonus setup which is an error trade. I have this so that I can monitor what errors I make and how much error trades are costing me.

8. Entry. I have 2 types of entry, blind limit order off the level and a trigger setup. Again I enter this so I can monitor which is performing well or badly.

9. L/S. Long or short. I use 1 for long and -1 for short. If you are writing your own excel journal, is a lot easier to use binary choices when it comes to composing logical statements.

10. #. No of contracts.

11. Price in. Entry price

12. Initial stop. Stop price

13. SCO. The number of contracts out at first exit which I call the scale out.

14. SCO.price. The exit price of the scale out.

15. P1. The number of contracts at second exit which I call Target 1.

16. Price Out 1. The price at the second exit.

17. MFE. The most favourable price the trade reached without hitting my stop. I define this as the next pivot high (for longs) or pivot low (for shorts) on the relative timeframe. Trading the 15min then the next 15min high or low, trading the 5min then the next 5min high or low. It does not matter whether I am in still in the trade or not. I track this as it enables to analyse my exits stats against the potential in the trade. Which in turn allows me to make decision whether I should go for bigger or small target.

18. MFE.T The time when price reached it MFE. This allows me to look at how long these set ups play out.

19. MAE. For winners this tracks how far price went against me, so I can analyse my stop size. For example my scalp trade used to have a stop of 7 ticks, but by analysing my MAE, I found that on my scalp that if price rarely went more than 2 ticks against me and that the SD of my winning MAE was 4 ticks. So now my average stop size is 5 ticks. So on every losing trade I now save 2 ticks.

20. SCO. Did the trade hit the scale out target. A binary choice of 1 yes and 0 no.

21. T.15. 15min trend.

22. T.60 60min trend.

Trade Journal

1 to 8 is a Trade Grading System. I have implement this after reading this excellent post from BreakingOutBad.

9. Log.Stat. This is a binary choice of 1 or 0 to indicate whether I have read my logical statements after each type of trade. This helps keep me focused.

10. Primary/ Secondary. Sometimes I get secondary setups after I have already got a winner off a level, and I have noticed that these tend to run longer and give bigger winners. So I have added a column so that I can collect data to see if this proves my assumption right or wrong.

11. SC/IDS Whether the trade is a scalp or intraday swing. I have clear rules defining which is which.

I also have a copy of this trade journal in a separate sheet which I enter trades I missed. As one of the questions I am trying to answer at the moment is “What effect does no fill or missed trades, have on my win rate and performance?”

Reading and making use of all this data.

Sorting the data into a readable and useful format is the next step and the key to this is pivot tables and slicers.

Below is my main stat page, which is a pivot table and a bunch of slicers.

Trade journal

A. All these are slicers, which enables me to filter the data in the main table by time, day, week, month and all of the columns in my journal.

My main pivot table covers

1. The various setups

2. The number of trades this setup produces.

3. Win rate.

4. Loss rate.

5. Break even rate.

6. Total gain compared to amount risked.

7. Total gain in money for this setup

8. Expectancy in Risk terms

9. Expectancy in Ticks.

10. Expectancy in ticks expressed over a 100 trades. This is something fairly recent I added. To help me relate this to actual trading decisions.

11. Average win size in ticks

12. Average Loss in ticks.

13. Total commissions for this setup.

14. The average size in ticks of the scale out position.

15. The number of times this setup hits the scale out exit.

16. The average size of the stop in ticks.

17. The average size of the second exit in ticks.

I also have a second pivot table covering the same information for the missed trades on a different tab.

On separate tab I have an expectancy calculator so that I can play around with new targets and stops of step ups, so I can see what the potential return is compared to my current return of these setups.

Maximum Favourable Excursion Data

This is an important data sheet for me. This is constructed using pivot tables and slicers. On an important note, MFE is always reduced by 1 tick to ensure that the MFE is recording a price that it is possible to exit at.

It takes each trade and plots the MFA (B) and MAE(C) in an histogram, which then can be filtered by the slicers (A) to show the types of trade that I am interested in.

It allows me to look at where price clusters for a setup and then I can compare this to my actual targets, to see whether they are too ambitious or am I leaving potential too much money on the table.

I also have a sheet where I compare my actual exits to the MFE on a histogram.

Again this is a pivot table with slicers.

My maths skills are pretty poor, which I have worked on to improve but there is a nagging in question I cannot answer. Maybe someone reading this can give me some help in the comments or twitter.

For example, If my scalp win rate is 68% with an average win of 6 ticks. If I increase the average target to 7 ticks, as the sheet above shows that 20% of my winning scalp trades go 1 tick further. The question is would this reduce the win rate by 20% and increase my average win to 7 ticks. Therefore the new win rate be 54.4% and average win 7 ticks.

Trade matrix

This is also a pivot table with slicers.

It records the number of trades, the win rate, loss rate, expectancy, the average length of time it takes to hit the MFE (A.SW) and the average time in trade (A.TIT).

This data is grouped into hourly slots and into days.

These allows me to see if there was any particular part of the day or a particular day where I underperformed, which then can be filter to show what I want.

One downside to this chart is that as it grouped into many different sections is getting a big enough sample size for the questions to become relevant.

Grading

Another stat I keep track off is the average Grade for the trades per day and per week.

Again this is created by a pivot table.

I will add slicers to this to see if the grading is effected by time of day, day, type of setup etc. But I have not got around to adding this to the sheet.

I also have a couple of graphs showing the equity curve and the expectancy curve, but I find these are my least most useful tabs.

Summary

My trading journal has taken a couple of years over numerous versions to get to this stage.

To get this sort of information from your trading, you do not need to make your own spreadsheet.

Check out my review of Edgewonk here.

And the new version Edgewonk 2 is coming soon.

I personally think it is a great piece of software. There are a couple of main reasons why I do not use it.

I can enter my trades a lot quicker in my journal as each trade is one line. In Edgewonk each exit has to be a separate entry.

Edgewonk does not cover the MFE/MAE stats in as much depth as I do. Which is crucial in my opinion in optimising targets and stops for each setup.

As far as I know these are being addressed in Edgewonk 2.0

If they are I will probably switch from my own journal to theirs.

Weekly Trading Review – Being honest or what the stats do not always tell us.

Weekly Trading Review – Being honest or what the stats do not always tell us.

Weekly Trading Review – 29th August to 2nd September

A bit of a mixed week, overall ended up as a down week.

First down week since the start of June, I have had a couple of breakeven weeks but this was the first week in a while that was actually down. Not a problem in itself.

I have gone through my stats and journal, I cannot see anything that stands out as a problem in my process and actual trading.

Overall I think that this week was not that easy to read or trade and whilst I averaged Grade A trades, my focus and performance as trader has been very inconsistent.

In summary, difficult week, compounded by trader not performing at his best.

What did I do best this week and how I did I do it?

Preparation, especially for the Month End and NFP.

I had clear and well researched plans, and I traded the plans.

Month end did not work out so well, but it was not for a lack of plan or lack of implementation.

NFP worked well. 1 no fill and 1 winner, which was the 2 trades that I outlined in my plan.

Whilst my daily trade plans have areas of interest, but rarely specific exactly the setup I am looking for and how I am going to manage these trades. My intraday plans do have this information.

I have found that when these plans do contain this information, that when it comes to the end of day review, it makes easier to compare what happened in real life to my plan. Thus giving me data which I can then feed back into decision making loop, and this then improves the plan for next time.

For example, I was running a new trade management scheme for month end. Which was a core position with targets and stops set by the stats research, and then running a position scalping the pullbacks, with its own separate targets and stops.

As my plan had specified the size, stops and targets for both schemes. I learnt valuable feedback about running the 2 trades this way and how I can use these scheme better in the future.

What did I do badly this week and what lead me to do it?

Overall this week, I was trading in the B game. I had a hard time keeping focus when the markets were chopping around and found the market difficult to read at times. Looking at my journal and mini plans, the times I found reading the market hard also lined up with the times I was not feeling focused.

My trading reflected that, with more B grade trades and also missing out on some good trades due to un focused approach. What a surprise!

Other times I was extremely focused and during these times, my profit and loss reflected that.

What is the problem

Weekly Trading Review

Inconsistent application of focus and routines.

Why do I have this problem?

Quiet markets coupled with not been fully back into the swing of things. This has been demonstrated by not following my pre market routine and aftermarket routine to the letter.

And with hindsight, the routines I have followed, I have been going through the motions rather than doing them properly for the benefit that provide my trading.

In summary, starting to drift away from some of the routines and habits which enable me to stay focused during the day.

What I am going to do

I know that my performance, and I do not mean my profit and loss, but how I perform as a trader in following my process and staying focused, during the session is largely determined before I even sit down at the computer.

If I am unfocused about what I am trying to achieve that day, then I tend to be unfocused about being focused and trading in my A game.

First thing, is to knuckle down with the routines, and get back to doing them with feeling.

Secondly, I was doing visualisation exercises just before bed. Focusing on how I was going to approach the next day.

I did not do these exercises during my break and did not restart them when I came back to trading.

So I will restart these exercises and knuckle down.

Being Honest and what the stats do not always tell you.

It took me a while to write / rewrite this weekly trading review.

Why?

On the surface, I did my routines, I followed my processes and kept my average trade grade for the week in the A’s.

So nothing to see here, did nothing wrong, just a down week, move along now.

And my trading review originally reflected that, as that is what my stats reflected. But when I started to look back over my journal, my mini plans and what I was actually doing during this week.

I know that some mornings I was going through the motions when I was doing my routines.

When the markets were quiet, I should have been keeping my mental models up to date so I was ready with a plan when the market decided to move instead I was watching videos on Youtube.

Some of my trade plans where rushed without proper thought going into the context and what might happen.

Also at times, I was also fecking around with custom indicators and charts in RT Investor, which is a massive red flag that I am not focused on trading.

So I have to be honest with myself. This week was let down by me. And if I ignore this, then it could turn into a problem and result in taking steps back in my development.

It is very easy to hide and not acknowledge what is happening but the only person this effects in the long run is me. I am lying to myself if I am not honest about my performance.

I have re written the article to reflect what I feel went wrong and this in turn will me the focus on what I need to do next week.

The hard work I have done to find an edge is not destroyed by one poorly focused week. It is destroyed by not addressing the real problems and then having subsequent poor performing weeks.

How I am improving my Play to Win Mindset

How I am improving my Play to Win Mindset

During my break from trading in August, I have been thinking about the whole play to win mindset verses the playing not to lose, especially when it comes to taking trades and setting correct targets.

PLAY TO WIN

I have two types of trade, scalps which generally have a target of 5-8 ticks, and intraday swings (IDS) which typically have target of 10-16 ticks.

The problem I have, is that it is a lot easier for me to set the targets for a scalp trade and ignore that on certain trades I should be placing IDS targets.

This is due to habit and fear of losing. I am having problems accepting the risk on the IDS trades which tend to take up to an hour to play out compared to my scalp trades which play out in less than 15mins.

I have clean defined rules which decide which trades are designate an IDS, if it does not fit these rules then it is a scalp trade.

For a while now I have implemented a decision making process, to help me approach problems the same way each time.

It is based on a watered down version of John Boyd’s OODA loop called DADA loop, which stands for Data, Analysis, Decision, and then Act. Then gather more data and continue with loop.

I am going to walk through the problem using my DADA process to decide whether I should stick to just scalp targets or on certain trades aim for the larger targets.

The information generated will in turn be placed in my exit rules, so that before entry I re read these and in turn help me focus on playing the trade in my best interests.

Everything is going to be done without taking in account, commissions and costs.

DADA Process

Question

Whether I should set scalp targets or IDS targets.

NB not randomly but when the setup rules specify IDS or scalp targets.

Data

What is the likely outcome?

Scalps Targets

It is a Win. My current win rate on these trades is 68%. With an average win of 6 ticks.

It is a Loss. My current loss rate on these is 24%. With an average loss of 5 ticks.

It is Breakeven trade. My current breakeven rate on these trade is 8%.

My average reward to risk ratio is 1.2 to 1.

Now for some maths.

For me to be profitable taking trades with a 1.2 reward to 1 risk. I need to win 46% of the trades.

This is worked out using the following formula 1/(1+(R multiple)) therefore 1/(1+(1.2)) = 0.4545

Therefore I need to win a minimum 47% of the trades and my current win rate is 68%. So far so good.

My expectancy is typically worked out as follows

(Average win x Average Win rate) – (Average Loss x Average Loss rate)

(6 x 0.68)-(5 x 0.24)=2.88

One of the problems I have found with the expectancy formula, whilst telling whether my edge is profitable or not, it has little bearing to my real life trading decisions.

So I have decide to change this to try and give me a number that I can relate to.

Instead of using ticks, I will use the value of 1 contract and I will multiple the result by 100 trades. This will tell me the value for the next 100 trades for every contract traded.

Therefore

1 contract of the Bund is worth 10 euros per tick.

My expectancy is (((6 x 10) x 0.68)-((5 x 10) x 0.24))x100 = 2,880.0 euro

By scalp setups are worth 2880 euros for every contract traded over the next 100 trades.

IDS Targets

It is a Win. My current win rate on these trades is 57%. With an average win of 12 ticks.

It is a Loss. My current loss rate on these is 33%. With an average loss of 7 ticks.

It is Breakeven trade. My current breakeven rate on these trade is 10%.

My average reward to risk ratio is 1.7 to 1.

Now for some maths.

For me to be profitable taking trades with a 1.7 reward to 1 risk.

Again using the following formula 1/(1+(R multiple)) therefore 1/(1+(1.7)) = 0.3704

Therefore I need to win 38% of the trades and my current win rate is 57%. So far so good.

Therefore my expectancy for the IDS

1 contract of the Bund is worth 10 euros per tick.

(((12 x 10) x 0.657)-((7 x 10) x 0.33))x100 = 5,574.0 euros

Data Analysis

Over 100 trades my scalp expectancy is 2880 and IDS expectancy is 5574.

The difference is 5574-2880 = 2694 euros

Decision

If I do not take a trade when I should, then I am losing a potential minimum of 2880 euros.

If I place scalp targets when I should be placing IDS targets then I am losing 2694 euros.

Act

So I will take every setup that fits my process / rules and I will always place the correct target structure.

I then can collect more data and then repeat the process using my MFE and MAE to see if a change in targets and stops produces better results.

Of course these calculations are not taking in account my cost per contract, so are not a completely true reflection of the profitability. But the purpose of this exercise is to work though the problem in a logical manner using DADA and then turn the result into something that I can relate to.

It is a matter of re framing the risk acceptance.

My journal tells me that my expectancy is 2.87 and my win rate is 68% but during the trading session I cannot relate to that.

I can relate to

That if I take this scalp setup, I have to win 47% of the next 100 trades to be profitable and if I follow my process over these 100 trades then this is worth 2880 euros.

That if I take an IDS setup, I have to win 38% of the next 100 trades to be profitable and if I follow my process over these 100 trades then this is worth 5574 euros.

The next step is to transfer these figures to my exit cheat sheet. The plan is that when I stalking trades using my process, that the reminder of what a missed trade or incorrect targets means will help me accept the risk of losing 5 or 7 ticks on this individual trade when there is a lot more reward for sticking to the plan for the next 100 trades.

26th August 2016 – Bund Daily Trade Plan

26th August 2016 – Bund Daily Trade Plan

News

0700 Ger Cons Clim 1300 US Jackson Hole 1330 US GDP 1415 US Ser PMI
1500 US Yellen

Stats

DATR 0.65-

WATR 1.73-

p.WK.50%

M.50%

Weekly Summary – Inside Week Hi @ 168.02 IW.lo @ 166.38 /.16

Previous Day – bac of id.lo 37 with down day with neutral bear close at id.lo

General Bias – SC -1

Big Picture

60min – Short Bias, for dir hold 50-64 and bac 12

15min – Short bias, for dir hold 44-50 and bac 27

Bear Hypo – if price holds/bof 37 or 44-50 then shorts t 27 bac 27 then shorts t 19-12 bac 12 t00 t2 91-76

Neutral Hypo – if price holds / bof 19-12 then longs t 30-37 t2 50 bac 50 t 64, if price holds /bof 64 then shorts t 41-37

Bull Hypo – if price bac 64 then longs t 74-84

Red flag levels – For short trades bac 67.64 For long trades bac 67.12

Weekly Trading Review – Goals Progress Report and Next Steps

Weekly Trading Review – Goals Progress Report and Next Steps

This weekly trading review will be slightly different to normal.

I am due to take my summer break from trading next week, so for the next few weeks, I will be keeping an eye on the markets but not trading or tweeting.

So this weekly trade review, I am going to focus on the following

Where I am on my goals that I set for this time period.

My plan for when I come back to trading.

Progress Report on Goals

At the end of May, I set myself some personal goals with a timeframe of approximately 2 + months, i.e. before I took my summer break.

1. Increase the number of trades per week, whilst maintaining Grade A trades and my process. This was not just a random number picked from out of the air. This was based on checking the average number of opportunities per day that fitted my process, after back checking my market reviews for about 3 months.

2. Increase average weekly return from the trades. This was decided from looking at my current stats at the time and running a Monte Carlo simulation 25 times to get an idea of the return range, if I increased my number of trades. From this I then picked an average of the simulated returns.

3. Increase my expectancy from my trades. This was decided by looking at the MFE of my trades after I exited, whilst looking at the win rate of the first target and second target. From this I could see that I was miss managing a lot of my trades. Basically some trades, the scalps especially on fades again the bias, I was aiming for too large targets, and my trades with the bias I was aiming for too small targets. I did not give myself a hard target for this. Just aiming to increase this.

It is the end of July and where am I.

Trades increased from average of 8.5 to an average of 13 per week. Goal was 12.

The average return per week for the time period was 115% of the target set. No point going into specifics of what the actual target was, as this is personal and does not matter to this process.

Win rate and expectancy at the end of May was 56% and expectancy was 1 tick. Sample size 100.

Win rate and expectancy at the end of July was 66% and expectancy is 2.8 ticks. Sample size 104.

An important point to note about these goals, none of these where actively monitored during the session, and were not the focus of my trading during this period.

I set these goals, but then looked at what I needed to do performance wise for these goals to be the natural outcome of hitting my performance / skills targets.

Therefore, I focused on the following performance targets

Taking Grade A trades

Ways for me to maximise my focus so that I could entry as many grade A trades as possible

Minimising the number of missed Grade A opportunities due to FOL and other focus issues.

Work on my trade management though analysing past trade data and working on my mental side.

These areas were my primary focus and the results from these meant that I hit the other goals.

If I had just focused on the primary goals (the number of trader, return and exp) rather than the performance targets, I am pretty sure that this would be a different story.

I do not, for one moment, think I have cracked this. No, this is just a single step in my journey to become the best trader I can.

And there is still plenty of work to do on the above performance areas.

Next Steps in My Trading Journey

Goals

Over this break I am going to work on my goals for the next time period. I will follow the same process.

Result – what am I trying to achieve over this time period.

Process – to achieve this result, what processes do I need to do have in place to achieve this

Performance goals and Skill training – what performance areas and what skills do I need to work on to be enable me to successfully hit my process goals

Look at weekly performance in terms of process and skills – what do I do well and what could I do better.

Starting trading again

One of my concerns is that I rush back into trading over confident, and make a completely balls up and set myself back in this process.

So my plan is this

For the first week back I am not going to focus on any new goals.

Before I start trading I will read my trading system plan, from start to finish, from pre session right thought to end session. Even though I know everything my heart, I will re-read it all.

Completing all my routines to the letter.

During the session, a focus on only the Grade A trades with no pressure to take every opportunity. Goal will be to ensure that my read of the market is good and I am back into the flow, before actual trading.

Goal for the week will be to have 90% Grade A trades with a focus on what my read of the market is like.

Really the first week back will be a warm up / acclimatisation week.

Weekly Trading Review – Why I Love Tracking Statistics and Gut Instincts.

Weekly Trading Review 18th to 22nd July

What did I do best this week and how I did I do it?

My goal for increasing trading activity whilst staying with my rules, has been hit for 5 weeks in a row.

But whilst comparing this to my number of missed trades, I am still not making the most of the opportunities. I discussed this in last week’s review and what new processes, I was going to implement this week to improve this element of my trading.

Overall these new processes have helped in the short term especially during the session. One week is not much of a sample to indicate that this has improved on a permanent basis.

So for the next couple of weeks, I am going to continue with my current set of processes, and collect more data. But I am going to make one alteration to the current routine. Which I will explain fully below.

One thing that I love about tracking, is that once the process of collecting data has started, just the fact that I am collecting and monitoring a particular thing, can lead me to start noticing things which would have slipped by me.

One of the reasons, I started collecting data on missed trades, was that I had noticed, that I had a problem with fear of loss after a winning trade, which had then a cumulative effect.

It was not until I had started collecting data, that I realised how many opportunities I was missing. So this is pretty normal in the run of things whilst collect data.

But as the data sample grew, I noticed that Fear of loss had a cumulative effect across the week, and that I took less trades during the latter part of the week, as I started to string more profitable days together. This, I was not aware of, I had thought it was a day session only problem. Once I started to notice that it had a cumulative effect across the week, I start to notice the emotions involved with these days.

During particular bad days of being risk adverse after a string of good days, I had already known that I am going to be a risk adverse before I start trading, and with no correlation to my preparation before the session started.

How do I know this?

Well I have been tracking my gut instinct, as part of my grading of trades, to see what effect it has on the individual trades. With the view of collecting a large sample size, to decide how much importance I should place on gut instinct in my decision making process for trades.

Once I started tracking my gut instinct across individual trades, this has led me to be more in tune with my gut instinct. Therefore, I started to noticed that on the days I was particular risk adverse, I had a gut instinct that I was going to be gun shy before I even got out of bed.

And thinking about the last 2 of these instances, which are the freshest in my mind, I had actually gone to bed with the thoughts of I have had a good week, don’t give it all away tomorrow. Which has translated to risk aversion the next day.

Not wanting to give it away, is a natural and good in some ways, but it should not stop me taking good context, A grade trades.

I need to change that thought process

From

I have had a good week, don’t give it away which translates in to over risk adverse trading (non-trading)

To

I have had a good week, I need to be more focused and ensure that I still take only grade A trades, this way I will give myself the best chance of not giving away my returns but also increasing them

What I am going to do.

Currently I do a 5-minute visualisation before the session starts but I have noticed that on these days when I am risk adverse, that this makes no difference to my day. I am going to move this visualisation session to just before I go to bed. That way I am going to sleep on a positive and growth focused mind-set.

What did I do badly this week and what lead me to do it?

Apart from the cumulative risk adverse problem, I had a good week, all trades apart from 1 where Grade A, all days were Grade A and the week was Grade A.

One thing that started to slip was the end of day market review.

What is the problem

I have found that when I have a run of good weeks / months that some of the processes within the routine start to slip. It is normally only some of the minor ones, but this can start a slippery slope of starting to skip processes, that in turn can lead to poor returns and taking a step back in my performance.

Why do I have this problem?

This can be traced to a build-up of confidence, and the desire to get the same result with less work, but also is tied in with have not had a decent break from trading this year, plus racing twice a week and a tough weekend regatta.

All this has led me to being pretty mentally tired.

What I am going to do

I am going on holiday soon, so that we give me a break to mentally recharge.

But before I go on holiday, I will make a push and start my market reviews again, as if I leave them till after the holiday, it will be a lot harder to start that routine again.

I will do at least one review of either the Bund or the Stoxx, every day up to my break.

I will not post them every day, as this adds 10 minutes to the whole process.

My mild dyslexia mean I have to proof read everything I post at least 3 times.

I want to make it as easy as possible to get back into the routine. Once the routine is established once more than I can think about posting my reviews to the blog.

Winning but still scared – Weekly Trading Review

Winning but still scared – Weekly Trading Review

Weekly Trading Review 11th to 15th July

What did I do best this week and how I did I do it?

My goal for increasing trading activity whilst staying with my rules, has been hit for 4 weeks in a row. But comparing this against the number of missed trades, there still room, for improvement.

I am using the following methods to increase my trading activity without taking lower probability trades.

First, I am working on increasing the amount of time I can stay focused. This has improved though the following

  1. Taking regular small breaks, basically after every 25 mins, I tend to take about 5 mins breaks.
  2. Spending less time discussing the market in the Stage 5 chatroom. Whilst it is an excellent room, where there is good focus on the markets and good discussions. I do find that it detracts from my overall focus.
  3. Having 2 cups of Bulletproof coffee per day. One at the start of the AM session and the second at the start of the PM session.
  4. Not relaxing after having a winning trade, I do this to avoid giving back profits but overall limits the amount I trade. I have improved on this. But I have found it is accumulative emotion the better I do in one day the harder it is to continue.

    With every winning trade, I become more risk adverse and with every winning day the harder it is to continue in the same vein the next day. See below, in what I did badly, for more on this.

  5. Updating my mini plan all thru the day, helps keep me focused, even when price is far from my areas of interest, and even if the plan comes out very similar to the previous plan. It helps me to stay in the game rather than slip into auto pilot and start getting distracted.

Secondly, defining my 2 markets, the Bund and Stoxx, into Primary and Secondary

Primary Market is where I trade all the levels from my context charts down to the execution charts. (Daily,60min,15min,3min) and trade levels that are blind and require triggers.

Secondary market where I trade only the levels that require blind entries from the Daily, 60min and 15min.

Though I do need to check price action and structure before I let these orders be filled, and I sometimes do not notice that price is trading close to the area, as I completely focused on stalking a trade in another market.

Therefore, I need to make more use of the alert system on my platform, so that when price comes near I can do a quick check whether I want to leave the order in or pull it.

What did I do badly this week and what lead me to do it?

My no fill problem is becoming less of a problem in most aspects, more of them are set at the correct buffer but I am still having problems switching to market orders from limit orders on trigger / order flow.

But having collected a sample of 90 trades, the bigger problem is missed trades due to lack of focus or fear of loss. That is the lower hanging fruit at the moment. I will come back to the trigger / order flow problem later. One step at a time.

What is the problem

That after each winning trade and after the each winning day the desire to skip trades becomes more and more pronounced.

Why do I have this problem?

As always it comes back to fear. Fear of Loss. In this case fear of giving money back. This constant theme in my reviews of the 2 fears is starting to get on my tits.

If I could just banish this then it would be great, but it seems not to be the case. So I just have to identify the situations that this rears its head and get on with it with finding solutions.

What I am going to do

I have logical statements that I am meant to read aloud after each winning trade and one that I read aloud after each losing trade. When I do read these aloud, I find that it helps, but I have noticed that I sometimes skip this step, especially after a winning trade.

I think this is my sub conscious sabotaging my methods to improve, so it can stay in the comfort zone. A desire not to do the things that we help me. Well fuck that shit.

So I am adding a tracking column to my trading journal where I will track whether I am reading the correct logical statement after each trade. It will be binary either it is the correct one or it isn’t.

weekly trading review

I know that I respond better to tracking stuff so this should help.

A second prong of attack is that I have re written my setups cheat sheet, so rather than having one for blind entries, one for trigger entries and one for exits. I have just one for entries and one for exits.

This means that I stripped even more of the discretionary side out of the setups.

I have made it even more black and white between what is a blind or trigger entry level and stripped down the trigger to 5 criteria, where 2 have to be present for me to take the trade.

So there should be less discretion between the 2 types of entry and less discretion in what I am looking for when entering on a trigger.

14th July 2016 – Bund Daily Trade Plan

14th July 2016 – Bund Daily Trade Plan

News

1200 BOE IR/QE 1330 US Core PPI

Stats

DATR 0.92

WATR 1.83

WK.50%

M.50%

Weekly Summary – break up of inside week with strong bull close

Previous Day – ID with strong up close id.hi @67.47 id.lo at 66.32

General Bias – SC 1

Big Picture

60min – Neutral Bias, bac 1 x sz, back at prev iw.hi and prev id.lo. For t/c to long bias bac holds 89-74 and bac 37 then 47

15min – Long Bias, for cont, exp hold 16-08 bac 37

Neutral Hypo – if price holds / bof holds 37 or 47 then shorts t 25 t2 16-08, bac 08 t 03-96 t2 89-74l if price holds 89-74 then longs t 03-00 t12

Bull Hypo – if price holds 16-08 then longs t 25 t2 30-37 bac 37 then longs t 47-56 bac 47 then t2 66-76

Bear Hypo – if price bac 74 then shorts t 62 t2 45-32

Red flag levels – For short trades bac 37 then 47 For long trades 66.74

Return of the Stats – Follow up

Last week I posted an article called Playing the Odds – Return of the Stats, which was about the various techniques I was using to improve my use of stats within my trading.

One of the areas, I have worked on, is looking at the various statistics and when they worked / completed and then looking at the how far the maximum adverse exclusion (MAE) was for each instance.  I then compiled these into a sample, where I could then work out the most common (mode) and the Standard Deviation of the MAE. I then used this to help me identify potential areas of entry and defined my risk and reward.

I use RT Investor to calculate these stats and the various MAE results. David asked me to post a one of my charts with the text definition, as he was having struggling to write the code.

I mentioned in the previous article, that I got the idea for this from a webinar that Tom Dante and Hugh did called Playing the Odds.

Whilst I initially said I would post the chart definition, I have realised that each of my charts definitions use the code from one of Hugh’s charts from the webinar. Therefore I do not feel comfortable posting my definitions, as this is a paid webinar and the original code is not mine to give away.

The chart in question is Breakout Failure Part 2

There are a couple of solutions to this

1) Ask Hugh to post the definition for this chart.

2) Buy the Play the Odds webinar. It is 14.99 GBP, for that you will get the webinar and 15 templates that are compatible with MD or RT Investor. Of course if you only want the above chart, then it might sound expensive, but you could look at this way. I had put at least 5 hours in, trying to implement this, before I reverse engineered Hughs code. The question I would ask myself would this amount of money be worth the time saved.

To be totally clear. If you buy this webinar, I receive no monies from Tom or Hugh. If you want to go directly to the site then use Google search and the keywords Tom Dante Playing the odds, it is the 4th entry on the 1st page.

Hugh is much better than me at writing the code, and I would pay 14.99 for a webinar from him, on how to do these sort of charts covering various stats, as I sure that I would learn from that experience, as I have from watching his previous webinars.

But the choice is yours. If anyone has questions on the additions I made to Hugh’s original chart then I will do my best to answer them.

Weekly Trading Review 13 to 17th June

Weekly Trading Review 13 to 17th June

Another interesting problem for me in this weekly trading review. During the week, I had this small conversation with Jared Tendler, the author of The Mental Game of Poker and The Mental Game of Poker 2. Which if you have followed my previous reviews, then I highly recommended these books.

Weekly Trading Review

Using my trader profile, I have a list of traits that I have associated when I am trading at my best and when I trade at the worse. I have been closely watching when I start display traits that are not conducive to my trading, so that I can apply strategies to counter these traits. Which is working okay, but is still a reactive strategy, i.e if I display these traits I then apply a strategy to counter.

But after that conversation, I have started to look at the situations when I slip from my focus zone and A game to B or C game traits.

So that I can then be on the lookout for the situations that generate these traits so that I can start to try these and counter these traits before I starting taken lower grade trades.

What did I do best this week and how I did I do it?

I followed my process and was again more active in the market relatively to the amount of time I traded (more on this in a moment), and my trades this week had a better win rate and exp.

I had a similar day to last week, where my read of the market was wrong and I blinding followed my process, ignoring my gut that something was wrong. I noticed this a lot early than last week and managed to nip it in the bud earlier. This allowed me to recover by following my process, fairly quickly and have a good end to the week.

After the above conversation with Jared, I looked at all the instances where my focus and my traits slipped from A game to B or C game.

The most common link to the majority of these instances seems to come after I take my break and partly into the afternoon, I noticed that in my day journal that my mini plans become less frequent, that I feel distracted, less focused and tired.

I decided as a short term strategy that I would stop trading as soon as I started to get distracted, the warning signals are reading twitter, reading news items on the internet or general internet browsing, etc. When I am focused, I might check twitter once or twice a session, and never browse the internet.

This result of this was that I did not trade in the afternoon of Thursday and Friday. Overall this decreased my trades per day, by an average of 1 per day over the whole week, but my winning percentage and expectancy went up. Obviously with the caveat, that this is a very small sample size.

One thing that was noticeably that this weeks results whilst positive, where statistically at the top end of my average returns, but with less trades and less sessions on average.

Therefore whilst the optimum result is to reduce these non focused sessions to as close to zero as possible (as an average), the second best option for my results, is to continue to trade as normal, but as soon as I start feeling distracted and cannot get back on track, then I will stop trading.

A quick note to this, I absolutely hated not trading the afternoon sessions for 2 days, made me feel like a loser and a slacker, even though statically it is better for my bottom line.  Which again reinforces that what we want and what we feel, does not always correlate to what is best for our trading.

The next step is to work on a strategy to start that reducing these moments.

What did I do badly this week and what lead me to do it?

I am having problems implementing my three things, from last week’s trade review, consistency. I made a start and I struggled during the week, obviously this has not been helped with my focus problems. It is hard enough implementing my known processes when I am distracted and non-focused, let alone add new solutions.

I am going to concentration on the non-focus problem, I am going to still keep implementing these new process, but the first step is to get the focus under control and then see what the consistency of the new process implementation is. And only judge the quality of my implementation of these new processes when I am focused and in the zone.

What is the problem

Early into the PM session, I am starting to lose focus and get distracted which leads to poor chart reading, lack of mini plans and then even poorer execution.

Why do I have this problem?

I have always suffered with this problem to some extent, but have managed to keep it under control by going to bed early and taking regular breaks, so what has changed over the past three weeks that could have a knock on effect to make this a issue.

1) I restarted my fitness programme back in April and have slowly been building intensity and volume over this time as I have gotten fitter. This could be having a knock on effect. As I am knackered after a HIIT session, and that normally effects by ability to concentrate or even hold a pen properly for a good 20-30 minutes afterwards.

2) I used to have a cup of Bulletproof coffee for breakfast a long time ago and I found that it was an excellent way of keeping me focused during the day. But this all had to stop since when I found that milk was adversely affect my stomach and giving my other problems, so have since last year gone dairy free.

After reading this article from a trader at Stage 5 about the benefits he found using Bulletproof coffee. I decided three weeks ago, to start it this routine again but without using diary and only using cold pressed coconut oil.

Again I am having excellent results in the AM session, but could this exaggerated lack of focus, be because I am hitting an energy wall in the afternoon session.

What I am going to do

As I am not sure what the cause of this problem is, I am going to only change one of the 2 things that I have been doing differently over the past 3 weeks.

I am not that keen on reducing the exercise, because this had little adverse effect on my trading in the past, and I was training with a lot more intensity and volume I am now.

The Bulletproof coffee has a positive effect on my AM session, so I am to have a second cup of bulletproof coffee at around 1230 after exercising to see what effect this has on my focus during the afternoon session.

I am not too bothered about the calories, as I never eaten breakfast, rarely eat lunch and have a big fuck off meal in the evening. This has been my modus operandi for the past 30 plus years. So with the introduction of these added calories, I will reduce the portion size of my evening meal to just a fuck off size.

I have also done a cheat sheet of when I should be using my logical statements during the session, along with a reminder of my three new execution processes.