A problem that might haunt you at some stage of your trading

[immy]

There is a certain human mental pattern of behaviour that might occur to you when you start live trading or in some stage of your trading. It may even happen to some people while demo trading.

When you are having a losing day you will be more prone to take more trades and suddenly you will find that taking a trade would become so easy. This is because you want to either recover your losses by trading more or you are engaging in "Revenge trading".

But on the day you have your first few trades as winners you will, all of a sudden find it hard to take more trades. This is because you are protecting your profits for the day

The former case would usually be a choppy day and the later usually a moving trending day.

When you find yourself doing this your losing days will often be double or even more of your usual winning days. In some peoples case that losing day often wipes the profit of the entire week if not month.

This is a trait/habit that is not found in consistently successful traders', its not one of their habits or they have learnt to overcome it.

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So keep an eye on this. keep a max loss for the day limit and don't keep a max win limit. but if you want to keep a limit on the winning day then keep a max loss lets say 50 pips or 3% then put a max win limit of 5 or 6%. something along these lines. Moreover work on integrating the 5 fundamental beliefs about trading found in the first post of my journal.

[immy]

Today in the chatroom I found a good friend comment on something, this afternoon

Our friend said, "I found a new confirmation to get in Fruit, I trade for a few weeks and let you know the out come"

My response what? What "new confirmation"?
He replied, "additional confirmation" and he said "it seem to be 70% right direction"

This is what a typical trader is after. "double confirmation" what is a double confirmation? How can you confirm something that is just there in front you. A Fruit with good angle. That is the confirmation. What else can you add to it so that you can improve the rate of success? The more important question is do we really need to be right more time than we are wrong?

So I said, " Additional Confirmation" Again this suggests the mind set of novice traders who wants to "make sure that the next trade is a sure shot winner".
A beginner is always trying to hit that next winning trade. And this "need to know the future" is the biggest problem.

I'd like to tell you one thing though no matter what anyone says, with whatever they can throw at me, I will NOT Add anything to my chart or change my technique. do you know why? Because it works. I don't need to change it, IT WORKS

What is additional "confirmation"? I don't like the concept behind confirmation because Nothing can confirm "the future" for a fruit signal. or any other signal. Is there a way to know the future?
I said, "You know that I don't give a shit about how perfect the entry is? you know I place only 5% importance on entries?

Because Trading is 80% is in the mind. 10% is MM and 5% exit that leaves 5% for entries. So its 20% science. (the strategy) and 80% Art. AIMS is The Art of Trading Chaos!

A trader with correct mindset will make a mediocre trading strategy look awesome a trader with wrong mind set, will destroy a strategy with a very powerful edge.
However sadly, 95% of traders put 80% of their efforts towards the 5% of the equation in trading and that is The Entries.

They want to make perfect entries. They want to nail those entries that bring winners 100% of the time, double confirmation, quadruple confirmation. Something to put their mind at ease before entering the trade that "this trade is going to be a winner".

However I have bad news for those traders. Sadly that is not gonna happen. Because trading is not a game of perfection. You cannot manipulate things into your liking . Trading is a game of probability. You win 50% of the time or less using the same pattern, the very same pattern that looked beautiful and produced 100 pips this time, that exact same pattern might appear again the next time still it may bring 15 pips loser. A new trader is baffled, surprised an shocked. How come this pattern did not work this time? The pattern might look exactly identical. but its unique its never happened before.

What you see is an an identical patterns yet unique at the same time. Its not the same patterns they are are similar but at the same time unique.

Its very important to understand that Every Moment in the Universe, and so in the market as well, is UNIQUE. every moment in the market is unique

As a result of Understanding this information you will know that as long as you continue trading the same pattern using correct money management and following your exit plan accordingly every time, your account would have grown more than its drawn down at the end of 20 trades . That my friend is Trading.

The ultimate goal of a trade is not to hit a winning trade, or avoid the losing ones, but its is a psychologically challenging thing to achieve called Consistency. And consistency is not show in one day or two weeks. Consistency is shown for longer periods such as 3 to 6 months to start with. And consistency is an equation.
Consistency = Patience + Discipline.

When you see a pattern you might think ok here we go again, the pattern is there the next trade is going to be a winner. But what follows the pattern, the entry pattern lets say, is a unique outcome. everytime.

The probability of success is very high if you follow the system, but the probability of success per trade is only 40-50% . You gotta understand it as good as you understand that if you jump off Eiffel tower or Empire state building without a parachute two things will happen to you 100% guaranteed.
1. you know you will hit the ground.
2. when you hit the ground there are 100% chances that you will die.

Without understanding this concept trading can be very stressful and a hard work because you will be "trying hard" to make money on each trade. You will be pushing "yourself" and trying very hard to make this next trade profitable. However the fact remains, no matter how strong you crunch your tummy muscles, no matter how hard you bang your desk, no matter how closely you watch the chart, you cannot make your next trade a winner with 100% surety. Be a Casino and let the players play their game.

Enjoy your trading by "Believing in the system and that successful trading is a game of probabilities".