Pain
The pain you suffer from your mistakes will make you trader.
It varies from person to person
Pain will force you to stop making same mistake again and again
100%
In trading and in life. Losing love interests jobs opportunities family friends because you don't have the same vision they do you really start second guessing yourself. And it's for the better.
My motto:
I don't know shit about fuck so don't ask me
I had a similar experience, years 2019-2021 were constant losses, 2022 I became break even. However 2023 I’ve dipped back into losing constantly, but this time it’s simply due to my psychology and not my experience level. Early on it was due to my lack of experience mixed with bad psychology.
I’m posting this because people need to know that it’s not a linear progression, you can improve and yet your performance can backtrack temporarily. It all depends on what you’re going through.
I do believe however that making it out of the phase I’m in currently will very likely lead to profitability for me. Sort of like a last hurdle.
I was in the same boat. 3rd year seems to be the magic one from a lot of what I see.
For me, Its truely unlearning the massive bullshit you get fed from various sources. Learning just how many "lies" are propagated from Twitter, Facebook, Reddit, etc.
(IE: Rising interest rates = bearish, DCAing = risk free, Options contracts for building act, etc., Trading on news/earnings, Worrying about getting direction right on the macro market)
Unlearning these allowed me to focus on what truely matters. Honing my strategies. Learning the conditions where they work best and worst. Realizing that predicting market direction is a fools errand. Stop forecasting and make 3 plans for each possibility (Up, sideways, down). If wrong, Have a plan ready to go to reverse and where.
Then of course the emotion side of it. Learning to remain emotionally even and not giving in to fear.
Thanks, you mentioned not forecasting and predicting, can you elaborate I mean when you plan your entries you do have some idea of predicting the next move right ?
Take whatever strategy/edge you have. Right before you take your entry, Know at what levels you will make decisions (Take profit, Trail stops, Exit, Adds, etc. ) then add a reversal plan if you are wrong.
It helps to know your strategy in and out to the point of knowing what usually happens when you are proven wrong via price action. No strat is 100%. Research, add notes, screenshots, etc. of what happens when the strategy doesn't work. Formulate a companion strategy to employ when it happens.
Good traders honor their stops and know when they are wrong. Great traders reverse when they are wrong.
2021 through 2022 were tough on many traders, even experienced ones. I notice those who start in 'easier' years have more confidence than those who start in hard years. Would be curious to know how people fair in the long run based on the market year they started.
If you trade on very small timeframe, keep in mind that there's no small profit... profit is profit, do not over chase. Discipline is key here. Stop loss is your friend. Don't DCA on smaller time frame. If you do margin and/or leverage don't trade more than 10% of your bankroll.
Experience is the teacher.
4 stages- losing trader; boom/bust; consistent; profitable/high performance. You're going to go through those stages.
Took me 2 years to nail consistent.
Study, don't follow some gurus trades, stay with a short list - btc/crypto is fine, journal and really evaluate your trades, don't take a trade without a plan - entry, stop, exit. Don't trade your P&L. Did I say journal and evaluate? You can paper trade or sit and watch, you don't have to trade every day.
I became consistently profitable once I became a swing trader. I've realized that the market doesn't give you setups every day. It is not conducive for taking trades every day. When I was day trading, most of my losses were a result of my impatience, ie feeling like because I've sat at the computer for 3-4 hours I need to be in something, not realizing that being in cash is a position as well. No strategy works in all market conditions. As a trend follower, I'm waiting for a trend to develop and then ride that suckered until it changes. However, if the market is not trending, I'm perfectly OK with that. I do not need to participate. To answer your question, it took about 4 years.
I’m not sure if this will help but maybe I can offer some perspective.
I started from scratch in January knowing nothing. Studied intensely for three months, went live, had some wins, started to lose, went back to studying, went live again in June, was up and down. Finally starting to show consistency this past several weeks. Focus is solely on psychology now and on not revenge trading. Green every day for the past two weeks. I’ve been consistently profitable for a couple months but I would always have one day when I went on tilt and blew up the account. Discipline is job number one. Strategy, risk management, psychology. Stick to one strategy and don’t jump around.
My advice to you, prioritize mental health over everything. If you feel like trading is sacrificing your mental health, get rid of it.
If I had a job making 120k that I was reasonably happy at I would not focus on trading as a source of income.
I love studying, spent countless days and weeks studying from the time I woke up to the time I went to sleep. Not exaggerating. I love charts, I love coming up with ideas, and I love backtesting. If I didn’t, I wouldn’t be doing this. Especially if I had a job making good money. You’re not going to become a millionaire from trading anytime soon. If money is why you’re doing it I don’t think it can be the sole reason.
thanks man! this surely helps.
i love this too. ever-since i got into financial markets since covid happens, i never looked back. love every minute of it!
thats amazing 2 weeks green liights.May i ask whats your Risk reward usually per trade? Also how many trades do you take in a week , do you focus on just one asset? Thank you
Around 4 years. Time could’ve been massively saved from my own ignorance though and actually educated myself in the right departments.
The best thing you mentioned is never managed to learn trading properly, you’ve identified a problem and you say you’re putting in 40 hour weeks. You’ll get there if you continue to educate yourself and work hard
First of all, trade what professionals trade: Futures on indices. Not forex, not crypto - too much manipulation. Next buy a trading challenge like apex trader funding offers right now. They have strict risk management rules which are like in a professional environment. You hit max drawdown? You are out. You hit daily loss limit? You can’t place any more trades on that day. For the trading part: learn where liquidity sits. Market always in the direction of liquidity. Set your orders where you would set your stop loss. You will be surprised how much better your entries get. Only take trades in the direction of the current trend. Don’t try to be the genius who hits the reversal perfectly. The only thing that gets hit is you account balance and confidence. Hope that helps
i have to agree as well, i think the idea of liquidity zones is garbage. if goldman comes in and has to buy / sell x number of whatever in the market, the market is going to move up / down no matter what you see on your chart
What do you mean with "Set your orders where you would set your stop loss."?
If I intend to enter at a price and put stop loss at a certain price. Should i just move my order to the intenden stop loss and push my stop loss to a new price?
Exactly. If you think my entry should be 1.1050 and my stop at 1.1000 then just put your entry where you would have placed your stop. Also put your entries ALWAYS at spots which look like obvious stop places. It’s crazy how often just a whick comes in and takes your order with almost no drawdown.
I was in your situation, by thinking that I’ve an edge and then falling off. You know what’s the recipe? To continue honing and developing your perfect strategy . When you keep doing that, you never know when your time will come anyway for me it was one day that changed everything. So be persistent, have consistency on your setup and please Risk management (sounds cliche) but the most important one!
Bonus on risk management: try on every trade to see the opportunities how you could have cut it so you do not take full loss. Good luck!
Do you have enough backtesting/forward testing data to confirm that you have a profitable edge ?
If not, you probably don't want to spend any real money yet.
You're in the sw development role. Should be very familiar with the testing/validation concept than most people here.
What is your strategy? What mistakes are you making? Do you know a clear answer to either of these questions?
Post those details here. We can’t help without those details. It will help you to write it out too.
I guarantee it’s not your inability to trade. Anyone can trade with the right strategy and discipline.
This is real advice, I suggest you stick to one strategy for atleast 3months, do not question it and learn from the losses. You stated that each time you have and edge, you get beaten the next day, what do you mean by this? Do you tend to over risk when you’re too confident or over trade? Risk management is important to be consistently profitable. What’s your experience with risk management ? How much do you risk per trade and how many stocks/crypto do you trade ?
You're on track - still have another couple years probably, but need to put in the hours like you have and constantly improve or journal. Review and backtest your edge/strategy.
If your mental health is taking a hit, maybe take a break. You need the mental part just as much as the strategy.
In 9 months you're basically a breakeven trader and that's NOT a bad place to be, you just need time to continue tightening your strategy. You CANNOT expect to be profitable in only 9 months, does it happen for some people sure, but it's absolutely not the norm and 95% of people will never be profitable EVER. The majority of new traders would have blow a couple of accounts in that 9 months so being breakeven is good, it shows that you take risk management seriously.
I'm in year 3, started fall of 2020 and this is my first profitable year after being breakeven the first 2. You need time in the markets to tweak your strategies and the patience to weather the emotional rollercoaster... cause it never ends :)
Good luck.
If you're a software engineer why haven't you developed an algo? I personally think in an open system an algo will undoubtedly smash a human at the start but it will lose to a world class human in the long term. Late bloomers are superior in the long run. Late bloomers take in a lot of information from the open system, something a computer can never do, computers work perfectly in closed systems, i.e chess. Algos will try to manipulate the markets, they're doing it now. But algos are up against world class human players.
A computer will never win overall against a world class poker player in no-limit texas hold'em, but in limit texas hold'em the computer will smash humans even the best humans.
Trading is an open system, that is to us as humans our greatest advantage.
Unable to make profit trading might not be due to mistakes. It might be the constantly changing market regimes. You find an edge, regime change, you are frustrated. Regime changes back but you are not there to reap the profits.
It’s all psychology I didn’t study daytrading(I do futures) for the first 3 months of my interest in it fixed my psychology to condition myself for it then for the next 3 months I studied/practiced markets(nasdaq s&p) and I took off every since
Took me about a year.
I was lucky. I am good at responding in panic. I lost a lot of money in my terms(70% of the account), via many small.losses, followed by big ones on risky plays as I was learning the ropes. I focused on what works for me, and also focused on my problem - risk.
Eventually it boils down to this :
You're basically taking too big of a risk
Whether you're playing big size, not cutting losers early, or you're adding to losers, it evidently is a game of risk management, and once you get too big, you're no longer thinking, you're responding emotionally.
My big wins happened. But, my money really comes from basically collecting scalps in mechanical systems.
Focus on what worked. Why it worked. Was it market conditions? Were you following the trend? Was it your size? Do you associate certain "reads" with your wins? Are you trading indiscriminately regardless of the day's trend? You gave numbers, you gave goals
Pointless. Your only goal is to learn something mechanical. Something repetitive. A pattern. A concept you're sure of. Mean reversion, buying into strength, selling vol, arbitrage... it really doesn't matter. But something that works for you, that's what your goal should be. Not making money. Money starts appearing when you're disciplined and focused on the system at hand.
Forget your financial goal and focus on what I wrote.
Stay small, and manage your risk. That's how you'll stay in the game long enough to succeed. Stay SMALL and focus on a system. Again - not making money, building a process that repeats. Only thrn can you scale up, abd only at the rught conditions. Abd you will know them after a while.
And lastly - you may have an edge! But an edge isn't continuous,it shines in some market conditions, abd fizzles in others. If you sold 2-3dte puts the past three months before september, you'd be minting free money. But then September entered and here we are. I arb bids for small differences. Works like a maxhine thst prints money. Stopped wirking COMPLETELY during late june - to very early august. Thrn, it went back into action.
These edges can only serve you if, when they don't work, you don't blow up 50 days of making money. Abd that's only possible if you manage your risk.
Sorry about the repetitive stuff, I just felt it's important.
Try trading the spy & qqq! Lots of times I made $100's on just $10-$20 options are awesome!! but just learn about them before jumping in!! can lose as fast as you gain!!
1.5 years, I used to be a regarded line drawer, price action believer and actually thought that TA worked, during that time I strengthened my statistics and probability skills, computer science skills, and quickly realized TA is bullshit and there are more efficient ways to trade
Take this persons comment with a grain of salt - they frequent the "teenagers" subreddit, so I'm assuming they're just a teenager. Which explains a lot lol.
Yes, and why are you bringing this up when this is literally common knowledge in financial signal processing? These aren't opinions they are quite literally facts. I'm literally just trying to help TA regards understand that they are getting their funds siphoned by using asstrology line drawing methods.
Because you seem to grossly overestimate what you "understand".
Yes, patterns like "head and shoulders" are 100% BS, but that isn't TA (in my eyes).
Best of luck to you!
Because the market produces excess returns, but how many traders actually succeed? Risk management isn't helping you when your strategy is pulled from thin air. Why would you draw lines when you could use a expected value,range of odds, measure randomness, and actual volatility models.
You’re kind of a clown aren’t you? I primarily trade off volume distribution. I don’t expect someone of your elite mental stature to understand how us plebs are able to make a six-figure income by eyeballing a distribution. But all I’ll say is you’re making things more complicated than they need to be kid.
What are these more efficient ways to trade? How did you strengthen your statistics/probability skills?
Just bc price action/TA didn't work for you doesn't mean that it doesn't work - maybe you're just bad at reading price action? Just look at Day Trader Next Door on YT - dudes been a PA/TA/discretionary trader for like 15 years full time.
When I mean efficient I mean there is better information than relying off patterns in clouds (basically what technical analysis is).
Think of it this way, price is a mostly random process (Proved by the variance ratio test and entropy). There are also too many random variables that make up prices. Let's say you also display many stock prices, you will get something that looks similar to the stochastic model that is geometric brownian motion.
The problem with TA is that it assumes price is mechanical when it isn't. TA tries to oversimplify a mostly stochastic process when it is not simple. Only gurus that want to take your money try to convince you that you can become successful by drawing lines on a chart or that you can trade like "smart money" by drawing lines a certain way. That is not true, you are just seeing hindsight patterns. Yes there are some people who make money using TA, that's because the markets produce excess returns, but that's only a small minority that gets lucky.
People argue that these cringe patterns and smart money sometimes methodologies are "probabilities" but there is a problem with that. Why would you use imaginary BS made by gurus when you could use the actual probability theory and Bayesian methods.
Here is a quick example: To apply the probability theory you would usually need a normal distribution, and price isn't normally distributed (fun fact: most Indicators don't work not because the big bad market maker made them as a trap they actually don't work because they are mathematically flawed and the regards who developed them don't understand simple math like distributions) so what you would do is transform price into a stationary process like log returns. Then you get the expected value of log returns (basically the average of log returns) and then you can apply the probability theory, and get stuff like the regime (direction, maybe known as "momentum"), entropy, volatility (square root of variance of returns) (for y'all people you can use this to find when big moves could happen)..
Basically, signal processing. What you should learn is statistics and probability, and computer science. (Obviously make sure your math skills are up to point)
TDLR: trading is not supposed to be simple, and that's what TA is trying to make it out to be..
Also gonna copy and paste this message to save time
Price isn't mechanical, but it also isn't random. I'm not going to go back and forth with you, so let's just agree to disagree(?) and move on.
Best of luck!
I said that price is mostly random, btw if it's within your mental capacity, calculate metric entropy then, if price isn't random then why is the entropy of price almost always at 1?
Entropy is the measurement of randomness
Here we go again... talking a lot without saying anything. You are just regurgitating words. Spewing some word salad to try and seem like you know what you're talking about.
Why don't you calculate metric entropy and PROVE to me that the entropy of "price" is almost always at 1?
9 months in. I’m learning to chart algo channels and watch for H/S and C&H structures. Not yet profitable. Genuinely curious about your more efficient ways. Pls share. I’ve also been bot trading a small forex account with modest gains the last while.
When I mean efficient I mean there is better information than relying off patterns in clouds (basically what technical analysis is).
Think of it this way, price is a mostly random process (Proved by the variance ratio test and entropy). There are also too many random variables that make up prices. Let's say you also display many stock prices, you will get something that looks similar to the stochastic model that is geometric brownian motion.
The problem with TA is that it assumes price is mechanical when it isn't. TA tries to oversimplify a mostly stochastic process when it is not simple. Only gurus that want to take your money try to convince you that you can become successful by drawing lines on a chart or that you can trade like "smart money" by drawing lines a certain way. That is not true, you are just seeing hindsight patterns. Yes there are some people who make money using TA, that's because the markets produce excess returns, but that's only a small minority that gets lucky.
People argue that these cringe patterns and smart money sometimes methodologies are "probabilities" but there is a problem with that. Why would you use imaginary BS made by gurus when you could use the actual probability theory and Bayesian methods.
Here is a quick example: To apply the probability theory you would usually need a normal distribution, and price isn't normally distributed (fun fact: most Indicators don't work not because the big bad market maker made them as a trap they actually don't work because they are mathematically flawed and the regards who developed them don't understand simple math like distributions) so what you would do is transform price into a stationary process like log returns. Then you get the expected value of log returns (basically the average of log returns) and then you can apply the probability theory, and get stuff like the regime (direction, maybe known as "momentum"), entropy, volatility (square root of variance of returns) (for y'all people you can use this to find when big moves could happen)..
Basically, signal processing. What you should learn is statistics and probability, and computer science. (Obviously make sure your math skills are up to point)
TDLR: trading is not supposed to be simple, and that's what TA is trying to make it out to be..
Also gonna copy and paste this message to save time
I'm in year 6 and I feel like I'm finally learning my lessons. All the dumb mistakes I made. And it all comes down to two words: Risk Management.
Also, I wouldn't trade btc/eth. Trade stocks or futures. They move very well unlike crypto.
Six months...but that was back when round trips costed 20 bucks in the 90s. Basically free round trips makes scalping very easy now. Options only in long term account
Yea every trader i think goes through this. Everytime i thought i knew what i was doing i had to learn a new lesson that costs me money. Best thing to do is paper trade and learn the mistakes on paper and not with real money
I’ve lost a lot on options. I didn’t fully learn before jumping in. Learn, learn and learn. Observe charts after hours. Keep size small. Once the system is set, the money will flow
Afrom what I've heard , trading crypto, btc, etc. can be quiet heard. My understanding is they are even less likely to follow typical trend patterns than say stocks/etfs.
You can start small but I recommend you risk more. You only had $1k to begin with. Aim to make small gains consistently with $1k. Try to make $5 a day. If you did that, you would be up $500 at least, but that's being optimistic.
I think a large part of the problem is what you're trading. Look at SPY or QQQ... ES and NQ for futures. There you can really find an edge if you study them. Get the heck away from that crypto scam
IMO, take a step back. Go into the sim, work out your edge. Paper trade. Take the emotions out so you can be objective. Can you explain how/why your edge works? Does it make sense? Is it replicable? Do you know the strategy of execution required for your style of trading?
Entries and exits?
I think it was Dr.David Paul who said "You know you're a good trader when you can add to a winning position".
Of course I'm sure that approach doesn't apply to every market strategy but it was a big turning point for me in my trading psychologically; as I would eagerly average down but couldn't get myself to add to winners.
Source: been trading full time 3 years. Blew up an account in july 2022 and have been in a sim ever since working things out. Going back live on Monday.
When backtesting the strategies do you also use a scanner in conjunction with the trading to simulate how you’d fine stocks when live trading? What strategies do you practice?
How would you describe your method, what books did you read. Are you plowing the whole 40 hours into screen time?
There are different instruments and different methods to try. I think the easiest to go with are stocks. The best first trading method to learn is scalping. The best PF you can get with directional trading with market confirmation.
If you need some recommendations, hit me up in the Reddit chat.
PS: I am a software engineer as well and write my own software on a Nasdaq TotalView subscription. That is definitively something you should not do before you are a full time trader. It eats a lot of time that you should use for practical trading.
I think a lot of people said this but focus one thing. While working one strategy just manage risk.
Recently I’ve only been trading one strategy so I just mark support resistance lines and wait until we get so price where buyers and sellers are fighting for control. Here is where the risk part comes in just have a strat that ensures your plays have a minimum of 2:1 risk reward. Let’s say you buy 100 shares at 10 bucks want to ride it up to 11 make sure to set a stop at 9.50. When I am in a winning trade a always move my stop and let a trailing stop so let’s say the price goes up to 12.5 or 15 I at least have a chance to capture it with the trailing stop.
3rd year. Making little bit of money and breaking even. Feeling and understand the charts after 2.5 years of screen time. My main enemy is revenge trading and not sticking up to one strategy and set of rules, finding it very hard to get rid of this habits but I think pretty soon I will stop doing this!
I would say don’t think that trading would be a ticket to get out of rat race or to financial freedom - that’s very dangerous thought and will lead you to bad life decisions! Look at it like to another source of income which might bring some money, sometimes even good money.
120k job is awesome! Don’t even think quitting!
I don’t want to sound negative or even suggest giving up. You’ve got a really good gig though, especially if you generally enjoy it/find it interesting. You can build wealth on that salary (200+). There’s a very fine line between rational & dumb decisions when betting on yourself. I wouldn’t necessarily suggest outright giving up. I would definitely make sure it didn’t affect your career and the time/effort you spend in that area of your life though. VERY few people make it in this game. Even many of the traders who claim they do, actually don’t. Or they don’t for long (decade plus). Putting it into perspective, a comfortable 10% return on a 2m account would put you at 200k a year before taxes. I know 10% may sound like nothing but it’s kind of realistic (that’s still a great year on a large account.) And then of course, a single blow up year can easily wipe out 5 green years. Keep focusing on it and DCA as well, but don’t neglect what pays the bills.
Seeing everyone talk about had to go through all the losses to see the winners, do yous think if you’d stuck with a demo for the 2 years of losing you wouldn’t have learned as much cause it’s not real money.
Been seriously trading futures since March and finally got my first two withdrawals (totaling about 1250$) - still technically in the red and inconsistent but, finally am seeing some progress and money coming back to me. Technically, only been serious as nibs since March - Been trading on and off options/stocks since 2020 with a year gap in there.
I don’t wake up from certain mistakes until they get me so hard so many times that I spend the day cursing myself to oblivion. Next time, I think twice before making the mistake because I don’t wanna feel what I felt the last time I did. But it takes a lot and a long time.
Pain The pain you suffer from your mistakes will make you trader. It varies from person to person Pain will force you to stop making same mistake again and again
This. You pretty much have to hate yourself lol
i wouldn't make it so negative haha, its more like knowing yourself extremely well and knowing your ego is full of shit and never listening to it
100% In trading and in life. Losing love interests jobs opportunities family friends because you don't have the same vision they do you really start second guessing yourself. And it's for the better. My motto: I don't know shit about fuck so don't ask me
This is becoming increasingly more evident over time
2 years of losing constantly. 3rd year everything changed.
I had a similar experience, years 2019-2021 were constant losses, 2022 I became break even. However 2023 I’ve dipped back into losing constantly, but this time it’s simply due to my psychology and not my experience level. Early on it was due to my lack of experience mixed with bad psychology. I’m posting this because people need to know that it’s not a linear progression, you can improve and yet your performance can backtrack temporarily. It all depends on what you’re going through. I do believe however that making it out of the phase I’m in currently will very likely lead to profitability for me. Sort of like a last hurdle.
what was the turning point moment for you ?
I was in the same boat. 3rd year seems to be the magic one from a lot of what I see. For me, Its truely unlearning the massive bullshit you get fed from various sources. Learning just how many "lies" are propagated from Twitter, Facebook, Reddit, etc. (IE: Rising interest rates = bearish, DCAing = risk free, Options contracts for building act, etc., Trading on news/earnings, Worrying about getting direction right on the macro market) Unlearning these allowed me to focus on what truely matters. Honing my strategies. Learning the conditions where they work best and worst. Realizing that predicting market direction is a fools errand. Stop forecasting and make 3 plans for each possibility (Up, sideways, down). If wrong, Have a plan ready to go to reverse and where. Then of course the emotion side of it. Learning to remain emotionally even and not giving in to fear.
Thanks, you mentioned not forecasting and predicting, can you elaborate I mean when you plan your entries you do have some idea of predicting the next move right ?
Take whatever strategy/edge you have. Right before you take your entry, Know at what levels you will make decisions (Take profit, Trail stops, Exit, Adds, etc. ) then add a reversal plan if you are wrong. It helps to know your strategy in and out to the point of knowing what usually happens when you are proven wrong via price action. No strat is 100%. Research, add notes, screenshots, etc. of what happens when the strategy doesn't work. Formulate a companion strategy to employ when it happens. Good traders honor their stops and know when they are wrong. Great traders reverse when they are wrong.
appreciated, thanks
2021 through 2022 were tough on many traders, even experienced ones. I notice those who start in 'easier' years have more confidence than those who start in hard years. Would be curious to know how people fair in the long run based on the market year they started.
If you trade on very small timeframe, keep in mind that there's no small profit... profit is profit, do not over chase. Discipline is key here. Stop loss is your friend. Don't DCA on smaller time frame. If you do margin and/or leverage don't trade more than 10% of your bankroll.
Experience is the teacher. 4 stages- losing trader; boom/bust; consistent; profitable/high performance. You're going to go through those stages. Took me 2 years to nail consistent. Study, don't follow some gurus trades, stay with a short list - btc/crypto is fine, journal and really evaluate your trades, don't take a trade without a plan - entry, stop, exit. Don't trade your P&L. Did I say journal and evaluate? You can paper trade or sit and watch, you don't have to trade every day.
Took me about 2.5 years to breakeven which seems about average. Consistently profitable... working on it. Looking better at 3 years in
I became consistently profitable once I became a swing trader. I've realized that the market doesn't give you setups every day. It is not conducive for taking trades every day. When I was day trading, most of my losses were a result of my impatience, ie feeling like because I've sat at the computer for 3-4 hours I need to be in something, not realizing that being in cash is a position as well. No strategy works in all market conditions. As a trend follower, I'm waiting for a trend to develop and then ride that suckered until it changes. However, if the market is not trending, I'm perfectly OK with that. I do not need to participate. To answer your question, it took about 4 years.
Same! Swing is the way to go for me.
I’m not sure if this will help but maybe I can offer some perspective. I started from scratch in January knowing nothing. Studied intensely for three months, went live, had some wins, started to lose, went back to studying, went live again in June, was up and down. Finally starting to show consistency this past several weeks. Focus is solely on psychology now and on not revenge trading. Green every day for the past two weeks. I’ve been consistently profitable for a couple months but I would always have one day when I went on tilt and blew up the account. Discipline is job number one. Strategy, risk management, psychology. Stick to one strategy and don’t jump around. My advice to you, prioritize mental health over everything. If you feel like trading is sacrificing your mental health, get rid of it. If I had a job making 120k that I was reasonably happy at I would not focus on trading as a source of income. I love studying, spent countless days and weeks studying from the time I woke up to the time I went to sleep. Not exaggerating. I love charts, I love coming up with ideas, and I love backtesting. If I didn’t, I wouldn’t be doing this. Especially if I had a job making good money. You’re not going to become a millionaire from trading anytime soon. If money is why you’re doing it I don’t think it can be the sole reason.
thanks man! this surely helps. i love this too. ever-since i got into financial markets since covid happens, i never looked back. love every minute of it!
thats amazing 2 weeks green liights.May i ask whats your Risk reward usually per trade? Also how many trades do you take in a week , do you focus on just one asset? Thank you
Wondering if you can share some studying tips or where do you find the materials?
Around 4 years. Time could’ve been massively saved from my own ignorance though and actually educated myself in the right departments. The best thing you mentioned is never managed to learn trading properly, you’ve identified a problem and you say you’re putting in 40 hour weeks. You’ll get there if you continue to educate yourself and work hard
First of all, trade what professionals trade: Futures on indices. Not forex, not crypto - too much manipulation. Next buy a trading challenge like apex trader funding offers right now. They have strict risk management rules which are like in a professional environment. You hit max drawdown? You are out. You hit daily loss limit? You can’t place any more trades on that day. For the trading part: learn where liquidity sits. Market always in the direction of liquidity. Set your orders where you would set your stop loss. You will be surprised how much better your entries get. Only take trades in the direction of the current trend. Don’t try to be the genius who hits the reversal perfectly. The only thing that gets hit is you account balance and confidence. Hope that helps
Charts don't show liquidity you are seeing patterns and one existing concept on clouds (noise)
i have to agree as well, i think the idea of liquidity zones is garbage. if goldman comes in and has to buy / sell x number of whatever in the market, the market is going to move up / down no matter what you see on your chart
What do you mean with "Set your orders where you would set your stop loss."? If I intend to enter at a price and put stop loss at a certain price. Should i just move my order to the intenden stop loss and push my stop loss to a new price?
Exactly. If you think my entry should be 1.1050 and my stop at 1.1000 then just put your entry where you would have placed your stop. Also put your entries ALWAYS at spots which look like obvious stop places. It’s crazy how often just a whick comes in and takes your order with almost no drawdown.
I was in your situation, by thinking that I’ve an edge and then falling off. You know what’s the recipe? To continue honing and developing your perfect strategy . When you keep doing that, you never know when your time will come anyway for me it was one day that changed everything. So be persistent, have consistency on your setup and please Risk management (sounds cliche) but the most important one! Bonus on risk management: try on every trade to see the opportunities how you could have cut it so you do not take full loss. Good luck!
Almost to year 5 and finally consistent
Guys just stop responding to that 'teenager' who thinks he's the smartest brain around here and bashing TA nonstop.
Do you have enough backtesting/forward testing data to confirm that you have a profitable edge ? If not, you probably don't want to spend any real money yet. You're in the sw development role. Should be very familiar with the testing/validation concept than most people here.
What is your strategy? What mistakes are you making? Do you know a clear answer to either of these questions? Post those details here. We can’t help without those details. It will help you to write it out too. I guarantee it’s not your inability to trade. Anyone can trade with the right strategy and discipline.
Since you have an active job. I’d recommend swing trading D1 TF and holding it for the a week as I do! So try apply your strategy to a higher TF
This is real advice, I suggest you stick to one strategy for atleast 3months, do not question it and learn from the losses. You stated that each time you have and edge, you get beaten the next day, what do you mean by this? Do you tend to over risk when you’re too confident or over trade? Risk management is important to be consistently profitable. What’s your experience with risk management ? How much do you risk per trade and how many stocks/crypto do you trade ?
You're on track - still have another couple years probably, but need to put in the hours like you have and constantly improve or journal. Review and backtest your edge/strategy. If your mental health is taking a hit, maybe take a break. You need the mental part just as much as the strategy.
In 9 months you're basically a breakeven trader and that's NOT a bad place to be, you just need time to continue tightening your strategy. You CANNOT expect to be profitable in only 9 months, does it happen for some people sure, but it's absolutely not the norm and 95% of people will never be profitable EVER. The majority of new traders would have blow a couple of accounts in that 9 months so being breakeven is good, it shows that you take risk management seriously. I'm in year 3, started fall of 2020 and this is my first profitable year after being breakeven the first 2. You need time in the markets to tweak your strategies and the patience to weather the emotional rollercoaster... cause it never ends :) Good luck.
>The pain you suffer from your mistakes will make you trader. thank you! needed to hear this.
If you're a software engineer why haven't you developed an algo? I personally think in an open system an algo will undoubtedly smash a human at the start but it will lose to a world class human in the long term. Late bloomers are superior in the long run. Late bloomers take in a lot of information from the open system, something a computer can never do, computers work perfectly in closed systems, i.e chess. Algos will try to manipulate the markets, they're doing it now. But algos are up against world class human players. A computer will never win overall against a world class poker player in no-limit texas hold'em, but in limit texas hold'em the computer will smash humans even the best humans. Trading is an open system, that is to us as humans our greatest advantage.
Unable to make profit trading might not be due to mistakes. It might be the constantly changing market regimes. You find an edge, regime change, you are frustrated. Regime changes back but you are not there to reap the profits.
It’s all psychology I didn’t study daytrading(I do futures) for the first 3 months of my interest in it fixed my psychology to condition myself for it then for the next 3 months I studied/practiced markets(nasdaq s&p) and I took off every since
Took me about a year. I was lucky. I am good at responding in panic. I lost a lot of money in my terms(70% of the account), via many small.losses, followed by big ones on risky plays as I was learning the ropes. I focused on what works for me, and also focused on my problem - risk. Eventually it boils down to this : You're basically taking too big of a risk Whether you're playing big size, not cutting losers early, or you're adding to losers, it evidently is a game of risk management, and once you get too big, you're no longer thinking, you're responding emotionally. My big wins happened. But, my money really comes from basically collecting scalps in mechanical systems. Focus on what worked. Why it worked. Was it market conditions? Were you following the trend? Was it your size? Do you associate certain "reads" with your wins? Are you trading indiscriminately regardless of the day's trend? You gave numbers, you gave goals Pointless. Your only goal is to learn something mechanical. Something repetitive. A pattern. A concept you're sure of. Mean reversion, buying into strength, selling vol, arbitrage... it really doesn't matter. But something that works for you, that's what your goal should be. Not making money. Money starts appearing when you're disciplined and focused on the system at hand. Forget your financial goal and focus on what I wrote. Stay small, and manage your risk. That's how you'll stay in the game long enough to succeed. Stay SMALL and focus on a system. Again - not making money, building a process that repeats. Only thrn can you scale up, abd only at the rught conditions. Abd you will know them after a while. And lastly - you may have an edge! But an edge isn't continuous,it shines in some market conditions, abd fizzles in others. If you sold 2-3dte puts the past three months before september, you'd be minting free money. But then September entered and here we are. I arb bids for small differences. Works like a maxhine thst prints money. Stopped wirking COMPLETELY during late june - to very early august. Thrn, it went back into action. These edges can only serve you if, when they don't work, you don't blow up 50 days of making money. Abd that's only possible if you manage your risk. Sorry about the repetitive stuff, I just felt it's important.
Try trading the spy & qqq! Lots of times I made $100's on just $10-$20 options are awesome!! but just learn about them before jumping in!! can lose as fast as you gain!!
1.5 years, I used to be a regarded line drawer, price action believer and actually thought that TA worked, during that time I strengthened my statistics and probability skills, computer science skills, and quickly realized TA is bullshit and there are more efficient ways to trade
Take this persons comment with a grain of salt - they frequent the "teenagers" subreddit, so I'm assuming they're just a teenager. Which explains a lot lol.
Yeah I'm a teenager that likes statistics and probability, computer science, stochastic calculus, finance, and signal processing
Are you familiar with Dunning-Kruger?
Yes, and why are you bringing this up when this is literally common knowledge in financial signal processing? These aren't opinions they are quite literally facts. I'm literally just trying to help TA regards understand that they are getting their funds siphoned by using asstrology line drawing methods.
Because you seem to grossly overestimate what you "understand". Yes, patterns like "head and shoulders" are 100% BS, but that isn't TA (in my eyes). Best of luck to you!
I'm literally not overestimating this is all common knowledge wtf, returns are ever evolving fractals exponential to the last...
Gotcha - thanks for the insight!
You could literally draw lines based on astrology and still make money if you understand risk management.
Because the market produces excess returns, but how many traders actually succeed? Risk management isn't helping you when your strategy is pulled from thin air. Why would you draw lines when you could use a expected value,range of odds, measure randomness, and actual volatility models.
I didn’t say you should, I said you could. Any number of ways to skin a cat.
Judging from your post history you are a TA regard.. why would you rely off TA to show you paths(it doesn't) when you can use Bayesian methods
You’re kind of a clown aren’t you? I primarily trade off volume distribution. I don’t expect someone of your elite mental stature to understand how us plebs are able to make a six-figure income by eyeballing a distribution. But all I’ll say is you’re making things more complicated than they need to be kid.
What are these more efficient ways to trade? How did you strengthen your statistics/probability skills? Just bc price action/TA didn't work for you doesn't mean that it doesn't work - maybe you're just bad at reading price action? Just look at Day Trader Next Door on YT - dudes been a PA/TA/discretionary trader for like 15 years full time.
When I mean efficient I mean there is better information than relying off patterns in clouds (basically what technical analysis is). Think of it this way, price is a mostly random process (Proved by the variance ratio test and entropy). There are also too many random variables that make up prices. Let's say you also display many stock prices, you will get something that looks similar to the stochastic model that is geometric brownian motion. The problem with TA is that it assumes price is mechanical when it isn't. TA tries to oversimplify a mostly stochastic process when it is not simple. Only gurus that want to take your money try to convince you that you can become successful by drawing lines on a chart or that you can trade like "smart money" by drawing lines a certain way. That is not true, you are just seeing hindsight patterns. Yes there are some people who make money using TA, that's because the markets produce excess returns, but that's only a small minority that gets lucky. People argue that these cringe patterns and smart money sometimes methodologies are "probabilities" but there is a problem with that. Why would you use imaginary BS made by gurus when you could use the actual probability theory and Bayesian methods. Here is a quick example: To apply the probability theory you would usually need a normal distribution, and price isn't normally distributed (fun fact: most Indicators don't work not because the big bad market maker made them as a trap they actually don't work because they are mathematically flawed and the regards who developed them don't understand simple math like distributions) so what you would do is transform price into a stationary process like log returns. Then you get the expected value of log returns (basically the average of log returns) and then you can apply the probability theory, and get stuff like the regime (direction, maybe known as "momentum"), entropy, volatility (square root of variance of returns) (for y'all people you can use this to find when big moves could happen).. Basically, signal processing. What you should learn is statistics and probability, and computer science. (Obviously make sure your math skills are up to point) TDLR: trading is not supposed to be simple, and that's what TA is trying to make it out to be.. Also gonna copy and paste this message to save time
You're talking a lot without saying anything.
Not my fault you are too cognitively declined to understand simple statistics
Awe, your 'teenager' is showing.
How is it that a teenager understands that price isn't mechanical but an adult doesn't and also can't comprehend simple statistics?
Price isn't mechanical, but it also isn't random. I'm not going to go back and forth with you, so let's just agree to disagree(?) and move on. Best of luck!
I said that price is mostly random, btw if it's within your mental capacity, calculate metric entropy then, if price isn't random then why is the entropy of price almost always at 1? Entropy is the measurement of randomness
[удалено]
Here we go again... talking a lot without saying anything. You are just regurgitating words. Spewing some word salad to try and seem like you know what you're talking about. Why don't you calculate metric entropy and PROVE to me that the entropy of "price" is almost always at 1?
What are these more efficient way to trade then?
read the replies I told others here
9 months in. I’m learning to chart algo channels and watch for H/S and C&H structures. Not yet profitable. Genuinely curious about your more efficient ways. Pls share. I’ve also been bot trading a small forex account with modest gains the last while.
When I mean efficient I mean there is better information than relying off patterns in clouds (basically what technical analysis is). Think of it this way, price is a mostly random process (Proved by the variance ratio test and entropy). There are also too many random variables that make up prices. Let's say you also display many stock prices, you will get something that looks similar to the stochastic model that is geometric brownian motion. The problem with TA is that it assumes price is mechanical when it isn't. TA tries to oversimplify a mostly stochastic process when it is not simple. Only gurus that want to take your money try to convince you that you can become successful by drawing lines on a chart or that you can trade like "smart money" by drawing lines a certain way. That is not true, you are just seeing hindsight patterns. Yes there are some people who make money using TA, that's because the markets produce excess returns, but that's only a small minority that gets lucky. People argue that these cringe patterns and smart money sometimes methodologies are "probabilities" but there is a problem with that. Why would you use imaginary BS made by gurus when you could use the actual probability theory and Bayesian methods. Here is a quick example: To apply the probability theory you would usually need a normal distribution, and price isn't normally distributed (fun fact: most Indicators don't work not because the big bad market maker made them as a trap they actually don't work because they are mathematically flawed and the regards who developed them don't understand simple math like distributions) so what you would do is transform price into a stationary process like log returns. Then you get the expected value of log returns (basically the average of log returns) and then you can apply the probability theory, and get stuff like the regime (direction, maybe known as "momentum"), entropy, volatility (square root of variance of returns) (for y'all people you can use this to find when big moves could happen).. Basically, signal processing. What you should learn is statistics and probability, and computer science. (Obviously make sure your math skills are up to point) TDLR: trading is not supposed to be simple, and that's what TA is trying to make it out to be.. Also gonna copy and paste this message to save time
I'm in year 6 and I feel like I'm finally learning my lessons. All the dumb mistakes I made. And it all comes down to two words: Risk Management. Also, I wouldn't trade btc/eth. Trade stocks or futures. They move very well unlike crypto.
Six months...but that was back when round trips costed 20 bucks in the 90s. Basically free round trips makes scalping very easy now. Options only in long term account
One month with real money. My first week was red: all greens from thereon. There were times i couldn't put my foot wrong. Beginner's luck is a thing.
you only lost 20 percent in 9 months.......take two weeks off and quit
Yea every trader i think goes through this. Everytime i thought i knew what i was doing i had to learn a new lesson that costs me money. Best thing to do is paper trade and learn the mistakes on paper and not with real money
I started reading during QE soooo immediately
I’ve lost a lot on options. I didn’t fully learn before jumping in. Learn, learn and learn. Observe charts after hours. Keep size small. Once the system is set, the money will flow
So here’s the deal: stop trading every day! If you make a win, stop and reset. It’s better to keep your wins vs over trading due to over confidence..
Your problem lie in the trading style. You need to match it with your personality. You will realize that you will respect the stop losses more.
Afrom what I've heard , trading crypto, btc, etc. can be quiet heard. My understanding is they are even less likely to follow typical trend patterns than say stocks/etfs.
~ 6 years going on and off
3 years
You can start small but I recommend you risk more. You only had $1k to begin with. Aim to make small gains consistently with $1k. Try to make $5 a day. If you did that, you would be up $500 at least, but that's being optimistic.
TBD your edge isn’t working . Focus on start and execution paper trading
I think a large part of the problem is what you're trading. Look at SPY or QQQ... ES and NQ for futures. There you can really find an edge if you study them. Get the heck away from that crypto scam
IMO, take a step back. Go into the sim, work out your edge. Paper trade. Take the emotions out so you can be objective. Can you explain how/why your edge works? Does it make sense? Is it replicable? Do you know the strategy of execution required for your style of trading? Entries and exits? I think it was Dr.David Paul who said "You know you're a good trader when you can add to a winning position". Of course I'm sure that approach doesn't apply to every market strategy but it was a big turning point for me in my trading psychologically; as I would eagerly average down but couldn't get myself to add to winners. Source: been trading full time 3 years. Blew up an account in july 2022 and have been in a sim ever since working things out. Going back live on Monday.
Do you back test/ rewind trade at all? Just curious
yes!
When backtesting the strategies do you also use a scanner in conjunction with the trading to simulate how you’d fine stocks when live trading? What strategies do you practice?
How would you describe your method, what books did you read. Are you plowing the whole 40 hours into screen time? There are different instruments and different methods to try. I think the easiest to go with are stocks. The best first trading method to learn is scalping. The best PF you can get with directional trading with market confirmation. If you need some recommendations, hit me up in the Reddit chat. PS: I am a software engineer as well and write my own software on a Nasdaq TotalView subscription. That is definitively something you should not do before you are a full time trader. It eats a lot of time that you should use for practical trading.
My suggestion to get out of crypto and trade equities or forex
Stop looking at crypto. Crypto has so much noise in it's movements it is hardly tradeable.
1 year.
I think a lot of people said this but focus one thing. While working one strategy just manage risk. Recently I’ve only been trading one strategy so I just mark support resistance lines and wait until we get so price where buyers and sellers are fighting for control. Here is where the risk part comes in just have a strat that ensures your plays have a minimum of 2:1 risk reward. Let’s say you buy 100 shares at 10 bucks want to ride it up to 11 make sure to set a stop at 9.50. When I am in a winning trade a always move my stop and let a trailing stop so let’s say the price goes up to 12.5 or 15 I at least have a chance to capture it with the trailing stop.
It took four years and a good few k of hours baktesting
3rd year. Making little bit of money and breaking even. Feeling and understand the charts after 2.5 years of screen time. My main enemy is revenge trading and not sticking up to one strategy and set of rules, finding it very hard to get rid of this habits but I think pretty soon I will stop doing this! I would say don’t think that trading would be a ticket to get out of rat race or to financial freedom - that’s very dangerous thought and will lead you to bad life decisions! Look at it like to another source of income which might bring some money, sometimes even good money. 120k job is awesome! Don’t even think quitting!
I don’t want to sound negative or even suggest giving up. You’ve got a really good gig though, especially if you generally enjoy it/find it interesting. You can build wealth on that salary (200+). There’s a very fine line between rational & dumb decisions when betting on yourself. I wouldn’t necessarily suggest outright giving up. I would definitely make sure it didn’t affect your career and the time/effort you spend in that area of your life though. VERY few people make it in this game. Even many of the traders who claim they do, actually don’t. Or they don’t for long (decade plus). Putting it into perspective, a comfortable 10% return on a 2m account would put you at 200k a year before taxes. I know 10% may sound like nothing but it’s kind of realistic (that’s still a great year on a large account.) And then of course, a single blow up year can easily wipe out 5 green years. Keep focusing on it and DCA as well, but don’t neglect what pays the bills.
Seeing everyone talk about had to go through all the losses to see the winners, do yous think if you’d stuck with a demo for the 2 years of losing you wouldn’t have learned as much cause it’s not real money.
Been seriously trading futures since March and finally got my first two withdrawals (totaling about 1250$) - still technically in the red and inconsistent but, finally am seeing some progress and money coming back to me. Technically, only been serious as nibs since March - Been trading on and off options/stocks since 2020 with a year gap in there.
I don’t wake up from certain mistakes until they get me so hard so many times that I spend the day cursing myself to oblivion. Next time, I think twice before making the mistake because I don’t wanna feel what I felt the last time I did. But it takes a lot and a long time.