TheRumpledOne
6,411 posts
msg #57956
- Ignore TheRumpledOne |
12/11/2007 11:11:55 AM
IN MY INBOX TODAY:
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Here is the next in a series of articles I'll be sending you about
the mental/emotional side of trading. The articles, together,
will comprise the major part of a new book I'm writing. Enjoy!
============
BOUNCING BACK
Dawn is just breaking and a few early birds are chirping their
little heads off. I let the dogs out for some overnight relief and
get the coffee started.
I walk past the TV-tempted to turn it on and see what new
disaster or murder took place overnight- but stick to the plan.
I walk over to the small waterfall I had constructed in the
breakfast room and turn the pump on and the soothing sound
of water gently cascading over artificial falls fills the small room
over- looking the garden.
I sit down in chair and gently close my eyes. I begin silently
repeating my mantra. I envision a small bubble slowly rotating
in clear blue water. The sound of the waterfall is all that I hear.
My breathing slows and I drifted off into peacefulness. It's
like sleep but I can still hear the continuous gentle flow of the
water and the hum of the electric pump. It's delightful and I
concentrate on the bubble and the slow steady beat of my
heart.
Intuitively, I stop repeating the mantra and very slowly open
my eyes. Twenty minutes has elapsed in what seems like five
minutes. I sit quietly for a few more minutes and then start to
focus on today's trading.
The prior night, I had decided on two potential trades. The
Euro-Dollar and the Dollar-Yen. Both had been retracing as
expected.
I would lay in wait for the entry signal. Stops had been
calculated and I had a vision in my mind of what the chart
patterns and signals should look like.
I felt good about the possibilities of at least one of these
trades making a nice profit. I visualized myself watching
the tick mark hitting my preplanned profit targets for both
currency pairs.
After breakfast and chasing the dogs back into the house,
I went upstairs and brought the computer out of its
working sleep. Prices had continued in re-tracement and
everything was in place. I was close to my prey; watching
and waiting to pounce.
I told myself to relax and trust in the system.
All indicat-ors needed to be in place to make the entry.
No exceptions.
Soon, the Dollar-Yen started to fall into line. The candle
made an engulfing bull and the slow stochastic was turning
upwards. I would wait for another one hour candle to
confirm the reversal.
The Euro-Dollar continued sideways and I focused on the
Dollar-Yen. While I waited for the next hour's candle to
form, I sent an instant message to my trading buddy in
London.
It was lunchtime in his time zone and I knew he was
probably watching this currency pair also. We had
established a procedure that if either one of us was going
to enter into a trade we would alert the other.
We would take a look and confirm if it was a "go" or not
and in this way we helped each other stay out of trouble
or jump onboard the trade.
Even though I had never met David in person, I felt a very
close working relationship with him and he had saved me
many times from breaking my trading discipline (we had
exchang-ed our trading systems to make sure we could
hold each other accountable).
David answered me and confirmed that it looked like a go
although but he was already in another trade and his rules
prohibited him from entering into more than one trade
at a time. He wished me luck and signed off.
The hour had passed and the candle confirmed my
expectations. However, the stochastics were still a little
high to show an oversold condition. I set the stop-loss
and walked away.
I had decided that once I entered a trade, I would not stick
around to watch the show but would periodically monitor
progress. After entering the trade in my journal, I walked
away from my home office and headed out to the golf
course.
I loved it. Playing golf and making money at the same time.
Like quantum physics, I was two places at the same time.
My golf stunk (I lost all of my balls and had to borrow
from a complete stranger) and when I returned home, I
found out than I had been stopped out about three hours
after I entered the trade.
The stochastics never reached an obvious oversold
position and I had broken my discipline and paid for it.
My first tendency was to get angry with myself but I sat
down and did a complete analysis of everything I did and
saw quite clearly that I had not kept to the discipline.
Now, I had to pay the price: I was required to take three
days off from trading and forced to review my system to
"refresh" myself on what the procedures were. I wrote
all of this down in the journal and swore to myself that I
would never enter a trade without the confirmations.
Live and learn. Or is it live and pay?
I no longer felt angry with myself and actually felt good
that I had seen my weakness. I would see to it that it
would never happen again. I was a professional and
would bounce back.
My best,
Norman Hallett, CEO
Subconscious Training Corporation
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