# Short Term Traders, what is your homework?



## havaiana (6 December 2012)

Wanted to exchange information and ideas about how short term traders trade.

Rather than only a couple of experienced people contributing and everyone else asking them questions on their entires and exits, i'm thinking more about what study/research and homework people who are still in the learning process like me are doing.

Hopefully we can give eachother some ideas and pointers on things to research more so than handing out answers. Things we have found effective, not effective, resources etc


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## havaiana (6 December 2012)

I will start with some of the things i'm looking at at the moment


Pre Trade

-Check what happened over night. Where are we in terms of longer term trend/range. Are we in a medium term range or a trend, is a new trend developing etc
-What are the key levels from the day before. This is usually just previoud session and/or days highs and lows. Sometimes an area where a previous High/Low was taken out and might become support/resistance,50% levels of moves or an area where alot of volume traded.
-Is there any news out today? Is the market waiting on some important news the coming night etc


Post trade

-Print out chart. On them i annotate or have annotated my trades, a certain Dom Pattern i am looking into at the moment
- I note on charts moves that are over a certain number of ticks and how many ticks the move was. Then i add this into a longer term table where i keep note of the distribution of moves in ticks.
-At regular intervals i do some crunching on things like (i really need to automate this) average number of ticks of ranges, or pullbacks during trends, chop, certain times etc

I will also note down anything i noticed about the market during the day. How did i trade? what i did wll and bad. What would have made the day better (then will look at how it would have panned out if i had that change on previous sessions)

Maybe we can also post or attach any resources that have helped us along the way?


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## CanOz (6 December 2012)

Great topic mate...your records, is this your journal? Lots of talk in the last year that journaling is the holy grail of trading....

For me it's...

Market structure, these are today's levels
Trade plan, what do do if x happens at the level I'm watching
News, what's happening today
What happened over night and where could the market open

Afterword, a bit of a review, how did I feel? How many times did I drop into that little 'zone'

CanOz


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## havaiana (6 December 2012)

Some resources, i have a heap more these are just the first to come to mind or things i looked at recently

http://www.brettsteenbarger.com/trader_performance.htm
http://www.brettsteenbarger.com/articles.htm
carol osler research papers (google)
http://www.youtube.com/user/BigMikeTrading (futures trader71 stuff)
http://www-bcf.usc.edu/~lharris/Trading/Book/Book-extract.pdf Market Microstructure for Practioners pdf by Larry Harris


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## CanOz (6 December 2012)

Really like the FT71 stuff, as well as L2ST...

Big fan of John Grady as well, have you seen his course, no BS Daytrading?

Jigsaw trading, have you seen that?

CanOz
Sorry no links...on the iPad...


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## Gringotts Bank (6 December 2012)

Almost all my homework has gone into my system, so I don't really need to do anything but watch as things unfold and place an occasional override order.

In regards to if/when I place that override order, I put a huge emphasis on how I feel.  When I reflect on bad trades, my gut feel was always in direct opposition to my actions.  

Ongoing work is to do with reading about flow states and how they are most readily entered.  Mark Douglas' book was good.  But I don't think you're really into that (or most others here!  They like the numbers and stats).


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## havaiana (6 December 2012)

CanOz said:


> Great topic mate...your records, is this your journal? Lots of talk in the last year that journaling is the holy grail of trading....




At the moment it's just a little notebook i handwrite in. I do a page every day for the pre trade stuff and things i want to remember to concentrate for the day, and then thought sduring the day and how the session turned out, so pretty much a journal. Other pages are just number crunching, ideas for study etc. I really should do it in excel, but it's not working at the moment on pc and i like the old fasioned pen and paper.

Due to the bond market being next to static i've been looking solely at the Taiwan index the past few weeks.  Have not yet found any decent (free) news resource for Taiwan markets yet in english

The thing i'm having the least success with at the moment is my plan for how the day might go. Generally levels work ok, but alot of times the big trending days and inside days come at times when i least expect them too.

Need to add 2 of your threads to the resources list:


https://www.aussiestockforums.com/forums/showthread.php?t=24819 Scalping the DAX (SIM)https://www.aussiestockforums.com/forums/showthread.php?t=24827 Scalping the HSI & the K200 (SIM)


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## havaiana (6 December 2012)

CanOz said:


> Really like the FT71 stuff, as well as L2ST...
> 
> Big fan of John Grady as well, have you seen his course, no BS Daytrading?
> 
> ...




Yep seen them both, agree

http://www.jigsawtrading.com/lessons/lessons.html
http://www.youtube.com/user/NoBSDayTrading (he also has a website, not sure if i can post commercial links?)

Some propex/Guy Bower stuff:
http://www.propex.net.au/market-education
http://www.youtube.com/user/GuyBower

SMB trading vid's http://www.youtube.com/user/smbcapital


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## CanOz (6 December 2012)

Gringotts Bank said:


> Mark Douglas' book was good.  But I don't think you're really into that (or most others here!  They like the numbers and stats).




I've got both the ebook and the audio version of Trading in the Zone. I listen to the ebook at least twice a week.

CanOz


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## CanOz (6 December 2012)

havaiana said:


> Some propex/Guy Bower stuff:
> http://www.propex.net.au/market-education
> http://www.youtube.com/user/GuyBower




LOL! Guy Bower fan too! Lots of good YT stuff...all for free.


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## Gringotts Bank (6 December 2012)

CanOz said:


> I've got both the ebook and the audio version of Trading in the Zone. I listen to the ebook at least twice a week.
> 
> CanOz




Cool.  Most of the trading psychology threads I've started go dead or get attacked mercilessly!

Maybe we should chat about our findings some time.


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## CanOz (6 December 2012)

Gringotts Bank said:


> Cool.  Most of the trading psychology threads I've started go dead or get attacked mercilessly!
> 
> Maybe we should chat about our findings some time.




I think its a bit of a fickle subject...sometimes its difficult for me to articulate my thoughts on it.

I also have used a trading coach in the past, he's actually a pretty good friend now. He's helped me out on other personal issues as well. He is a clinical psychologist.

CanOz


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## havaiana (6 December 2012)

Gringotts Bank said:


> Cool.  Most of the trading psychology threads I've started go dead or get attacked mercilessly!
> 
> Maybe we should chat about our findings some time.




I think psychology is important, but not as important as it's made out in the trading selling industry and forums. Sometimes it's made out to be the edge rather than something that helps you to take advantge of the edge more efficiently.

I remember Trembling Hand (i think, can't find post now) made a post once something like, if you were held hostage and offered release if you could shoot an apple off your partners head, would you rather the shooting skills to hit the apple from the distance or the skills to be able to do it calmly. Psychology will help your skills if you have them, if you don't have the skills or the edge it will just help you lose (or shoot the head off you partner) with a clear head.

Edit, I still suffer from psychology problems during trading, but i think someone with a decent edge in trading will be less likely to be effected by psychology. Does the psychology cause the losing problem or does the losing cause the psychology problems? When i fix some of the problems with my trading skills i think psychology wil be a non issue if i maintain a daily stop limit.

Edit 2, found the post http://tremblinghandtrader.typepad.com/trembling_hand_trader/2009/02/fin-disapline.html


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## Gringotts Bank (6 December 2012)

havaiana said:


> I think psychology is important, but not as important as it's made out in the trading selling industry and forums. Sometimes it's made out to be the edge rather than something that helps you to take advantge of the edge more efficiently.
> 
> I remember Trembling Hand (i think, can't find post now) made a post once something like, if you were held hostage and offered release if you could shoot an apple off your partners head, would you rather the shooting skills to hit the apple from the distance or the skills to be able to do it calmly. Psychology will help your skills if you have them, if you don't have the skills or the edge it will just help you lose (or shoot the head off you partner) with a clear head.
> 
> ...




Yes a good edge will give you confidence.  Or at least it _should_ give you confidence.  A good edge with no confidence and no discipline will tend to lose money (as demonstrated by the Turtle experiment).  No edge/system with good confidence will tend to make money.  I've seen it in myself and other traders.


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## skc (6 December 2012)

Gringotts Bank said:


> No edge/system with good confidence will tend to make money.  I've seen it in myself and other traders.




And you wonder why your psychology stuff gets shredded to pieces?


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## Joules MM1 (6 December 2012)

Gringotts Bank said:


> .... a good edge will give you confidence.




eventually



Gringotts Bank said:


> A good edge with no confidence and no discipline will tend to lose money




for some



Gringotts Bank said:


> No edge/system with good confidence will tend to make money.  I've seen it in myself and other traders.




oh dear

while there were no children injured in the making of that post, many shall be if they give  any credibility.....there are many confidently broke people in the world...they remain that way.....competent confidence and incompetent confidence look very similar, application is quite different.....

and here's the bit that counts


Gringotts Bank said:


> I've seen it in myself




something past-tense about that ....especially with all the chartlines .....they dont really fit together....

how do you say GB ?


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## havaiana (6 December 2012)

Now a bit to the problems side of things... I have found the biggest problem for me is execution and finding enough of an edge to make up for it

When I first took my short term trading method that has made me millions of sim dollars to my live account I was in for a bit of a shock. At first I put it down to bad luck, psychology, slow reflexes etc. It took me longer than it should have to realise that i'm just not profitable enough to go live with my backtested and SIM profitable system because for reasons which are obvious to me now but for some reason i failed to understand then, there will be a tendency to get fills on all your bad trades and not get fills on all your good trades. This will have a significant effect on your win loss ratio, or on your R:R if you chase

That's where i am now, so close, but yet so far. I have a method that will make me money on a simulator, market replay or when backtested on a chart, but it's just not good enough yet for the real market. I just need a touch more edge, but that touch more is so illusive it's driving me crazy. Hence the hunt for more ideas and resources...

It actually amazes me the kind of edge big traders must have, to also have to deal with slippage and maintain your edge must take some serious skill


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## Trembling Hand (6 December 2012)

havaiana said:


> That's where i am now, so close, but yet so far.




Open up your time scale. Stop playing the tick chart and go to the 5 min for targets for example.

OR

Just think positive!!  lol!


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## Gringotts Bank (6 December 2012)

Jules when I say confidence I'm not talking about reckless abandon and bravado (which is basically the opposite of confidence).  People often confuse the two.  

My statement is based upon meeting people who have traded from real confidence and made a pile of money.  

There is no system that can't be ruined by someone with low confidence.  And the most green newbie can do fantastically well on his own, with nothing but gut feel.  I've seen it.  Judging by what you say, you not seen this happen.


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## Gringotts Bank (6 December 2012)

skc said:


> And you wonder why your psychology stuff gets shredded to pieces?




I used to wonder, but then I came to realize people will defend their precious beliefs with more gusto than they would their own offspring.

It's like walking into a mosque and saying "hey guys, apparently the story about the 12 virgins is BS".


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## Trembling Hand (6 December 2012)

Gringotts Bank said:


> My statement is based upon meeting people who have traded from real confidence and made a pile of money.




Unbelievable. You have confused an external event (a bull market) with a miss-place and deluded mind set (confidence).

Its like saying today it rained and the market fell. Therefore the reason the market fell was due to rain.


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## Trembling Hand (6 December 2012)

Here is an example,


Gringotts Bank said:


> I've been making an effort to trade with a much shorter time frame... and be profitable.  So far no luck with the profitable side of things but I'm still working on it.  So many of my slightly longer time frame projects hit the wall about May this year and it's been extremely hard to make money as a trader.




What happened? Lack of confidence or change of market that you couldn't adapt to?


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## Gringotts Bank (6 December 2012)

Trembling Hand said:


> Unbelievable. You have confused an external event (a bull market) with a miss-place and deluded mind set (confidence).
> 
> Its like saying today it rained and the market fell. Therefore the reason the market fell was due to rain.




You should put up a few of your trades live on ASF.  The reason I say "live" is because then there would be real pressure to perform in front of everyone, and you'd start to make errors because you would be afraid of mucking it up (in the same way that it was when you started prop trading - remember how it was?)


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## Gringotts Bank (6 December 2012)

Trembling Hand said:


> Here is an example,
> 
> 
> What happened? Lack of confidence or change of market that you couldn't adapt to?




The market definitely changed in 2011.  Ask any system trader - a very unusual year.

With confidence you adapt.  Without it you crack.  When I posted that i was doing the latter.  Thanks for the reminder.  I'll dig up some of your earlier posts!


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## Trembling Hand (6 December 2012)

Gringotts Bank said:


> You should put up a few of your trades live on ASF.  The reason I say "live" is because then there would be real pressure to perform in front of everyone, and you'd start to make errors because you would be afraid of mucking it up (in the same way that it was when you started prop trading - remember how it was?)




Haha! Whats has that got to do with your belief that confidence is the reason for successful trading?

Why can you not make money then?  Lack of confidence or lack of skill being able to adapt?


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## PinguPingu (6 December 2012)

As a psych major I must say the personalities on this forum are far more interesting than their trades/trading behaviour. :


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## Trembling Hand (6 December 2012)

PinguPingu said:


> As a psych major I must say the personalities on this forum are far more interesting than their trades/trading behaviour. :




Maybe we could have your soon to be professional opinion? Where does success start, skill development or deluded confidence


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## PinguPingu (6 December 2012)

I'll just say I've never found any 'trading psychology' material helpful or evidence based past the authors personal opinon and that in my Degree the compulsory statistic research units (e.g. using SPSS) have been more helpful than the cognitive aspects. 

Anything more and that'll be 99/h please! :


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## SuperGlue (6 December 2012)

havaiana said:


> I just need a touch more edge, but that touch more is so illusive it's driving me crazy. Hence the hunt for more ideas and resources...
> 
> It actually amazes me the kind of edge big traders must have, to also have to deal with slippage and maintain your edge must take some serious skill





Havaiana you wrote on : Prop Shops in Australia 

"So how is this actually done? At the prop shops, they have a mentor that will set you exercises. Examples of the exercises are:
 Stay in the market all day. You cannot close trades, only reverse them. The idea of course is that you get in tune with the flow of the market." 

To stay in the market all day with a small account will be quite difficult.

By the way Propex is advertising again.

http://www.seek.com.au/Job/proprietary-futures-traders/in/gold-coast-gold-coast/23590535


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## skc (6 December 2012)

Gringotts Bank said:


> There is no system that can't be ruined by someone with low confidence.  And the most green newbie can do fantastically well on his own, with nothing but gut feel.  I've seen it.  Judging by what you say, you not seen this happen.




I think I've said before... but here it is again. 

Confidence is very important and necessary for good trading. No confidence = no successful trading. No one is debating that. But it doesn't mean that confidence alone is _sufficient_. 

To see the logic more clearly, substitute the word "confidence" in the above paragraph with "A good trading platform" or "A decent computer". See how logically senseless it is...

From your various posts, you read trading books, draw lines on a chart, program and backtest systems. If confidence is all you need, why do you bother doing any of that. Just close your eyes, buy 200 lots and stay confident.


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## Joules MM1 (6 December 2012)

PinguPingu said:


> I'll just say I've never found any 'trading psychology' material helpful or evidence based past the authors personal opinon and that in my Degree the compulsory statistic research units (e.g. using SPSS) have been more helpful than the cognitive aspects.
> 
> Anything more and that'll be 99/h please! :




Brett Steenbarger is not currently publishing any works as he's under contract to a major firm....he's a successful trader (mostly es) and very smart trainer.....you'll learn a lot.....especially once youve dropped that know-it-all stance youre in......

http://traderfeed.blogspot.com.au/


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## PinguPingu (7 December 2012)

Hey, don't profess to know-it all, far from it. The typical undegrad psych course just doesn't look at concepts relating to trading. It's far more focused on the clinical side - more like a medical degree, learning the disorders, the big schools of thought, etc. Closest you'll get is fallacies like sunken cost or cognitive biases. That's why the statistical analysis part has been of more help in that context. The trading psychology stuff I've seen so far is akin to 'The Secret' and its self-help, positive thinking ilk. 

Thanks for the link, will have a dig round.


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## tech/a (7 December 2012)

.







> especially once youve dropped that know-it-all stance youre in......





?? cant see it.

Many under estimate the Bull Market.

When it returns everyone will be a crack trader with 
confidence. Every line and squiggle will be correct.
Every valuation will be spot. 

Every new book or technique a winner.

In the meantime many buy going down in the* hope* that one
day the market proves they're a genius.


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## havaiana (7 December 2012)

SuperGlue said:


> Havaiana you wrote on : Prop Shops in Australia
> 
> "So how is this actually done? At the prop shops, they have a mentor that will set you exercises. Examples of the exercises are:
> Stay in the market all day. You cannot close trades, only reverse them. The idea of course is that you get in tune with the flow of the market."
> ...




I took that from the jigsaw website of an example of the exercises prop get you to do. I have already applied and failed with propex back in October, don't know if i can apply again and probably wouldn't at this stage (not much more they can teach me unless i got to the inhouse stage with mentors would be good). I will try to get profitable enough by myself and apply the other route via trading records. The trainee trader experience was a good one and i would recommend it to anyone serious about trading

I agree to stay in the market with a small account size is difficult. I think 1 contract is damn near impossible and 3 contracts is better than 2. At the moment i am using 2 because my account size is not big enough to trade 3 contracts.

If i used 3 I would do something like this:

-Going for break: enter 3 contracts, exit 1 at a move back to my perceived value, exit the second where i would enter the opposite direction if i wasn't going for the break, hold 3rd for runner and look for spot to add.
-Trading range:  enter 3 contracts, exit one at my perceived value, exit another towards opposite end of range, reverse at opposite end of range. Unless i luck into a break then will switch to the previous.


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## havaiana (7 December 2012)

Trembling Hand said:


> Open up your time scale. Stop playing the tick chart and go to the 5 min for targets for example.




I'm using 1 min charts, at the moment, but not trading for just a few ticks. Think i will extend out the range i'm going for by a tick, which should filter out some losses. This will be the second time i have extended the range, the first time didn't help much. This time the increase in the R:R i will be able to go for should mean that i can also increase my stop by a tick, so will see how that goes. Hopefully this does the trick, because extending by another tick after that i think would put me in the middle of the moves of the next timeframe up and probably have a negative impact.

My main problem is that my win/loss ratio has been rubbish. If this doesn't work i will try the larger time frame. Just trying to keep active enough so eventually i can reapply for prop.


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## havaiana (7 December 2012)

My approach to short term trading.

This is just a quick rundown for anyone more in the beginning stage of how i am looking at the market and trying to exploit it. I'm obviously not an expert so if anything that i say is BS i'm sure the more experienced guys can point it out.

2 of the most common prop execises for trainees:
-Stack the orderbook with limit orders every x number ticks for the whole day. Discretion on stop outs.
-Enter every retracement of x number of ticks for a whole day. Discretion on exits

What these exercise show you is that both will make money in certain (and usually opposite) market conditions and both will lose money in certain (and usually opposite) market conditions. Just using them willy nilly wont make you money

*First* you need a way to determine what the market condition is, and/or what the the market condition could likely be
*Second* you need to work out what ranges are best to use for x and a way to exit both winning and losing trades with a high enough R:R and win % to cover transaction costs and still leave you with profit
*Third* when you work out how hard the first 2 points are, you need to work out the sort of things which will skew x, such as time of day, news, key market levels, correlations, DOM games, where are the stops and many more things
*Fourth* when you have made millions on your SIM account, go live and soon enough start the process again from point one (hopefully not down too much $), only this time you need to do each of the points better and more efficiently

Good luck and PM me the details of your method once completed and making money live. Thanks.


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## Trembling Hand (7 December 2012)

What are you trading?


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## Gringotts Bank (7 December 2012)

skc said:


> I think I've said before... but here it is again.
> 
> Confidence is very important and necessary for good trading. No confidence = no successful trading. No one is debating that. But it doesn't mean that confidence alone is _sufficient_.
> 
> ...




Some were saying confidence is of no influence - so this paragraph is for them.  A quick look through sporting history will show thousands of examples of skilled people who have suddenly and inexplicably 'dropped the ball' during times of low confidence.  The skill doesn't disappear, but it gets overrun by emotion.  Greg Norman blew many big titles and lots of prize money by missing shots a good amateur could have landed.  Kournikova couldn't get a first serve in during a whole game at her worst.  Her serving yips were legendary.  Then there's the skilled traders who knew all the rules and blew up everything.  Skill can be gained slowly over time, but emotions can change in a split second and cause havoc.  Any sportsman (or professional) will tell you about how the ball bounces your way when your confidence is high, and how the opposite occurs too.  Even very strongly ingrained skill sets can be totally ruined by a run of low confidence. 

In my trading I can feel when confidence is running low and it will invariably show up as:

-- poor or incomplete fills on limit orders
-- a sudden widening of the spread on the very day my system is telling me to sell
-- an unusual lowering of buyer volume on the very day I'm due to sell

You say that I use TA resources a lot, which I do.  I use these to _create _confidence.  And then I trade from this confidence.  If I was to teach my system to a clever guy who is not good with money, he would mess it up somehow.  He'd find a way to ruin it.  I myself have found ways!  And it's a good system.  So I actually do see confidence as sufficient in itself.  If I could create confidence from scratch, I would, but it's very hard to do in oneself.  But I have done an experiment where I attempted to create confidence in someone with no market knowledge - and it worked.  When I say it worked, the results were well beyond what chance would have delivered in a very short time frame.  I've posted this on ASF before.

From no BS trading:

I know a guy who made a million and lost it. I know another guy who made 20 million and lost a whole bunch of it. I know another guy who had several years of triple digit returns on a small fund and then put together a 100 million dollar fund and blew it all. These guys were great traders. They didn’t get lucky when they made money. *They understood the game and played it very well*. They didn’t get unlucky when they lost. They broke their own rules and started making stupid trades. They stopped waiting for high probability trades and started taking shots. They started trading too much size. They started holding positions much longer than normal. They started thinking, “it has to come back”.

Why did these guys who knew the markets and knew trading inside out, suddenly become so reckless?  If you asked them I bet they wouldn't even know.  These examples are not so much about confidence, but other emotions will be at play.  Emotions drive behaviour.


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## havaiana (7 December 2012)

Trembling Hand said:


> What are you trading?




MSCI Taiwan index. Mainly because the low tick value means i can trade more than 1 contract without risking too much for my account size and the volatillity is decent (at least compared to bonds)


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## Trembling Hand (7 December 2012)

havaiana said:


> MSCI Taiwan index. Mainly because the low tick value means i can trade more than 1 contract without risking too much for my account size and the volatillity is decent (at least compared to bonds)






havaiana said:


> I'm using 1 min charts, at the moment, but not trading for just a few ticks. *Think i will extend out the range i'm going for by a tick,*




There IMNSHO is your problem.

Expectancy = (Probability of Win * *Average Win*) – (Probability of Loss * Average Loss)

The easiest, well relatively easiest, way to get your expectancy positive is by working on your 1 in 10 winners that just blow the doors off all your small losses and hugely add to your avg win. 

Getting in a trade and just taking the same old target IS the recipe for losing long term. 

You can believe all the BS you want about discipline and confidence till your account is drained by the pros. What you have to be able to figure out and fast and on the minute by 5 minute basis is the stuff you have listed in your second last post. 

Remember, support, resistance, range and trend are dynamic. As they shift so to should your approach (stops, targets and size)


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## skc (7 December 2012)

Gringotts Bank said:


> Some were saying confidence is of no influence - so this paragraph is for them.




Who's said that? I think most are just saying confience in and on its own isn't sufficient for trading.



Gringotts Bank said:


> *So I actually do see confidence as sufficient in itself.  *




Every example you've put up merely highlights confidence being necessary. The only evidence of it being "sufficient" is your anecdotal observations of newbies being sucessful at trading. Don't forget there's an element of chance in trading - so you can't use the random success of few people to prove anything.

Show me a professional sports person who didn't have the skills or training or physical gifts and was successful. 



Gringotts Bank said:


> In my trading I can feel when confidence is running low and it will invariably show up as:
> 
> -- poor or incomplete fills on limit orders
> -- a sudden widening of the spread on the very day my system is telling me to sell
> -- an unusual lowering of buyer volume on the very day I'm due to sell




Can you explain the mechanism which your personal confidence level affects the volume or buy/sell spread without resorting to paragraphs from "The Secret"?


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## Joules MM1 (7 December 2012)

tech/a said:


> .
> 
> 
> ?? cant see it.




? is it that you can't see, duck ?


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## Joules MM1 (7 December 2012)

skc said:


> ...explain the mechanism which your personal confidence level affects the volume or buy/sell spread without resorting to paragraphs from "The Secret"?




magic, skc...pure magic

lulz


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## McLovin (7 December 2012)

Joules MM1 said:


> Brett Steenbarger is not currently publishing any works as he's under contract to a major firm....he's a successful trader (mostly es) and very smart trainer.....you'll learn a lot.....especially once youve dropped that know-it-all stance youre in......
> 
> http://traderfeed.blogspot.com.au/




I'm neither a trader nor a psychologist, so this may seem somewhat naive (although I do have an interest in confidence tricks), but aren't these guys just teaching similar things that 99% of other "self help" coaches do, and just calling it "trading psychology"? If you give anyone confidence in themselves they are going to perform better at anything than they would without confidence. I guess what I'm asking is, what do I get from trading psychologist that I wouldn't get from a guy hitting people in the forehead before making them walk across hot coals on late night TV?

I like your avatar btw.


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## ThingyMajiggy (7 December 2012)

Wouldn't it be hard to just _give_ someone confidence when they might not have the skills necessary to pull it off?

I don't think I could have much confidence until my actions/skills have proven to me that I can make it work, therefore skills are far more important IMO. Confidence feeds off the skill set, not the other way around.


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## Joules MM1 (7 December 2012)

McLovin said:


> I'm neither a trader nor a psychologist, so this may seem somewhat naive (although I do have an interest in confidence tricks), but aren't these guys just teaching similar things that 99% of other "self help" coaches do, and just calling it "trading psychology"? If you give anyone confidence in themselves they are going to perform better at anything than they would without confidence. I guess what I'm asking is, what do I get from trading psychologist that I wouldn't get from a guy hitting people in the forehead before making them walk across hot coals on late night TV?
> 
> I like your avatar btw.




Steenbarger is a trader _*and*_ a trainer....that's the distinct diff, he's in the trenches...

the main thing is the qualitative/quantitative side for someone who's an average joe receiving all the averge joe hits and not understanding, that, in the first instance he/she is clueless about asking even the right questions...that's the key .

easy to get bogged down in the navel staring.....i think confidence is the cream on the practical cake.....


----------



## Joules MM1 (7 December 2012)

(as the thread slowly devolves into best euphemism, best analogy of the year........)


----------



## CanOz (7 December 2012)

Yeah, lets get back on track...Joules, what do you do prior to trading? Do you have some homework...and i'm not talking about the article searches!

CanOz


----------



## Trembling Hand (7 December 2012)

Joules MM1 said:


> Steenbarger is a trader _*and*_ a trainer.




AND an actual clinical Psychologist.


----------



## McLovin (7 December 2012)

Joules MM1 said:


> Steenbarger is a trader _*and*_ a trainer....that's the distinct diff, he's in the trenches...




Thanks, I guess that does make a difference.


----------



## havaiana (7 December 2012)

Trembling Hand said:


> There IMNSHO is your problem.
> 
> Expectancy = (Probability of Win * *Average Win*) – (Probability of Loss * Average Loss)
> 
> ...




Thanks for the advice

Warning, long post and pretty useless (and probably not as entertaining as the 'best euphemism's'. Not sure if i used that word correctly)....

I usually let one contract out of the 2 run and have the other one fixed or else my strike rate will be even more crap than it already is.

When i say move out my range by a tick, i mean on the entries.

For simplicity sake, assume we are in a certain market condition that my stats say on average will have a distribution of moves 4 ticks or higher in the frequencies below;

4tick move- 15% (15% of all moves from high to low are moves of 4 ticks)
5tick- 20%
6- 15%
7- 10%
8- 10%
9- 10%
10+- 20%

So if i was previously entering all moves with a limit order of 4 ticks (my entries and stops are more discretionary in real trading) and stopping out on 7 tick moves or higher, then theoretically my win rate should be about 50%, winning when swings are 4-6 ticks and losing if they are 7+ ticks. I can still hold for as many ticks as i want when i am in the trade

If i changed that requirement of entries by +1 one tick, so i enter on a 5 tick move with limit, stop out on 8+ tick moves, then my win rate should be now be about 53%. So i take less trades missing swings of 4 ticks, but the win rate improves slightly as i am now taking entries further from the mean. There is a certain point though where this has a negative impact (when i start missing most of the moves in that particular timeframe and start getting **** entries on the moves in the timeframe above. Data above is just made up)

In reality my win rate is below 50% because of the previously mentioned execution problems. That's why i was trying to improve it.

I think i get your point and will definitly take your advice, because the stuff above is really not improving my results much. I will spend my time on looking at catching the odd larger runner and developing my dynamic support and resistance prediction skills


----------



## Trembling Hand (7 December 2012)

Havaiana this is probably reverse to peoples normal trading logic but as the volatility increases I increase size. VERY important i reckon. makes the winners BIG. Trick is to have the skill to get it right....

Or maybe its just cuz I'm confident......


----------



## havaiana (7 December 2012)

Interesting. Kind of like a way of letting your winners run and cutting your losers short in terms of opportunity

I have some things to think about now whilst in Italy for next month, before deploying Haviana short term trading method 2.0 next year


----------



## barney (7 December 2012)

ThingyMajiggy said:


> Wouldn't it be hard to just _give_ someone confidence when they might not have the skills necessary to pull it off?
> 
> I don't think I could have much confidence until my actions/skills have proven to me that I can make it work, therefore skills are far more important IMO. *Confidence feeds off the skill set*, not the other way around.




Exactly.



Joules MM1 said:


> (as the thread slowly devolves into best euphemism, best analogy of the year........)




Don't mind a good analogy myself!  

I walk into a bar and a pretty *crook Karaoke singe*r is belting out "Long way to the Top" by AC-DC ... He thinks he is ..... but is actually


He comes on again later after he's had 6 beers and sings another tune.  He's relaxed and full of "confidence"  .......... *He still sounds crook*

*Moral of the story ....  Crook is still crook no matter how much "confidence" you have*



I leave the bar, go up the road and have 6 beers at another pub.  I come back and old mate is singing another tune .... He is actually sounding ok ..... 

My *ability/"skill*" in discerning how crook he really was has been diminished (pun for the musically inclined) .....  I am hesitant to blame the beer because that would represent common sense, which is the exact opposite of what I am experiencing!

*Moral 2* ....... Either I need to stop drinking ... or he needs singing lessons ....  maybe both!!


----------



## Gringotts Bank (13 December 2012)

skc said:


> Every example you've put up merely highlights confidence being necessary. The only evidence of it being "sufficient" is your anecdotal observations of newbies being sucessful at trading. Don't forget there's an element of chance in trading - so you can't use the random success of few people to prove anything.
> 
> Can you explain the mechanism which your personal confidence level affects the volume or buy/sell spread without resorting to paragraphs from "The Secret"?




I haven't read _The Secret_, but I have read other similar books.  The whole idea became interesting to me when I first found out that thoughts are extremely influential in determining outcome for one's health.  In the behavioural sciences and medicine, expectancy (psychological, not statistical) is one of the most powerful determinants of outcome.  The large majority of health care providers still believe that their pills and techniques and surgeries and manipulations are making the patient better.  Whilst such interventions may have some efficacy on their own, they are rendered completely powerless when prescribed or performed with an attitude of indifference and low confidence.  There's heaps solid scientific proof for this.

So this idea of thoughts influencing outcomes: can it be extended to things outside of the body.... things like trading?  In terms of evidence, there's not yet a lot of good experimenting going on; it's more like blind faith.  But a guy called Rupert Sheldrake is worth a look because he is very strict with his protocols.    http://www.sheldrake.org/Research/overview/   There's also this page, which is useful:  http://www.sheldrake.org/experiments/expectations/  Note that these are not articles about trading.  They are articles about how the mind can influence things outside the body.  See what you think. 

What I base my statement on is hundreds of personal examples.  In terms of trading, anyone can test this idea for himself quite easily.  Before you click 'buy', make a note of how confident you feel that the trade will work out profitably, then score that confidence or expectancy out of 10.  Write it down for each trade you make.  The tricky part is to really understand your feelings accurately. Bravado, pumping oneself up, acting confidently is not the same as real confidence.  Then look back after a month or two if you're a frequent trader, that is.  You'll see a strong correlation.


----------



## skc (13 December 2012)

Gringotts Bank said:


> I haven't read the Secret, but I have read other similar books.  The whole idea became interesting to me when I first found out that thoughts are extremely influential in determining outcome for one's health.  In the behavioural sciences and medicine, expectancy (psychological, not statistical) is one of the most powerful determinants of outcome.  The large majority of health care providers still believe that their pills and techniques and surgeries and manipulations are making the patient better.  Whilst such interventions may have some efficacy on their own, they are rendered completely powerless when prescribed or performed with an attitude of indifference and low confidence.  There's heaps solid scientific proof for this.
> 
> So this idea of thoughts influencing outcomes: can it be extended to things outside of the body.... things like trading?  In terms of evidence, there's not yet a lot of good experimenting going on; it's more like blind faith.  But a guy called Rupert Sheldrake is worth a look because he is very strict with his protocols.    http://www.sheldrake.org/Research/overview/   There's also this page, which is useful:  http://www.sheldrake.org/experiments/expectations/
> 
> What I base my statement on is hundreds of personal examples.  In terms of trading, anyone can test this idea for himself quite easily.  Before you click 'buy', make a note of how confident you feel that the trade will work out profitably, then score that confidence or expectancy out of 10.  Write it down for each trade you make.  The tricky part is to really understand your feelings accurately. Bravado, pumping oneself up, acting confidently is not the same as real confidence.  Then look back after a month or two if you're a frequent trader, that is.  You'll see a strong correlation.




GB, you are still confused and extending "confidence is important" to "confidence is sufficient" without a trace of logic. Examples like personal confidence influencing health - of course it can - because my brain, my thoughts and my body are all connected. 

The reason confidence cannot be sufficient in trading is because the market doesn't know jack about your confidence level (unless you are James Packer and confidently buy $200m in TEN network). There are no means to connect through so any correlation you see are either pure chance or indirect / secondary feedback effects.

But it's not up to me to tell you how you should approach your trading, and we've crowded this homework thread for far too long. I will stay out of your trading psychology musings from now and may be you will find an audience with others.


----------



## Trembling Hand (13 December 2012)

Gringotts Bank said:


> The large majority of health care providers still believe that their pills and techniques and surgeries and manipulations are making the patient better.  Whilst such interventions may have some efficacy on their own, they are rendered completely powerless when prescribed or performed with an attitude of indifference and low confidence. * There's heaps solid scientific proof for this.*




Links please? Peer reviewed studies? Not pseudo-science crap thanks.


----------



## Gringotts Bank (13 December 2012)

Trembling Hand said:


> Links please? Peer reviewed studies? Not pseudo-science crap thanks.




I've just chunked this off Wikipedia.  Let me know if this interests you and I'll go to a bit more effort to find some really juicy stuff.



    Barber, T.X., "Death by Suggestion: A Critical Note", Psychosomatic Medicine, Vol.23, No.2, (March-April 1961), pp.153-155.
    Barker, J.C., Scared to Death: An Examination of Fear, its Cause and Effects, Frederick Muller, (London), 1968.
    Barrett, G.V. & Franke, R.H., ""Psychogenic" Death: A Reappraisal", Science, Vol.167, No.3916, (16 January 1970), pp.304-306.
    Barsky, A.J., Saintfort, R., Rogers, M.P. & Borus, J.F., "Nonspecific Medication Side Effects and the Nocebo Phenomenon", Journal of the American Medical Association, Vol.287, No.5, (6 February 2002), pp.622-627.
    Cannon, W.B., "'Voodoo' Death", American Anthropologist, Vol.44, No.2, (April-June 1942), pp.169-181.
    Charcot, J.M., "The Faith-Cure", The New Review, Vol.VIII, (January 1893), pp.18-31.
    Cohen, S.I., "Psychosomatic Death: Voodoo Death in a Modern Perspective", Integrative Psychiatry, Vol.3, No.1, (March 1985), pp.46-51.
    Dein, S., "Psychogenic Death: Individual Effects of Sorcery and Taboo Violation", Mental Health, Religion and Culture, Vol.6, No.3, (November 2003), pp.195-202.
    Di Blasi, Z., Harkness, E., Edzard, E., Georgiou, A. & Kleijnen, J., "Influence of Context Effects on Health Outcomes: A Systematic Review", The Lancet, Vol.357, No.9258, (10 March 2001), pp.757-762.
    Goddard, H.H., "The Effects of Mind on Body as Evidenced by Faith Cures", American Journal of Psychology, Vol.10, No.3, (April 1899), pp.431-502.
    Hahn, R.A., "The Nocebo Phenomenon: Concept, Evidence, and Implications for Public Health", Preventive Medicine, Vol.26, No.5, (September 1997), pp.607-611.
    Hahn, R.A. & Kleinman, A, "Belief as Pathogen, Belief as Medicine: "Voodoo Death" and the "Placebo Phenomenon" in Anthropological Perspective", Medical Anthropology Quarterly, Vol.14, No.4, (August 1983), pp.3, 16-19.
    Harrington, E.R., The Nocebo Effect: A Meta-Analysis of the Effect of Suggestion on Reports of Physical Symptoms, (Ph.D. Dissertation), Temple University, 1998.
    Houston, W.R., "The Doctor Himself as a Therapeutic Agent", Annals of Internal Medicine, Vol.11, No.8, (February 1938), pp.1416-1425.
    Kennedy, W P., "The Nocebo Reaction", Medical World, Vol.95, (September 1961), pp.203-205.
    Kirsch, I., "Response Expectancy as a Determinant of Experience and Behavior", American Psychologist, Vol.40, No.11, (November 1985), pp.1189-1202.
    Kirsch, I., "Response Expectancy Theory and Application: A Decennial Review", Applied and Preventive Psychology, Vol.6, No.2, (Spring 1997), pp.69-79.
    Lasagna, L., Mosteller, F., von Felsinger, J.M. & Beecher, H.K., "A Study of the Placebo Response", American Journal of Medicine, Vol.16, No.6, (June 1954), pp.770-779.
    Lorenz, J., Hauck, M., Paura, R.C., Nakamura, Y., Zimmermann, R., Bromm, B. & Engela, A.K., "Cortical Correlates of False Expectations During Pain Intensity Judgments ”” A Possible Manifestation of Placebo/Nocebo Cognitions", Brain, Behavior, and Immunity, Vol.19, No.4, (July 2005), pp.283-295.
    McGlashan, T.H., Evans, F.J. & Orne, M.T., "The Nature of Hypnotic Analgesia and Placebo Response to Experimental Pain", Psychosomatic Medicine, Vol.31, No.3, (May-June 1969), pp.227-246.
    Merton, R.K., "The Unanticipated Consequences of Purposive Social Action", American Sociological Review, Vol.1, No.6, (December 1936), pp.894-904. [1]
    Miller, F.G., "William James, Faith, and the Placebo Effect", Perspectives in Biology and Medicine, Vol.48, No.2, (Spring 2005), pp.273-281.
    Miller, F.G., "Sham Surgery: An Ethical Analysis", The American Journal of Bioethics, Vol.3, No.4, (Fall 2003), pp.41-48.
    Milton, G.W., "Self-Willed Death or the Bone-Pointing Syndrome", The Lancet, (23 June, 1973), pp.1435–1436.
    Perlman, L, "Nonspecific, Unintended, and Serendipitous Effects in Psychotherapy", Professional Psychology: Research and Practice, Vol.32, No.3, (June 2001), pp.283–288.
    Phillips, D.P., Liu, G.C., Kwok, K., Jarvinen, J.R., Zhang, W. & Abramson, I.S., "The Hound of the Baskervilles effect: natural experiment on the influence of psychological stress on timing of death", British Medical Journal, Vol.324, No.7327, (22-29 December 2001), pp.1443-1446.
    PyysiÃ¤inen, I., "Mind and Miracles", Zygon, Vol.37, No.3, (September 2002), pp.729-740.
    Rief, W., Avorn, J. & Barsky, Arthur J., "Medication-Attributed Adverse Effects in Placebo Groups: Implications for Assessment of Adverse Effects", Archives of Internal Medicine, Vol.166, No.2), (23 January 2006), pp.155-160.
    Richter, C.P., "On the Phenomenon of Sudden Death in Animals and Man", Psychosomatic Medicine, Vol.XIX, No.3, (May-June 1957), pp.191–198.
    RÃ³heim, G., "The Pointing Bone", The Journal of the Royal Anthropological Institute of Great Britain and Ireland, Vol.55, (January-June 1925), pp.90-114.
    Rubel, A.J., "The Epidemiology of a Folk Illness: Susto in Hispanic America", Ethnology, Vol.3, No.3, (July 1964), pp.268-283.
    Shapiro, A.K., "A Contribution to a History of the Placebo Effect", Behavioral Science, Vol.5, No.2 (April 1960) pp.109-135.
    Shapiro, A.K., "Semantics of the Placebo", Psychiatric Quarterly, Vol.42, No.4, (December 1968), pp.653–695.
    South, R., "A Sermon Delivered at Christ-Church, Oxon., Before the University, Octob. 14. 1688: Prov.XII.22 Lying Lips are abomination to the Lord", pp.519-657 in South, R., Twelve Sermons Preached Upon Several Occasions (Second Edition), Volume I, Printed by S.D. for Thomas Bennet, (London), 1697.
    Spiegel, H., "Nocebo: The Power of Suggestibility", Preventive Medicine, Vol.26, No.5, (1 September 1997), pp.616-621.
    Staats, P., Hekmatb, H. & Staats, A., "Suggestion/Placebo Effects on Pain: Negative as Well as Positive", Journal of Pain and Symptom Management, Vol.15, No.4, (April 1998), pp.235-243.
    Stam, H.J., Hypnotic Analgesia and the Placebo Effect: Controlling Ischemic Pain, (Ph.D. Dissertation), Carleton University, (Ottawa, Canada), 1984.
    Stam, H.J. & Spanos, N., "Hypnotic Analgesia, Placebo Analgesia, and Ischemic Pain: The Effects of Contextual Variables", Journal of Abnormal Psychology, Vol.96, No.4, (November 1987), pp.313–320.
    Stewart-Williams, S. & Podd, J., "The Placebo Effect: Dissolving the Expectancy Versus Conditioning Debate", Psychological Bulletin, Vol.130, No.2, (March 2004), pp.324-340.
    Tracey, Irene et al. "The Effect of Treatment Expectation on Drug Efficacy: Imaging the Analgesic Benefit of the Opioid Remifentanil", Science Translational Medicine, Vol.3, No.70, (16 February 2011), pp.70ra14.
    Wilson, I., The Bleeding Mind: An Investigation into the Mysterious Phenomenon of Stigmata, Paladin, (London), 1991.
    Zusne, L. & Jones, W.H., Anomalistic Psychology: A Study of Magical Thinking (Second Edition), Lawrence Erlbaum Associates, (New York), 1989.


----------



## Trembling Hand (13 December 2012)

Gringotts Bank said:


> I've just chunked this off Wikipedia.  Let me know if this interests you and I'll go to a bit more effort to find some really juicy stuff.




GB you stated 



> Whilst such interventions may have some efficacy on their own, *they are rendered completely powerless when prescribed or performed with an attitude of indifference and low confidence.* There's heaps solid scientific proof for this.




Where is your "heaps  of solid scientific proof for this" for what you have STATED?? That is that medical procedures "are rendered completely powerless" without confidence ?


----------



## Gringotts Bank (13 December 2012)

Trembling Hand said:


> GB you stated
> 
> 
> 
> Where is your "heaps  of solid scientific proof for this" for what you have STATED?? That is that medical procedures "are rendered completely powerless" without confidence ?




I just gave you hundreds of studies on how negative expectation affects outcome in medicine.  Confidence = positive expectation.  Lack of confidence = negative expectation.  Read the articles!!

If you want me to dig up an article about a drug made completely ineffectual by low confidence, that will take me some time.  I can do that if you're interested.


----------



## Trembling Hand (13 December 2012)

Gringotts Bank said:


> Read the articles!!




I did read a few. Not one supported you BS about low confidence "rendered completely powerless".


----------



## pavilion103 (13 December 2012)

To think that I came in here expecting what homework short term traders do....


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## Gringotts Bank (13 December 2012)

Trembling Hand said:


> I did read a few. Not one supported you BS about low confidence "rendered completely powerless".




You didn't read too far, did you?


Abstract

Evidence from behavioral and self-reported data suggests that the patients’ beliefs and expectations can shape both therapeutic and adverse effects of any given drug. We investigated how divergent expectancies alter the analgesic efficacy of a *potent opioid* in healthy volunteers by using brain imaging. The effect of a fixed concentration of the μ-opioid agonist remifentanil on constant heat pain was assessed under three experimental conditions using a within-subject design: with no expectation of analgesia, with expectancy of a positive analgesic effect, and with negative expectancy of analgesia (that is, expectation of hyperalgesia or exacerbation of pain). We used functional magnetic resonance imaging to record brain activity to corroborate the effects of expectations on the analgesic efficacy of the opioid and to elucidate the underlying neural mechanisms. Positive treatment expectancy substantially enhanced (doubled) the analgesic benefit of remifentanil. *In contrast, negative treatment expectancy abolished remifentanil analgesia.* [ie. rendered it completely powerless]. These subjective effects were substantiated by significant changes in the neural activity in brain regions involved with the coding of pain intensity. The positive expectancy effects were associated with activity in the endogenous pain modulatory system, and the negative expectancy effects with activity in the hippocampus. On the basis of subjective and objective evidence, we contend that an individual’s *expectation* of a drug’s effect *critically influences* its therapeutic efficacy and that regulatory brain mechanisms differ as a function of *expectancy*. We propose that it may be necessary to integrate patients’ beliefs and expectations into drug treatment regimes alongside traditional considerations in order to optimize treatment outcomes.

I think that proves it.  But anyway, I'm talking about trading.  Do I now have to prove that to you as well?  Or is your mindset completely rigid?


----------



## Out Too Soon (13 December 2012)

pavilion103 said:


> To think that I came in here expecting what homework short term traders do....




I think I'll start a thread called growing apples & talk purely about making lemonade  
:topic:topic:topic:topic

Getting the message yet????


----------



## Trembling Hand (13 December 2012)

Gringotts Bank said:


> You didn't read too far, did you?




Thats doesn't prove it at all. It says " critically influences its therapeutic efficacy". Not what you claimed *"rendered completely powerless"*.

No is arguing that it can _help_. You have been arguing that its the CAUSE.





> But anyway, I'm talking about trading. Do I now have to prove that to you as well?




I would love for you to do that. How about 100 of your trades proving how being confident effects positively your results. 

thats is if you actually trade!





By the way you haven't provided the link......


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## Gringotts Bank (13 December 2012)

Out Too Soon said:


> I think I'll start a thread called growing apples & talk purely about making lemonade
> :topic:topic:topic:topic
> 
> Getting the message yet????




Hey don't blame me, I had to backtrack because some people couldn't get their heads around the psychological aspects of trading.


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## Trembling Hand (13 December 2012)

Gringotts Bank said:


> Hey don't blame me, I had to backtrack because some people couldn't get their heads around the psychological aspects of trading.




thats pretty funny from someone who cannot make money trading.


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## Gringotts Bank (13 December 2012)

Trembling Hand said:


> Thats doesn't prove it at all. It says " critically influences its therapeutic efficacy". Not what you claimed *"rendered completely powerless"*.
> 
> No is arguing that it can _help_. You have been arguing that its the CAUSE.
> 
> ...




If you can't Google to find the reference, I dunno... should you be trading at all?

The blindness is astounding.  It's all spelled out for you and your rigidity is stopping you seeing it.  It actually says that the potent drug won't work if you don't believe it, dumb dumb.

Did you even see the word "ABOLISH"????


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## Joules MM1 (13 December 2012)

once upon a time if someone mentioned hitler, the convo was over

now it's anything with the prefix wiki or google.....it's like cheap baseball bats to try n hit the other poster over the head with....

and _that's_ what i do for homework


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## Trembling Hand (13 December 2012)

Gringotts Bank said:


> If you can't Google to find the reference, I dunno... should you be trading at all?




Well one of us should. We certainly know that you don't.


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## Gringotts Bank (13 December 2012)

Joules MM1 said:


> once upon a time if someone mentioned hitler, the convo was over
> 
> now it's anything with the prefix wiki or google.....it's like cheap baseball bats to try n hit the other poster over the head with....
> 
> and _that's_ what i do for homework




A bit like those hundreds of meaningless charts you rip of your fav website and put on the XAO banter thread.  Yep.


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## >Apocalypto< (13 December 2012)

apart from not trade on NFP friday I do nothing. start looking for set ups each hour from start of the Asian session till 12am. that's it.


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## Gringotts Bank (13 December 2012)

Trembling Hand said:


> Well one of us should. We certainly know that you don't.




You can't read.  I even underlined the word abolished.  But you're fixed aren't you?  

You're looking more and more foolish the more you post because it's all there in black and white.  Everyone else can see it but you.  How do you trade with blinkers on?


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## Joules MM1 (13 December 2012)

GB 0

TH 5

:jerryopcorn:


----------



## Trembling Hand (13 December 2012)

Gringotts Bank said:


> How do you trade with blinkers on?




How can you post on a trading forum when you cannot trade? Lets start there when talking about fools....


----------



## Gringotts Bank (13 December 2012)

Joules MM1 said:


> GB 0
> 
> TH 5
> 
> :jerryopcorn:




You remind me of the little red headed kid at school who'd repeat everything the big bully kid said, just so as to avoid scrutiny.  W - E - A - K.

Go and get the Trembler a drink - he might give you a pat on the head if you're lucky.


----------



## CanOz (13 December 2012)

C'mon guys...as enjoyable as this is to watch you guys sling mud at each othercorn:...can we take it off to another thread somewhere....as we are way :topic

:thankyou:

CanOz


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## Joules MM1 (13 December 2012)

Gringotts Bank said:


> A bit like those hundreds of meaningless charts you rip of your fav website and put on the XAO banter thread.  Yep.




oh, yikes......reaching for the self-expulsion switch, GB ?


----------



## ThingyMajiggy (13 December 2012)

Can you explain how this relates to trading? 

In trading you need a skillset, which leads to confidence and so on, not the other way around, you don't get confidence, then the skill set. 

People taking medication doesn't require any skills so isn't it a bit open-ended? If they developed and made the drug themselves and knew how it worked and why then it might be relative to trading, but I don't see how they connect, because trading requires the skill set first, so wouldn't you work on getting that instead of trying to trade willy nilly with just confidence because you read somewhere that mindset influenced the way a drug worked?

Genuine question GB, not having a dig, I just think it's a completely different thing, but I might be looking at it wrong 

EDIT: what the? had a GB quote at the top I though, ah well, questions directed at GB obviously.


----------



## Trembling Hand (13 December 2012)

Back on topic. I guess the question should be what homework do you do *IF* you are a Short Term Trader.

I'd just like to post this again,

https://www.aussiestockforums.com/forums/showthread.php?t=25516&p=731792&viewfull=1#post731792

If the coming market lines up then swing for the fences. If not hold ya bullets. If ya cannot figure out whats coming either way then are not a traders butt h....

Thou you can always post what the RSI looks like though in some thread to feel included I guess


----------



## Gringotts Bank (13 December 2012)

ThingyMajiggy said:


> Can you explain how this relates to trading?
> 
> In trading you need a skillset, which leads to confidence and so on, not the other way around, you don't get confidence, then the skill set.
> 
> ...




Sam I think you'd understand that I get sick of the trolls from the ****-I'm-good-I-trade-futures-International-Traders-banter thread derailing everything they don't understand.  PM would be better.


----------



## >Apocalypto< (13 December 2012)

>Apocalypto< said:


> apart from not trade on NFP friday I do nothing. start looking for set ups each hour from start of the Asian session till 12am. that's it.




Op i guess home work IMO is major news releases or CB meetings. they have the potential to disrupt the market, or change its dynamic.


----------



## Trembling Hand (13 December 2012)

Gringotts Bank said:


> Sam I think you'd understand that I get sick of the trolls from the ****-I'm-good-I-trade-futures-International-Traders-banter thread derailing everything they don't understand.  PM would be better.




I think you should start a thread. Clearly we are all interested in your answer to Sams question? 

Of course some real life examples of your trading and how it fits together would be just mind blowing too.....


----------



## Joules MM1 (13 December 2012)

>Apocalypto< said:


> Op i guess home work IMO is major news releases or CB meetings. they have the potential to disrupt the market, or change its dynamic.




yes, the context thing

i'm looking at the previous session(s) to see if there is a basic set-up to buy or to sell an annoc as not all set-ups are on the day or just for the day.....for example, i am riding gold shorts from this morning, based on rapid sales at the fomc and the inability for funds to raise price and that the commercials and swaps dealers have been heavily selling but at extremes and as we're not at either extreme of daily highs or lows then the play is within the context of that background data and how far i think price is likely to travel before either value buyers  (funds lower and commercials much much lower) try and step or value sellers (commercials much much higher) the retail crowd is pretty well tied up long in both the US futes and metals......gold has been moving smoothly on 12 point swings and they look impulsive but suddenly die and can cause traps so ratios maybe important inverse or inline doesnt matter jsut gettign them narrated is important, simply an earmark....silver has held its ground very well, so another backdrop is telling how well contained any sell is likely to be and if silver breaks it's level of value buying then pressure is inviting a build to hold overnight and if equities sell down impulsively the likelyhood leans to selling metals for the purpose of liquidity availability too plus sell-side liquidity should build during the session via puts etc..........i'm looking for general media sentiment, general talking heads sentiment.....put/call ratios of the previous day and cumulative effect ......i find reading the COT and options activity a very good background to support higher time frame activity, trying to get context so i can see if my trades will be large swings or i can do lower time frame, i think i am in the diff levels of that activity, call it trend if you like.....some basic pattern recognition starting with monthly all the way down, doesnt take long....still looking to get sense of context why is one trough a buy in the minor upmove and one trough actually the first leg in a larger downswing...again, context of the news if i'm going to be active at that time is vitally important....so a lot of prep is done on the run, how is price reacting and what level are major players likely to step in, what gaps, how likely is price going to retouch the launch price before continuing and confirming the session

news days are simply extra excuse days to move price.....it's how price might be moved relative to those biggest players and where they'll be positioned....within the confines of chop or trend.....do i think the pros have been holding this stuff for enough days and are looking to release with short sell energy or held high enough to get late have-to-buy players and then sell that strength......as everything has context and is about relative size and intent, the job is to focus in the correct area, who gains at what level, when selling looks like a break down there are levels where the buyers await the sellers, they just wait and wait no smashing bids or any of that stuff, that is a different time frame again.....the spx might not see any of the usual pro activity just after the open, but it looks smooth and somehow odd, there's no news coming and no ones pushing, i'm not looking at depth, it's in the price.....two hours into the session the pricing just goes lame but i know it wont stay lame...someone needs an excuse to move price....one large account can be the catalyst and suddenly there's two hours of downward chop to hold onto and quickly figure the ratios likely to be met or previous turnover zone that is most likely to find buyer lurking, how was this play set-up and how does it set-up the next sessions play (news or no news)

some where am i going to be wrong levels depending on the play i'm looking for and some flip-flop levels and an approximate % of where to reverse and add to a position if i find that price is telling me of a secondary or thirdary play....again, moving to context and size of the plays as fast as possible

prelim health stuff, not too tired, hungry etc little things like that do make a diff

anyways, contributing to the thread, that's prelim stuff i look at and do....most of anyways...percentage wise it's flexible, somedays all the real price work is done within minutes or seconds of trade, some light bulb ah-ha-i-see-you piggy moments

(thirdary....wot.....? sorry william!)


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## Joules MM1 (13 December 2012)

speaking of confidence et al

occasionally i'll do an emotional logic check.....yes, sounds like twallop doesnt it

emotional logic is  where i am looking for evidence for the feeling i have.....it goes like this: today i came in when i am unsure of what is happening in a specific price trend and i'll read some posts from diff sources. some are very good, top data and some are highly motivated to paint a picture (ex bulls on gold) so i unwittingly allow myself to swallow a pile of goo and need to know i dont take that pile of goo when all i really need to do is say the magic words: "i dont know" and leave things at that.....sure trade management can keep me out of trouble but then its the thousand cuts thing

the point is, awareness of self ......

i think a lot of traders do exactly what i've just described with the black hole of knowledge of understanding, of how to frame a play etc etc......it's the gaping whole in the knowledge and the rush to fill it with 'other' stuff......

the rush to get in and trade, to gamble effects and affects many, probably the vast majority of short term players.....that's another thing, that lack of knowledge makes ordinary people (would-be traders) into players at the casino rather than technicians or pro-realmed traders at an auction......

so, yeah, every now and then an emotional logic check

and i've witnessed many dom traders who get hooked on their own game even tho they have data screeming at them to do something different they become hard-wired right in that time frame and take the hits.....

emotional logic is one of those things most people dont talk about because they perceive it as a weakness, the subject is not about them, it is within them ....getting onto the subject, repetitively, can make a huge difference when practised just like 3 minutes of hard cardio makes to your body a 30 second questionnaire once a week or day can make a huge business decision difference.....


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## havaiana (22 December 2012)

Joules MM1 said:


> yes, the context thing
> 
> i'm looking at the previous session(s)...




On holidays and don't get many opportunities to post much at the moment but thanks for the detail Joules, this post is exactly the kind of info i was hoping for this thread


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## havaiana (22 December 2012)

Trembling Hand said:


> Back on topic. I guess the question should be what homework do you do *IF* you are a Short Term Trader.
> 
> I'd just like to post this again,
> 
> ...




Here's another post you highlighted a while back from drillinto

https://www.aussiestockforums.com/forums/showthread.php?t=6486&p=168028&viewfull=1#post168028

When I started to get the hang of the basics of trading, estimating the possible beginning and end of a wave and was having some moderate success, I didn't realise that it was just the basics and thought that would be all i would need.

I'm have been trying to work on getting a better handle on the bigger picture or bias 'which way to lean'. When to look to get flat/reverse versus when to hold/add. For example, when you say that you are "mostly playing the long side today", there is obviously another level to your trading other than short term trading


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## havaiana (22 December 2012)

My thoughts on trading edges

I spent alot of time searching for the illusive trading edge. Fundamental Analysis aside, the more i have learned the more i think that nearly all trading edges come down to some form of one of two tendencies of the market

1. Mean reversion 
2. Fat Tails

If i was starting from the start i would waste less time on other things and just concentrate on the above 2 things


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## CanOz (17 August 2013)

Here a little video of my homework process....for the FDAX.

[video=youtube_share;cI_fv8eGm3k]http://youtu.be/cI_fv8eGm3k[/video]


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## notting (17 August 2013)

CanOz said:


> Here a little video of my homework process....for the FDAX.




Nice music!


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## cbc (17 August 2013)

Charts, charts, charts.


I keep looking at charts till am eyes start bleeding.


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