A Major decision, and the last post for some time.

I know given the context of recent posts this seems abrupt, and it is, but it's been a carefully thought out subject and we've decided to just pay off the house.

For whatever reason, I am not able to replicate my performance with real money on any level. I have in fact reversed my performance from a 45 degree uptrend with paper trading, to a 45 degree downtrend with real money. I have my theories as to the incorrect actions I am taking, but at the root of those actions I am just too emotional and undisciplined to make it happen right now. While I could continue to trade small and work on adapting to real money, it has come to my attention just how different things could be if I used all that money to just pay the house off instead.

We currently owe about $142,000 on the house. I have spent time using mortgage calculators and we have developed a plan that will allow us to pay our home off in almost exactly 4 years if we are able to follow it.

Out of the $30,000 I started my trading account with, I am extremely grateful to have only lost 1.5% of that ($470) after all my losses, bringing the account down to $29,530. The only reason I am down so little is because I took a trade in Sugar for a profit of $960, and my very last trade (which I closed yesterday) was in Orange Juice which made me about $470. (Fun fact, my OJ went up enough to nearly have me break even on my account that day, but I put in a modest limit order to just get out with a profit.) I did not trade either of those (Sugar/OJ) the way I wanted to, but it's in the past now.

Anyhow, I have transfered the $29,530 back to my checking account and as soon as it posts I will be setting up a payment on my mortgage for a lump sum payment of $37,354. That payment will include a one time lump sum payment of $35k, a monthly over payment of $1.5k we plan on doing every single month, and of of course, our regular mortgage payment which is $854.64. I have determined that if I can work 60 hours a week, we should be able to over pay $1,500 every month and still pay the rest of the bills. Yes, anything can happen to possibly throw this plan off, but I have got so many reasons to do this. I have written them down and would like to share them:

#1. Think of the relief you will feel when you are free of the burden!

#2. You are already used to the hours, and you love your job! You've lasted 9 years so what's another 4?

#3. It's better to attack your bill with all the resources you have for a short period, because the shorter period increases the odds of resources being available to do so.

#4. You will see market opportunities come and go, and you will miss them. Realize that hindsight will cause you to feel that you missed out, but there are no guarantees you would have capitalized on even the best setup profitably. Do not remorse your decision to do this, as you will be able to recoup this money so fast it will amaze you. You will be in a much better position than you have ever been in, so it's worth it to hold off on trading until this 4 years is over. It will fly by, and you can use this time to become a better trader!

#5. You can, and you will do this. Do not entertain any idea otherwise!

#6. You are saving $66,000 by doing this! You could buy an entire house out east with that kind of money!

There are of course other thoughts that I am sure will come in the future and I may update this post with them, but that's all I have for now. Both my wife and I are excited, and this reminds me of the journey I had over the road to save as much as possible so I could try my hand at day trading. Trading didn't work out then, and it didn't work out now, but the challenge of saving and grinding away at it all was fulfilling and just my type of challenge. This is a much longer version of that, but with extremely tangible results that will change things dramatically for us. Wish us well.

An Overdue Recap & the Heroes Journey

You may have noticed that it's been awhile. Yep. You can probably also guess why. Yep, I had a tough time and tough times can drain the will to do anything out of you, especially if that means putting a glaring spot light on your mistakes. But, lets get to it.

With all the data that I had, I was absolutely certain that I had got this trading thing down. Then I went to trading real money and quickly realized that I had not had the grasp of it I thought I did. At a certain point I literally thought that maybe I had just gotten lucky, even though I had hundreds of trades to prove there was some positive edge there, and that I had found it. I even went back over all of those trades and added in realistic commissions to see where I stood afterward. Yep, still up massively over that period of time.

My wife has even went live lately and found herself having the exact same problem, and like me, now has a significant amount of trauma surrounding real money trading. It is not a problem that I would have thought I would deal with at this point, but that is where my journey has taken me thus far. We spend so much time building mental images of our future as if we can control every aspect of it. The reality is, at best we can control only ourselves and our choices about how to move forward when life presents it's will to us. Life is always the teacher, and there is no lesson we meet that there isn't something to learn or grow from. This trading thing has been a thorn in my side since I was 15, and I just turned 35. Thats 20 fucking years of journey that still has not found me consistently profiting with real, usable dollars.

But, something I have to share is that in the last year or so I have pushed harder than ever. I have gotten beaten down by the Goliath of depression so many times due to trading losses and confusion. I have felt the weight of that invisible giant's foot on my chest as it stares down to me and screams "GIVE UP!!". And as humorous as it sounds to put it this way, I feel like Neo from the matrix. Not yet the one who can stop bullets, but the one who is starting to believe. The one who has just been brutally murdered by his foe, only to take the impossible next breath. There are many times that I doubt. But those times they are increasingly accompanied by the immediate look down the other path. The road I have been down so many times before, that I know leads to a life I do not want. I have to ask myself often "Is this heartache really worth what I want?". While I would say logically every time "Of course",  my heart takes time to catch up. I'm really grateful that I named my trading venture "Never Give Up". I don't know where I would be without that one facet of all this. It has been like a totem for me. If I hadn't had that phrase printed out on my clothing to see everyday, I may not feel as compelled to keep going in the same way I am. Why would I say never give up? It sounds so damn obvious to anyone. You'll never achieve what you're striving for if you give up. But maybe the obvious part isn't the reason. If you never give up, yeah, maybe you will achieve your dreams, and maybe not, but you will become something along the way that you would never have become.

You know, I was just talking with my wife a few days ago about how I want to transform from someone who views these unwanted outcomes in my trading as devastating and depressing, as just another chance to improve and keep going. I want to have a powerful mind of a warrior. And really, I realized as I said it, that is exactly what I am becoming. It is the fight within ourselves to keep going in the face of failure and fear that sets all warriors apart from those who let their dreams die, as they return to the safety of mediocrity they know they never wanted. And you know what? It isn't even safety they go back to. Quite often it is just a hell they convince themselves is what they wanted, because they weren't one of the lucky ones.

I am the hero of my story. Fucking plain and simple. But I am tired of making declarations that I can do this. They do nothing but set up traps to fall into when they don't work out like my mind envisioned. The hero doesn't need to know exactly what's going to happen, or why, only that he will not give up until it is done. What is to be done? To take the next step, again and again.

I find that trading is a hyper-distilled and direct experience compared to most encounters in everyday, average life. I'll wager that most don't even realize what experience truly is. The saying that has been with me for so much of my life, (that "One man's trash is another man's treasure") speaks exactly to what even the most mundane experience is, which is the experience of reality through the filter of the mind. I argue that trading is the hyper-distilled version because the results are so immediate. It seems unfitting maybe, but the first parallel that came to my mind just now would be someone bashing their head into a brick wall. There is no one there making them do it, so the reasoning and results of that are entirely up to them. Just as it would seem insane to ram your head into a wall, it seems insane to just give your money away with the click of a button. But there are people that do both of those. Just look on YouTube for proof. The obvious question is, why are they doing that? It is because the filter of their mind presents reason to do so.  The problem, is that our nature is often so neglectful of considering variables that can protect us because we are so locked on with tunnel vision towards the reward.

In the grand accumulation of all my experience, the most accurate explanation I can surmise is that the failings of mankind are due to a lack of impulse control. We know sugary foods are horrible, but we do not control the impulse to ingest them. We know sedentary lifestyles are unhealthy, but we cannot overcome our impulses to remain stationary. We know that we cannot afford pregnancy, but we cannot overcome our impulse to experience those few seconds of bliss. We know we do not have the money, and that debt is financially crushing, yet we give in to the impulse to have what we want (and often do not need) right now. That very desire to have what we cannot afford, at the risk of financial ruin, is what has led this country to what will soon be a devastating correction.

I think the reason we cannot control our impulses is due to one very clear and dangerous fact. The effects of poor impulse control are almost always delayed. You don't instantly become overweight from a poor diet. You don't instantly become strong and fit from working out. You don't instantly have to care for an infant after the deed is done, and you don't instantly go bankrupt the moment you borrow money. If we received the logical outcomes immediately, far less people would make these decisions. You do however get an immediate response from bashing your head into a wall, which sadly might be the only reason more people don't do it. Unfortunately with trading, just like all the examples above, you can be rewarded in the short term for making boneheaded decisions. And as we know, that will likely keep people taking the risks.

There is something about trading real money, that nothing but trading real money can prepare you for. It is the true fear of loss that clouds our judgment, often causing us to take trades we should not be taking, then not to exit at a small loss while it is still small, and then hesitating to take the setup that would have resulted in an overall profit. While I have taken larger losses with real money, it has thankfully not been due to stubbornness and fear of a small loss. It has often been a result of my lack of knowledge with the platform.

Something I have suspected but not been able to arrive at clearly until recently until now, is the relationship between position size and volatility. I apologize if I have covered this already, but my mind is not so clear and I am just going to say it anyhow. Tim has always strongly advised against using leverage. I have found that I am really not all that comfortable trading $1,000 positions on the lower priced volatile stocks. They just move too fast and represent too much of a risk because of that. It is very easy to lose a lot of money on them, even though I am not using leverage. In fact, Tim recently released a video discussing the use of leverage and after watching it I added some comments that I thought were very appropriate.

"I completely agree with Tims warning, but there is a caveat that I think is important to mention. Tim is always talking about trading volatile stocks. You don't want to waste your time playing something that is not moving, because there is no opportunity in a stock that isn't moving. Leverage, can be used safely and effectively to synthetically amplify the volatility of a "slow moving" stock, such as twitter or something similar. To clarify, even though the stock might be moving slowly % wise, it may be moving comparably $/share wise (and offer an even tighter spread) than a lower priced stock may be. You still want to ideally trade a stock with a good catalyst, on higher than average volume, that has a good setup that will give you good risk to reward! Think about it: Suppose you have a $5,000 account and use a $1,000 position (333 shares) on a volatile low priced stock, of Lets say $3.00. Consider a high odds setup appears that sees you risking $.10 to make $.30-$.40. You take the trade and you lose $.10 or $33. No big deal. Lets say the same setup shows up on a $60 stock with the same $.10 risk to make $.30-$.40. Safely using 4 times leverage you size up to a $20k position (still 333 shares) and you lose the $.10 on the trade, or $33. Without leverage you would not have the opportunity to take that high odds setup. In that case leverage was not a danger. It is in the case where people lever up on low priced volatile stocks that extreme danger exists. You can get horrible fills and lose far more than you should ever lose! I personally don't like using even 20% of my account on low priced stocks for this very reason. Basically, these low priced stocks are so volatile that you actually need to use inverse leverage to trade them safely!"


I feel kind of slow for not realizing the concept of inverse leverage before making this comment, but I am glad to have made it so clear for myself. There is nothing wrong with leverage at all if it is risk adjusted leverage. Sticking to $1,000 positions for those volatile stocks may seem like a small size, but for my risk appetite it is just too much if a stock can move $.50 in a matter of seconds. It's not worth losing $50 so quickly. I am running out of time this morning, but I think that is a concept I would like to expound upon further in a post pretty soon here.

Real Money Recap: First 10 days

It's been 10 days since my first real trade already?!?! Wow.

It has been a roller coaster for sure. Friday the 5th is when I subscribed to live market data for $20/month. I made $51 in 82 seconds on $TLRY. It was setting up so I went long. The instant I was in a position some tab scrolled up blocking my access to the trading buttons on the chart. What would have been $150+ ended up being only 1/3rd of that.

I thought about nothing but trading all weekend, and I believe I even traded the open of some day in my simulator, Think or swim on demand. Ended up making some money.

Monday rolls around and I made $87.50 and left a ton on the table because $IGC just kept running. It's okay though, I did not feel bad about it as I know this will happen often. What blew me away, was knowing how much money I would have been up if I had been trading that $13k size position from Friday... So much potential.

Tuesday I ended up taking no real trades because of an account setting I had that sweeps my excess cash over to the commodities side of the account, which disqualifies it for use on equities or something. I changed that setting and traded in the sim.

Wednesday the Market was very slow and I made some mistakes, which I covered in my previous blog post. Ended the day down $53.20 after commissions, which was about 2/3rds of that!

Thursday was slow as well and I got the inclination to walk away from the market down only $3 on the day, but $TLRY looked like it was setting up for a break higher and I took the bait. This is where my week really got worse. One beautiful thing about interactive brokers is that you can set your orders to size your shares based on a dollar amount, so your equity performance and dollar performance are much more closely linked. It keeps you swift as you no longer have the burden of doing the math to size your positions and can just click your hot keys to enter the position. Unfortunately I did not read the fine print when I checked off the option to set my position to be $1,000. A little box popped up that told me "Any position under 100 shares will execute at 100 shares", so when I went to trade $1,000 of a $136 stock (which would have been only 7.3 shares) it got me in at the minimum 100 shares, a $13,600 position! That is just one of the mistakes that ruined my day. Another unfortunate mishap was that I was setting a limit order to enter on the break of a recent high, and it executed me instantly at basically the top of the resistance instead of on a break of it like I had planned. I still do not know what happened to cause that, but regardless, I was in a position that I did not desire to be in. It was only 10 or so seconds after execution did I even pick up on the fact that I was in with 100 shares. I was panicked, but I decided to see if the trade would turn out as my instinct had suggested. Well, no it didn't because my instinct was only wanting to go long on the break of highs, which never happened. I took a loss of $110...

I then told myself "I am very familiar with the way this stock moves, and every time I trade it I walk away with profits on it". With that in mind I decided to stick with trading it and at the same $13k position size. I ended up taking 2 more losses and finally caught the bottom, but was shaken out given the fact that the stock kept making lower lows. The interesting thing, which seems to be happening to me a lot in this slower, choppier market, is that I end up taking losses when the stock offered me gains. If you look, the second and third entries would have paid me back and more on my first loss, and the fourth entry would have done even more so! Instead, I ended the day down over $330! It was a sorrowing defeat for me that day, because I had said earlier that I was going to walk away because the market was slow, and I was down $3... While $TLRY did have potential, I simply disregarded my own words. What I had realized after my $TLRY incident, was that it was having it's lowest volume day in a month, and the range on the day was only $4, which for $TLRY was not much, especially given that the spread alone on that stock is routinely $.50-$.80!

It was very difficult for me to face the markets again on Friday, and my only goal was to finish up green. I wanted to go into the weekend in the green. One thing that did help me feel better, was to realize that the loss I took on $TLRY was so damn small, that had I been trading it as a $1,000 position, it would have been basically a $10 loss... That's NOTHING! While I was tempted to come back trading with that full $13k size from the day before, I knew I was probably not in the best emotional state to be doing that. I ended up coming back to make $41.61 Friday, but commissions ate into that making it only $22.20! While that is a bummer, I am trying to keep in mind that I am trading $1,000 positions to acclimate myself into trading real money and the emotions that go with it. I still struggle to lose $20-$30, but I think that can be minimized with the right perspective. I mean, I'll go out to dinner and spend that without remorse (usually), why can't I spend $30 happily and without stress if it means I can get $100 back?

As the weekend ended, even though I finished green Friday a lot of enthusiasm had left me. I am trying to learn to let it go so that I can maintain the proper mindset for this. Without the mindset there is no long term success. I didn't do any studying that I can recall, but I also couldn't wait for Monday to get back in the ring and make up those losses. My goal was not to make them up though, it was just to trade good. And, I have to say Monday was another frustrating day. I took so great trades but just (once again) left a lot on the table!

I actually traded $TLRY because it was setting up. This stock can bounce like crazy and it usually puts in a nice long green candle with volume as the signal that the bottom is in. Even though I hesitated and did not take the initial entry I wanted, that would have paid me hundreds of dollars easily, I still traded it too conservatively when I actually did enter! Thankfully when I was at work turning on my platform to record my days charts, I saw it had broken out hard and pulled back. It was an important level to break and I felt the need to take the opportunity for continuation on the stock, so I did. I ended up making about another $90. It crashed pretty damn hard after that so I was thankful to have exited pretty much perfectly on the remainder of my position.

So that was a nice way to end the day. up $238.70 real money on the account, but I was still bitter about not having executed on my gut and buying what was essentially a routine bounce for $TLRY. Literally ever dollar per share that thing moved would have been $100 profit to my account, and I legitimately missed about $10/share of moves, to be conservative about it. Anyhow, I had made up the losses from last week and was still up $14 from when I had come back to real money trading.

Today I came back to trading a $1,000 position, and the only stock I traded was $FFHL. It popped up on Ross' scanner and I felt like I should take a stab at it. I almost got stopped out, as it violated the lows just barely, but I held on and had set my limit at high of day. I got filled as it popped up and came right back down for $112 on the day. I said I was done, and I kept it that way, even though $TLRY had some incredible movement this morning. It ended up hitting $170 premarket. I had a feeling I should take a small over night position on it, but I did not do it. Oh well. My goal for next the rest of this week will probably be to continue trading $1k positions and just slowly building my account. I just want to prove that I can do it with this size, and then naturally I can increase it all. I have just $30 to go to make up my losses from last years real money trading!

Red day recap and digesting my mistakes

While I was green on Friday making $51, green on Monday making $87.50, and Tuesday having no trades because the cash in my account was not available, today I lost $58.10.

Why does this deserve a blog post? Because I have some key points to talk about, and I am using the lessons I perceive today to grow instead of beat myself up about things as I have so heavily in the past on days like today. The funny thing is, I say "Days like today", but today is not a catastrophic one like many of the past even though it is a red day. Just in having taken the time to reflect and see these lessons today, I already see a gigantic change in who I was as a person and the difference in how I would have handled myself just weeks ago. My problems today are basic, crystal clear to me, and most importantly nothing that I need to get upset about. It was not an easy day today by any means, and I do still hear the remnants of that demon in my head that wants to take over and make it mean things it doesn't have to mean, but it's more like I am observing from a monitor in a secure room while it is locked up in a prison cell.

Today started out much like the last two days, meaning not much up on the scanners, and what was up did not have much volume behind it. To start the day I took some premarket trades on something with decent news,  volume and a good chart setup. After the open it had a brief spike that failed so I tried to buy a dip, took a loss, and I did not touch it again. It proceeded to fade all day if I remember correctly.

If you notice on the chart above, I never respected risking a break of the lows and got scared out with small losses. Furthermore if I had held my position of 249 shares from $4.01 I could have sold into that spike at the same $4.43 (on my chase trade) for a profit of $104.58 if I would have simply respected the lows. Instead after all those trades I took a profit of only $6.02, which after commissions is a loss of $6!

I basically made the same mistake on $ACRX with not respecting the lows and getting scared out of several trades that never would have gotten me out before a good profit opportunity. However the $ACRX trade was not a planned trade at all. My wife pointed out that it was rocketing, and then Ross in the chat room pointed it out as well. I looked into the news and it had just been given a price target of $10, which means it was a long way away from that. I wanted a pullback to get into and it did not seem like it was going to give one, so I took that initial position with the goal of cutting quickly if wrong, and I did. I kept trying to play it due to the news, but I guess the market in general is not hot enough. Either way, a good deal of profit was available to make up for any losses I would have taken if I had simply respected risking off a break of the lows. It was even making higher lows, which I did notice.

I did happen to trade two other stocks well today. $IGC (+$16) and $ASTC. (+36)

All throughout the session I had to keep awakening to the tense state of my body to consciously loosen muscles and breathe. Surprising as it may sound, I often had to do that with my paper trading. People in the realm of trading frequently say contest that paper trading isn't any help, but I think it is if you have the ability to operate from the conviction that what you are doing is real. We see people all the time playing video games on edge because they've suspended their disbelief and have become invested in something that for the most part holds no real world threat. The best performers in any field are those who can detach as if there is nothing at stake, so that they can enter a flow state and execute optimally.

I have been employing (or attempting to employ) some very specific perspectives on this journey in order to operate from that detached place as much as possible.

Every morning I attempt to remind myself that cutting losers is so important, that it is basically the strategy itself. While I am experienced and have a repertoire of tactics that come to me without effort at this point, none of them can have any hope of expressing a long term advantage if I can't keep my losses small when the trade does not complete the pattern as anticipated. 

A reminder I tell myself to help ease any difficulty in cutting losers, is that I have plenty of money in the account, plenty in the bank to replenish some if needed, and a great job that I can earn to replenish with as well. There is literally no need for me to fear taking a small loss. But, as simple as all of this is, it is not easy, and that is the paradox. The real work does not so much lie in strategy, but in self mastery. Caring enough to cut the loss and follow the rules, but not caring so much that you are too scared to trade or respect the risk in the first place. Today, that was my shortcoming. It was my fear of losing that caused me to lose money today.

To sum up the errors for today:

1. I kept trading after I noticed the market was slow, as it has been for a few days now. There were very few stocks gapping up on big volume. I forgot to trade the market we are in, not the one I wanted to be in. That means that buying dips on support and taking small wins is probably going to be the recipe for success, but that's my general attack anyhow! I chased some moves and it was not ideal for the overall market energy. 
2. I kept trading after I said "Ok, I'm up on the day, I'm going to walk away". When I said that, I was up $47 on the day ($70 something before commissions). From now on, if we are in a slow market and I say that, I am going to stick to that. I only kept trading because $ACRX popped up with what seemed to be a good enough catalyst for a trade. 
3. I kept trading as it was moving into midday. Volatility just dries up and people aren't trading as much. That means potential for follow through is much less, and trading is just a bad idea for someone who want's quick and volatile movement.
4. Possibly the most obvious one of them all is that even when I did come back to trade and spotted come correct big picture patterns, I got scared out of them because I did not respect the risk off the lows. That means I was trading my P&L and not the chart. (I will add the caveat to that, that there were big sellers on the ask that kept pushing price down. While I did felt the squeeze was coming, and it eventually did, what matters is the price and level II right now. Right then I was seeing much larger size on the sell side than the bid.)

After running all the numbers, had I respected my risk I had the potential to make a combined total of $248 on the day  (including my other trades) instead of losing $58.10.

To be fair, If I had made that initial $104 on $NVCN I think I probably would have called it quits or traded very differently, as this first week my general desire is to make at least $50 a day. Who's to say though. Either way todays lessons are very important and need to be remembered every moment during the trading session. I am thankful to only have paid an amount that can easily be made up tomorrow if the market presents a good pattern and I trade it well.

This is all hindsight, and hindsight always makes it feel deceptively easy to know what you should have done. Hell, I could have respected the lows and kept getting stopped out for larger losses than I did today, which may have ended up me being down even more on the day. It's truly anyones guess, but I have to keep reminding myself of one monumental truth: I have over 9 months of tracked trades that shows I can't just be getting lucky.

During Step 1 the goal was simply to trade the chart and see if I could capture more % positive of a stocks upside over time than I lost.

During Step 2 the focus began to be equalizing my position size over all trades so that the dollar gains more accurately reflected the equity gains. In the very beginning I had some major mental hurdles brought about by the size of the positions. I got stubborn on only a handful of trades and took devastating losses, that most of, if not all, where in profit at one point or another. The bottom line is, I was truly devastated by these losses because to me it meant I would never be successful. After regrouping and almost giving up entirely after 19 or so years trying this, I began to think differently. I began to understand that if I did give up, I would never be what I wanted, or achieve what I had desired so much of my life. The only change that took place at the apex of this chart was me lowering position size to a mentally manageable level, and cutting losers.

I try to look at these charts often and realize that is what has made all the difference, and that the same person who has turned horrible results around on paper, can continue the upward trajectory with real money. Perhaps the only real world hurdle I face besides my own discipline right now, is commissions and not trading on the platform I love that allows me to see everything I need to see to trade my best. This first week I am trading with only $1,000 positions, and although my commissions are quite small compared to the rest of the brokers, if I trade too much by taking less than optimal setups I will eat away at my profits in a very detrimental way.

I have since made what looks to be a turn around since I stopped trading a year from the very last real money trade I took. I not only find it hilarious that it was basically a year exactly that I came back to real money trading, I find it consoling, because so many things in my life seem to happen so coincidentally as this. I am certainly not saying I have mastered this, either in concept or execution, but I am saying that I have never been more convinced that I am going to make this happen in a big way. My present course forward has me getting comfortable with trading $1,000 positions and slowly ramping it up so that commissions don't eat into my profits so much. As of right now with a $1,000 position, if I make a 5% gain on a stock that would be $50. If I am trading a stock that with 250 shares, the commissions would be $2.50 per round trip trade. Just the commissions alone would eat up 5% of my profit because I am trading a per share commission structure. In the future as I increase my standard trade, I plan to switch to a flat fee per trade at some point. Anyhow, today was just one day out of the journey, and I got something out of it.

Going Live

Today after trading and making $612, my wife asked me "Why aren't you live yet? What are you waiting for?" and I said "I don't really know honestly... but, if I'm going to go live I'll need a market data subscription for interactive brokers."

So I went online and added the live market data for $19.50 per month. I then logged into the live account and indeed saw that the data was live now. Then I took a look at $TLRY, a stock we have been paper trading for a month now. I saw a setup, and I clicked the buy button. I was in the stock and as soon as I was, a tab flipped up and blocked my view of the buy and sell buttons!!!

46 heart pounding seconds later, I figured out how to get rid of the damn tab and close the position. I could have made about $150 in those forty or so seconds, but I ended up banking $53. What's worse, I could have easily lost $150 too, but I got lucky.

After the trade I sat there shaking because of the frantic attempt to find my buttons again. I asked myself how much of that physical reaction was honestly due to the panic of not finding the buttons, and even now hours later, I'd say almost all of it. I did my best to rationalize what I was doing and stay zoomed out. At the end of the day I have been doing this profitably for 18 days straight now, and overall, I have several hundred trades under my belt that prove to me I know how to do this. It is so important to make it my mantra, that keeping losses small is the real strategy. As long as I am trading volatile stocks, buying on dips for the most part, and cutting losers, the winners will more than pay for them. Not only does it help to remember that, but it also helps to remember that I have plenty of money in the account, more waiting on the sidelines, and even more that I can save to refund this operation should the worst happen. But, I am not going to let the worst happen because I am in control of this. The only way I should be losing any large amounts of money is if my broker fails, which is highly unlikely.



After I was finished with the trade, I went into my spreadsheet to input it and was surprised to find out that the last real money trade I took was one year ago yesterday.

It's just kind of interesting to me. Anyhow, as I am writing this I am spending some quality time with the Trader Work Station platform (From Interactive Brokers) so that come Monday I am hopefully familiar enough and have my hotkeys workings correctly. It seems that I have it mostly figured out now.

The Gateless Gate.

I have been watching Tim's video lessons from Profitly and they are resonating in a way that they never have before. I am not learning a single thing (that I can tell), which I think on the surface sounds bad until I continue with the fact that it is simply solidifying everything I already knew. Do I think I know it all? Not in a minutia way, but honestly yes, in the "What matters" way.

Like I said in my previous post, if you can't cut the inevitable losers, no strategy matters, so ultimately the real strategy is to cut losers quickly.

The reality for me, is that I honestly feel like Tim was my problem. Ironically, as things often are, the setbacks I encountered as a result of following Tim, created the ground work for the beautiful self sufficiency I am now experiencing. The contrast between what he was teaching and what I felt in my gut all along makes seeing what I see have much more of an impact. He was both the problem, and the solution. Every "problem" is actually just a force that guides you forward, and it is essential, if proven by nothing other than its existence alone. It was totally necessary to see through him in order to more clearly see myself. What the evidence is showing me in my own data, is that I can be profitable trading only 1 hour a day, without spending hours each night creating watchlists and delving into SEC filings or reading the news.

So much more to talk about, but I have to get back to work.

The Art of Is: Standing forward in reverse

With everything I am about to say, I'd like to preface it with you not getting caught up in the language as if it were being used to make me sound wise, esoteric or sagely. I am saying what I am saying specifically because it is the best way I can muster to say what I'm trying to say.

Life is crazy isn't it? Well, yes and no. The crazy nature of humans makes life seems crazy, but, there is no problem that exists outside of human perception of a problem. There is never anything wrong, and as wrong and ironic as it sounds, there is nothing wrong with feeling like everything is wrong. All of it just is, and has its purpose, as evidenced if only by it's very existence. Discomfort is the driving force in it all. Discomfort is a good term to apply to the human condition, but in general, imbalance is what drives everything from one place to another. Existence is a sea of imbalance, that is simultaneously producing chaos from one vantage point, and harmony from another. To be clear: Imbalance, not wrongness.

No matter what I say or do, (no matter what any of us say or do) the drama that permeates being a human with emotional attachments will always be there in some form or another. One can understand very clearly that they are (to put it plainly) simply a program occupying some hardware which is involved in a dramatic play, and yet be so overrun by that programing to the point that they wouldn't be taken for having awareness of that at all.

What the hell does this have to do with anything? As usual, and quite appropriately; everything.

I have said it so many times I want to gag each time I spew the phrase, but, "I've spent my entire waking life trying to dismantle the mechanisms that I operate by". I say waking, because to me at this point in my life I view person-hood as being in a dreamlike trance so deeply, that there is no other way to explain being so caught up in things that are not actually real. Rightly so, to stop dreaming, you have to wake up. What do I mean "not real"? By not real, I mean the very concepts from which we draw pleasure, pain, hope and fear from. They are almost entirely concepts that exist not apart from the brain that computes their imaginary outcomes, or replays things that no longer exist apart from the imagining of them. This thread is the basis of this blog post, and ever more the basis of my life and way of being. Both knowing about it's sincere lack of tangible reality, and knowing that it so acutely produces tangible reality as far as anything else can, it might as well be called "The Art of Belief", insofar as we are basically an imagination of ourselves. That imagination, crystallizes into physical manifestation.

So how did I get here and what have I done about it?

As you know I have been involved with trading for many years now, and my efforts have been very sincere in the last couple of years. A pattern I have been repeating consistently during these last few years has been one in which I have several great and disciplined days of trading, only to blow it all away with some gigantic lack of discipline, throwing all my gains (and much more) completely out the window. In my last bout of depression over this loop of behavior, I was able to come to some very important breakthroughs and I would like to discuss them, along with the proposed solutions I have come up with to rewrite the programming. One of the most notable things about this entire experience for me, has been to watch the negative programming's behavior. I wanted to say "grip on me", but, it is me. We are the programming. I guess what I really find amusing is how part of the programming can watch the other destructive part, be aware of it, and yet struggle with such futility only to watch itself succumb to it. It's just another layer of perceived chaos and harmony. Quite interesting.

So as I was saying, a few great days of progress only to find myself being stubborn and giving it all back. I don't just take a big loss, I get angry and completely disregard the trade altogether because I just don't want anything to do with it anymore. To be honest, in that moment I don't want anything to do with trading ever again. I eventually cut the loss as my rationality comes back around, but besides the lack of discipline, the real problem has been the depression that immediately and without hesitation moves in and takes complete control.

The thought that moves into my mind is always "Dammit! I did it again, I'll never be able to trade for a living!". That always felt like the perfectly logical observation to me. I've been trying to trade profitably for around 19 years or so now, (very sporadic to be fair) and this is the umpteenth time this has happened to me, so it is obvious I will never get this, right?

That thought, I thought, was rational. But, I have been able to see it for what it is. It is nothing more than programming. Even if you could argue it is logical based on the statistics gathered throughout my attempts in life, I have come to understand something far more important I think.

I pondered what the hell was different about anything. What was the difference between my good, profitable, disciplined days, and the days where my discipline failed? One critical question is: Why am I lacking discipline in the first place? What is the underlying reason that I can't cut these bad trades? While I want to answer that as best as I can, I first I want to handle what happens to me after that evaporation of discipline and why. The whys have always fascinated me in life.

The hell that follows after a day like that is one that I absolutely would not wish on anyone. Well, definitely one person, but that's another story. I get so depressed and angry at myself that I feel worthless. I eat like crap to feel at least some satisfaction, then I feel like an even worse person for binge eating garbage. I sleep in, because when you are depressed you are tired and unmotivated. I am an absolute energy vampire for my wife to be around, and we both cause each other to spiral into darkness because I get so low that she can't help me at all. It is always something I have to simply endure, and it is complete hell. But why does this happen?

After a few days of pondering it all very seriously, I had only the semblance that there was something out there to grasp. It was similar to just barely being able to hang on to the feeling a dream gave you, with no discernible details. It's this feeling of deep meaning and detail, but you just can't break below the surface to discover it. (Also, it's not like I have never tried to ponder these things, it's just that this time I actually got lucky and broke below the surface.) Then finally while talking to my wife about it on a walk around the neighborhood, I began to make some breakthroughs. I discovered that my depression gets worse every time I have an undisciplined losing day, because there seems to be a subconscious part of me that operates on a logic something like this: Last time you broke your discipline you were a loser, so you deserved to feel bad and be punished, but this time you broke your discipline again and that means you must endure an even worse punishment because obviously the last punishment was not severe enough to change your behavior. I came to realize that it is not simply making mistakes that sends me into a depression, but making repeat mistakes of the same action.

The depression itself hinges on the idea that my failure to do it right this day, means that I will never get it, which obviously means that trading will never actually be a thing for me. That thought of course is crushing, because although I love my regular job, it is not something I want to be doing the rest of my life. I understandably want the freedom to go and do what makes me happy, not to be tied to a job because I am trying to pay off my house. And honestly, due to self driving vehicles being a thing, I don't know that I will even have the option to do this long enough to pay my house off. I am not qualified for other high paying jobs at the moment, so naturally that paints a bleak picture in my mind, which just enforces the depressive thoughts.

So what are my solutions to replace this programming? First of all it has to be recognized so that it can be corrected, which thankfully I feel I have done. I have since then developed some phrasing to help focus my mind on some important things.

#1. There is not a problem with your discipline, there is a problem with your process to obtain it.

This phrasing is not only correct, it takes the blame off of me in a way that makes it easier and healthier to look at what is going on. Obviously if I am not as disciplined as I need to be, it can be argued that the way I have gone about to acquire discipline needs to be tweaked. We will get to my solution to acquire discipline later on in the post.

#2. Error is part of Trail, Error, and Refinement.

It's super important to put it in the forefront of my mind that making mistakes is 100% natural. Use your errors to refine your process, not beat yourself up.

#3.It is absurd not to eat just because you know you will be hungry again. It's just as absurd to disallow yourself happiness because you know you will feel bad again.

I really was getting hung up on this one, but my wife presented it in this really beautiful and relevant way that just clicked with me. There are endless things we do and cycle through over and over that we don't and should not feel stupid about. There is this innate thing in me that always resists starting to feel good again. It's the whole idea that I'm just going to screw up and find myself feeling like a fool again. The desire not to feel like a fool again keeps me from feeling like it's okay to follow the natural flow back into happiness and goofiness that makes me who I am.

#4. Poor outcomes and negative feelings have their place. Do not wallow in them past their usefulness.

This one is from a long time ago, but it's super easy to forget. I was first introduced to the concept of "Just suffering" (or something like that) from a book called "The Four Agreements" by Don Miguel Ruiz. The point is made that we make one error, but often continually punish ourselves over and over for it. What I wanted to drive home further in this thought was that negativity is the outcome of error, and that once the solution to the error is found and understood, there is no more reason to feel negative. Suffer justly.

Lastly: The only way to progress and feel joy is to keep moving. The root of joy seems to stem from the resolution of conflict. We call this progress. There are always conflicts and areas of resistance to perceive and overcome. I literally know of nothing more that brings peace and joy than to have a resistance, and move past it either through problem solving, or perspective shifting.

So, why am I undisciplined? As I came to understand it, I simply was not operating with the right thoughts about what I was doing. If I genuinely thought the trade was never going to turn around, I would cut it and be happy to have cut it. What I needed to do was actually find a way to operate from a point of genuine conviction about losing trades in order to enact discipline and cut them off quickly. Think about it. Isn't it rare that we knowingly do something that is going to gravely hurt us physically or emotionally? No one gets married because they believe they will get divorced, no one eats a food if they truly believe it will cause them some acute reaction, and certainly no one invests money into something they believe will cause them financial loss. The fact is, even though I had been through multiple events where holding losers hurt me with catastrophic depression, doing so had worked out enough of the time to teach me the worst kind of habit. It is the random outcome that keeps people doing unhealthy things, even if statistically in the long run you will endure ruin.

How I am fixing my discipline.

My solution to acquire discipline felt once again like the hidden details below the surface of that powerful and important dream you can't reach.  I knew that if I wanted to teach myself to put the toilet seat down, all I had to do was consciously go through the physical loop 30-50 times and it would just ingrain itself into my motor memory. What I was struggling with was how to translate that into making sure I cut losers when I need to. I kept equating one as a physical task and the other as a mental task. After an hour or so of contemplation, I laughed at the obvious answer that took so long to become obvious: just open trades and close them as soon as they move against you. The idea had to consciously be about cutting the loss, not trading to be profitable. I'm no expert, but to me ultimately all subconscious behaviors are mental because the brain controls the body, but you can program the subconscious mind through conscious thought and the body.

While the physical act of opening and immediately closing trades that go against me is like planting seeds, equating logical reasons behind why I would want to do that is like getting the soil of my mind ready to hold deep roots when those seeds begin to germinate. One perspective that is helping me to actually enjoy cutting losers is that if I just take very small losers, I can get back in a few times without much total loss if the stock sets up for another trade. I will say, it is really enjoyable to exit very quickly only to see the stock continue to free fall without taking your money. That has happened several times and each time I see the stock continue down through resistance I am just thinking about how horrible I would be feeling if I had been stubborn and held.

I still find myself feeling some resistance creeping up when it comes to cutting my losers, and that is natural because I have only just started to implement these things. I imagine it will be a habit I will have to put work into maintaining for the rest of my trading career, but it will save me a fortune. My current stance, is that whenever I feel a resistance to cut, I just cut immediately. If I am noticing any resistance, it is there for a reason so I just force myself to cut.

THE REAL STRATEGY

Through the literally thousands of combined hours watching video lessons, DVDs, reading books, blogs, and actual time at the market watching charts, I have come to a very specific conclusion about what successful trading is. I certainly don't want to speak too soon here as I can't consider myself a success just yet, but I feel a great deal of conviction about this, and I see a direct correlation to my profitability as a trader.

Everyone advises to cut losses quickly. It is rule number one for pretty much every educator or trader that I've seen or studied from. The strange thing is that it is one of the hardest things to do because it flies in the face of what being wrong traditionally means about someone, even if only even on a subconscious level. So much time is spent talking about the strategies; what stocks to trade or avoid, and how to trade them, but I would go so far as to say that "Cutting losses quickly" IS the strategy. It truly doesn't matter if you find the very best stocks, if you can't cut the inevitable losers, you won't make it long term. Yes, it is understanding the particular nuances and context of each new moment on the chart that that lends to your probabilities and thus your long term edge, but no one is ever right all the time. It is simply imperative to cut off trades that aren't working, and for me, the sooner the better. As of right now I am going into each trading day saying aloud to myself "The strategy is to cut losers quickly". Distilling it down to such a simple phrase keeps my mind honed in on exactly the way I need to be thinking about these trades. Another thing I have been doing, is trading the chart and only the chart, meaning I am not looking at profit or loss to determine my exits. If the trade is breaking below my support level or not bouncing quickly enough after I buy it, I just get out.

So much goes into the gigantic machine that is trading, and I have up until the last two years always sought out the very easiest way to trade. What I have learned and what becomes continually clearer to me as the months pass, is that trading truly is just a mirror that reflects your character right back at you. I had heard that line a few times before throughout the years but just held it as a romanticism of sorts, but now it means something entirely different to me. It's exactly similar to the how the company you keep is simply evidence of your real inner constitution. It says just as much about you as the quality of your work when no one's looking. It's funny because the motivator behind all the effort I have put in my life through doing the hard work first, was so that I could relax after. When it came to money, I wanted to save to buy, not buy on credit and pay 30% more just to have it right when I wanted it. I never wanted to go to therapy or seek medication because I was always convinced that it was only a journey in which I could find the true answers for myself, and that if I could just find the programming mechanisms I could change them on my own. In retrospect I think a little therapy might have aided me, but I don't regret my path. I have had several loved ones who I would imagine are equally qualified or greater anyhow. Those that love you will tell you what they think is true at all costs.

Anyhow, the reality is, even though I have spent hundreds of hours learning to trade before I started to take it to this level, I somehow still wasn't serious about it. Maybe my standards for what that means are too high, as I still question myself here and there to this day... I think in the end, to be a great trader you have to possess the qualities of a great person, and I just want to be the best person I can be. I am ever grateful for my wife and family that has continued to slowly draw out the best in me.

Without them I would not have the motivation it takes to get past the delusions that harm me, nor the desire to continue in the delusions that serve me such a beautiful life.

More Trading aggravation with my platform

You know for awhile now I have been noticing that my broker has been giving me HORRIBLE fills at the open... I will place a limit order minutes before the open at my level, and at the open, price will go right through it and not fill me, then it will come back down through it and not fill me... it is only a good while after the open that I am able to actually get in the market with any kind of haste.

I have come to the realization that TD Ameritrade is shit for what I want to do. I put in an order to go long a break of premarket highs at the open and what happens? It gets totally ignored. It's fucking annoying as hell!

If you look at this chart full-size you can see a difference between the 1 and 5 minute charts to the left and center, versus the tick chart to the right... You can clearly see that the premarket high was broken at the open as price flew up and then began to form a bull flag, only to breakout to new highs again where I was also trying to go long and it skipped past my order. look at the tick chart, it doesn't even show ANY of that price action, where of course I was trying to trade.... All it shows is that somewhere right at the open I had in and out of about 3000 shares... I should have been screen capturing the damn thing today...  If this is any indication of how it will be to actually trade with this broker, it's fucking bullshit. 

This is the first time I have seen TD Ameritrade do this to a chart... The guy I am learning from now, Ross Cameron at Warrior Trading, trades at Light Speed. I am going to download their software and try trading a few weeks with that. I am feeling more in line with the patterns, but without the right access to the market, it's for nothing. 

I need to step it up.

The key to this game once you understand it, is to freaking have the self control to do what needs to be done. From now on I am going to start tracking each day/trade I stick to, or break my rules. It is going into the spreadsheet and I am going to get a percentage score for the day.

It has been a week market in small caps the last week or so and I new that going into today. Something set up wonderfully and I did not take the trade my gut told me to take, and then it just kept going higher, squeezing out shorts. I lost $150 on the stock today, thankfully because I was trading smaller size, but damn... I was reading the stock pretty well and got stubborn at the end. I kept exiting positions too quickly only to have them ramp up literally seconds after I got out, which of course frustrated me as time kept moving and I kept doing it.

Then when I noticed the market was probably finished going higher, I wanted to make the money back and I kept trying. Even my very last position would have gotten me a profit on the day, but I bailed quickly. I need to get my head on straight. Here's my recap from last month. As you can see, not a lot of trading days happened for me, and only 2 the month before!

Titles that inform the reader are so damn important

It's funny that I am away from all of this so long each time that I have to go back and re-read the previous post. It's like reading someone else's journal because it's so fuzzy to me, but at some point I find myself going "Oh yeah! Damn."

Orange Juice has remained in the $1.70's, so yeah, I missed out big time. My sugar position is down $1,400 at the moment and is nearing a point at which I think I might want to add. It has not bothered me much beyond seeing it go negative the first few days. The thing is, I have been watching financial videos on YouTube and another, even crazier financial collapse seems inevitable. We have just run up the debt far too much, the stock market has run on levels of irrationality for a long time, and it has reached the point where the Fed is starting to raise interest rates. These and many other factors are all ingredients that are screaming for an unstoppable correction, we just don't know exactly when. It scares the shit out of me, because I still have the debt of my house. If for whatever reason my employer isn't positioned safely enough to handle this when it happens, I may be forced out of this comfy job. Also, friends and family I care deeply about are in massive debt, or unable to save as it is. It worries me greatly.

And then what usually happens happens. I know immediately that there are no mistakes, regardless of pain or pleasure. I could spend years of my life worrying about this next financial collapse (like I did wasting years of my life worrying about a military state taking over) to never have it effect me in a major way. Who the hell knows what specifically is going to happen to me or my family, but spending hours every day driving myself to an anxious death is not a wise way to spend my time here... 

You know, at the end of the day life is truly an amazing and strange thing. Simultaneously there are billions of people living out individually different perspectives, with individually different feelings about the same things. Some are at peace, some are ecstatically enthusiastic about it all, and some are on the brink of suicide over it all. I've been in each of those positions for sure, and I would rather be a balanced individual who is neither so optimistic as to be blind to information that holds serious weight, nor so analytical over things I cannot control as to hate my existence. 

So what do I do? Well, at the moment, I am financially positioned comfortably. I am aware that could change on a dime if I start trading a large account and get reckless. I thought reckless was spelled with a W, but spell check is telling me otherwise. One thing I can say, is that this train I am on just keeps me pulling into new and engaging situations. 

Not long ago, I noticed what seemed to be a pattern in the stocks I was watching. The pattern was that stocks that were active premarket and managed to break above their premarket highs at the open tended to keep going. I thought about looking into how often that happened so that I could possibly make a strategy out of it. Well, lo and behold one day on YouTube I just so happened to see a video from a trader that I saw frequently, but continuously ignored because I was already focused on  learning from Tim Sykes. I for whatever reason decided to actually take a look into this guy's content and found out that the pattern I thought I saw was indeed a significant observation. It turns out that he trades this exact thing and has called it a "Gap and Go" trade. Long story short, my wife and I have gravitated to his content and pretty much ignored Tim because we have seen so much more value in this guys personality and teachings. His name is Ross Cameron and he started this site called Warrior Trading. In just a week of diving into his free content we've both learned things that Tim Sykes never mentions, or if he mentions it, he is far too vague about it. We ended up joining Ross's chat room for $49/mo and it's been very interesting. The value has been like night and day. With Ross you get to watch him trade live every single day. You are literally watching a screen share of his trading as he explains his exact actions and thoughts about everything. Tim Sykes only offers live trading webinars twice a week, and you can only watch them if you are a current challenge student, which means you have paid Tim over $5k a year. 

Something I really have been thinking about, and want to express lately, is that I feel like finding Ross is going to be a game changer for me and here's why: Tim's mantra was "Study-Study-Study", and while I understand that studying is important, I got the impression from him that you must have your nose to the grindstone in a certain way all the time, no days off. Tim wants you reading SEC filings and looking into the fundamentals of the company and all that. I am not and was never against the necessity of studying those things, or the past behavior of stocks. Maybe I wasn't seeing something as clearly as I should have been in regards to Tim, but I always had this feeling that, regardless of how much you study, it all comes down to just trading the price. Yes, knowing that a stock is in horrible financial condition can give you a certain edge in how to trade it, or whether to avoid it at all. It might save you from buying something that is breaking out, that simply isn't likely to continue because it has a lot of people that can suddenly sell at a certain level. I was always in conflict between knowing a stock's story and condition deeply, and just wanting to trade the price action and the chart. I mean, you can know all there is to know and still lose on the stock. 

The driving thought that is growing with more conviction in me since finding Ross, is simply to ride the momentum of a stock as best you can, and cut losses quickly as soon as you think something is wrong. 

Ross has literally taken a $583 trading account and turned it into over $700,000 dollars as of now, and the recap of every single thing he did is on YouTube for free. It's kinda crazy. He even has a free E-book that is filled with his strategies and how to trade them. For free. 

So, I feel that as of July 7th 2018, which is when we purchased his live chat room, I feel that the sails on the boat of our future have caught a favorable wind that is going to help lead us toward a more beautiful and much desired place in the future. It feels freeing compared to being under the mentor-ship of Tim, because the struggle to learn felt never ending. The time constraints on pulling off trading throughout the day felt crushing somehow. And with Ross, I am comfortable with the idea that I can achieve my goals in 1-2 hours a day, leaving the rest of my busy life to do a few more things that give me some humanity, and sanity. As long as I can make it home early enough to wake up at 6 a.m. and trade the first 2 hours, I think I can pull this off. And now that I think of it, even during the last financial collapse, day traders still made a shit load of money. I just want to pay my house off so I can secure my families future. The rest is gravy. 

To move on, I want to explain something if I have not in previous posts. I am looking at my trading journey as of now, as 3 distinct phases. Phase 1 was me proving that I can simply rack up gains overall by purely focusing on entries and exits. Phase 2, which I am currently doing as of July, is to try and translate that same skill (which I have proven to myself) into increasing the actual dollar amount of the account I am demo trading. It may be confusing as to how that is any different than Phase 1, so let me explain. Phase 2 will involve increasing my focus and skills into actually paying attention to my position size. I have to calculate the number of shares each position will need to meet a certain dollar risk. During phase 1 I simply bought a stock and sold it for a loss or a gain, not sizing for any dollar risk. If I bought a stock at $1.24 and sold it for a 10% gain at $1.36 with 100 shares, that only gave me $.12 of profit. On a $100k account that is meaningless. I would now size up that same trade to 8,000 shares so that I were using 10% of my account on the position. If every trade I took was on the same stock at the same price it would be easy, but each stock I am trading varies a lot in price and thus I will need to build the skill to quickly know the appropriate size, adjust it in my platform, and execute the trades. It is crucial to do this in order to normalize risk on each and every trade I take, or I could be putting my account at a huge risk.

I still have some nuances to discover and understand I am sure of that, but I will figure it out. The main hindrance at the moment, is that Ross's trading style is quite different than the style I used in Phase 1. I don't have time to go into the details of it though, as I am getting unloaded and will have to drive soon. 

It feels good to be able to express some things. I know I don't post much, but I hope what I do post is something I can look back on and enjoy reading about later, whatever it is that I've transformed into. 

Consistency is so important

It's embarrassing how long I have been involved in one way or another with the markets when I think about it some times.

But, I also look back and can easily say I just didn't take it seriously. I know I still have a lot more consistency to build in my current state, but I am far more serious than I have ever been.

My wife and I just recently took a vacation road trip for our anniversary, and I can with out a doubt say that it hurt my focus big time. I have not booted up the charts once in the last 2 weeks. I have barely even turned on my laptop.

For the first time in my life I think I can actually notice some fat gain on my stomach just from this trip of indulgent eating, and it annoys me.

The state of things currently are this: I am disappointed with my lack of discipline for everything in my life at the moment. I am having trouble sleeping through the night because I have to pee, and getting up to pee makes it harder to go back to sleep and feel rested when I do wake. My body is (or was) acclimated to getting so little sleep, and each night on our trip I slept only 4-5 hours.

My eating has been difficult to be disciplined with since I got back. I can feel my body craving things way sooner than I want to eat. My late work nights and lack of sleep are really making not eating outside my window a difficult task due to the increase hunger hormones released as I am more tired.

My sugar position is still in profit, and I have been checking in on it once a day, noticing that the price action seems to be preparing for some more upward movement. OJ also consolidated for a bit and looks to be taking another stab at breakout the $1.70 level soon.

Overall, my trading confidence has waned a lot. Yes, I had this run of profitability on paper, percentage wise, but dollar wise (which is all that really matters) has not been the same. My confidence is not what I would like, because my consistency is not what I would like, because my commitment is not what I would like.

I have a few projects at the house that I have been distracted with, and while I have been doing well building this fort thing for my kids, in the back of my mind I have a growing worry that I'm not going to do well as a trader. It's this anxiety and I know the projects are a welcome distraction to actually doing the work and putting real money at risk... It's disappointing to see in myself.

Also, I am realizing that lower back has never healed from the bulged disk I got several years ago. Every time I stretch in an attempt to make some progress on my flexibility goals, my lower back hurts all day at work... That is frustrating as hell. It makes me feel like my body will never feel better and that I will never be able to achieve the goals I have for it. This is all pretty depressing.

Regardless, if I want to succeed I need to just get back on task and keep repeating the process over and over. That is the only way I will ever make anything worthwhile happen in the market long term.

On top of all that, I have this damn $100k hospital  bill shit that insurance hasn't worked out yet looming over me. It is truly frustrating as hell and I just wish people would do their damn jobs.

Anyhow, I just felt compelled to write a little. I am feeling down, but it's important not to wallow in it. Back to work.

Poor Discipline Today

I broke just about every rule there was to break today at the market and I paid for it.

$CODX is a low float that ran up a bunch yesterday on no news, so naturally it was on my watchlist for this morning. It closed strongly end of day yesterday and then proceeded to rally after hours. Here are my mistakes from today.

1. Having a long bias on a stock with NO NEWS. I even said this in my watchlist for today to be careful because it had no news and it was a choppy stock. If you don't know why something is running, stay away from it, and if you can't help it, at least trade it very small. I did not stay away, and I should have traded smaller.
2. I bought at the open after it was already up a ton, in anticipation of a morning spike. It very quickly turned around which led to...
3. Averaging down instead of cutting the loss immediately! I averaged in for a total of 3 positions, each time hoping it would get me back to break even. What was I thinking?!?! In all honesty, the whole time I was thinking "You have done this before and you know you should not be doing this, why are you doing this?" 
4. The next mistake was somewhat revenge trading, or at least, trading when I was emotional. You know you should not be trading when as soon as you are in a position you want to be out of it. I took 2 more trades, one for a controlled small loss, and one that basically made that small loss up.

The conclusion is that I just completely ignored the price action that I was watching. The price is always the truth! 

THE PRICE IS ALWAYS THE TRUTH.

I saw it all happening, and I just hoped. Planning on a dip buy down to support is one thing, buying at the open before a breakout has even occurred and then adding to your obviously losing position is just horrible. I lost 5% of the value of the trading account today. Something I at least did right, was not going in with more than 20% of the account size. 

Today was just a slow market, and I should not have traded that stock, except to the downside. Of course there were no shares to short. It turns out to have been a chatroom pump... Some fake guru got his followers to buy the stock and he tanked it at the open. Had there actually been a real catalyst behind this stock, it could have really had a second day of squeezing. Really, that's what it did premarket. It squeezed shorts who didn't respect the first green day of a low float stock. I just didn't play the RIGHT play and buy it at the close yesterday.

Current thoughts and update on Sugar trade.

Not much time to report this morning, but I felt compelled to write a little.
My Sugar trade looks like it's taking off a little bit, so that's nice. You should be able to click on the images to view them full size.

I'm long the March 2019 contract from $.1273 (that's 12.73 cents/lb) and up a little over $800 at the moment. Because the contract is for 112,000 lbs, every one cent it goes up equals $1,120 profit. It could still be in an overall downtrend, and if that's the case I'll just add more when it comes down a bit, but it would be nice to ride it up a few cents, as it looks like there is going to be resistance in the low to mid 14's.

On the stock trading front, I am still pretty consistently profitable. Here is my current cumulated % gain and my % win/loss distributions. Up 486% at the moment. Keep in mind this is not representative of the % my account would be up, because I would not be utilizing 100% of my account on each trade, and therefor not be realizing these percent gains exactly. If I were to use 20% of my account on each trade that would put the account up roughly 97%, which in 5 months is pretty damn crazy. That would be risking 20% of only the initial account size as well, it does not include any compounding.

As I have been going through this experience, things have been (naturally) becoming clearer to me. The funny thing is that in the beginning I felt like I would never get it, that it would never be clear to me. I have had so many days of feeling like a total loser, confused about the whole thing even though theoretically I understood some things. I have been speaking into my phone here and there describing what is become clear to me. So far I have a few hours of talking that I feel I will eventually put in writing for others to benefit from. To sum it all up though only takes a few sentences, maybe less. 

Go where the money is. which means follow the stocks that are actually moving big, on big volume. They are usually moving for reason, which helps very much to understand so that you can gain an insight as to the future potential of the stock. Learn the patterns, understand why the patterns play out like they do. There are psychological reasons these patterns happen, and you need to operate on a level of awareness that makes them clear to you.  The price is always the truth. That means if a stock is not doing exactly what you want it to do, don't be fooled into stubbornly holding because you are convinced it will eventually do what you want it to. Even if it does, if it isn't right now, you're wrong. And lastly, Cut losses quickly. Cutting losses in my opinion is imperative to success. Unless you are trying to short a hard to borrow stock you can always get back in. Averaging in consciously and carefully can be done, but you must still respect your overall risk and be willing to cut it like any other trade. Another way to say cut losses quickly, is to say It's okay to be wrong, just don't stay wrong. 

It's amazing that it breaks down to those 5 sentences, and that I can literally talk for hours about it beyond them. The reason for this is that there is nuance to each trade because the context will always vary, but the overall strategy behind playing the pattern will remain the same. 

Another facet to update on my life is my schedule. Trading and Truck driving don't mingle perfectly, but I am grateful to work for a company that offers enough flexibility that I can have plenty of time in the mornings to trade, and even during work on a delivery I often have time to build a watchlist, study, or archive my trades for the day. The job I currently have provides so much opportunity. Even though that is great, I feel this point in the future coming closer each day. The one in which I will actually start trading live and taking real steps towards the independence from obligations to an employer. 

The funny thing is, in the last few months I have watched myself go from wanting to quit, to finding some success and starting to feel confident that I can do it, and will do it, to in the last few days feeling like this percentage chart I have is too good to be true.

The reality is, it probably is. I do have some long term stocks that I am holding right now that would hurt it a bit if I just took the losses, but I would still be up several hundred percent. I feel that the biggest hurdles before me at the  moment are actually sizing my trades up each and every time so that my account utilization is normalized to maximize my progress. As far as long term trades, I am pretty sure that is something that will need to wait until my account is pretty big. When I go for real I will need to focus on the most volatile plays to maximize the use of my capital. It would not be wise to employ any of it differently.

I recently watched a motivational video with a guy named Darren Hardy, in which he said that when he decided to really be successful and committed, that he made a list of things he was going to give up. He said he gave up body building because it was over 2 hours a day that he wasn't moving forward on what really mattered. I guess I have been leading up to the same decisions for myself. It was a goal of mine to get into the best shape of my life this year, which is completely subjective, but I now know I am committed to being a successful, consistently profitable stock trader at all costs. I want to get into the best financial shape of my life this year. The great news, is that I already am in the best financial shape of my life, but I want to blow it out of the water. I want to get in the best situation for my entire family.

A great point was made in another motivational speech I listened to, which is "If you make your pain about you, you're going to want to quit when it gets painful, but if you make your pain about something outside yourself you can keep going". The moment I start feeling down about trading, not only do I tell myself that if anyone out there is doing it I can also do it, but I tell myself that I am going to give my wife and all those in my family the life they deserve. I'm going to set them free from debt and such crazy obligations of their precious time to making their employers rich. Not that there's anything wrong with work, there isn't. In fact we are made to move and work, but I want to enable them all to put their hearts into something that matters to them, something that will bring fulfillment instead of dread and depression.

That is my reason, and I will not stop trying. I will do this. I have been working up to this for 19 years now, and I am taking it more seriously than ever. I am seeing results, because I am doing the work.

Until next time.