Tuesday, February 3, 2009

Tuesday Notes - Going the Extra Mile

5:30pm Well, while today will go into the books showing only a modest, but respectable chip gain, I'm going to rank it as one of my better "managed" trading days in a while despite the fact that I had to trade remotely in the afternoon. And here's where the "life" part of trading must be addressed which also happens to be one of those chapters left out of all those "How To Trade" books thrown out there by everyone putting up a shingle in the cottage industry of the late 1990s.

It started last night when I already knew I wouldn't be at my trading station for the 2-4pm period due to a prior commitment, which given how the market had been developing over the last few days, I figured would be a fertile time for a breakout of the 810-830 logjam. So my plan heading into the day was to (1) short scalp any morning initial approach toward 830 if we got it, (2) sit tight for much of any consolidation that would likely take place intraday, and (3) make darn sure I had access to the market on a remote basis after 2pm if indeed the market broke the range.

#1 was accomplished within 15 minutes after open as I finally found some morning rhythm. Check. #2 was also accomplished as I stayed out of trouble during the midday chop. Check. And finally, #3 was accomplished when I made darn sure I had access (thanks again Sony Vaio and Sprint PCS) to the market in the afternoon when ES indeed broke the 830 barrier on decent volume. Check. And while I purposely kept sizes light given my circumstances, I ended the day with a few decent sequences -- amidst a rather choppy breakout pace where the market closed well off its highs -- to nip any chance of a consecutive day losing streak in the bud. And I hate losing streaks ... that single 3-day streak last year still doesn't sit well with me.

And while some gave me grief for trading remotely a few weeks ago, I contend that "just being there" is often 90% of the job. Sure it wasn't a home run as I couldn't size as I would have liked under the conditions. Yet it was a couple of solid base hits when the alternative was to not bat at all.

Most who know me -- including likely those who follow the blog -- know I'm extremely critical judging my own trading. Today was simply one of those days where I had the option of not going the extra mile and earning nothing, or making sure I was prepared ahead of time and giving myself a chance to earn something.

In hindsight, I think today was a strong example of what separates those serious about the markets from the "hobbyists". You simply have to go the extra mile. You have to want it more than everyone else, and then work even harder.

Over the years, I've learned firsthand that many pursuing this business are lazy at heart. Thus providing fertile ground for the "advisory service" and chatroom fleecing of the flock. They want others to tell them what to do, often use the slight inconveniences of life as an excuse not to be prepared, and then complain about their own results while telling others who do well that they're "lucky".

Someone asked me last year what I thought separated the tiny minority of Million Dollar traders from the rest. Included in my response was, "a helluva lot of hard work that most won't bother to pursue".

You have to go the extra mile.


NQJ said...

Hi Don,

Thanks for the post. Making money is really hard work. I am going absolutely crazy :-)

Had a question about the Globex sesssions. The evening/night time is so slow. What times do you typically trade?

Thank you,

Don Miller said...

F&W -

All depends on the setups and opportunity, combined with when I'm mentally the sharpest ... which will of course differ for everyone.

I tend to trade late mornings well, which is a shift from earlier in my career when I nailed almost every opening sequence. Yet I know many who trade afternoons well.

I also suck after 3:30pm as my mind simply isn't mentally alert regardless of opportunity.

The rest is up to the market as it dictates.


steve said...

Great points, this post is a "printer and keeper".

Oh, after yesterday, I guess you don't need me to stop by to help set up a few small losses!

Don Miller said...

Steve -

I'm sure I'll have my slumps this year and will keep you in mind :-).


Severino said...

Hell Don,

I do trade sometimes trade with a laptop and it is actually surprising how much you
can fit on one via workspaces. (TradeStation)

If you could not use all your tools which ones could you live without and which ones would cause you not to trade if not available.

1. 1 minute chart (sometimes switched to 2 depending)
2 .5 minute
3. 15 minute (30 and 120)
4. 3-bar break
5. Vix
6. Tick
7. Dom
8. 5 and 15 minute moving averages
9. ADX
10. Volume
11. Stochastic

“I go the extra mile so I am never left behind”



Ps If you put wholesale prices in the search on top it gives a good synopsis page of a pro.

Don Miller said...

Tough one Severino, as my preferred answer is I need all of them and indeed have all of them on my laptop. (Sort of like asking which window is most important in the car you're driving.)

It also depends on the market action and what trend is in play, but here's my shot at ranking them, using comparisons to driving a car.

Essential: DOM (Steering Wheel), 5-Min (Speedometer) with MAs, 15-Min with MAs (Windshield).

Next in Line: 1 or 2-Min & TICK (Tachometer), VIX (Fuel Gauge)

Sitting in the Back Seat: Stochastics (GPS), ADX (Wipers), Volume (Stereo ... couldn't resist), 3-Line Break (fuzzy dice ... at least they look like them).


BobD said...

Hi Don,

I am a fairly new trader that re-started trading after a 24 year lapse. Got referred to your blog from a friend. Great Stuff.

I can't find your 7/4/08 post. Do you have a direct link?

The Best,


Don Miller said...

Hi Bob and welcome to the blog.

Just expand the 2008 links in the menu to the left, and you should be able to see July. The initial link is:


Hope that helps.


E said...

Note to Flag and Wedge,

Making money is hard because you think it is hard.

Try Reading "Secrets of the Millionaire Mind" by T Harv Eker.

It wont replace the skills you need and learn by countless hours of watching and learning to interpret the market systematically.

Without a mind prepared to receive money, however, any profession is hard.

Reread the bamboo post so you have reasonable expectations.

Scared money never wins, so having another source of income while you develop yourself as a trader is a must as Don has suggested to us.

Just a caddy here with a suggestion.


BobD said...

Thanks, Don,

Good Blogs...congrats on your trading.

What are your thoughts about the next couple of weeks while they are voting on the stimulus package?

The Best,


Don Miller said...

Bob -

The background "noise" of the stimulus package doesn't really come into play for me, nor does any other "reason" for market moves as all I'm really interested in is what the market is doing at any given moment vs. why it's doing it.

On that topic, I got a kick out of Briefing.com's following post after the market began its PM move yesterday:

"14:13 We are not seeing any news that would account for the sudden lift in the markets."

Hmmmm ... I'll take a wild stab and say that the market went up because it broke a clear consolidation pattern and that buyers (including stuck shorts) gained the upper hand based on pure price action.

The charts usually tell us all the "news" we need to know, aside obviously from dramatic price spikes from FOMC, surprise interest rate cuts, etc.

If the on-again, off-again package means anything, it's that it might provide emotional market moves and we should be "careful". Yet being "careful" describes every trading day of the year:-).

Thoughts from one trader as always.


Benjamin said...

Hi Don, great post today on hard work. I also play guitar and was recently sent the following passage re a study of virtuoso musicians. i think youve touched on it before but it really relates to trading.
"The really good ones had totaled 10,000 hours of practice, while the good ones had only managed 8,000 hours or so. The underachievers? Just 4,000 hours of practice.
The most surprising thing was that they really couldn't find any "naturals." Nor could they find any grinders; people who just worked harder than everybody else but just didn't have the talent to become elite. If they made it to 10,000 hours they were elite players in every case.
The thing that distinguished one from another was simply hard work, nothing else."


NQJ said...


Thanks for the suggestions. I have bookmarked the Bamboo tree post.


MikeH said...

To add to Benjamin's comment, you might want to check out Gladwell's new book "Outliers". The premise is a long sustained period of practice (10000 hrs or 10 years) and the development of a environment that suits the person's strengths. I think Don's 2008 performance could be a case study for the book. He has the years of experience and he decided to really push for a goal and the market conditions were more suitable to his style's strengths and he took advantage of it.