Monday, April 20, 2009

Monday Notes - Ante Up

4:30pm Today reminded me of a cash poker game where you throw some low-cost chips on the table hoping to see some cheap flops, and then simply ditch hand after hand if you don't hit. And such was the case today as the market never dealt me a hand better than K-9, so I'll chalk up today's very modest -$3K chip ding to the cost of antes.

As most know, Mondays aren't my strength -- ranking as the worst performing day year-in and year-out -- and this Monday which lacked my preferred setups and pace, while teasing traders with a number of false 1-minute turns, had all of the ingredients of a recipe for disaster.

So all in all, I'm fairly pleased with my chip management today as reflected in several green scores on today's scorecard. I also ended on my PM equity high as the result of shorting the last-hour approach to 15-min resistance. Again, the daily bottom line is irrelevant except in aggregation on 12/31.

There will be time to push the chips.

For me, it wasn't today.


Ken said...

I have been following your blog for 3 months, and I appreciate your daily words of wisdom. I have been trading for 5 years, and I still get frustrated and angry on days like today. I bought at every support level on the 5min and 30min charts and watched price slice through each one like butter. I was short from Friday in a swing trade account, so those profits more than offset my daytrades. How do you handle your emotions on a day like today?
I read a few trading books on psychology. However, this irrational market just drains me emotionally. I wish I could trade like a robot everyday. Thank you.

Don Miller said...

Hi Ken -

Oh, I get frustrated (I'm human), but let me put it this way:

I know over the course of roughly 250 trading days in a year that I'll have many losing days, including some clobberings and days from hell, as well as sessions where I'm simply not dealt my type of patterns, off my game, or even worse -- both.

It's simply expected and can't be avoided, so I just try to move on and use the info for the next day. Often, it's the market making a low probabiltiy move like an all day trend, so the likelihood of it repeating on day 2 or 3 is pretty low, so you just have to stay on your game.

Always easier said then done of course ... that's why the vast majority of traders lose money over the long run.


Don Miller said...

One other thought is today was a good example of why I feel varying sizes and proper size management is critical.

Today, my trade win/loss % was likely under 25%, yet I kept my sizes and antes extremely light most of the day as nothing "stood out" warranting size (I was looking for one hard pullback to short, which of course never materialized).

Don't forget the Svithjod Rock post ... today was yet a blink of an eye for the year ... and tomorrow will be as well.

anonymous said...

Today's a hard day to trade. I took a bit of a gamble and bought puts very close to the close on Friday.

On the daily we were right above the reverse kissback + we had a wedge within a wedge + mildly exhaustive volume near the close (friday).

Then the rumors today. How coincedental.

Anyways It was a hard day unless you had a position on already. If you did, then your job was to peel contracts off.

Nice blog. Read it everyday.

RexVulgaris said...

Barely a 3 handle bounce all day.. a rare real grinder and tuff as heck to trade... NEXT

kobej9872 said...

Mr. Miller,

I am new to trading and really enjoy your blog. I have kind of a dumb question, but what brokers allow you to trade the e-mini's?

If I wanted to start trading them, what would be the best direction (broker, do i need to register with the cme, etc...) ?

I am clueless

thank you

Don Miller said...

kobe -

Tough to answer in a web post.

From a broker perspective, suffice it to say that many brokers allow you to have direct access to the CME. Shop around for rates, service, etc.


James Stollenwerck said...


FYI here's a link about the mentality of trading.

It's good on providing liquidity and retail vs. wholesale at about the 18-19 minute mark on the video, but the whole thing is as good as I've seen.

Severino said...

Thanks James.

Kind of you to share.

I found the concept of thinking of trades in a group an interesting perspective.
Even if we know not to focus on one trade, by thinking about it, even that statement
has us focusing on “a trade”. Lol.

I am going to take 1000 trades counting backwards. And will reload accordingly.
If a fictitious drawdown can help set a state of mind, why not.

I would have to imagine that trading a few thousand contracts would have a natural curve to help not to just think about 1 trade eventually.

1000 and counting