End of Day Journal (6-21-2010)

Day one of practice.

When it came right down it, and despite all the prep over the weekend, I wasn't quite sure how to get started. Mostly a matter of establishing a rhythm; I had been fairly comfortable with what I had been doing for the past few weeks, but limiting myself to two strategies and a time constrained yes/no decision forced some changes to the daily routine. Good changes.

Practically speaking it came down to browsing down thru the list of big moving stocks (EMA(daily,7, high) - EMA(daily,7,low) >= $2) and giving myself about 5 to 10 seconds to decide if the stock passed strategy criteria. It went relatively fast as I got the hang of it. If something looked promising, I would flag it. No decision meant pass. After checking a few stocks I would glance back at the market (Q's and SPY) and make a decision about how it was setting up. Direction? Momo? S/R? If something interesting was going on, I would check the flagged stocks for setups. All this interspersed with a glance at the high/low ticker for items of interest. Rinse and repeat.

Kept me busy and focused on what was happening; I felt more sensitive and in tune with what was going on. Optimistic I am.

Well - I hit a logistical snag that ended up diverting most of my attention late morning and all afternoon. I haven't used NT's alert system very much yet, and when I started trying today (on flagged stocks) I found out that it is extremely limited. I think I finally figured out something, but it entails keeping a new chart open for every price alert. I will be able to monitor and manage all the alerts from a 'main' chart (linked to the flagged list) but for the alert to actually trigger, a chart with the stock has to be up and running. I think the comp can handle 10 or 15 more charts without a problem, but it was too close to the end of the day by the time I got it figured out to test it.

A guy would think that I would be beyond the basic logistical aspects of this trading thing by now. Oh well.

Profit wise? I had a lot of great setups - but only captured the ones that were displayed on the active chart. I plan on posting charts tomorrow if I don't hit any snags. All just on paper this week.

Recall - the goal here is to force myself out of the analytical left brain decision mode and into and comfortable with my intuitive/gut sense. Not so much about making money, or being right or wrong, at least not for now.

The idea is that everyone's intuition is already very good at processing large amounts of complicated 'environmental' information, much better at it and faster than the analytical side of the brain. The problem is that very few of us allow or trust that side of ourselves. We need two things here - we need to train our intuition (the small problem) and we need to train ourselves to trust our intuition (the big problem). Training our intuition is about giving it a good framework (an idealized model), not about making it faster or more accurate. It is already very fast and very accurate, it just needs a target.

All the great traders have an incredible 'sense' for the market. I look at some of Scott's trades and just scratch  my head - I analyze, theorize and make stuff up; sometimes I think I figure something out, but most of the time I don't see anything that would make me enter/exit; and he just nails it. That is intuition. He has years of practical experience to draw from - his target. But not only that, he knows how to trust his intuition. I don't have either; in fact my professional training wants to scream 'No' whenever I even think about trusting my gut. I don't think it is a stretch to say that the majority of western civilization teaches us from a very young age to deny/castigate our intuition.

The big step for me is the shift. As a shortcut to fostering that trust, I am trying to give the intuition a well thought out, idealized model, simplify the process as much as possible, and keep the analysis at bay by not giving it any time to creep in. After I begin a small step in trust, I will have years to keep defining the target. Then I won't be able to explain my magic giganto right direction trades either. =)