End of Day Journal (8-16-10)

Summary:

Finished the day at +$407 (200 share lots on TNA, paper):

I had a single goal today - flawless application and execution of my 'system'.

However, there are a couple of problems:

• My 'system' is not so very well defined (trade when I think I should and exit when I think I should)
• My thinking is mired in emotional fog.

When I started/committed to this paper trading exercise, I intended that it would address the first problem - definition/refinement of my system/edge. As I have been simplifying, I find myself with the opportunity to pay more attention to what is going on, especially in my head, and I realized again today that my emotional state dominates my trades, especially the exits.

Here is the funny thing, let's say I get out too early (which I did 3 times today), my tendency is to try my hardest to see something, anything, to show me that the stock still had direction - rather than addressing the emotional framework. I turn to the charts for a solution; but it is my emotions screaming so loudly when I exit. Price action doesn't stand a chance. I should be asking myself questions like - why was I feeling the way I was feeling?

This practice thing is great, and the original thought was that I would refine my technique, establish a confidence baseline, and then tell the emotions to look to the baseline. But - I am beginning to think that my emotions are so 'loud' they hamper the development/refinement of my edge.

Here's the kicker - I think feelings are a bonafide trading mechanism, but the feelings need to be a response to price behavior not other things.

What are the other things? I am not sure about them all, but I have identified a few that come up regularly while I am holding a position:

• Watching a winning trade turn into a losing trade
• Failing at trading

I want to pour energy into addressing these directly rather than my default action of trying to force something out of the charts (that probably just isn't there to begin with). This needs to be part of the practice program.

What to do?

I have virtually no experience in this area, but this is what I am thinking:

• Identifying and coming to grips with the worse possible outcome of my fears
• Affirmations

I want to think about these and how they should be applied. And - if anyone has any suggestions, feel free to pass them along. Again - I want things that I can actively apply while I am in a position, perhaps even before I enter a position.




I am posting the chart, perhaps trying to re-enforce the need for patience? I was at the top of the 7:45 short opportunity, bottom of the 8:30 long opportunity, near the top of the 11:10 short opportunity, and bottom of the 12:20 long opportunity. I capitalized on the 11:10, but got out too early on all the others.

And this is practice - what is the worst that can happen if I would of let all those turn around and become losers? I would of had to post a negative blog entry today. Pfft.

Trade well.

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