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Brian:
My first comment is: You knew in advance that there was an important
economic number out this morning and more important, that the US
Supreme Court was hearing the election debate this morning. Your
first thought should have been: Do I want to trade on a day like
today? And if so, do I have to watch out for unusual market
conditions?
Second: If you are making 3 pts on one day, 5 pts on another day, 9
pts is the max for the week, you *can't* lose 19 plus pts one day!
Cannot! No way. Can't ever let it happen.
First rule: If you run out of capital, you don't get to trade again.
Period. They take your account away. If you can't be disciplined
enough to stick to a rule as important as: I *can't lose more than 8
points in one day, you aren't trading...you are not even gambling.
You're throwing money on a raging fire. Traders around the world are
waiting for you to make another trade so they can get rich.
This isn't a game, Brian. This is trading. It's often very difficult.
It's work. The hardest thing to do is to stick with the plan.
Have a plan, trade the plan. Period. No over ruling the plans. No
changing the rules mid-way through the day. A bad plan is better than
no plan at all, and a plan that isn't followed is worthless.
If you don't respect yourself enough to follow your own plan about
losses, either stop trading and put your money in a CD *or* please
tell all of us what commodity you are going to trade next, so we can
get some of the free cash you are passing out.
How do I know when to quit? I hate losing money. When I lose money, I
don't think about a comeback. I don't get mad. I close my positions
out and take a break. I must be doing something wrong--why would I do
more of it? There's always tomorrow.
Last thing I'll throw your way: Joe DiNapoli has a great technique
for traders that are trying to learn to follow their rules: You set
your rules. You make your plan. If you make money that day and
followed the rules, that's great. Get ready for tomorrow. If you lost
money today, but you followed the rules, that's ok. You're gonna make
losing trades, that's part of the plan. But if you didn't follow the
rules you made for yourself, impose some discipline right now. The
worst penalty a trader can impose on himself is time off from
trading. Take three days off from trading now. No exceptions. Get
away from the market action, because you are addicted to it. Take a
break and clear your head. Don't go back to trading until you have
gotten all that poison out of your system. If you come back and
violate the rules all over again, take a two week period off.
You're gonna say..."I can't be away from the markets for three days!"
And that's your problem. You have no respect for yourself and your
hard earned assets. Get some discipline.
I hope you think long and hard on it over the weekend.
Tim Morge
On Fri, 01 Dec 2000 14:00:41 -0700, Brian Keith Voiles wrote:
>I have a question: At what point do you (meaning everyone in
general)
>call it quits for the DAY when you're losing? And how do you
>discipline yourself to actually stop and quit, and not try to "make
>it all
>back"?
>
>I'm wondering because I had a great week in the S&P this week, up
>until today. Monday was a 3-point gain, Tuesday was a
>5-point gain, Wednesday was a 9 point gain, and Thursday was a
>9.5 point game. Now... here we are on Friday... and I lost 19.7
>points (ouch!). So grand total I made 6.8 points this week on
>18 trades... a net win of $1232... but could'a been a lot more if I
>hadn't responded so emotionally today to this:
>
>My first trade today missed the limit by 1-lousy tick.... then it
>turned around and hit my stop -- minus 4.7 points. Second trade:
>the same thing happen -- minus 5.5 points.
>
>So those two events got my emotional-juices flowing. But, you
>see, I have a written rule staring me in the face that says
>
>"REMEMBER: a loss of 8-points and you're done for the day, no
>matter what!"
>
>So I ignored it. Here I am after the session realizing that may be
a
>rule I can't live with. After-all, I'm the "come-back king!".
>
>Well, I'm looking for all you "old-timer's" advise on this. What
>rules do you follow and how do you mentally and emotionally
>disconnect enough to quit while the losses are "small"?
>
>Thank you,
>Brian Voiles
>
>
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-- Timothy Morge, tmorge@xxxxxxxxxxxxxxx on 12/1/00
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