TAILIEUCHUNG - Diary of a Professional Commodity Trader: Lessons from 21 Weeks of Real Trading_8

Tham khảo tài liệu 'diary of a professional commodity trader: lessons from 21 weeks of real trading_8', tài chính - ngân hàng, tài chính doanh nghiệp phục vụ nhu cầu học tập, nghiên cứu và làm việc hiệu quả | Being wrong on 91 percent of trades over a series of 27 trading events reaches the outer extreme of a bell curve distribution. The standard deviation of this occurrence is quite extraordinary. But it is explainable. The reason is that the distribution of profitable and unprofitable commodity and forex trades in a data set is not random in the way coin tosses or dice rolls are random. Dice and coins do not have emotions. Traders do My recent losing streak included some self-defeating trading practices which skewed the statistical probability of randomized results. Getting spooked by markets can lead to defensive trading practices that can prolong a trading drawdown. So how exactly does this work The hardest trades to emotionally execute for a discretionary trader trades for which every cell in a trader s body screams to avoid are often the best trades. In contrast trades that are emotionally easy to execute are often trades consistent with the conventional wisdom of the marketplace. Conventional wisdom is usually wrong. During a losing streak a discretionary trader as opposed to a systematic trader can revert at least subconsciously to those trades that seem safe. Nearly every losing trade during the recent string developed an immediate profit. From time to time over the years I have toyed with the idea of grabbing a quick 500 to 1 000 per contract profit and walking away from trades. The analysis of my trading in October and November not shown in this book revealed too many trading events. I had become too short term in my market analysis and was overreaching for trades that I should not have taken. Excessive market activity on my part is normally linked to three types of trading events 1. Too many major pattern anticipatory signals in an attempt to pre-position for a major breakout that may never occur. Weekly chart patterns can take a long time to come to fruition. I tend to exercise an itchy trigger finger to get involved when I see a weekly pattern developing.

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