Reasons why I sucked at the beginning & what gets me into trouble

If you couldn't tell from my blog posts, I have a deep passion for stocks.  This passion is what got me involved in the stock market and eventually to technical analysis.  It is also the reason for my failures.  My failure at the beginning of my career and the downs of my current trading.  Trading is one career path that no matter how hard you work, success is not guranteed.

I have been active in the market for 3 years now.  The entire first year I was terrible and experienced nothing but losses.  But I didn't care.  I wanted to get this down.  Even if I wasn't any good, I still loved to do it.

As I progressed and continued to learn, I developed a deep understanding of how the market works.  I was able to build on my book knowledge and fully grasp why certain things were happening in the market as well as see patterns correctly.  I finally started to see some profit and consistency.

But amazingly enough, I still sometimes struggled, even with all this knowledge and understanding.  How could this be?  If you know so much about the market hows it possible to not achieve the success you want, how is it not possible to be right "most" of the time?

There is an important element to this game.  And its your emotions.  I became an action junky.  My love for trading became an addiction.  Instead of focusing on the perfect trade, (a very strong case of multiple variables and time frames to support a trade) I would trade everything and anything when I thought I saw a good pattern.  This leads to death by a million cuts.

In trading, everyone always preaches, "let the trade come to you".  But what does this really mean?  In lamest terms, its simply letting the trade opportunity present itself rather than seeking it.  If you've ever made a boredem trade this is an example of seeking a trade.  If you've ever been scrolling thru charts/chatrooms thinking "I have to find something to trade" well you guessed it, you're seeking a trade.  Today I had a great example of letting a trade opportunity present itself.  It was CLF.  I put this on watch for the pattern you see below.  I knew it had earnings this week so I figured, if it beats this has room to move.

I walked into my office late today because I had an appointment for work.  I opened up my platform and checked out the chart.  Immediately, an opportunity presented itself to me.  I didn't have to rationalize taking this trade.  It had all of the variables I was looking for.  Daily breakout, intraday flag, holding support, limited risk, high probability to name a few.

Whats Changed Recently?

I've really narrowed down my trading over the past few months.  I have mostly swing traded, but do look to take a daytrade a few times a week.  A major shift in focusing on what I am good at and understand has been put into place.  Instead of trying to be a gunslinger being in everything, I take my time before entering.  Things have slowed down for me.  Charts don't seem to move as fast.  My heart isn't pounding tick by tick.  I've become much more comfortable when in a position.

I did this by shifting my mind.  I'm looking for premium hands, what I am good at.  I'm not just looking for a random pattern.  If I have a full understanding of the pattern, I take it.  If I'm iffy, I'll shift to my insurance work.

We are all different.  We all have different styles.  We each have our own strengths and weaknesses.  Some take profits too quickly, others hold way too long when the trade is over.  Whats important is figuring out what your strengths are and focusing on them.  The pattern and action you understand, is less likely to shake you out or make you stop out early.  I can ramble on and on about this, but I'll save more in-depth talk about each subject perhaps for another blog post.

This is the first blog post that I can sit here and type, I think I am starting to understand myself when it comes to trading.