Well it's been a long long time since i last traded! I stopped in late Dec, and I only started again in early Feb~ More than a month now!
I've not been slacking around of cos :) The reason i stopped trading was this: I was recalibrating myself while going thru my intensive trader's course. So i avoided trading altogether as suggested by my wonderful coach Mr Conrad Alvin Lim. Check him out at www.conradalvinlim.com.
This in turn helped me in focusing on learning. So in essence I opened my mind towards learning and i stopped trading in case i was reinforcing wrong habits. So a good one month away from trading helped ALOT.. Having learned all that I can learn (well not really all, and I'm still 2 more lessons from graduating), I came back to trade once more. This time, back with a vengence hahaha!
Armed with new found knowledge, an arsenal of tools and a better understanding of how trading works, Ladies and Gentlemen, I present to you the results of my best ever performance in trading yet! In a total of 2 trading weeks, or 10 actual trading days, God did amazingly above and beyond. I made a net profit of 176% plus :) From $100k to $276k plus.
How did that happen? Well, basically I kept things at the bare minimal. Rule One is K.I.S.S or Keep It Simple Stupid is truly wat works in trading. More often than not, traders overwhelm themselves with so much information that we suffer from wat is known as Analysis Paralysis ;) So a golden rule in trading is this: Keep It Simple Stupid! I was amazed just how true that worked out to be.
I applied whatever I had learned about technical analysis from class and researching about market sentiment and what not. Having a better understanding, i was much equipped to better succeed at making trades. Rule Two is know what you are trading. Do everything you can to get a clearer understanding of the markets you are trading in. If it is currency, find out what is driving the sentiment of the economy of that currency. If stock, find out everything u can about the sector, industry, fundamentals of the stock etc.
And finally, the hardest of them all, Rule Three is know yourself. When push comes to shove, every trader will find himself fighting against himself, his own psychology. When you are in a situation where you need to cut losses fast, but you hang on hoping the price will make an about turn. What truly stops you from doing the most sensible things is your own weakness of psychology. Do you know that success in trading lies largely on one's own psychological makeup? The percentage attributed to psychology for success in trading is 60%-70%.
Some Sun Tzu quotes are extremely applicable to what I have experienced over the past 2 weeks.
"If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle."
"If you know the enemy and know yourself, your victory will not stand in doubt; if you know Heaven and know Earth, you may make your victory complete."
"Victorious commanders seek the conditions to win first, then fight. Losing commanders fight first, then seek victory."
Check out the 3rd quote. It's one that truly applied in my latest experience in this past 2 weeks of trade. No victory comes without planning how to win first. Likewise in trading, we seek high and low to find ways to reduce risk and increase reward BEFORE we enter a trade ;) To enter a trade first, and then plan and hope for it to move in your favor is asking for trouble, asking for defeat. Trade (Gamble) like that and you will lose every bit of your capital. Some have lost their lives over this. Think about that.
Here are the results of my latest trades. Just 2 panels:
As you can see from the table, I made a total of 32 trades in half a month. 30 winners vs 2 losers. Each of the two losers were trades of about 5k plus and not more. But I have a total of 8 winners which profits numbered in the tens of thousands, the smallest being S$10,480.41, and the largest amount being S$24,865.06.
How did I manage to only make 2 losing trades and kept them at a minimal while yet have 8 huge winning trades? The answer lies in risk management. The golden rule is to cut losses quick and let profits run their course. The moment i saw those 2 losing trades move against me, I did not hesitate to cut them. That allowed me to preserve my bulk of capital. After cutting, I simply shrugged off the losses, regrouped my thoughts, focused my psychology, and moved on with life to the next winning trade.
You can see that on the 10th after I made that losing trade of S$5,197.57, I did the above and went on to a huge winning trade of S$17,298.23 the very same day. That was a trade which i prematurely cut and that move paid off.
The 2nd losing trade on the 16th was a little different. It was a case whereby I had placed my stop loss too shallow and thus got stopped out. Together with this loser, I had 2 other trades which were losing as well but had deeper stops. After I got stopped out, the other trades turned back in my favor and went on to be profitable.
I look forward to my next trade and in the meantime, here's wishing everybody a Happy and Prosperous Lunar New Year! Stay safe and don't gamble! :)
