Tag Archives: Journals

How to Kick-Start Your Growth and Development

 

If your progress has stalled in any way, it is just SO IMPORTANT to realise the following truth:

Progress comes from your growth and development plan, not from your strategy.

This just won't work:

The typical failed process

Hoping, wishing and praying doesn't work.

Just trying harder doesn't work.

You need something ACTIONABLE.

Let's fix it NOW:

STEP ONE: Implement a growth and development plan based upon GROUPS OF TRADES.

Here is the concept. Review the following articles:

(a)  http://yourtradingcoach.com/trading-business/its-time-to-fight-to-get-to-the-next-level/ 

(b)  http://yourtradingcoach.com/trading-business/its-time-to-fight-to-get-to-the-next-level-examples/

(c)  http://yourtradingcoach.com/trading-business/you-can-do-this/

(d)  http://yourtradingcoach.com/trading-business/consistency-its-a-necessary-part-of-the-process/

(e)  http://yourtradingcoach.com/trading-business/before-making-changes-to-your-strategy/

A GROUP OF TRADES Growth and Development Process

Also… any changes you're making…  consider making them the stretch goal for your next group.

See here – http://yourtradingcoach.com/trading-business/stretching-to-the-next-level/

A stretch goal - just a little stretch beyond current capabilities

Most importantly, major process changes can only occur at the end of each group. And they must be based upon proper review and analysis of your group stats and journal entries.

STEP TWO: Intra-group, monitor daily to ensure consistent implementation of your process.

No major process changes occur here.

Only tweaks or minor changes to how you execute your processes.

A daily review to improve implementation of your processes

Now move the response to question three to tomorrow's pre-session planning.

Remember:

Progress comes from your growth and development plan, not from your strategy.

If you're not progressing, then something HAS TO CHANGE.

Something actionable.

Something concrete.

Between groups, you MUST identify a concrete, actionable improvement to process.

Within groups, you MUST monitor consistency in implementing process, and tweak as required to improve implementation.

Hoping, wishing and praying that somehow this time it will be different, doesn't work.

Just trying harder, doesn't work.

Find something REAL that you can implement.

It won't always be easy. In fact it will rarely be easy. But damn it, you can't progress by just continuing on the same treadmill.

Fight to find an actionable change that progresses you in the right direction. Implement it. Repeat.

You can do this, 

Lance Beggs

 


 

Employing a Self-Distancing Strategy to Improve Journaling and Review

 

Close your eyes and imagine a really bad trading session. You might have a recent example you can use. Or if not, just make one up.

The details don't matter. They'll vary for each of us. Just make it bad.

Maybe this:

"I drag myself into the office and throw my bag on the floor. Feeling crap with a hangover and too little sleep due to last night's celebrations. It's 10 minutes till market open. No problems. I'll catch up on the pre-session admin later and just wing it. I'm on my third coffee already – this should help me make it through ok."

The market opens and drives higher with strength. "Suckers… it's right into resistance. I'll short here and catch the move back down to the market open."

Of course, it loses!

As does the second attempt. And the third. And the fourth, which had the stop pulled even higher, because "this damn thing is so overbought".

Or maybe your example is something much worse.

Whatever it is, close your eyes and visualise it. And feel every feeling that such a session would bring.

Disgust! Anger! Frustration!

Now, the session is over. You've smashed your keyboard and it's time for review. Close your eyes and imagine yourself critiquing your performance.

SERIOUSLY!

Close your eyes, visualise this scenario. And then critique your performance.

Now let's shift the scenario slightly.

This time the session went exactly the same, but you weren't the trader. The trader was the person you most love in life. Your partner. Your Mum. Whoever you care the most for.

And you're their coach. The person they come to after each session to discuss their performance and to plan the way forward.

Close your eyes and imagine how you would handle their performance review.

Visualise it.

Feel it.

If you've been honest with yourself, it's likely that the first scenario would have been far more emotional. Quite likely an explosive, self-critical and self-deprecating review.

Whereas the second, while still noting that the performance was unacceptable and must lead to change, would likely be more calm and rational. With a more considered review of both the reasons for the poor performance and the solution that is necessary to prevent recurrence.

This simple shift in the scenario has created some space, or distance, between our rational mind and the emotion associated with the trade performance.

 

Self-Distancing Strategies

I absolutely love this article by Brad Stulberg in NYMag.com:

http://nymag.com/scienceofus/2017/02/self-distancing-will-help-you-make-smarter-deciions.html

Please read it. It will take about 10 minutes, tops.

Some key excerpts:

  • Collectively referred to as “self-distancing,” practices like those outlined above and Rusch’s “pretend you’re talking to a friend” allow us to remove our emotional selves from intense situations, paving the way for more thoughtful insight and subsequent decision-making.
  • Employing a self-distancing strategy allows you to evaluate activities or situations that are rife with passion from an entirely different perspective, one that includes logic alongside emotion.
  • “I talk to myself all the time,” says Rusch. “It’s just that when I talk to myself as myself, I tend to be negative and not so helpful. But when I talk to myself as if I were talking to a friend, my words are motivating, forgiving, and far more productive.”

 

Employing Self-Distancing Strategies to Improve Journaling and Review

I will be employing these ideas in two ways:

(1) Journaling

Here's another excerpt from the article:

  • Similar studies show that when individuals think, or journal, in the third person rather than in first person — for example, “John is running into challenges with his business that seem insurmountable” versus “I am running into challenges with my business that seem insurmountable” —they, too, evaluate themselves and their situations more clearly and with more wisdom.

 

I now journal in the third person.

Give it a try for a month. You can always go back to normal if you don't like it.

(2) Reviews

All reviews (session reviews and longer term reviews) will now be conducted as if I am the "Performance Coach" reviewing a trader within my firm.

Again, give it a try for a month. You've got nothing to lose.

And if you can separate your rational and logical side from the emotion of the session, just a little, there is a WHOLE LOT to potentially gain.

 

Why Not Get Started Right Now?

That trading you did so far this year is no longer yours. It was done by your best friend, your partner, or some other loved one.

You are now the performance coach.

And it's time for you to honestly review their trading business.

Close your eyes and imagine the review session. And answer the following questions.

  1. Did they approach these recent months with clear and realistic goals for growth and development?
  2. Did their performance drive them successfully towards achievement of their goals?
  3. Are the goals still appropriate, or do they need amending?
  4. What action must be taken in the coming months to take decisive steps forward?

 

Calmer. More rational. More logical.

And far more likely to lead to practical and effective decision making.

Give it a try!

Happy trading,

Lance Beggs

 


 

Studying a Higher Timeframe Trap

 

There are some common themes that run through the articles I produce at YTC. One of these, which has been here since the beginning, is the importance of creating a Market Structure & Price Action Journal.

Every day, find something that amazes you in the charts. Print it out. Cover it with notes. Study it. File it. And review your journal often. It really will be the greatest trading book… EVER!

Over time, I promise you will start to see patterns within the market structure or price action, which repeat themselves again and again and again.

Like this, which we shared via social media way back in 2015:

What doesn't happen... is important information! 

This is a structural feature that I see repeated again and again and again.

Here's another previous example – http://yourtradingcoach.com/trading-process-and-strategy/trading-failed-expectations/

And of course, those with the YTC Price Action Trader should look to Volume 2, Chapter 3, Page 143.

But let's look to an example which occurred last week, on a higher timeframe chart.

Yes… it's an idea which you will find in all markets and all timeframes!

Studying a higher timeframe trap

Studying a higher timeframe trap

Studying a higher timeframe trap

Studying a higher timeframe trap

Studying a higher timeframe trap

Studying a higher timeframe trap

Studying a higher timeframe trap

Studying a higher timeframe trap

Studying a higher timeframe trap

Studying a higher timeframe trap

Studying a higher timeframe trap

Studying a higher timeframe trap

Happy trapping,

Lance Beggs

 


 

The Good, The Bad and The Ugly!

 

Here is another way to track and review trades… with a classification system that makes it a little bit of fun!

During your post-session review you classify them into one of three categories:

  • The Good – Trade ideas which DID have edge and were well managed.
  • The Bad – Trade ideas which DID have edge but were either poorly entered or poorly managed.
  • The Ugly – Trade ideas which DID NOT have edge.

 

Some clarification:

  1. "Trade ideas which DID have edge" – I need to do some more work on teaching this in the future. For now, consider them to be trades in which your hindsight review says, "Yes, taking this trade was the right decision". This does not necessarily mean it profited. You might have taken a loss. But without any doubt, it meets all your trading plan criteria and it's one you were right to have taken.
  2. "Trade ideas which DID NOT have edge" – Those trades which are clearly not a part of your trading plan. You had no right to be in that trade. This doesn't mean it lost. It may well have profited, but was still a poor trade (for example… a revenge trade that works!).
  3. Feel free to vary the definitions in any way that makes more sense to you. But keep them in three classifications – The Good, The Bad and The Ugly!

 

Our aim is to seek constant improvement in our stats. When analysing the stats associated with larger groups of trades (20 minimum), we look for the following:

  • The Good – We want more of these. Always be aiming to increase the percentage of The Good within any sample of trades. And to increase the profit they provide.
  • The Bad – We want less of these. Always be aiming to decrease the percentage of The Bad within any sample of trades. And to reduce the damage they do to P&L.
  • The Ugly – Ideally, we aim for NONE of these. That might be tough. But it's the goal.

 

It's a continual striving for improvement in skill and expertise.

And of course we drive our performance improvement through an effective review process:

The Good:

  • How can I ensure I take more of these in future? What signs were there pre-trade to suggest this could be one of The Good? Consider both the market structure and the way that price was moving.
  • How could I have have performed even better? Was there any way to have increased size (assuming you scale in and out)? Was there any time or place at which I could have added to the position? Was there reason to extend the targets even further?
  • Were there any non-technical factors present which may have assisted with my decision making? How was my physical state? How was my mental state? How was my emotional state? How was my trading environment?

 

The Bad:

  • In what way did I underperform with this trade?
  • Why did this occur?

  • How can I ensure I do less of this in future?
  • Were there any non-technical factors present which impacted upon my decision making? How was my physical state? How was my mental state? How was my emotional state? How was my trading environment?

 

The Ugly:

  • How can I ensure I avoid these trades in future? What signs were there pre-trade to suggest this WAS NOT A VALID TRADE? Consider both the market structure and the way that price was moving.
  • Why was I not aware of this at the time?
  • Were there any non-technical factors present which may have assisted with my decision making? How was my physical state? How was my mental state? How was my emotional state? How was my trading environment?

 

The Good

The Good

The Good

The Good

The Good

The Good

The Good

The Good

The Good

So… given that it's now closer to 4:30am… how about we come back next week with part two. We'll look at the earlier trade from this same sequence (The Bad). And I'll see if I can find you one of The Ugly ones as well.

Happy trading,

Lance Beggs

 


 

Review and Improve

 

You might like to consider your review process as the vehicle which drives your trading business to its ultimate destination.

Whether that destination is ongoing improvement and eventual success… or continued mediocrity, frustration and failure… is completely up to you.

If you've got nothing in place, here is a simple process to get you started.

Once you're comfortable with this, there is great scope to expand it to new areas of review. It doesn't solve everything.

But again, if you've got nothing in place, consider implementing this process RIGHT NOW.

Review and Improve

Look at your last 20 trades. Study them with the benefit of hindsight.

Examine 50 if you prefer. Or 100. Find the right compromise for sample size, which is large enough to be statistically significant and small enough to ensure your review process occurs on a regular basis. But not less than 20. I would suggest that is the absolutely minimum.

Once you've gathered all the trade data and charts, let's check the quality of the setups.

How many of your trade ideas were in chart areas which DID offer potential for multiple-R profits (2R minimum)?

It doesn't matter whether you actually managed to profit, or not.

We're checking the general concept. The trade idea.

We're making sure you're trading in the right areas of the chart.

Did price move from the setup area a sufficient distance to provide multiple-R returns?

Take note of all the trades within the sample which achieved this goal. And now let's check the quality of trade entry.

Now consider those trades that were in good multiple-R setup areas. How many were you able to enter at a place and time which offered good potential to catch those multiple-R profits?

Again, it doesn't matter if you achieved a profit or a loss.

With the benefit of hindsight, given where you entered, is it reasonable to expect that a successful trader could manage that position to achieve multiple-R profits?

How many of these trades would you classify as having a good entry?

Take note of them… and let's move on to check the trade management.

Now consider those trades that were in good setup areas and which were entered well. How many of these were successfully held from entry to the first target level?

How many were you able to hold open to the initial target point, avoiding all temptation to scratch the position early?

And then…

Of those which did achieve the initial target, how many of these were held to a further "hindsight perfect" exit point?

Again, take note of how many achieved this aim.

And now let's use this information to drive our business forward.

Looking at these figures, which area do you need to improve when trading the next sample?

It's important that we focus on one area at a time.

And that we work in order.

Get the setups right first. Are you happy with the number of trade ideas that are actually providing multiple-R profit potential? If not… focus on improving the quality of your trade ideas.

Then work on entry.

Then initial management.

And then ongoing management.

Find the first area that disappoints you. Examine why. Determine a course of action for the next 20 trade sample.

And repeat.

Happy trading,

Lance Beggs

 


 

Finding The Places Other Traders Got It Really Wrong

 

I really like this statement from last week's article, where we discussed how I use "the other trader" to identify good trade opportunity.

  • If I can't feel someone on the other side of the trade getting it really wrong, there is no trade.

Step one in implementing this idea into your trading, is to learn to find these areas where "the other trader" might have got it really wrong, with the benefit of hindsight.

And to achieve that, I recommend you use one of my old favourites – your Market Structure & Price Action Journal.

Let's add a new category to our journal entries – "Places Other Traders Got It Really Wrong".

Print your trading timeframe chart. Cover it with notes. File it. And review it often.

You don't have to find every single occurrence.. Just the obvious ones which really stand out to you. Anything which immediately screams out to you, "that was a dumb place to trade!!!"

Here's an example covering the first hour and a half of the most recent session.

(Click on the image to open a full-size version in your browser)

Finding the places other traders got it really wrong

What if you did this every session for the next few months?

Could the potential improvement in your edge more than justify the five minutes it may take each day?

What are you waiting for?

Happy trading,

Lance Beggs

 

PS. It's important to note that in trading like this I rarely enter via a limit order placed ahead of time in the area of interest. My personal preference is to let price enter the area where I think other's might have got it wrong. And then watch to confirm the behaviour. Ideally I'll see some sort of stall or exhaustion, indicating a failure to continue further in this direction. That's my cue to enter. Sometimes it comes VERY quickly. Other times it provides a nice stall structure which allows entry as it breaks. With experience you'll know whether it has potential to snap back quickly or not. First step though… learn to see them with hindsight. So get started on your Market Structure & Price Action Journal.

 


 

What If You Did This Every Day?

 

The following image was posted on YTC Social Media on Tuesday… and I think it makes such an important point that I want to expand upon it in today's article.

First… here's the image:

What if you did this every day?

All trading conditions are NOT equal.

Sometimes the environment is well suited to your trading strategy, your style and your personality.

Other times it is clearly not suited.

What difference could it make to your results, if you were to start each session with a game plan. Something like this, for example:

What if you did this every day?

As always, the game plan is subject to change during the session. But it's a useful starting place.

It will have you ready to engage the market without hesitation, should price move into areas with potential for ideal trading conditions.

And it will have you operating cautiously at all other times.

But how do you learn to identify these areas?

This is a good goal for your Market Structure & Price Action Journal!

What if you did this every day…

What if you added a short task to your session review procedure? Just a couple of minutes to review the higher timeframe and trading timeframe charts.

What if you identified the areas on the charts which provided ideal trading conditions? The price action with clear directional conviction, smooth flow and ideal pace (or whatever other conditions you prefer). Just the absolute BEST!

What if you studied the market structure, noting on the chart the features or conditions that led to creating this ideal environment. Typically these might be areas that spring an HTF trap, or areas of significant breakout.

What if you studied the price action, noting how to best exploit the trade opportunity to maximise profits while minimising any risk.

What if you printed the charts, along with your market structure and price action notes, and filed it into a ring binder or folder?

What if… after doing this for a year… you realised that you had a document with maybe a hundred or so examples of ideal trading conditions, along with notes on how to identify them, and how to exploit them once they're confirmed.  (Yes there are well over 200 sessions a year, but not every session will provide an area of "ideal" trading conditions!)

What if you used this resource to document some rules-of-thumb for identifying potential areas of ideal conditions, allowing you to commence each session with a game plan just like the example listed above?

Would that perhaps be useful?

Let's look at another example using the same market as in the above image, but from the very next day.

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Market Structure and Price Action Journal Categories

 

I've long been an advocate of the importance of a Market Structure and Price Action Journal. There is no shortage of material on this topic if you want to search the YTC article archives. The best place to start might be with anything tagged "journals", which you'll find here.

So I'm pleased to have received this email question from a YTC reader.

  • "Sir, I have started a market structure journal but would be most grateful for some suggestion for topics or categories for journal entries."

 

No problems at all.  🙂

Some people prefer to make their journals completely free-form. That is, no categories at all. Just finding one item of interest each trading day and studying it in depth. That's great.

Others will prefer to pick a topic or two for intense study. Each day they'll find and study a market structure or price action sequence related to that topic. This will allow for quicker discovery of "rules of thumb" regarding how to identify and manage these particular market structure features or price action sequences. And when you're "done"… move on to a new category.

Just pick whichever approach you want. There is no right or wrong.

Ok… so the email question assumes you've chosen the second approach and want to focus on one particular category of journal entry at a time.

What should you chose?

Again, there is no right or wrong. Just make sure it's something relevant to your own approach to trading.

But let's list some categories to help you get started if you're new to journaling. Or if you already have a journal underway, perhaps the list will help you identify a new area for future exploration.

Support & Resistance Structure

This is the obvious starting point – the S/R Structure. Print examples and study them in detail. What makes a good level? When do they lose relevance? How does price interact with the level?

  • Level Definition – Which Levels Remain Valid For Further Touches?
  • Level Definition – When Do Levels Lose Relevance?
  • Resistance – Successful Break
  • Resistance – Failed Break
  • Resistance – Tested But Not Broken
  • Resistance – Becomes Support
  • Support – Successful Break
  • Support – Failed Break
  • Support – Tested But Not Broken
  • Support – Becomes Resistance

 

Specific Key Levels

You may wish to expand upon the basic S/R structure and study some specific levels in a little more detail.

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Build a Visual Library of MUST-TRADE Scenarios

 

We've spoken in NUMEROUS articles about the importance of using a journal to study key market structure and price action sequences, with the aim of developing your ability to perceive and understand the current strength or weakness of price movement and project that forward to develop a bias for the near future.

Here are some articles on this topic if you missed it all:

 

That's a quick list from the top of my head. But there are likely more if you want to search through the archives (http://yourtradingcoach.com/site-map/). Perhaps try the Tag List on the right hand side, or the search box at the top right.

Equally as important though is a Trades Journal, studying the best trade sequences of the day whether you took them or not, with the aim of developing your ability to perceive, understand and exploit trade opportunity when it presents in the markets.

I know… I ask a lot of you!

But I really believe it's of GREAT benefit to your trading business. Every trading session – one entry in your Market Structure / Price Action Journal. And one in your Trades Journal.

Trading is a skill-based & performance-based activity.

How do you develop skill?

How do you improve performance?

By studying best-practice! Whether you traded it or not!

What was the best trade opportunity of the session? If you did see it at the time, what did you do well and how could you do it even better? What did you do poorly and how could you improve next time? And if you didn't see it, what clues did the market provide that this was a Must-Trade scenario.

If you don't have a Trades Journal, get started today. Open up your charts to the prior session and find that day's Trade of the Day! Print it out. Study it. Cover it in notes. And file it.

Here's a few to get you started… all from last Friday's session… all of which I consider Must-Trade scenarios.

Click on the images to open larger copies in your browser! Or see the links below the images to download a copy to your computer!

trades journal - sample 1

 

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Why Do We Create and Regularly Review our Market Structure and Price Action Journal?

 

Last Sunday I shared the following image on YTC Facebook and Twitter.

It's such a beautiful example of the benefits of journaling, I just had to expand upon this in a newsletter article.

From YTC Facebook and YTC Twitter - why we create a Market Structure and Price Action Journal

Here's the thing…

Finding and exploiting market opportunity

Ok, I know!

The markets don't always back up the very next day with a repeat of key price sequences.

The real benefit builds over time. As you populate your journal with more and more examples of key price action sequences (and ensure regular reviews) you will come to see repeated patterns or themes within the data.

Some of these patterns or themes lead to documented improvements to your trading plan.

But most are simply internalised, improving your situational awareness as real-time data unfolds in future trading sessions. You have improved your ability to perceive shifts in the supply/demand dynamics of the market. You have improved your ability to understand what that shift means in terms of risk and opportunity in the near future. And you have improved your ability to exploit that opportunity for profits (or minor losses when wrong).

Similar benefits apply when journaling market structure features, in particular the points of transition from one environment to another.

There was another recent article related to the topic of journaling, in which we discussed the journal-identified hypothesis that "A Day After a Monster Trend Day, which shows no follow through overnight and a weak open, is likely to remain rangebound within prior session S/R levels". You can see the article here if you missed it: http://yourtradingcoach.com/trading-business/day-after-monster-trend-day/

This article attracted the following comment:

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