Mark Douglas - Trading In The Zone

[toyogo00]

Hi,

After learning FibMaster method for about 4-5months, I believe I've understood a concept of the method. However, I'm really disappointed with my results - I'm just floating above the water. Is there anything wrong with FibMaster system or is the mentor not good enough in teaching the method? No... FibMaster System definitely is a proven system with high probable odds. AND FibMaster is inevitably a good mentor who is very experienced/knowledgeable and certainly very helpful.

After reviewing my journals, there are so many unforced mistakes - such as chasing the trade, never follow the rules, impatient etc...

I decided to re-read Mark Douglas "Trading In The Zone" and I find it very fruitful. At the end of the book, there is an exercise recommended to trade at least 20 trades that follow his procedure.

I would highly recommend traders should read/re-read his book. I would like to highlight his keynotes:

Five fundamental truths.
1. Anything can happen in the market.
2. You don't need to know what is going to happen next in order to make money.
3. There is a random distribution between wins and losses for any given set of variables that define an edge.
4. An edge is nothing more than an indication of a higher probability of one thing happening over another.
5. Every moment in the market is unique.

Seven principles of consistency

1. objectively identify my edges.
2. predefine the risk of every trade.
3. completely accept risk or I am willing to let go of the trade.
4. act on my edges without reservation or hesitation.
5. pay myself as the market makes money available to me.
6. continually monitor my susceptibility for making errors.
7. I understand the absolute necessity of these principles of consistent success and,therefore, I never violate them.


I'm now really following the recommended procedure to trade 20 trades and would like to see the result over the next few weeks.

FibMaster Method is just another system that has a high probability edge - it is still following the random distribution between wins and losses but in the long run, the odd is on the winning side if we can consistently execute the rules.

we must follow rules rigidly - wait patiently for the setup, then remember anything can happen to the market and every moment in the market is unique. Thus we must be flexible with our expectation - if the market do not move accordingly to our plan, get out instead of insisting must get the expected target.

I hope to share this with traders who are still not yet "successful" like me!

Regards,
Toyogo

[FibMaster]

Hi Toyo,

After 5 months of serious trading, you are holding your own and actually surviving! In this field, that is almost a miracle. In that same period, there are many millions of traders who have lost their accounts and have quit trading. Consider the billions of dollars that have been lost by those traders.

Of the few traders who do become profitable, some achieve a degree of success in a year or less, some do that in several years of effort, some even more.

There are many factors involved, and trader psychology is an important aspect. I have read Mark's book many years ago, and agree that it is a good one. The book will focus on controlling your actions and emotions, more than technique. This is important too.

You are on the way and are obviously doing something right, or you would have quit by now. Your posts on the forums over the months are a testament to your progress. Keep working at it, keep improving, keep optimizing.

The more you do it, the better you become at recognizing good trades, bad trades, and the better you become at managing your trades while they are under-way. Your losses should become smaller relative to your gains, and your losses should become less frequent relative to your winners. That is the goal, keep working on it.

Have you implemented the strategies from the recent "Stop Loss" seminar ? In that seminar we talked about a strategy to increase the size of your winners and reduce the size of your losing positions. Obviously, if your winners are larger than your losers (over time), you have a significant advantage.

That technique alone can make a difference. Have you worked on that? Are you implementing it? If you need to re-take the seminar, write to me on April 3rd, to see if there are any available seats in the next seminar.

FYI, for others who may read this, that stop-loss seminar will be held again soon, April 4th. See details here;
http://www.fibmarkets.com/pro_seminars/index.html

-Neal.

[toyogo00]

Hi Neal,

It certainly helps very very much, remember the USDJPY trade : http://www.traderzine.com/forums/showthread.php?t=514 . We were in twitter, you asked me why I entered the trade? I told you that was another impatient trade; However, I managed to exit with only -5pips instead of my usual 50-100pips fixed stop loss. It really helps to minimize the loss - a great concept of disaster and actual stop loss. It is inevitably another great seminar.

FibMaster@Toyogo00 I'm wondering why you enter long at 98.90 on USDJPY rally, instead of buying the retracement? #FOREX

Toyogo00@FibMaster I may miss the "trade" when it rallies higher - impatient! Hope the 98.78 support hold, othewise will consider exit early!

FibMaster@Toyogo00 Respectfully, I do not like your late entry USDJPY. However, that is already done.

Toyogo00@FibMaster Cut @98.85 for -5pips! sideway market now! goto bed - get ready for the next better trade tomorrow! lol!

FibMaster@Toyogo00 Good move, good night!


Regards,
Toyogo

[toyogo00]

Hi,

For those who are interested in attending the magic of intelligent/practical stop loss, see this link for more information about it : http://www.traderzine.com/forums/showthread.php?t=529

Regards,
Toyogo

[paddycal]

Hi toyogo

thanks for sharing this info with the rest of us. As neal mentioned , your postings to the forum are a great source of education for the rest of us as you step thru the reasons for your trades.

also being new to Fibmaster methods , i am also trying to get a more consistent level of trading , while juggling full time work , and a new addition to the family.
i've managed to keep losses to a minimum over the last 2 years, so i hope to be one of those traders for whom success takes a bit longer.

so please keep posting your updates and hopefully your transition to successful trader will begin soon and we can share in your journey and also learn from it !


regards

Paddy

[Justin]

Fellow trader Toyogo00,

After trading with Fibonacci methods for years and knowing just enough to be dangerous I finally (thankfully) came across the FibMaster. I've taken all of his downloadable training courses and every one of his real-time seminars. I've been very pleased with them and I've become a better trader because of him.

My former Fibonacci instructor "guru" {and I use that term loosely} knew about retracements and extensions but had no idea about expansions (and there is a big difference between extensions and expansions and their accuracy - at least for me!) He also had no idea about finding Fiblevels having more strength than others - with the concept of SK, and never taught proper stop placement strategies.

When I first started with the FibMaster, I had a lot of bad habits - constantly trying to find the bottom or the top and then jump in and ride it for as much as I could get. I would consistently get stopped out by a "dead cat bounce" and lose money. It was kind of like I was stuck in repeat because I would do it over and over. I'm quite certain if Neal were sitting in the same room as me he would have smacked me on the forehead and said, "What the hell are you doing? Where's the trend? I'm just not seeing what you're seeing, why did you make that trade?"

Now I'm not at the level I want to be at yet (I'm one of the ones that Neal mentioned takes years to learn how to achieve a degree of success - :() but IMHO I believe the road to being successful in this field takes 3 things:


Education. Becoming intimately familiar & comfortable with the information Neal teaches (Fibonacci, Money Management, Stop Placement, etc...) and other sound trading principles.
Experience. It is critical to get the education and the application of that education is just as critical. It's one thing to "know it", but it's quite another to actually "get it". I've encountered many costly lessons by trying to force the market instead of just taking what it's trying to tell me it's going to give...the market always beats me when I try to force it (imagine that! :rolleyes:) {I still make dumb mistakes and want to jump in right before a move because I see a setup - and I pay the price. Two Fridays ago I did just that - tried to get in early and lost - and those lessons can sometimes be unsettling, which brings us to the third point...)
Discipline. You have to work your plan, learn from the mistakes, and keep going! I anticipate even the FibMaster makes a wrong call occassionaly (No offense Neal, I'm more than certain its very rare!) even after all of his years of doing this. There are going to be trades I don't get right and it goes against me - but I've got to learn from it and dive right back in striving to make a better decision. I think training your gut to be disciplined regardless of the current result is what makes the difference between winning and losing.
Again, I'm not yet to the level I want to be at (I'm a little thick headed!) but I'm determined and I'm getting better. So I guess the point I'm making with all of this is, "I hear ya" - keep learning & keep going.

Then of course there's my other hypothesis...that the market gods know my name and they are all conspiring against me, but I'll save that for another post. :D:D

[Justin]

The market gods had their way with me today with only 1 winning trade all day - I was late into the moves all day, Ouch! Sometimes education is painful!

[Justin]

Toyogo,

Just rereading your original post here...it really is a very good post! You mentioned some excellent points by Mark Douglas that coincide with the video from the link: http://www.traderzine.com/forums/showthread.php?t=581

The post from the FibMaster & your post in response let me know my recent results aren't unique and, like you said in your response to me on my Lessons post, it happens to all of us.

Thanks for providing the information - Mark Douglas seems like he's a good source for learning to see things differently - especially the draw on your psyche when things seemingly continuously go against you. I've got to get his book!