Is it possible to Whipsaw yourself...

I hope that made since :-) Just when you "convince" yourself that market or a stock is going to move in one direction it turns and moves in another or just flat. Maybe I just need to trust what the indicators are telling me "right now" instead of what I want to read into where it may or may not be going.

Is it possible to "whipsaw" yourself?

I'm a private pilot, and when I was learning to fly my instructor always warned about "over controlling" the airplane. It could cause a pilot to experience strong turbulence that wasn't really there at all. Usually if the student would release the controls they would find that the "turbulence" would magically disappear. I wonder sometimes if I'm doing that with my trading.

When I was trying to learn to trade using intraday chart it seemed easier, but now trying to get a handle on trading off the daily charts I feel that I’m "late" or have missed the move completely. Instead of getting a turkey sandwich, I end up with a pack of Nabs, or just an empty wrapper. I usually run back to the WSB manuals and CDs. Sometimes I feel I find an answer, and sometimes I don't. I've finally had my morning coffee... 3 times already! I hope this made since.



Edited 1 time(s). Last edit at 10/17/2013 06:23AM by RichieRick.

Richie,
What you are describing is what killed me when I started. Unfortunately, I could not "stomach" the turbulence. I did not have the capital to endure to much. Now, I am in a much better position to deal with a bit more of that, but I am now addicted and find excitement in trading small charts. That is what I was forced to do when I was flat broke. Of course, I am not in a position to ever make suggestions regarding big charts such as the Daily. I never look at that chart- never. The 233 is about as big as I will ever glimpse- well at this time in my trading experience.

I will make one comment-Well, I guess it is a suggestion. If you have the time to study the markets on small charts from the time frame of 10-11:30, take a peak at your stocks between that time frame. I think you will be surprised what you see. I will not suggest a specific small chart to analyze, but I think everyone knows the chart I live by. I am amazed that more people who have the time do not see this big nugget ALMOST every single day! You just have to put some of the pieces together. My process of study and implementation involved combining some of Darcy's practices, her S/O approaches, tidbits from others, and my personal research and practices.

If you are limited to big charts only, I will suggest attempting to get into the head of Big Chart Trader, MUTU, TrendTrader, and a few of the others who I think trade big charts. Also, I am pretty good judge and I think Darcy knows a lot about Big Charts, but she rarely "Puts it out there" because she simply enjoys smaller charts. Unfortunately, the folks who post the most trade off small charts. I will PM a trader with no reservation. If they do not respond or snuff me, I keep it moving and go to the next who I think might be able to clarify some things. I know Darcy's legs are tired of carrying me on her back over the last year. She and her S/O have very strong legs because I am 6'6 and over 250lbs!

Again, most of this is my opinion, so please do not think I am trying to persuade you in one way or the other. Although, those small charts have helped me come out of near poverty- nickel and diming day after day after day.

Thanks for responding Rookie.

After 30 some views and no response I was thinking it was the dumbest question... ever. I was about to delete it and go away in shame.

Last year, as I was going through the fall/winter trading zone I thought I had it figured out. I really thought I was on my way. Then the transitional zone hit, and rattled all my traps. Things seemed to get worse from that point.

Now I'm no longer able to view the markets during the day, so I'm limited to the Daily/weeklies. Technically I could "squeeze" in a view of the markets during the day, but if I'm caught its big trouble. I don't think it would be enough to monitor a trade even peeking at the 55 min charts.

Yes it’s true, I work for a tyrant. He believes that ANYONE trying to trade the markets is a fool, and they are "gambling". I'm tired of wasting my time convincing him he is WRONG!

Anywho!
Transitioning to the larger charts has been sort of hard for me, but I'll get it... I have to; I really need that "choice" in my life.

Thanks again for responding! I'm gonna have my second cup now :-)

I have also been whipsawed in and out of trades, chart can show HRFP and before you can be profitable it can reverse and even show a HRFP the other way.

RichieRick Wrote:
-------------------------------------------------------
> Thanks for responding Rookie.
>
> After 30 some views and no response I was thinking
> it was the dumbest question... ever. I was about
> to delete it and go away in shame.
>

LOL... It is easy to convince yourself of anything you want to believe. That is in any area of life, job, fun or relationships.

I think all of us on this board have been whipsawed in and out of trades and most likely some of us don't want to admit it!

I remember when I first started to learn one fellow who got my S/O and I into GW's classes was asking how I was doing. I told him my trades were doing very well. I told him I was still learning and was doing virtual. He waved me off...In other words I got the distinct feeling he thought I was worthless as a trader. He is the same fellow who jumped out right away and started trading real money. He lost and gained and lost and gained. He got with a fellow trader and together they did well until they started to think the market owed them more than they were getting. In 3 trades he lost over $800,000. He doesn't trade any more.

Another trader who was in the same GW class as S/O and I went on to RTP and DE and other classes GW offered. He got to the point where he felt he just couldn't talk to my S/O and I because "all we took was 1-5 and advanced". In one trade after taking RTP he made $13,000.00. He emailed us and told us how well he was doing. 2 years later after he lost over 50g's he stopped trading and went back to studying 1-5.


> Last year, as I was going through the fall/winter
> trading zone I thought I had it figured out. I
> really thought I was on my way. Then the
> transitional zone hit, and rattled all my traps.
> Things seemed to get worse from that point.
>

I have never liked the fall/winter zone. I have always liked the trans zone. I have never liked earnings season and have always liked warnings season. I make my most money in the trans zone and warnings season than in anything else. Thus my reason to like those zones.


> Now I'm no longer able to view the markets during
> the day, so I'm limited to the Daily/weeklies.
> Technically I could "squeeze" in a view of the
> markets during the day, but if I'm caught its big
> trouble. I don't think it would be enough to
> monitor a trade even peeking at the 55 min
> charts.
>

I am sure that makes it very difficult. You are best off learning the daily and weeklies. In fact you may want to also practice buying and selling stock rather than options.

My S/O and I have the perfect set up. We sit together and look at the market. We look for a trade and sometimes if we see several I'll trade a few and so will he. Lately we haven't seen a lot that we would get in. The charts just haven't been there. I am pleased with my WLT printing press thus far. Looking at the charts it has every reason to close below $16.00.

Quoting one of my favorite movies, "Never give up. Never surrender." (Galaxie quest)

I've seen that happen. I'm sure everyone here can attest to that.

Maybe it's just me trying to get in sync with the daily charts. Once I convince myself that the markets are about to change direction... it doesn't. I just wonder if I'm starting to head fake myself. Maybe it's that old "analysis paralysis" thingy :-)

Ding.... coffee!!!

Your cautionary tales are amazing to me, Darcy. Lost $800K in three trades! AMAZING!

Not to beat the proverbial dead horse, but I doubt they were doing the W/O and Printing Press techniques and following the rules on those three trades. I am reminded of a similar story that GW tells about a woman that was so happy with how well she was trading that she never bothered to move money into her W/O leg. In the end she lost it all and stopped trading. She had the key to her financial future in her hands and she let greed take it all from me.

As I look at printing $500/month from a $11K W/O account, I realize those dollars are low for those of you that are doing well in your trading account. But I will tell you that if you drag that $500 (mere 5%) forward on a spreadsheet for just a few years - especially if you are able to add a few hundred a month to it from your paycheck or other sources - those numbers get ridiculous. Enough to supplant a sizable monthly income within not that many years. And this is doing some quite safe techniques.

So I will echo the words of GW: "Nobody retires from the trading leg! NOBODY!"

Today I was talking with a friend who is very into owning rental properties due to the monthly inflow of cash. I responded by telling him about the Printing Press. His eyes got very large when I explained the potential even starting without a huge nest egg.

These stories you tell are just another reminder of important it is to be able to work all three legs. At this point I'm not worrying about the vault - but hopefully I will need to start worrying about the in the coming years. But if one is only confident with the trading leg, they are not achieving what they could. My honest opinion is that the W/O is the most important - though probably not nearly as exciting as the trading leg. I know it bothers people that you cap your gain by selling calls against it. But I sleep easy knowing that I have a plan, I am working that plan, and I will achieve my goals.

I just listened to the Printing Press section of the CDs again. GW emphasizes that PP actually helps you become a better trader. Another way of looking at it, I think, is if you are already confident in trading , then PP should be very easy for you.

Actually, Darcy, I have you to thank for bringing it to my remembrance. I have only done W/O trades in the past for some reason. I'm not certain why I didn't think more about PP. As I think more about it, I think it's actually more versatile because you can succeed in it even in a down market. I don't know how you do that with W/O.

So here's my plug for more W/O and PP discussion on this board. I'm speaking both selfishly (I will continue to learn from all of you), but also as a virtual friend (I don't see how only trading can allow anyone not already financially independent to become so through the stock market).

I welcome any feedback.

There is also "chunky money" widows and orphans. Buy a stock on the weekly in the FWTZ and leave it alone until the beginning of the spring trans. Zone. If you want 5% monthly avg then go ahead and figure that price to net 60% and set a GTC. You don't even need to sell options. Much easier than printing or finding a new stock monthly. If you pick a stock that's in your vault it makes it that much easier on your entry.



Edited 1 time(s). Last edit at 10/19/2013 06:41PM by BigChartTrader.

Kars,

He traded GOOG and PCLN and bought big, big blocks. I mean he would buy $200,000.00 at a whack. I think the last trade he was in was GOOG before it crashed. You are correct he never did W/O or Printing Press.

For my vault I will buy those stocks that pay dividends. That's is a ways away yet.

BigChartTrader Wrote:
-------------------------------------------------------
> There is also "chunky money" widows and orphans.
> Buy a stock on the weekly in the FWTZ and leave it
> alone until the beginning of the spring trans.
> Zone. If you want 5% monthly avg then go ahead and
> figure that price to net 60% and set a GTC. You
> don't even need to sell options. Much easier than
> printing or finding a new stock monthly. If you
> pick a stock that's in your vault it makes it that
> much easier on your entry.

BCT,

By "chunky money" do you mean that on a seasonal basis a good stock purchased in the Fall off a weekly chart should rise 60% into the Spring even without the benefit of selling options? Or am I missing something? Why wouldn't folks do this?

Thanks.

Correct

Thanks Darcy for juming in and firing up this discussion. You guys are confident in what you are saying, because you know what you are talking about... I like that :-)

I have no idea how I missed your post. I was responding to TCB, and completely missed yours. For some reason it showed up right under your post. Strange! Sorry I missed it.

I'm still trying to wrap my head around an 800,000 loss. Poor guy... Seemed like a powerful trader too, I hope he will someday be able to learn a strong lesson about himself, and make a big comeback. All while becoming more humble of course;-)

On a side note: Galaxy Quest was on TV about 3 weeks ago. If you haven't caught Tim Allen's current sitcom, you should check it out. It's really funny! It's called, "Last Man Standing".