Trading What I see !?

[goat68]

Trading is counter-intuitive by nature, so you almost need to unlearn your current way of thinking to be really successful.

I was rubbish at short term trading when I first started trading on financials, but by the time I reached Betfair trading, I was well-prepped. But nearly everybody I've taught struggles with this aspect when they first start trading.

Yes, I really do seem to be seeing exactly this. The annoying thing is I realize the problem, but it's very hard to fix. I have flashes of stellar performance where I win 8 out of 10 trades, then it just goes to pot, however i'm not sure whether that's just random variance anyway!

I try my best to look at a market and ask myself "is this screaming something obvious at me"? If it is then I look to trade the opposite... if it isn't then I don't trade.

I think what would be useful is a follow on from your "Psychology Secrets" video the other week, which takes the next step, as although "do the opposite" is the psychological recipe, you somehow need to tie it to what you're currently seeing and time it right, I have a tendency to just "jump in"!!!

[goat68]

So just traded Kempton 8:30, small win this is how I did it:
at 8mins :
looked at fav and looked like it was possibly coming in and maybe break 5.0
looked at 2ndfav and looked more tradeable to me, this was my thought process:
- Coming in slowly levelling out at 5.5, looks like resistance, I reckon most traders would LAY here
- Ok "opposite" hat on! We need to "BACK" it!
- BUT then I thought to myself, is that what other traders are actually thinking though? Hmmm, so they're thinking BACK, thus I need to LAY ! Which is what I did Lay'd at 5.7
at 5 : went into green a bit
at 4:30 : suddenly reversed back down to 5.4, I nearly threw the towel in but fav was hesitating
at 4 : 2ndfav suddenly went out to 6.2, fav down to 4.9, I held a bit then took profit at 6.2 avg
at 3 mins: 2ndfav suddenly reversed big time and came in to 4.3, so did fav came in to 4! I did not see that happening good thing I took profit...

I'm sure you'll laugh at my thought process here, but this is honest how I just traded this. In the end I didn't really "do the opposite" I went with what actually seemed like a standard U pattern based on my initial judgment. The "do the opposite" thought actually got in the way!
Charts:

Kempton830.jpg

[goat68]

Just looking at that chart again, where I wrote "BACKd", there's an interesting reversal pattern i've seen a lot there.

[auto-matt]

“Good thing too I didn’t see this coming” a good example right there of not thinking counter intuitively

[goat68]

“Good thing too I didn’t see this coming” a good example right there of not thinking counter intuitively

Yes exactly, so the "BACK'd" point where it looks like a possible up trend continuing with a small pullback, the counter-intuitive move is to think this is actually going to reverse and come in, even though the fav is also coming in big time! Now that is super-counter-intuitive especially given the fav's move as well...

[jamesg46]

My Mrs sat with me while I was trading this afternoon, she's never ever seen the markets in action or payed any attention to what it is im doing, after sitting and talking to me for a couple of markets, she starts calling out whats going to happen, turns out she's a bloody genius and showed me something I've never noticed before. We switched over to the Greyhounds and before i know it shes better than me, i had more success through doing what she was calling out than I would of doing my own thing. I'm now retired, ive found my edge

[goat68]

Hmm, ok i'm thinking as i'm going here.... So actually I was actually right in my first "do opposite" BACK thought, just I didn't apply it at the right time, or if I had i'd had to have braved a big move into the "red" with the sharp move up to 6.2 before finally reversing.... gosh there's a lot of ways of looking at a chart!

[speedyhamster]

You are overthinking probably . there are lots of things in the market that happen more than 50% of the time, some as high as 80% to 90% , when you spot these and practice enough you automatically act on what you see without the thinking part.
Going against momentum is very risky. doing the opposite does not mean going against momentum on the same horse . being defensive when the 80% or 90% is wrong (10% to 20% of the time) is one way of being profitable

[alexmr2]

Hmm, ok i'm thinking as i'm going here.... So actually I was actually right in my first "do opposite" BACK thought, just I didn't apply it at the right time, or if I had i'd had to have braved a big move into the "red" with the sharp move up to 6.2 before finally reversing.... gosh there's a lot of ways of looking at a chart!

I often have a similar thought process e.g. switch over to a race and there's something obvious that every man and his dog with FOMO will want to jump on. Obviously to beat the 95 or 99% we can't just all do the same thing so it could be better to be patient and wait for something to happen like the price to pull back a few ticks, and then place your original entry stake at the more favourable price

Be careful doing the literal opposite of intuition everywhere though because there are some scenarios that is a bad idea, or if you do choose to do it you have to be prepared to be wrong. Some examples would be laying a steamer (that shows no signs of stopping) or backing at a crossover (just because it seems obvious people will lay). Today there was a short-priced favourite that wildy drifted off the charts and stalled around 1.8, if you done the opposite of the crowd and backed it at the top of the massive move like I did you would have been wrong as it continued up further all the way over 2.0. Luckily I took the small loss and didn't Victor Meldrew it

We often overthink and overcomplicate reading the market when it is better to look at the bigger picture. That goes hand in hand with trying to be right and not accepting a loss. I don't think profitable traders stress out over reading the market, they simply use their experience to place a favourable entry and then if they are wrong they accept it and move on

[speedyhamster]

Hmm, ok i'm thinking as i'm going here.... So actually I was actually right in my first "do opposite" BACK thought, just I didn't apply it at the right time, or if I had i'd had to have braved a big move into the "red" with the sharp move up to 6.2 before finally reversing.... gosh there's a lot of ways of looking at a chart!

I often have a similar thought process e.g. switch over to a race and there's something obvious that every man and his dog with FOMO will want to jump on. Obviously to beat the 95 or 99% we can't just all do the same thing so it could be better to be patient and wait for something to happen like the price to pull back a few ticks, and then place your original entry stake at the more favourable price

Be careful doing the literal opposite of intuition everywhere though because there are some scenarios that is a bad idea, or if you do choose to do it you have to be prepared to be wrong. Some examples would be laying a steamer (that shows no signs of stopping) or backing at a crossover (just because it seems obvious people will lay). Today there was a short-priced favourite that wildy drifted off the charts and stalled around 1.8, if you done the opposite of the crowd and backed it at the top of the massive move like I did you would have been wrong as it continued up further all the way over 2.0. Luckily I took the small loss and didn't Victor Meldrew it

We often overthink and overcomplicate reading the market when it is better to look at the bigger picture. That goes hand in hand with trying to be right and not accepting a loss. I don't think profitable traders stress out over reading the market, they simply use their experience to place a favourable entry and then if they are wrong they accept it and move on

good post

[goat68]

Ok it's October..., I'm going to make it work this month!

[spreadbetting]

Ok it's October..., I'm going to make it work this month!

The tried and trusted 'This time next year, Rodney' approach?

[goat68]

Ok it's October..., I'm going to make it work this month!

The tried and trusted 'This time next year, Rodney' approach?

Yes Del Boy!

[goat68]

Definitely finding the longer a position hangs around the more likely it's going to be a loser...!
Which I think plays into the psychology of traders staying in on hope!
If it ain't happening get out!
I might set myself a time limit

[Kai]

Definitely finding the longer a position hangs around the more likely it's going to be a loser...!

Hmm not sure I would agree with that one, wouldn't logic dictate that the more time you give a trade the more likely it is to swing in your favor eventually? Even randomly? Providing it's a sensible position?

Maybe that's the secret swinging sauce? Opening sensible valuable positions and having the patience of a saint? If you perhaps let the short-term randomness at volatile price ranges work for you, instead against you?

Problem with pure swing approaches is people get uncomfortable holding on to positions, be it good ones or bad ones, the bad ones they want to scratch right away after they miss out on the best possible price, and good ones they want to butcher soon as it goes a few ticks into profit, it is very very difficult to find the right balance.