Thanks so much, Michael!
My biggest challenge with trading has evolved over time. When I first started trading currency four years ago, it was that I had no guidance, no feedback on what I was doing, and whether I was even on the right track. So I traded for a year and then stopped for a year, while I searched for training/coaching programs that didn’t cost tens of thousands of dollars. I eventually found Rolf and Moritz of Tradeciety, which offered courses on the swing and day trading, weekly watchlist videos and a forum where you could get regular feedback on your trades. Lifetime access was only several hundred dollars–a remarkable value. Within a few months, my trading started taking off, at which point my biggest challenge became guarding my time and energy and staying focused on a few goals. Because trading was going well, and several other things were going well, I kept on piling on more and more life-goals for myself until I finally hit a wall and all my motivation seemed to evaporate. Not long after this, my mother had a stroke and the next 6 months were taken up with me and my siblings looking after her and making sure she got the best care possible. I learned a lot of unsettling things about how overworked nursing home professionals are, and how easy it is for patients’ needs to be overlooked, and for family members to be very confused about what is actually supposed to be happening. Eventually, my mother had a second stroke and we brought her home to hospice care and spent 8 days taking shifts sitting with her around the clock. Remarkably, she lived for 77 years, 7 months and 7 days.
During and after that season, I spent another 18 months away from trading before I was ready to get back. This past summer, I took a few months to go back through the now updated coursework and began trading again, with the help of a ton of feedback from Rolf and Moritz. At this point, my biggest challenge was being selective and consistent. I was advised to stick to just one pattern–head and shoulder reversals–and learn it until it became second nature. It is surprising how many little variations there can be on a pattern, and how many clarifying decisions you need to make so that your rules about what will constitute a tradeable head and shoulders are “enough”. However, I was getting there, and while during the end of 2019, my trading was all over the place, by the end of January 2020, I was in a total net profit, and getting wonderful feedback from Rolf and Moritz about how far my trading had come, and how consistent my trades were looking.
By February 2020, however, as the Coronavirus became more and more of a concern, the usual mean-reverting setups I would look for and take on currency pairs began to unravel. It started with a string of losses, as typically valid setups I traded were triggered but then reversed and went the other direction, taking out my stop loss. Not long after that, there simply weren’t any valid setups to trade, as the market whipsawed all over the place, or, in many cases, currency pairs just kept on trending and trending and trending with no reversal in sight. So my biggest challenge now was, what to do when the market is in such a volatile phase, and the setups I typically look for simply don’t occur, or at least not with much confidence of follow-through.
I watched as the major indices trended strongly downward, reversing months or years of gain, and realizing that this could have been a MAJOR cash-in opportunity, where I set up for a trend following. I started listening to your Complete Turtle Trader book and decided to get myself set up with a futures account. However, just as with forex trading, I was now in completely uncharted waters again, not even yet understanding how futures markets work, how to navigate contract rollovers, etc., and not having anyone to guide me in the nuances of how one actually engages with trend following in a consistent manner than can deliver. There is so much on the charts that look obvious in hindsight, but when you start trying to work up different scenarios for how you might have walked through that and profited from a trend without getting prematurely stopped out (and then try to apply that to other trends) it quickly becomes clear that this is not at all as easy as it looks.
So with regards to my biggest challenge, that brings me full circle back to where I was several years ago with swing trading: I have ZERO guidance on what I want to be doing and little way of knowing whether I am on the right track or not.
Thanks for reading, and to paraphrase Mark Twain (or was it Blaise Pascal, or Ben Franklin?), I’m sorry for writing such a long email, as I did not have time to write a shorter one.
I look forward to checking out the intro video you sent!
Swing trading. Day trading. Stop.