Kerry, if your system told you to get out - its probably working OK. Have a look at the attached comparison of the XAO vs Total Market Advance Decline.

Hi Foz

I am a new trader - starting in January 2005. All but one of my open trades got closed at a loss around 1 - 2% of capital which was quite a hit. Luckily I had one trade in profit (my very first) which compensated for some of the loss.

I have only ever applied trend trading approaches (and so far not very well) and have not traded anything else. These were my second 'round' of trades after modifying my system and so I will never know whether I got the hang of it or not.

For now its back to the books/newsletter to develop up a new approach. I'm hoping that I can do better at a different system.

Kerry

Hi Daryl,
Thanks your short comment puts things in perspective but plese don't tell my TAI CHI Master I got clobbered with a sucker punch!!!!!!!!!!
Regards Ralph

The current market tests trading discipline. Good times and strong trends make it easier to ignore trading discipline.

The real test of discipline will come if the market rallies stronglyu for a few days or a week or so. Its like a sucker punch. Those who ignored stops will feelo vondicated, then when the next collapse comes, they wont act on stops (again) Unfortunately the market may conrtinue to fall and not rebound. This is the sucker punch.

We cannot tell what will happen, but trading discipline protects traders against the unknown and the unexpected.

Cheers
Daryl

Hi Foz,
What the shakeout did for me was reinforce the need to be disiplined!!!!!!!
Ill admit I got hit why for months Daryl has been saying it's time to tighten stops in the past I have had stops hit and made excuses to give the stock more room as I am trend trading so I need to give it more room as it will turn and be a good one ( so I thought)
Here is the problem, in the past giving more room seemed like a good stratigy the movements were slow and I never risked more than 2% when the turn came I was sitting on some stocks that were close to the 2% I should not have been holding them as they had hit stops.
You guessed it they fell out of bed big time, Iwas always scared to miss out on a profit I now know first hand how important capital protection is!!!!!!!!
In spite of recent events I am still having my best year ever but hopefully will not make the same mistake again!!!
Regards Ralph

Hi Foz
I'm not sure if what I did was right or wrong, but at the start of last week I had three open trades at 30, 12, 10% in open profit. I exited all on Easter Thursday as each hit there stops intraday rather than wait. By then they were 22, 0, 0% so I should call that a success in that some profit was retained and no capitol lost. I will now sit back and watch and wait to see what happens next...
I am pleased I had the discipline to wait for a stop to be triggered before selling and will now wait till the dust settles and go back to those trades and see if there was anything I could have done differently...Always an easy thing to do when looking at the left side of the chart... I have been trading for only a year and all my really stupid mistakes where committed in the first eleven months, give or take a month or so, and it's only recently that I have taken Leon Wilson's advice which is to ignore the dollar value and concentrate solely on your entry and exit setups...I have found that this removes most of the emotion from days like the last few and I was acting a lot more clinically than I have in the past...That's how I faired...
Cheers
Peter

The recent falls wiped $40 billion of the ASX values. 2005 is again flat as far as returns go. How did you the trader cope with the rout in the last few days ?? Personally I found that many stops were hit amongst stocks leading to kangaroo tails, parabolics stumbled and big Australians fell. I also found that the application required was nothing like the "easier" times previous. Nervousness seemed to spread. Nothing could be taken for granted.

Even though its wise to follow a strong trading plan... for the new traders, how did you cope with this down period? What emotions were brought to the fore? Were you prepared and was the learning harder than any text book ?