A long and stressful day . . . .

Working from 5:30a.m. to 9:00p.m. today - a long and really tiring day

First up, trading. My refreshing of past statistical data suggests that a typical week is made up of one really good day, one medium day, two small wins and one losing day (which contras out the two low wins and part of the medium win). Monday was an example of a medium day. Today was a losing day. Of course some weeks might, by chance alone, have two losing days, while others might have none. I just have to wait and see and be able to cope with either.

I was very aware when I started trading again that I would need to settle back into the correct psychological rythmn - the detached view in which each day is the same in that it consists of the following of the chosen system, that the actual day's results will take care of themselves, and so on. But I am not quite there yet. So each morning I remind myself that today could be the losing day and I need to just cope with it. Yet each trade starts with the hope that it might go well, and each small loss leaves me inevitably feeling a little deflated.

That said, I have been doing a lot of work in the last few weeks on recognising what sort of trading day is occuring. Interesting I was able to come up with a detailed specification of what a losing day looks like - linked to things like points differences between peaks and troughs and the times between such peaks and troughs. Certain combinations of these just won't be profitable. This suggested a form of intra-day stop in which the systems "recognise" that the day isn't going well and call a halt to things. So today followed that methodology. And around 3:30, the systems concluded that today was not to be their day and I withdrew "to fight another day". Soon afterwards (almost immediately in fact) the market set off in a fast decline dropping more than 30 pts in 30 minutes. Such a move could have cleared the day back to breakeven. But then it rallied strongly in the next 30 minutes. Sharp "V" shaped markets are horrible for my trading approach and would have left me with a substantially greater loss. So perhaps the intra-day stop has got off to a good start. I certainly felt better at 4:30, when the V was over, than I had a 3:45, when I would have been at breakeven for the day.

But this also highlights one of the problems I am still not clear of - staying detached while watching the markets throughout the day is very tough. It is so easy to start watching every little move, hoping this trade will be profitable. I do need to step back a little.

Of course I also spent the day working on Philosophy of Economics. The morning was mainly spent on compiling revision notes from what I have been reading over the past couple of weeks. This is going quite well and I do feel that bits are beginning to drop into place. But the afternoon was spent on new reading and this was very tough today. My chosen subject was the positive / normative distinction and I have been ploughing through several long papers. I was never very interested in theories of ethics when I have studied philosophy in the past, and that is definitely brought home by this current reading.

By 5:00 or so I have had enough and spend the next three or four hours reading a trading related book - Didier Sornette's Why Stock Markets Crash - and a book about the Pixies rock band. By 9:00 I was extremely tired. Maybe tomorrow I will have a new plan for the day's work - perhaps slow down on the harder stuff so I don't burn out on it.