Patience is not currently one of my strengths although I am getting much better at it. When it comes to trading, I believe you've got to have a lot of patience and discipline to remain consistently profitable, if profitable at all.
For the last few months I've been back testing and practicing my strategy on longer time frames to see how it performs in comparison to the three minute chart, which I've always traded. What I've noticed is that on a gross basis, my strategy tends to perform very similar on a 3 minute and 15 minute time frame. However the 15 minute chart is much more profitable on a net basis because it is not taking nearly as many trades and it is also holding longer so the average profit per trade is much bigger, even compared to the average losses.
The challenge for me however is that a longer time frame requires much more patience and this is something I have to get used to. In general, the longer the time frame, the better my strategy performs so over time it looks like it will pay if I can learn more and more patience with my trading so I can maximize my profits. This will take some time but the numbers are convincing so I am willing to work on it.
Today required a lot of patience. I only placed two trades using the 15 minute chart but my strategy performed almost as good as 14 trades did on the 3 minute chart (I didn't take any of the 3 minute trades). However, forcing myself to wait by sticking to one time frame (as per my plan at the beginning of the day) was a good exercise for me and I believe more days like today will not only help me become a more patient trader but also a much more profitable one in the long-term.
The point is, patience is good as long as you actually execute at some point. Just like most things, it takes practice to develop. Secondly, if you haven't already, take a look at some other time frames and see how your strategy performs. The results have really surprised me so perhaps they will you too.
Cheers!
The one thing I have noticed from my own trading was the more I traded the slower the charts became. I also trade the TF and one of my main charts is the 15 min. I do not enter on it but I enter because of it. Good trading
Posted by: Sam | October 15, 2009 at 09:16 PM