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The Crude Dude Oil Trading System
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The Crude Dude Oil Trading System

  #191 (permalink)
Market Wizard
west palm beach florida usa
 
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A couple of lessons learned today. Never get too attached to assumptions about where price has to go. Before 10 am price had moved down strongly as was only about 20 ticks from it's low of the day. I naturally assumed, since I didn't see much in the way of support blocking it, that price would follow through to at least the low of the day. It didn't. It reversed after hitting the 80.50 level. Then while reversing, price came within about 20 ticks of the high of the day..in it's first major leg up. I anticipated a possible pullback..but my mind was fixed on the idea that it would try to hit the high of the day. Instead, it reversed 70 ticks..of which I caught 30. Then it reversed again and got up to 81.50, but again never made it up to 81.66.

This shows the importance of not predicting too heavily that price will go to certain levels..and just trading what is happening in the moment.

Another mistake I made was relying a bit too much on what my 5 minute chart was telling me. Normally, besides looking at it first thing in the morning for some directional bias..it's not a big part of my system. But having read some CL threads lately where some traders seem to get good results trading off a 5 minute chart, I thought I would pay more attention to it. So when the first reversal gave me a signal on my 6 range and 2 range chart, I hesitated. I decided to get "additional confirmation" from my 5 minute chart. Waiting for that caused me to too miss over 30 ticks of the initial push. I did get a minor pullback and got 20 ticks.

I realize my system works so well because I get into trades much sooner than if I wait for 5 minute candles. So in fact, my risk is often less because my stop doesn't hit by the inevitable pullback a late entry will give. Now for people who have 20 to 40 tick stops..they don't have to be as meticulous with their entries..so I suppose the 5 minute candle works well for them. But when you have a system that is based on average trades winning
two to three times what they risk, it becomes much harder to trade a fast moving instrument like CL with slow Candle charts.
Anyhow, decent day..but it could have been much better if I hadn't experimented.

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  #192 (permalink)
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lancelottrader View Post
A couple of lessons learned today. Never get too attached to assumptions about where price has to go. Before 10 am price had moved down strongly as was only about 20 ticks from it's low of the day. I naturally assumed, since I didn't see much in the way of support blocking it, that price would follow through to at least the low of the day. It didn't. It reversed after hitting the 80.50 level. Then while reversing, price came within about 20 ticks of the high of the day..in it's first major leg up. I anticipated a possible pullback..but my mind was fixed on the idea that it would try to hit the high of the day. Instead, it reversed 70 ticks..of which I caught 30. Then it reversed again and got up to 81.50, but again never made it up to 81.66.

This shows the importance of not predicting too heavily that price will go to certain levels..and just trading what is happening in the moment.


I make this mistake all the time. I am often right about where it will likely go but if i am wrong and hold on too long the greater loss makes it wipe out the advantage of being right usually. I belive that taking an early loss helps you get out of your bias and equally weigh the two directions. on the other hand i still get mad about getting stopped out to the tick and then price reversing. i have let go of that frustration for the greater plan.
I was at a conference where 2 experienced presenters mentioned their failure to stop out and re-evaluate their bias.
One said he lost $250,000 in one position in one week and the other said he had him beat --lost over $800,000 in a short time the same way--being pigheaded. i found that sobering, that traders so experienced could do that and it means no matter how good you get you can never lose sight of the fact, that you could be wrong!
Of course sometimes we read about traders bringing down a bank the same way.

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  #193 (permalink)
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Just a suggestion regarding projected top/bottom of the intraday move. CL likes 76.4% fib retracements, countless times on different times frames it will stop around that number +- few ticks. Yesterday high 80.67 was 76.4% fib of the previous move up, and the intraday 80.44 was 76.4% of the day high plus few ticks(the exact figure should have been 80.39).



lancelottrader View Post
A couple of lessons learned today. Never get too attached to assumptions about where price has to go. Before 10 am price had moved down strongly as was only about 20 ticks from it's low of the day. I naturally assumed, since I didn't see much in the way of support blocking it, that price would follow through to at least the low of the day. It didn't. It reversed after hitting the 80.50 level. Then while reversing, price came within about 20 ticks of the high of the day..in it's first major leg up. I anticipated a possible pullback..but my mind was fixed on the idea that it would try to hit the high of the day. Instead, it reversed 70 ticks..of which I caught 30. Then it reversed again and got up to 81.50, but again never made it up to 81.66.

This shows the importance of not predicting too heavily that price will go to certain levels..and just trading what is happening in the moment.

Another mistake I made was relying a bit too much on what my 5 minute chart was telling me. Normally, besides looking at it first thing in the morning for some directional bias..it's not a big part of my system. But having read some CL threads lately where some traders seem to get good results trading off a 5 minute chart, I thought I would pay more attention to it. So when the first reversal gave me a signal on my 6 range and 2 range chart, I hesitated. I decided to get "additional confirmation" from my 5 minute chart. Waiting for that caused me to too miss over 30 ticks of the initial push. I did get a minor pullback and got 20 ticks.

I realize my system works so well because I get into trades much sooner than if I wait for 5 minute candles. So in fact, my risk is often less because my stop doesn't hit by the inevitable pullback a late entry will give. Now for people who have 20 to 40 tick stops..they don't have to be as meticulous with their entries..so I suppose the 5 minute candle works well for them. But when you have a system that is based on average trades winning
two to three times what they risk, it becomes much harder to trade a fast moving instrument like CL with slow Candle charts.
Anyhow, decent day..but it could have been much better if I hadn't experimented.


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  #194 (permalink)
Market Wizard
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meow View Post
Just a suggestion regarding projected top/bottom of the intraday move. CL likes 76.4% fib retracements, countless times on different times frames it will stop around that number +- few ticks. Yesterday high 80.67 was 76.4% fib of the previous move up, and the intraday 80.44 was 76.4% of the day high plus few ticks(the exact figure should have been 80.39).

Thanks for that info..I never noticed that before. That could be a big help.. I have noticed the 50% Fib seems to work a lot as well.

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  #195 (permalink)
Market Wizard
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Futures Edge on FIO

What value do you place on the webinars on FIO?

 
Here is a recap video of today's trades. As I mentioned in a previous post, due to my tendency to take several losses on Oil report day, I have instituted a new rule of only allowing a 20 tick max drawdown on this day. The other day's are allowed a 40 tick max drawdown.


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  #196 (permalink)
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lancelottrader View Post
Yes..there's nothing like watching price action on an instrument through countless hours of screentime. If you have the type of brain that has a highly efficient pattern recognition ability, you will see market events that repeat themselves over and over. I will watch sometimes as price hits these minor areas of support and resistance..and I can predict almost to the tick..how far it will bounce. Then at other times. I can tell from how fast and strong price is moving that it will just smash right through these areas.
I'm glad you can relate to what I am doing. The indicator that does the auto trail is something I bought 2 years ago from a site called Indicator Warehouse. I haven't checked to see if they still offer it. If it is free somewhere, I don't know about it. For some reason, I rarely ever used it. I think the best time to activate it is when I am up 20 ticks or so in a trade and due to the order flow and volatilty I'm seeing, I decide to let the trade be a runner. So, I could set a large target and decide that either the target gets hit or it hits the trail.

And as far as 5 contracts go, I didn't say I would stop there. I just would stay there until I built my account up enough to safely trade 10...and so on... Hopefully I'll get there in the not so distant future.

I do think this type of trading requires a type of personality or brain. Perhaps one very sensitive to detail and highly focused.

I can completely relate to watching price and predicting the small fluctuations accurately - the issue is choosing when it's a high probability situation with a decent risk:reward potential. I mainly focus on telling "how fast and strong price is moving" and then it becomes predictable when price will push past resistance/support and hit peoples stop orders for some temporary momentum. After this initial phase of predictable temporary momentum I become very uncomfortable as I now don't have a basis to be in, so I either hold hoping for a trend or I exit immediately at the first sign of weakness - i noticed you had issues with this earlier in your thread.

I imagine I'd use the auto-trail similarly, only in particular scenarios when everything lines up for a large momentum move. I prefer to actively manage my trades, I trust my intuition to manage it effectively, though my trade analysis may find this to be limiting my profitability, it sort of gives me a feeling of freedom which reduces stress upon entering -- knowing I can exit immediately if I want.

I think setting the runners and "large targets"/auto-trail is something for when it's a successful day and maybe just risk a few ticks gains on having a lucky day

Have you considered this, I thought it might compliment your trading style:

If you've had a good day, say +30 ticks profit. You're trading well, your decisions are good. Perhaps on the next trade, you add size as it wins and try to have a huge leveraged winner, of course never risking more than the normal initial risk on one contract.

I.e. At +20 ticks, add another contract, move stop up, same at +35 ticks. Now let 3 contracts run to auto-trail.

Of course, mostly this will breakeven or at worst it's a losing trade and you end the day with +20 ticks or so. But occasionally this could be a huge winner, e.g. 95+ ticks on one trade.

I call it aggressive sizing (opposite of regressive sizing when losing) and it's an idea I'm trying to time with higher time frames (i.e. we've hit a 60-minute support... wait for momentum on low time frame and then try to leverage the holding)

Of course its just an idea/suggestion and you might prefer to keep it simple and go for consistency.

Anyway, I've loved your ideas in this thread, keep it up, videos are cool with the American hollywood accent.

Stay G'
Turismo

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  #197 (permalink)
Market Wizard
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TurismoTek View Post
I do think this type of trading requires a type of personality or brain. Perhaps one very sensitive to detail and highly focused.

I can completely relate to watching price and predicting the small fluctuations accurately - the issue is choosing when it's a high probability situation with a decent risk:reward potential. I mainly focus on telling "how fast and strong price is moving" and then it becomes predictable when price will push past resistance/support and hit peoples stop orders for some temporary momentum. After this initial phase of predictable temporary momentum I become very uncomfortable as I now don't have a basis to be in, so I either hold hoping for a trend or I exit immediately at the first sign of weakness - i noticed you had issues with this earlier in your thread.

I imagine I'd use the auto-trail similarly, only in particular scenarios when everything lines up for a large momentum move. I prefer to actively manage my trades, I trust my intuition to manage it effectively, though my trade analysis may find this to be limiting my profitability, it sort of gives me a feeling of freedom which reduces stress upon entering -- knowing I can exit immediately if I want.

I think setting the runners and "large targets"/auto-trail is something for when it's a successful day and maybe just risk a few ticks gains on having a lucky day

Have you considered this, I thought it might compliment your trading style:

If you've had a good day, say +30 ticks profit. You're trading well, your decisions are good. Perhaps on the next trade, you add size as it wins and try to have a huge leveraged winner, of course never risking more than the normal initial risk on one contract.

I.e. At +20 ticks, add another contract, move stop up, same at +35 ticks. Now let 3 contracts run to auto-trail.

Of course, mostly this will breakeven or at worst it's a losing trade and you end the day with +20 ticks or so. But occasionally this could be a huge winner, e.g. 95+ ticks on one trade.

I call it aggressive sizing (opposite of regressive sizing when losing) and it's an idea I'm trying to time with higher time frames (i.e. we've hit a 60-minute support... wait for momentum on low time frame and then try to leverage the holding)

Of course its just an idea/suggestion and you might prefer to keep it simple and go for consistency.

Anyway, I've loved your ideas in this thread, keep it up, videos are cool with the American hollywood accent.

Stay G'
Turismo

Thanks again to your contributions on this thread. Your technique of evaluating "How fast and strong is price moving" is something I definitely look for as well..which is why I have gravitated towards the chart setups I use. Slow moving candle/time charts don't work as well for me..except for evaluating trends etc.

The auto trail is something I rarely use because like you, I prefer to manage my own trades. If I do use it, it's when I'm already up over 20 ticks..have broken even..and I detect a tremendous amount of volume and momentum. Even then I will probably have a target and the trade becomes a matter of hitting the target or getting trailed out. Today, on NQ, I turned it on after being up over 20 ticks and caught a big winner. In fact, I did much better on NQ today than CL.
I tried to get 30 ticks(on CL) on a couple of moves and they only reached about 20 before reversing and I ended up scratching them. Plus I lost a few trades early on. So I decided to pull out another weapon..my 10 tick surgical scalping method. Basically I wait untill some decent order flow shows up and find these 10 tick areas that have no price congestion..and time in. The key is finding areas or grids..where nothing blocks the flow of price. My software helps identify those areas. and then it becomes a matter of processing the immediate volatility and timing the entry. I managed to scalp back about four 10 tick winners in a row..so finished up just a little better than breakeven on Cl. Did great on the SIM NQ trades. Really starting to get a feel for it.

Your idea on agressive position sizing is a good plan and would probably work well for many traders. I have used some techniques like that in the past.. but have had a few issues. This isn't a reflection of the strategy but more an issue with my psychology and impulsiveness. Without going into a lot of detail, when I become too flexible with the amount of contracts I trade, I seem to get into trouble.

My system has evolved from years of evaluating my trading data and evaluating my own unique psychological strengths and weaknesses. I may have some form ADHD as well, which means if I don't have a strict set of rules and a precise system..I can veer off the path and find myself doing incredibly stupid things. After much statistical analysis of myself and my trading, I have found I am better off sticking to one type of contract size for the day or for however long I plan to stay at a particular size. In other words, when i go to 2 contracts in a few weeks, I will only trade that size untill I feel ready to move up. Then when I get to the next size I will stay there untill again I am ready to move up. Plus, I have found, even with multiple contracts, that going all in/all out as opposed to scaling in and out works better for me.

What I am doing now is establishing positive expectancy by proving for several months in a row that I can achieve a certain amount of Tick goals each week. This helps me psychologically because I have a pretty good idea of my skill level and what to expect. So the idea is to adjust mentally to higher contract sizes and just keep repeating the formula. It's like Bodybuilding or weightlifting..You start with a certain weight and progress as the body adapts and grows stronger. Try to go from benching 200 to 300 too fast as a novice..and you can get injured. As you can see from this old pic, I was into the weights a bit...lol.

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  #198 (permalink)
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lancelottrader View Post

10 tick surgical scalping method. Basically I wait untill some decent order flow shows up and find these 10 tick areas that have no price congestion

Love this idea, I also do this but I never quantified it to mean "areas without price congestion" but that's exactly what I'm looking for. These are my favourite types of trades as they occur frequently.


lancelottrader View Post
I may have some form ADHD as well, which means if I don't have a strict set of rules and a precise system..I can veer off the path and find myself doing incredibly stupid things. After much statistical analysis of myself and my trading...

This is where it gets weird because I also think I have some ford of ADHD as well, and have the same issues with needing very strict rules. In some ways I think ADHD gives me an advantage, I can be hyper-focused and very attentative to details if something interests me, I'm also extremely inquisitive! I'm at this stage now, the statistical analysis of my self and trading results...


lancelottrader View Post

What I am doing now is establishing positive expectancy by proving for several months in a row that I can achieve a certain amount of Tick goals each week. This helps me psychologically because I have a pretty good idea of my skill level and what to expect.

Totally makes sense, I'm working on the same thing. Except I'm still developing my trading plan/system to improve the foundations before testing a precise positive expectancy. Seems you've got it all figured out, good to know I'm on the right path.


lancelottrader View Post
You start with a certain weight and progress as the body adapts and grows stronger. Try to go from benching 200 to 300 too fast as a novice..and you can get injured. As you can see from this old pic, I was into the weights a bit...lol.

Cool, ok, we're very similar. I'm really into weightlifting at the moment, though the biggest challenge for me is eating more. 'Mirin that physique, I'm along way off it but working on it every day

I actually saw a YouTube video on your channel I think of your dad smashing his curls out, unbelievable!

Hope you keep this thread up through your continued success,

Turismo

EDIT: Be cool if you could post a YT video of these 10 tick scalps, as I think I could learn a lot from them. Cheers bro.

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  #199 (permalink)
Market Wizard
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Quick update..just scalped another 3 10 tick winners to finish up 40 ticks on day..and 130 ticks on week so far. Not sure I will be trading tomorrow..Heading out tonight to see the classic metal band Judas Priest. Depends how I feel tomorrow...

Failure is not an option
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  #200 (permalink)
Market Wizard
west palm beach florida usa
 
Futures Experience: Advanced
Platform: ninja trader
Broker/Data: Optimus Futures/ Rithmic
Favorite Futures: Cl, TF
 
Posts: 714 since Oct 2011
Thanks: 619 given, 2,394 received



TurismoTek View Post
Love this idea, I also do this but I never quantified it to mean "areas without price congestion" but that's exactly what I'm looking for. These are my favourite types of trades as they occur frequently.



This is where it gets weird because I also think I have some ford of ADHD as well, and have the same issues with needing very strict rules. In some ways I think ADHD gives me an advantage, I can be hyper-focused and very attentative to details if something interests me, I'm also extremely inquisitive! I'm at this stage now, the statistical analysis of my self and trading results...



Totally makes sense, I'm working on the same thing. Except I'm still developing my trading plan/system to improve the foundations before testing a precise positive expectancy. Seems you've got it all figured out, good to know I'm on the right path.



Cool, ok, we're very similar. I'm really into weightlifting at the moment, though the biggest challenge for me is eating more. 'Mirin that physique, I'm along way off it but working on it every day

I actually saw a YouTube video on your channel I think of your dad smashing his curls out, unbelievable!

Hope you keep this thread up through your continued success,

Turismo

Thanks for your comments.
Yes, that was my dad in his 70's.

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