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Zimmer's Journal: Naked Chart Reading


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Zimmer's Journal: Naked Chart Reading

  #51 (permalink)
Wernersabel
Lisbon, Portugal
 
Posts: 35 since Jun 2017
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mtzimmer1 View Post
One trade for me today. This was the second setup of the day. The first one never filled my limit, nothing I can do about that.



Self-Eval:
100%

Hi mtzimmer1,

cool to see how you are progressing, I like that. If you find some spare time over the weekend or in the evenings, I can recommend replay trading the same trades, or the trades you did not take to gain confidence in yourself and your method. By seeing things over and over again it becomes like a natrual reaction what you do if you see a particular setup.

Let us know how things are going.

Cheers,
Wernersabel

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  #52 (permalink)
 
mtzimmer1's Avatar
 mtzimmer1 
Upstate NY
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Experience: Intermediate
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Easy one and done today. I expected the bulls to come back in to test HOD around 10 am this morning. When that didn't happen and we broke the LOD, I knew that there was a high probability of a big move down. My significant levels drawn were much lower than current price and I saw nothing to stop the bears. I had a limit order on the first swing down but never got filled. I usually wouldn't enter a trade after the third swing down but I was convinced that the floor was far beneath us. When the next stop is miles away it isn't the worst thing in the world to get on the train late.

Trade Management:

I am having a tough time determining exit prices when I only have one contract. I always have multiple potential reversal lines drawn for each trade and ideally I would be able to aggressively trail a portion of my position at each one of these areas. Because I am only trading one contract for now, I am deciding to exit based on when the reasons to exit outweigh the reasons to stay in. In this case when the ES broke through to new lows, it did so weakly, while the NQ held above its low and the YM mirrored the ES. We started to uptick on the ES with good volume behind it and I covered. While there was no significant level of importance in play, I figured that I would rather lock in the profits then give the market a chance. Maybe this was my brain trying to create reasons to exit to mask the underlying emotional reason for desiring to exit.

After my exit, price dropped directly to one of my levels before bouncing. Price then PLUMMETED to my cluster of critical levels. I feel as though these levels act as magnets for price. Sure it would have been great to capture all 16 points, as was my original plan, but with only one contract I was not willing to give back 4 of the 5.5 points I was up in order to capture the larger move. If I had multiple contracts I would have trailed the first one on the first swing low, then trailed each remaining one at each of the two targets.




Results:
1 win
+2.08 R

Self-Eval
Entry: 100% Reasons For: 3 Reasons Against: 1
Exit: 100% the exit left much to be desired but you never know in the moment what will happen next and in that moment it looked as if there was a chance for price to find support in thin air or that I had missed a critical level in my analysis.

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  #53 (permalink)
Wernersabel
Lisbon, Portugal
 
Posts: 35 since Jun 2017
Thanks Given: 21
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mtzimmer1 View Post
Self-Eval
Entry: 100% Reasons For: 3 Reasons Against: 1
Exit: 100% the exit left much to be desired but you never know in the moment what will happen next and in that moment it looked as if there was a chance for price to find support in thin air or that I had missed a critical level in my analysis.

I have similar problems but I am getting better at letting things run. I try not to exit as long as there is no setup the other way. So I am trying to let that thing run until the exact same setup happens to the other side. And remind yourself why you got in, you did not see a reason for the bulls to step in. Obviously you were reading the market correctly, you got three confirmations that is why you got on.

I would also question my self evaluation in that very moment, because getting out too soon is also a mistake. So may be the accuracy level is a little below 100%. But no reason to feel bad about that day, try to point out the positives and keep woring on the other things tomorrow.

May be that helps staying with the winner longer.

Let me know if you find different ways to approach that.

Cheers,
Wernersabel

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  #54 (permalink)
 
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 mtzimmer1 
Upstate NY
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Wernersabel View Post
I have similar problems but I am getting better at letting things run. I try not to exit as long as there is no setup the other way. So I am trying to let that thing run until the exact same setup happens to the other side. And remind yourself why you got in, you did not see a reason for the bulls to step in. Obviously you were reading the market correctly, you got three confirmations that is why you got on.

I would also question my self evaluation in that very moment, because getting out too soon is also a mistake. So may be the accuracy level is a little below 100%. But no reason to feel bad about that day, try to point out the positives and keep woring on the other things tomorrow.

May be that helps staying with the winner longer.

Let me know if you find different ways to approach that.

Cheers,
Wernersabel

Very good points!

Maybe I'll say the exit was 50% accuracy to rules because I did have reasons to exit but price had also not reached my trailing target. So total accuracy on the day of 75%. 100% for entry and 50% for exit. Thanks again!

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  #55 (permalink)
 
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 mtzimmer1 
Upstate NY
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Experience: Intermediate
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There was one setup today. Missed my fill by 3 points. Oh well. That is the price you pay for using limit orders instead of market. Sometimes you get a better price but sometimes you miss trades as well.





Self-Eval:

100% Correctly identified a winning setup. Never was filled on my entry but my limit order was placed according to my rules.

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  #56 (permalink)
 
mtzimmer1's Avatar
 mtzimmer1 
Upstate NY
Recovering Method Hopper
 
Experience: Intermediate
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Even though I made no trades today, it is nice to see my analysis playing out. Check out how price reacted at my key levels.

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  #57 (permalink)
Wernersabel
Lisbon, Portugal
 
Posts: 35 since Jun 2017
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Hi mtzimmer1,

I get the feeling the market you trade is rather fast, have you considered to adjust your gameplan and work with market orders instead? I mean, if you want to get in, get in. If you want to get out, get out. How cares about a couple of ticks on a 50 Point move anyway? Do you want to be hyper precise or hyper perfect?

And it looks you can trust your levels, thats great! I always try to get confirmation. Like you got to the top. Price got rejected and came back to test a certain level I think 2 or 3 times, sellers held firm. Maybe that helps to trade with more confidence.

Cheers,
Wernersabel

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  #58 (permalink)
 
mtzimmer1's Avatar
 mtzimmer1 
Upstate NY
Recovering Method Hopper
 
Experience: Intermediate
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Wernersabel View Post
Hi mtzimmer1,

I get the feeling the market you trade is rather fast, have you considered to adjust your gameplan and work with market orders instead? I mean, if you want to get in, get in. If you want to get out, get out. How cares about a couple of ticks on a 50 Point move anyway? Do you want to be hyper precise or hyper perfect?

And it looks you can trust your levels, thats great! I always try to get confirmation. Like you got to the top. Price got rejected and came back to test a certain level I think 2 or 3 times, sellers held firm. Maybe that helps to trade with more confidence.

Cheers,
Wernersabel


I think you are right. My only issue with market orders is that when I enter price is already moving away from my limit order AND if I am right and price is really going to move then I may get slipped on my entry as well.

It is definitely something I need to think about.

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  #59 (permalink)
Wernersabel
Lisbon, Portugal
 
Posts: 35 since Jun 2017
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I may have to correct myself, I just buy the ask or sell the bid at the level I would set a limit order. All you lose is 1 tick both ways. I don't know wheter that is call "market order" or whatever on your trading platform. But if you think about it: whenever you set a limit order, you previously did your analysis and the setup you want to see occurred adn you try to get in. So I would want to make sure I am in or out and just hit the buzzer.

Think about it.
Wernersabel

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  #60 (permalink)
 
mtzimmer1's Avatar
 mtzimmer1 
Upstate NY
Recovering Method Hopper
 
Experience: Intermediate
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I don't think any of these trades really met my rules on entry or exit. Today's action was slow and I convinced myself that I was smarter than I really am. The market corrected my ego as it always does.

Alright lets look at the first trade objectively and try to comment on the process rather than the result.

Reasons in support of this trade:
-Unseen on the attached chart, ES had a strong reaction off of RTH Mid.

Reasons against this trade:
-YM traded into a triple top as seen and rejected off of it. One of my rules is to not trade into double/triple bottoms or tops unless there are a million other reasons to take the trade.
-The expectation on all three indexes was for a new low. By this I mean that the previous swing high had not been broken and we were still in an uninterrupted downtrend as far as structure and swing analysis is concerned.
-It was in the middle of the day's range on a narrow IB range day. Breakouts unlikely. Mean-reversion much more likely.

Total: 1 reason for and 3 against. This is not an acceptable entry. 0% accuracy for entry.

Only thing I did right was not moving my original stop. 100% accuracy for exit. (Do losing exits count as following the plan?)



OK. Lets look at the second and third trades the same way.

Trade 2:
Reasons For:
-Price above RTH Mid on both ES and NQ. At this point I had recognized we were in a range and I was looking to sell above the Mid and buy beneath it. Mean reversion.
-YM just shy of the Mid. Figured it would act as resistance.

Reasons Against:
-Price not far extended from Mid. Mid could act as support for NQ and ES.
-Late in the series of down-swings on a slow day.

Total: 2 for and 2 against. Again not an acceptable entry. 0%

Exit:
-ES barely broke the swing low while YM and NQ were nowhere near breaking their respective swing lows. My brain was biased and interpreted this as "Great, the ES is weak, now when YM and NQ break to the downside ES is really gonna slide." The flip side to that is what actually happened. NQ and YM were diverging from ES and this fact should have warned me that the down move was over. Instead I was greedy and sat waiting. Price came back to my entry and I closed for +1 tick, giving back 3.5 points. 0% for exit.

Trade 3 was a re-entry on trade 2... This entry was slightly better only because YM had traded to LOD and returned to Mid. Still not an acceptable entry.
Exit was +1 point and it was an acceptable exit, though it is difficult to grade given the entry was illegitimate.





Accuracy for the day probably is an honest 0%. None of these were good trades that met the criteria of my rules. Need to have a lot more discipline and focus tomorrow.

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Last Updated on September 30, 2019


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