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What a difference compared to yesterday. Some days I just don't get it right. I am not in rhythm with the market. I know it's not going all right and so I will try harder to make up for the losses. I just can't stop and think I am able to come back. Sometimes I do, but most of the time this leads to bad entries and ultimately overtrading. So also today.
Total trades for today: 34 trades for a total loss of -12.75 pts.
- 12 winners for +25.75 pts. That is +2.15 pt per trade.
- 22 losers for -38.5 pts. That is -1.75 pt per trade.
So the average winner is bigger than the average loser but there are just way too many losers due to bad timing and just too much "trying" instead of concentrating on only the best entries.
In addition to that, fact is I gave up quite some profits (16.5) in an attempt to let the trade run (to target). Some ended as a loser, some as a small winner.
I need to find a way to eliminate those bad timed entries.
Yesterday price bounced off the high of the range (3144.75) forming a double top. In the afternoon the ES sold off to close above Monday's close and high. Price closed within the range (3064.50 - 3144.75) for the fifth day on a row. Price is now hovering near mid-range.
During the Asia session price went sideways. During the EU session the market sold off to 3081 (ONL). Looks like ES is going to open inside yesterday's range, below value. At the moment of writing price is at 3104.50 (vwap).
Scenarios:
1. On weakness sell towards low range and levels: ONL, YL, Low of range (3064.50), Monday low (3027.25).
2. On strength buy towards higher levels: YL, VAL, YC (gap fill), ONH, YVPOC, YVAH, YH.
3. Consolidation: sell VAH, buy VAL towards VPOC and/or 3m ema20.
These are just notes for myself! No advice. Don't use it to trade on.
Yesterday I concluded that I need to find a way to eliminate overtrading (bad timed entries).
Today I did some thinking and I came up with four possible solutions:
1. setting a limit on the number of daily trades.
2. setting a limit on the daily loss.
3. trading a higher time frame.
4. using strict(er) entry rules.
Trade 1: Long first 10s HL after strong move down to ONL for MR scalp (to high range and 1m ema20) (2 pts).
Trade 2: Long 3m PB for high range. Too early, trapped (-2.75 pts).
Trade 3: Short 3m BOF for low range (-2.00 pts).
Trade 4: Re-entry short. No follow through (-1.50 pts).
Trade 5: Long 3m PB for high range (5.25 pts).
Total for the day: 1 pt.
Scenario 1 played out (exactly).
Trade 1 was counter-trend. Plan was to sell on weakness towards the lower levels. I forsake my plan.
Trades 2 t/m 5 were taken after scenario 1 already played out and the market was ranging. All 4 trades were taken in the middle of the range (near VPOC) while the plan said to sell the high and buy the low when consolidating.
I normally don't have so much troubles to follow the rules (I would probably been in jail if I had). Why is it so difficult to just follow my own trading rules?
Trade 1: Short PB for test ONL. No follow through (-1.00).
Trade 2: Long BOPB for YVPOC, YC, ONH. Too early (-1.50).
Trade 3: Re-entry long on PB. Closed at HOD (+4.50).
Today I played a little bit with a higher time frame (60m) trade in the EURGBP (in sim).
I planned to trade a BOPB from a range after forming a H&S (Chart 1). This was the higher picture. I watched the 5m chart for timing my entries. First lot was placed early as a feeler. Then I put on the second lot short. I realized it could also play out as a BOF (scenario 2). The buying was strong and there was not a good short signal (Chart 2). As it turned out price came back up strong into the range. I reversed my position and closed out near the high (Chart 3). I am considering to do more of these trades. We'll see.
Think this is an interesting 60m chart from the NQ.
At point three I can draw a trend line. Copy & Paste to point two would give me a trend channel with point four as a potential target for a trade. I cannot believe this is pure coincidence. Scalping a couple of points per day is hard work and not easy. Just imagine you catch a part of this trend with only one trade. This is difficult in the futures because of the risk (you will need a wider stop as compared to on a lower time frame). But with the micros it should be possible and it would give a great risk to reward (with lower costs).
Today NQ broke out of consolidation (accumulation) after printing a spring. We are still between the last swing low to high (4) in an uptrend. I would think the range will be support so I will try to find an entry (on the 5m chart) on a pullback to test the breakout (BOPB) for a test of the high (4) as target. If the BOPB fails I could look for an entry to go short (also on a BOPB) with lower channel line as target. May be it will happen overnight and I will miss the entry. We'll see.
Traded the MNQ today because of a possible opportunity for a larger target based on higher time frame (1H) analyses, see last post #58.
Trade 1: Short 1m BOPB for a test of yesterday's breakout (-2.50 pts).
Trade 2: Re-entry short. Closed too early (3.00 pts). Target was hit (approx 30 pts).
Trade 3: Long 60m BOPB for a test of Asian high and possibly higher (-1.00).
Trade 4: Re-entry long (-1.25 pts). Should wait for bull flag (continuation)) to finish.
Trade 5: Re-entry long PB / Flag. Closed at prior swing high (9.00 pts).
Trade 6: Re-entry long PB / Flag. Little early entry. Took some heat (MAE=6). Closed too early (no follow through) (9.00 pts). Should let winners run to target (1H level/Asian high, +20/40 pts).
Trade 7 (only trade during US RTH): Short CPB / bear flag for range low. Closed too early (7.25 pts). Should let winners run to target (1H level low range +70 pts).
Total for the day is 23.50 pts. This could have been way more if I'd just let the winners run to target.
Trading from higher time frame levels feels good and I think setting (higher time frame) target levels maybe can help me to stay longer in a trade while taking minimal risk with entries on the 5m or 1m. It's something I am going to explore a little more. Also, I am considering to look at some more markets on a higher time frame (for good risk /reward opportunities).
I am not certain I should continue to use the 310 Oscillator and Keltner channel indicator which I use for trend & momentum. I think I will keep it aside so I can give it a quick glance but will try to go completely naked (pure price action).
I am not an author or a journalist but I like to write down my feelings and thinking with respect to my trading method and development. It helps to organize my thoughts and allows me to monitor my growth by being able to look back on things. And that's exactly the goal of maintaining this diary. So I am planning to write short concise reflective pieces on different aspects of my trading method. This can be technical or psychological. By writing it down I think it helps to see if things make sense and by sharing people can give constructive feedback or discuss things.
There will be no fixed schedule with respect to subject or publication date. All I write is my own opinion and will be limited to my own trading method (based on my knowledge and experience).
