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I'm using Tradestation and the Sunday session opens at 5pm EST. That is also their rollover time between days so I figured it was a good session to use.
Can you help answer these questions from other members on NexusFi?
Good plan. I love simple rules like that to keep myself out of trouble. Although this kind of doji magic might only be applicable outside forex. Will watch.
Lesson Learnt Last Session
Yesterday had two quite short set-ups or so it seems. Probably noticeable now because I'm practicing my patience to stop myself leaping in without seeing any real PA.
Yesterday was weird. I just went over all 5 set-ups and on the one hand, they seemed really text-book perfect, but on the other hand, they seemed impossible to catch. Guess that doesn't make sense.
Goal today
Start making sense.
Stick to the procedure.
No entries without due diligence.
No impatience.
Top concentration level required.
With Zen-like calm, put the pieces together and take every good risk.
In positions, manage good PA with patient analysis, manage bad PA with patient exits.
Also I want to have named PA for every reason to get in or out. Risk Management
Account - sim: GBP 95,074
Position size: 2 x US$50K
Max risk per trade: $200
Daily time-out: -$400
Daily full stop: -$600
Session Details
Normal day, perhaps quieter week due to holiday yesterday. Start session 12:30.
Higher Time-frame
More of the same on the daily - either establishing a range with 1.3200 as the ceiling, or re-establishing the rally but having a few engine problems.
Volatility
20 day volatility 108 (10 year max 287)
20 hour volatility 20.5 (10 year max 96)
Hourly volatility plummeted yesterday thanks to the UK bank holiday but volatility can be volatile, right?
Asian Session
27 point range, 2.5 volatility (low!), quite choppy, lots of overlap, tails, dojis, mixed swing points rounded/abrupt. Bullish with sharp reversal from top at close.
London Session
Don't know what counts as a morning reversal. If the London trading population for some reason started 25 mins early today, then yes the Asian session was reversed to the tick almost and then re-reversed with a rocket on the unexpected German factory orders data at 11:00.
Some sharp fast swings going on early but then got a bit choppy and range-bound until 11:00, and climbed choppily through the 12:00 quiet period but has just pulled back from the first resistance level.
Trader State
Physical: no food today. Not cold anymore though - 21 deg C
Mental: still looking for an objective measure here - strength of trembling after a big cup of strong black coffee on an empty stomach?
Fatigue: also need a test for this
Motivation: Our achievements speak for themselves. What we have to keep track of are our failures, discouragements and doubts. We tend to forget the past difficulties, the many false starts, and the painful groping. We see our past achievements as the end result of a clean forward thrust, and our present difficulties as signs of decline and decay. -- Eric Hoffer, Reflections on the Human Condition
Session Notes and Review
The volatility today was even less than yesterday, amazingly. Has the govt introduced the financial transaction tax already? Guess it doesn't affect sim, but it's certainly quiet.
Plus there was no "high" priority news events scheduled for today according to ForexFactory. Only found 4 set-ups, and one of them isn't a proper set-up anyway.
Set-up 1 was a pull-back on the way (I thought) to 1.3140. I checked everything but where I thought I saw weakness in the retrace pull-back to the 20EMA, in fact there was nothing. It was just dead and then carried on retracing. I count this one as 1 part mistake, 1 part bad luck. The crucial thought that tipped my hand was that it was coming up to the hour and I figured the hourly bar would push back up into the close - thinking about it now, I have no idea why I figured it should do that.
Anyway I got in, but need to be precise about what the clues were on offer to get out before it reached my full stop. Hmm, I think realistically I was only 3 ticks from perfection - once the bear bar pushed down to the edge of the stall, it took only a break of that candle to a second piece of bad PA and a definite bail situation. Could even have reversed at the same point.
Set-up 2: the trend up from 1.31 had gone weak and turned into a complex pull-back with a big 1,2,3 back down, and should now be set for a rally again, having retraced almost as far as '00. The first higher low was too quick for me, and then the second higher low was almost too quick again but I dived in with a market order - late to the party. Not a good entry, but not tragic either.
I need to go over exactly what the bad PA was, to see whether I could have realistically got out earlier than I did.
on the 3-min chart, bar 322 is a shooting star - bad sign
bar 323 makes up for it a bit, but not completely
bar 324 is bullish but only by 1 tick
then a poor bearish range candle takes us back to the same place as the shooting star did
followed by a doji with a low tail that is ostensibly bullish since it got pushed back, but it still showed the bears are right there
then the killer bear candle takes us under the 20EMA - time to bail, but patiently - pull up the stop to under this candle
So I could have saved myself 3 ticks under normal circumstances.
Under other circumstances I can see it would have been advisable to exit earlier. From the run of PA in that rally if compared to earlier in the day it should have accelerated up to hit the next level rather than putting in that shooting star. There was no reason for the bulls to weaken.
Set-up 3 was not obvious, it's not a regular set-up, it's hardly an established bear trend, we're still going up, or looking for a lower low to prove the reversal. But the way bar 336 broke the run to leap up to the 20EMA and back down again signalled something strange going on, at least a scalp down to '00 under the guise of a pull-back in the sell-off.
Set-up 4 was the bounce off the trend-line from the last few days. Probably reasonable to assume that this is going to be quick. Bar 351 was the entry point where it broke upwards. In my dreams I might have got it.
Instead I entered seriously late over the 20EMA and after a shooting star, inexplicably. Got my lines crossed. Bailed out reasonably well without panicing.
Need to see a lot more set-ups.
Need to go over my journal to re-visit my trading from last year.
Need to go over some historical data quickly, maybe covering 8 hours of market history in the morning before doing a liv session.
The best set-up today?
Has to be set-up 2, because the others were invalid or obscure.
You can discover what your enemy fears most by observing the means he uses to frighten you.
Although to be honest, I should also avoid taking scalps if I can't be sure what direction the trend is either.
Lesson Learnt Last Session
I only did 6 things yesterday, (bought, sold x 2). Half of them were mistakes. If I had had a perfect day yesterday with my current level of knowledge and experience but with perfect implementation of my trading plan, I would have done nothing.
So the discipline stuff is still not working. The main problem is that the monitoring of my entry procedure is going nowhere because I just changed it and had to chuck out last week's numbers and start from scratch, and I also want to change it again. Currently I have the entry procedure in 2 places - one on a flash card, and second time on the tick list where I record my rigid adherence (or not) to the procedure.
I'm going to change it again now, have only the check list which I tick off before the trade, and add to it another item at the end "is this in the plan?" which should stop me taking entries based on exploratory ideas like I did yesterday (set-up 1). So now I'll have:
So I've also removed the check about account equity which I had in there as a mechanism to reduce the fear of losing on a full stop. I think I've assimilated that into the entry now.
The 2nd to last item to "confirm the weakness" is to check the PA again, make sure there's not strength in there like yesterday's long entry right after an upper tail.
Goal today
Rigid adherence to trading plan.
Identification of thoughts or emotions leading to deviation - the fundamental reason, not the ex post facto justification for a deviation.
Risk Management
Account - sim: GBP 94,982
Position size: 2 x US$50K
Max risk per trade: $200
Daily time-out: -$400
Daily full stop: -$600
Session Details
Normal day (hopefully), holiday on Monday, yesterday really quiet, today a holiday in France - expect continued thin market.
Shocked how late I am despite an early start. Waylaid by quadrant 1 crap.
Higher Time-frame
Same as yesterday - either establishing a range with 1.3200 as the ceiling, or re-establishing the rally but having a few engine problems - note potential trend-line up from Friday's low.
Volatility
20 day volatility 106 (10 year max 287)
20 hour volatility 17.5 (10 year max 96)
Down again from Thurs & Friday's spikes.
Asian Session
26 point range, volatility up to 3 mid-session as it pushed up to the high almost at 1.3100 but not quite, then went quiet again, not moving again. Interesting to know what it was. No news in Forex Factory from China. Hmm. OK it was the Chinese trade balance. Added CNY to my forex factory filter.
London Session
Rally started from 7:00, no Asian reversal, nice action until midday quiet period. Tendency to overshoot some of the S/R, maybe just the '00 level, bouncing off the 60min 50SMA just below. Not massively abrupt swing points, not much overlap, good trend on the whole.
Trader State
Physical: Food day today. Not cold either. Back problems creeping in, looking to buy a cool chair designed by Opsvik but they cost £500 each - got an ebay search set up for it.
Mental: trying to shine some light on the constant misbehaviour of my prefrontal cortex. Too many emotions are getting the green light for their dumb decisions.
Fatigue: rubbish again. Never can make progress on Tuesdays though due to evening commitments.
Motivation: When you are going through hell, keep going. - Winston Churchill
OK, will do.
Session Notes and Review
Mission failed. Another day not started on time, and also not quite sure what went wrong at the end. Will now check it out.
Set-up 1 was the break of 1.3150, with the zone stretching up 10 points. The break-out was medium strength, not strong because there was too much chop involved, some badly placed red candles. Can't say it was weak either since it didn't calm down to a bit of consolidation until above the zone.
It retraced well on bar 315 and put in a spike + ledge but I was too slow with my checklist and missed the entry.
I strictly forbid chasing which often resulting in price coming back, causing me to leap in without regard to the fact that it was bad PA now.
Set-up 2 was just a pull-back on the weak rally. I missed the entry, convinced it would touch the 20EMA first.
I have a slight problem wanting certain things to happen because I think they increase the odds of the trade playing out. Theoretically, if the stall broke before touching the 20EMA, that makes it more likely to play out.
Set-up 3 came after the full retrace back to S/R, and I astounded myself with an almost perfect entry. Could have been a tick lower but can't complain.
I had the feeling though this was just going to come back down again and it did - I got the exit feeling right at the top but didn't trust it. Maybe it was just the old "exit winners quickly" feeling rather than valid subliminal PA reading. However I left it to bounce off the 20EMA - seems to be more of a bad habit than I thought. Should have ditched it right at the 20EMA, could theoretically have got back in there only a couple of ticks higher at set-up 4 using the same target at the day's high.
Stupidly at this point I was instead considering a short - my theory being that we had now seen a lower low and a lower high so that made it a down-trend. The rule for a down-trend is it has to follow the failure to successfully cross an S/R level and come back across it in the other direction. The swing count could just as easily mean that it's turned sideways rather than reversed.
Then came a good push upwards and at this point it had loosened up a couple of screws in my psychological machinery. I got in on the pull-back, all nicely ticked off, grease lightning. Yowsa. Nicely practiced, but I missed the first rule, patience and waiting for at least 2 or 3 candles before jumping in. Maybe I've even said 5 candles before.
It was the usual Fear of Missing Out. "Confirm the weakness!" - what's to confirm, I told myself, when it's just put in such lovely green candles and is obviously about to do the same all the way to 1.3200?
2nd day it has failed to move up to the next S/R all afternoon.
Give a set-up at least 2 candles and only enter on the 3rd 3-min candle. A couple of 1-min bars isn't enough to confirm the weakness.
Fatigue was still showing up. A couple of twenty minute long periods fighting it. Simple solution, proving v. difficult to carry out.
Don't chase when the entry is gone, & don't be pleased about it coming back to offer an acceptable entry, it's got to be good from the start and an immediate retrace after the entry is more likely to make a bad entry.
Sort out something to eat & drink for lunch. I keep wasting time jumping up to get some stuff when I should have had it sorted before starting.
Need to go over reversal candlestick patterns. Dark cloud cover, that sort of stuff.
Checking off the entry procedure on the checklist is effective - I had 5 set-ups today but I had 10 points where I went over the checklist, most of them not getting to the entry step because I was wrong and this caught me. So to be effective, I check off the first 6 items and then enter a stop order, and when item 7 and 8 are ticked, I can swiftly bring the stop into position.
The best set-up today?
Set-up 1. Definitely a nice bit of PA leading to a nice move.
You can discover what your enemy fears most by observing the means he uses to frighten you.
Does Al Brooks use S/R levels? I don't remember now.
Lesson Learnt Last Session
Need to check post-set-up each time whether it's given me Fear Of Missing Out again.
Enemy number one at the moment.
Should check regularly as part of set-up procedure. First check: is this FOMO?
Goal today
FOMO management and strict adherence the trading plan.
Risk Management
Account - sim: GBP 94,943
Position size: 2 x US$50K
Max risk per trade: $200
Daily time-out: -$400
Daily full stop: -$600
Session Details
Holidays in catholic Europe. More thin markets. Start 12:30.
Higher Time-frame
Looks like a choppy retrace in a building rally today on the hourly. Obviously would be happier about that bull trend if we were above the May 1st swing high.
Volatility
20 day volatility 107 (10 year max 287)
20 hour volatility 18.5 (10 year max 96)
Still down but not decreasing.
Asian Session
Very quiet 14 point range, volatility 2.5. Totally sideways, a bit choppy.
London Session
No difficulty reversing the Asian session, and then again after the nascent rally stumbled in the congestion zone from yesterday afternoon. Down on the day by midday and looking a bit choppy and hesitant with extended interaction at S/R levels.
Trader State
Physical: hungry. Was cold, but now wearing winter clothes.
Mental: fear of fear of missing out. fear of not recognising fear of missing out until too late.
Fatigue: bad. Went to a show last night, late back.
Motivation: I am not as concerned about the return on my money as I am about the return of my money. -- Will Rogers
Session Notes and Review
A trend day that wasn't too difficult with long interactions at the S/R levels.
Still had a few argh! moments though.
I did alright managing my emotions - or rather just that one emotion, FOMO, but I messed up the prep work again despite instructing myself to sort it out yesterday. I went to get my coffee the moment right before set-up 2 unfolded. I was meant to sort out my food & drink last night, of course I went out to the theatre instead so didn't do it. Not that I was eating anything today, but I seriously wanted my coffee. I was just totally behind after giving myself an hour to do the prep work and failing to finish it without rushing and getting no chance for a coffee - so it was either no coffee while tired and hungry, or take a break to go & get it.
At 13:00 the market had turned around at the previous swing low after a dark cloud cover trigger had failed, but then the rally failed to continue and I was pretty sure of the sell-off continuing after set-up 2, a simple pull-back. Sure enough another dark cloud cover appeared and I was ready to go short, but the next minute bar did nothing. Hmm, then I remember the news release was coming up in 10mins so the market was likely to do nothing. Dumb mistake. I know the market often does something before a release - but I really wanted that coffee - and the market left the set-up as I left the screen.
1 dumb mistake, some nice trend bars gone without me, but I kept on the straight and narrow and banished the FOMO, whose tentacles were suddenly creeping around my thoughts.
Set-up 3 was seriously drawn out but that was expected and the direction it would take switched every 2 bars, but finally the PA looked good and I went long, managed it well despite it failing to get far. Could have rescued a few more ticks on the 2nd part but it went according to plan - better so that way than bailing early.
I had no chance to get short and the market just steamed through the potential set-up zone and put in a pull-back mid-way to the next S level - set-up 4 - I picked up some slippage on the entry there, I have no idea how they simulate it. My stops were seriously close, perhaps too close, but the target was also close so I guess I should have played it better, got in a point higher, which would still have been good PA. Just managed to maintain 1:1 R:R.
I had the 2nd half of the trade on still while the market hovered around '00 and I chickened out on it, taking the points on the table - that would the old "taking profits early" rule of bad trading.
I did get in again on some good PA but the market reversed sharply putting in a big hanging man on the 1-min right after my entry bar. I should have called it quits when that bar closed but the main decision-making mechanism in my brain jammed and I figured I would hang on (a) because I should be patient (it's in the plan!) and (b) it didn't feel good to exit. So that would be the corollary of "taking profits early" - I'm really learning the basics of bad trading here - letting my losses run".
To give myself a bit of credit, I had switched back to the 3-min chart and didn't see the 1-min hanging man but that doesn't excuse ignoring such crap PA.
It then moved down only 5 points to set-up on the lower trend-line from the hourly chart. Set-up 6 there dragged on a bit and I was putting in some serious deliberate thought suppression on the FOMO. Fortunately to save my mood, it moved well out of the set-up on good PA and I chose the target well at low of the day, getting filled on that and B/E on part 2. I had figured with a break like that, it looked good enough to break the low of the day so failing to do so was a serious weakness - a good reason to pull up my part 2 stop to B/E.
Sort out a bit of discipline starting and staying in session! Slack.
I am still a victim of "take profits early" and "let losses run" - need to check what to do there then.
Did alright on the FOMO - need to find room to deal with the above 2 little demons as well though
Must keep at the tick list monitoring, seems to be paying off.
Still slow though - need to keep at it.
The best set-up today?
The one that got away - between set-up 3 and set-up 4 I just realise now I could put in an upper trend-line coming down for the day, and that doji there just after 14:00 is broken well for the best trend of the day.
You can discover what your enemy fears most by observing the means he uses to frighten you.
Looks like you got some good entries @Adamus. On another note, I had the same question regarding Al Brooks as well. He does speak of support and resistance but I haven't seen him specify what he uses.
One issue I have is accidentally staying on the 1-min chart, especially when watching a position. This is bad news - the 1-min chart is only for timing entries (and exits sometimes when bad PA demands an exit). I should make an entry and then after the next 1-min bar is complete, I should switch back to the 3-min chart to follow the PA.
It's one of my rules (a stabiliser rule, I guess, like on a child's bicycle) to wait for the 3rd 3-min bar before allowing an entry in a set-up. This rules out entering in excitement after the market charges up / down into white space.
Goal today
More work on FOMO to make this suppression a habit, but also finding a way to take my losses when I should and leave my profits to run when I should. Probably the same thought mechanism. It'd be cool to have an acronym for "letting losses run" and "taking profits early" to identify the demons along with FOMO.
Risk Management
Account - sim: GBP 94,982
Position size: 2 x US$50K
Max risk per trade: $200
Daily time-out: -$400
Daily full stop: -$600
Session Details
Normal Friday (watch out for late afternoon shifts), holiday week, possible thinner markets than usual.
Start 12:30
Higher Time-frame
It now surely has to challenge the S at 1.2950/55
Volatility
20 day volatility 110 (10 year max 287)
20 hour volatility 20 (10 year max 96)
Up a little again. I want to see it hit the Feb highs.
Asian Session
30 point range, 4 point volatility, quite choppy, down and back up again with lots of tails, bar overlap and sharp reversals until 4:00am when it went quiet.
London Session
Reversed, re-reversed and reversed again over the Asian session with big swings, sharp reversals, lots of tails and high volatility (7 points) although it all went choppy at 11:00 over the quiet period.
It's not shuttling up and down between the S/R levels so well, guess they could be simplified. Got a big trend-line from the hourly chart coming down above but the swings are pulling away from that too.
Trader State
Physical: OK.
Mental: Don't know. Hopefully good to go on the thought suppression training session
Fatigue: still bad. Didn't suffer so much yesterday thanks to the judicious application of strong black coffee on an empty stomach, so the fatigue will be showing today more, and last night wasn't good for sleep either.
Motivation: Most people like to think of themselves as risk takers, but what they really want is a guaranteed outcome with some momentary suspense to make them feel as if the outcome had been in doubt. The momentary suspense adds the thrill factor necessary to keep our lives from getting too boring. -- Mark Douglas
Session Notes and Review
I started off slightly late as usual - still seeking ways to speed myself up before the trading session.
I watched set-up 1 only half concentrating as I was trying to finish my trading prep work. The set-up was actually quite daunting with big candles, lots of overlap and relatively small swings, along with a massive S/R zone. Saw a lot of PA, too much. Couldn't do anything.
Set-up 2 was after price had come back for the second time from the support at 1.2978 and I figured it was ripe for a counter-trend move up, i.e. the break-out failure to go down thro support - one of only 2 counter-trend set-ups I'm allowed to take. Don't know quite what happened but visually or manually I messed up my entry stop placement and got executed straight away and realised I hadn't followed procedure, i.e. hadn't even figured where the stop was meant to go yet. The PA was not convincing at all in hindsight, if I remember right, I was banking on a bit of a stall at the 20EMA and then an entry after that. I bailed.
The next bar picked up some serious volatility and would have taken out my stop but also offered a decent entry after putting in that big lower tail. Too much to handle.
So first trade of the day messed up - beginning to become a bad habit.
Set-up 3 at '00 didn't offer any opportunity to get long except within the first bar which is against the plan. Then came the massive doji which should have been my entry short but I foobarred it. Too much confusion. Beginning to think here that I just wasn't really with it today. Wasn't doing anything stupid, just getting confused by stuff that should be obvious.
I figured the two attempts at the 1.2987S level plus the big lower tail / spring signal were v. bullish and somehow cancelled out the subsequent bearishness of the doji up above '00.
Whatever, after the doji, the market reversed big time at '00 and the 20EMA but was too quick - in and out on 2 candles, so no entry possible.
It then set up nicely at set-up 4 on the descending trend-line but I was too slow and too risk-averse to get in. Price moved well right through to the other side of the '00 zone so would have hit target 1 nicely. Shame and more fodder for the FOMO demon.
I did manage to get short on the break of '00 on set-up 5, seriously late but still kind of valid. Taken out by a massive doji reversal - mistake not having my first target on the bottom of the support zone - too greedy and too slow to work out the R:R would have been alright with the stops just above '00. Wasn't sure because I was trading '00 but the S/R zone stretched down 12.5 points. Need to clarify that in my plan.
The doji sent the market steaming back up - no thought of reversal entries entered my head at this point for set-up 5 - and it started setting up on the down trend-line again for set-up 6. Once again, a massive doji - no, two massive dojis - signal overload!
I began seriously doubting that I could handle it today. There were 3 clear entries after those 2 dojis on the 1-min chart and I couldn't take any of them. A ton of points gone - maybe I was subconsciously giving myself practice at dealing with the FOMO.
Fortunately the big sell-off pulled back nicely at set-up 7 in a retrace into the '90 - '00 S/R zone. Again my actions weren't perfect, I should have had my first target at the top of the next S zone, but I put it on the other side. Admittedly the R:R would have been almost 1:1 and that is probably what derailed my procedure, but it didn't matter.
Just like yesterday, I couldn't handle staying in the trade on the 2nd part and bailed close to the target. A thought came into my head from Lance Beggs where he'd said something about getting out of a trade if it gets very close to the target but doesn't hit it. Failing of my trading plan. I haven't stipulated when to change from targets to trailing stops. I figure I wanted to trail the stop but also wanted the target and so the uncertainty allowed the "take profits early" demon to get a foot in the door.
It turned out to be the best thing to do anyway (bailing on part 2 near the target) and the market retreated back up to the '75 / '80 S/R zone and into set-up 10 at the 20EMA. I tried to get in once but the candle came right back and made some horrible PA so I bailed - not without fumbling first and missing the best exit.
Eventually it put in some more clearly bearish PA and I got in OK - would have been better to hold the previous trade because it was all well under the 20EMA despite looking rubbish and bullish. Anyway the 2nd entry proved worth it. It hit the target nicely but I totally messed up the 2nd part because I wanted to leave it unmanaged but didn't have anything in my plan about how best to approach that - where to put the stop and targets. So, as the first rule of trading psychology says, when you are uncertain, you are bound to choose the worst possible thing to do. Came within a quantum of neuronal indecision at '45 but ended getting hit on the stop at '60
I really need to establish a rhythm of daily work. My lateness in getting ready to start the trading session is hopeless to the point of embarrassment.
My trading plan doesn't say anything about trading big S/R zones larger than 10 points. I can deal with less than 10 points without extra thought, but greater than that and I start making the opposite side of the zone a target, which isn't logical.
Also in the plan, I need to work out exactly when to dump the target limit order and change it to a trailing stop.
The best set-up today?
Set-up 10 - finally one which I traded, a little bit amateurishly though.
You can discover what your enemy fears most by observing the means he uses to frighten you.
My 2c On your May 7th, trade #1:
Bar 288 was a strong two bar rejection, it's better not trade into it. In fact, I would short on bar 294, expecting a retest of a rejection bar to fail, especially when the retest is very weak, like in this case 291~294. Here's Lance's article on this specific pattern, in case you missed it. This is a quite reliable pattern, even when you are trading against the trend.
Thanks! But am I going blind, because I can't see Lance Beggs discussing that pattern or even showing any candlestick patterns in that article? Do you mean dark cloud cover or an engulfing candle or similar?
PS the reason for all the screenshots is for history. If I come back in a year's time and want to read what I did, I don't want to faff around in my charting software to find what I was talking about, especially the S/R levels are a major pain to reproduce.
You can discover what your enemy fears most by observing the means he uses to frighten you.
He mentioned on his charts in the article, "retest of prior high/rejection would fail, leading to at least a test of recent lows." Here rejection could be a two bar reversal (like in your trade), or a doji with long tail above indicates rejection(like in Lance's examples).
