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I like the analogy about the three strikes. But a batter can swing as hard as humanly possible on one swing, and still have two more. As traders if we swing as big as possible on one pitch, that could theoretically wipe out an entire account. Sometimes "going big" for a trader means he tries to take such a big swing on the first pitch that he uses up all his strikes on one swing So it still comes back to how much do we risk per week, per day, per trade, and for some people that "swinging big" means they risk on one trade what they probably should risk in a week. So even if I give myself 3 swings, I have to allocate my risk on each trade such that I take only 1/3 of what a "swing" would be for the day. As I heard someone say though, and as you said basically the same thing: when you have a loss you will always have on more size than you want (even if the size is 1 lol), and when you have a win on you always wish you had more on.
But I think the most important is what you said: take your swings in such a way that they will let you in the ballpark tomorrow
@Cashish
The one additional chart I use at key levels to help with my decision making is MarketDelta. No secret sauce here. Just a quick visual for helping with quick decisions. Helps me....may not mean diddly-squat to others.
I made a few notations which are pretty much self-explanatory. Mr. Cashish PM me should you have additional questions. I don't want to sidetrack the thread with questions about a tool/study that you do not use or have not shown in the thread.
Just had a call we had a death in the family. I must run.
I'm pressed for time this morning but wanted to post these charts of the COT Data. I hope to follow up on this later (maybe Sunday Night). As of Tuesday when the COT "snapshot" was taken Large Specs were still willing to increase their Net Short positions,, since this data isn't released until Friday I look at the relationship of the day's range to the previous Tuesday. If trade was within (at or near) Why Not add to shorts, if it was a good position then (previous week) I believe they (Large Specs) would take advantage of the opportunity, it appears they did and added over 15,000 contracts to their Net Shorts.
The bands on the chart below are a 20 day average of Highs and Lows, the significance I place on these will take some time to explain (maybe Sunday Night) ,,, sorry but that is what they are. It is a longer term picture.
Another month has past and the NFP Report was released on Friday, do you remember the "NFP Trade," I flew a little close to the flame but closed my "One and Done" U.S. Session long @ 1.2961. When the Big Dog did what, yes, traded on 1.2950.
It has been 4 longs months since I posted here. The TST combine format really threw me for a loop when I first tried it, as my last updates here show. One major discomfort was the pressure to make X dollars in Y days. The problem was that if I took …
Thank you @Cashish -- so far in this current phase though I am not doing very well at all, but I am still in the game at least for now Will post updates to that thread you referenced at some point. Thank you for the good wishes and for your charts as always!
I started to get some charts around Sunday night for this post but I was just to tired to follow through. IMO, I believe most traders "these days" focus on indraday charts and indicators that at best analyze short term movements and pay little (if any) attention to the bigger picture. If nearsighted intraday analysis works for you great, but I invite readers to consider combining longer term analysis with intraday analysis. Personally I find this gives me much more confidence in my shorter term indicators and also identifies "riskier times" when those indicators may give false signals or signal trades that may have limited reward, conversely, a longer term outlook can often pave the way for an increased reward.
Since the use of computers, the availability of trading programs, and the granularity of real time data the old daily bar chart seems to have lost it's sex appeal, but I assure you untold millions of dollars were extracted from the markets with hand drawn daily charts with nothing more than a volume graph and an open interest line. These simple studies can still provide a picture of a markets intentions that can be exploited, intraday. Who among us hasn't heard the term, longer time frame traders, these are their tools. These are the tools of the defensive traders, the traders that have the ability to throw millions of dollars, or thousands of contracts into the market to defend their positions or move a market to another level. We're the chickens in the barnyard, pecking the ground picking up pieces of feed that fell from the mouths of the draft horses that do the heavy lifting day in and day out.
This Daily Chart shows volume and OI along with a few SMAs that I watch. OI had been on the rise for 7 days prior to the news out of Europe. The Easter Holiday closed the U.S. market on Friday and the EU market on Monday (low volume bar). OI did tick UP on the Monday session with less than 100k of volume. In a previous post I've charted the COT Data and Large Spec and Small Spec increased their Net Short positions on Tuesday. These calculations were made Sunday night for Monday's trading session. Friday's move pushed price above the 20 period Highs and made a high of 1.3047. I use the 20 period average of highs and lows as a longer term trend indicator. First, price must close above the high band to signal a possible trend change from down to up, second the price bar on the fourth day has to close above the close of the "signal bar" to confirm the trend change. This signal, when price closed on Friday was in a "weird" spot. The close was 3019,,,,, the high band was 2973. To some these lines are just random lines and have no meaning but I trade them. Sunday Night the upper band was tested,,, it just so happen the 50% line of Friday's move was also in the area (2977) the low for Sunday/Monday's trade was 2975.
This move UP brought the real target of 1.3050 into play. Tonight, Tuesday's trade crossed this level, the question now is will this level hold? Defending a position, is in my opinion real. When prices ticked lower and lower searching for the bottom early Sunday/Monday I told myself if 2950 isn't defended NOW (2977) we'll never see 3050. Another question, will the Large Spec "load the boat" at 3050 and continue the down trend or will they change direction. I believe the Large Spec "eat their young" (Small Spec). Like the fable of the fox and the rabbit crossing the river,,, the Small Spec ride on the back of the fox as they swim across the river and the fox tells the rabbit to get higher and higher on his body until the rabbit is riding on the fox's head,,, then CHOMP, the rabbit is lunch. Small Spec end up being the fuel to propel the move.
A Monday Morning Quarterback
This post seems a little after the fact but my intention was to show that time spent on longer term analysis can be very helpful. I'm sure I spend many more hours on long term analysis than I do on intraday. One example is a trade I took Sunday evening while I was preparing for the EU open. Price was trading around even 3000, I sold looking for the rotation DOWN to 86/84 it took FOREVER but I got it. Then at the EU open I felt the 2950 level was a solid support level that was being defended by an army of Large Spec, I bought 86/84 and rode it BACK to even. Nothing works all the time, but I believe traders need to have an objective understanding of the market they're trading. I find the time I spend on daily charts sets the stage for the small intraday moves that my indicators sniff out. When a trade is signaled I feel I have a clear vision of what the market wants to do and who's in control of the move at this level. I'm looking to trade between 2950 and 3050 probably for a couple more days (not sure of news). I think 3050 is going to take some time to chew up,,, just my opinion of course. I hope the market proves me wrong!
You guys are good, I've already gotten a couple PMs about the charts I posted in the last post, I wanted to make the 3 last charts as clean as possible.
The first chart is the June contract only, I don't rollover contracts, I only chart the contract that is being traded. You can see (if you look close) the volume on this chart "arrives" when the March contract expires. I wanted to highlight the gap, even though the gap was filled I believe it still represents "pain" to more than a few traders and they will remember that pain when this area trades again. Also the Virgin POC resting at 1.3073 is a level generated by volume traded prior to the "arrival" of the masses from the March contract. Maybe this random line came into it's own this evening when this contract (June) traded on the high of 1.3075,,,, but what do I know. For the record, at the close of trading yesterday there was over 1000 contracts long and 1000 contracts short in the September 6E 2013 contract, and more than 200 in the December contract, I assume the traders holding these positions are not newbies!
The second chart is IQ's back adjusted data, I use that data for longer look back periods. I question the true validity of looking at volume generated by day traders weeks or months ago within ranges of several hundred points but we all have it and we all use it (so I guess that makes it O.K.). Edit: This chart is in what Ensign Software calls "tight alignment" mode,,, basically is tightens the profiles together and allows more (profiles) to be viewed on the chart. This skews the alignment with the dates on the bottom of the chart,, these are weekly profiles "crammed together." 6 weeks of profiles within a 4 week scale on the bottom of the chart,,, I could have,,, should have removed the "date scale" from the botton of the chart,,, sorry.
Lastly a spot chart, this is straight from the FXCM "Bucket Shop." To be honest I don't really give a shit! I don't chart the "baby pips" (.0000#) I round them to 4 digits. The levels this chart reveals is most always 50s and even. I've seen differences during moves of 20 ticks or more between the futures and spot and could never bring myself to trade the spot. I think I captured a couple charts the other day of a spike that proves what I'm saying, I'll look for them. I use this chart for long look backs also, mostly to remind me of "battle grounds" like the one we're at now 1.3050.
This brings up the other question, How do I deal with the spread between the cash and the spot? At some level I'd like to say "I don't" just trade either or. Yes, it is important to keep the spread in mind and I've written many times I suggest taking profits "going to" whole numbers not "going through" whole numbers. Why? because IMO every "Bucket Shop" around the Globe has to trade on that whole number, if they don't nobody does! (my opinion of course). But, if spot price approaches 1.3050 and the future is six ticks higher (like today) I'll damn sure place my order at 1.3056 and accept full responsibility for being a Dick for a Tick. When price reaches for high ground, "give 'em time." How about something as simple as Fib levels on a spot chart, if you go from "tail to tail" you might be to perfect, and the guy next to you has a different data feed and his chart might be off a tick or two as well,,,,, see where this is going?
With today's data printing exact numbers on our charts I believe it's very easy to get caught up in trying to be perfect. I want this level, it holds the most volume traded so far today! I'll say it again, don't be a Dick for a Tick. If perfection is your nemesis focus on being perfect at following your rules not picking exact levels for entries and exits,,,, if that is your problem, you're probably trading to big.
I hope this clears up the queries, if not "bring it!" You guys are good, that makes my efforts most enjoyable.
IMO, everybody and their Mother-in-law expected this level of resistance (1.3130), where the 50 and 100-day SMAs converge along with the .382% Fib of the Feb/March down move to put the brakes on this rally. While I was posting this chart, the Mighty Euro staged another attempt to push through to what I believe 1.3150, the attempt lost steam, ground to a stop at 1.3128 and retreateted to the safety of 1.3100. I believe the "screw up" (or master plan) of the FOMC Minutes threw a bucket of cold water on this market for the day, so back down to 1.3050 and test support.
So it still comes back to how much do we risk per week, per day, per trade, and for some people that "swinging big" means they 
