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Breakout Journal - a journey to full time trading
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Breakout Journal - a journey to full time trading

  #61 (permalink)
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Update:

Working through my setup on NT using TST data feed. Feeling good about how it works. Did around 40 test trades between yesterday and today to try to reproduce some of the setups I had with the t4 software.

I had a couple good trades today however they were on the NT sim account (Sim101). Talked to TST this morning and my practice account should be setup today sometime. Then I will start making trades and posting them.

Now that I have identified my setups I like to use I have been looking into other chart time frames and bar types to see if I can 1) produce more opportunity; 2) Find a better trending time frame / bar type. Some of my better entries are on trend line breaks.3) stay longer in trades.

The 150 tick chart for the 6e looks interesting and the 100 tick chart for 6j look interesting. I will be testing these out.

150 tick chart for the euro. A lot of trend line breaks.
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nosce te ipsum

You make your own opportunities in life.
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  #62 (permalink)
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iankotze View Post
I would suggest you take your time, do another week or two with the TST practice account before you go for your shot at the combine. As for your scalping style. I am not sure if it is the best route to take with TST. I tried that approach a few times and just could not make it happen because of the performance goals that are needed to be met as well as the profit target. If you manage to just stay above zero dollars but meet two objectives you can roll over. With scalping you have a hard time getting those performance goals in line and even if you make the profit objective you will not get funded if your performance goals are not in line unless you are doing a custom combine.

That being said I am a very big fan of small set stop losses and only trade 1 contract. I risk a max of 5 ticks on the Ultra Bond but cut sooner if the thing is not doing what I thought it would. If I have a loss I trade to get the loss back plus 1 tick. So that I am on even ground the whole time. When I do manage to get into a nice swing I hold for a long time and ride it out as far as I can. Thus the statistics come in line in the end even if I only have a nice trend once in 3 days. My performance goals are always very good just because of a few trades in a week that make the money. 80 % of my trades are just flopping around the 3 to 5 tick zone. A good winner is 10 to 30 ticks.

Ultra bond is $32 per tick. So an average of 12 ticks is needed per day.

My game plan is to get the 12 ticks on a day if it is just a normal day. This I do by 3 or 4 small trades taking 3 to 5 ticks if we are ranging. Once a week I try to catch a trend and get myself 20 or 30 ticks on the day. This I do so that I have a bit more profit in the bank for the dreaded down day which I cap at 20 ticks loss.

Hope that helps a bit
Ian

@iankotze

The last paragraph of your post is a similar to a approach to which I find most comfortable. Setting up a trade with a 5 tick target and being able to exit it with a gain if it starts to fail is good for me. However, I have not been able to do the longer hold times to get a higher tick count. 10 ticks is about my limit before I start fretting about losing everything I have gained. I know this is emotional block that I need to work on.

Once I get things set I will need to participate in a combine to see if it works. Then I will make adjustments to my trading style based on what failed. I should note that I anticipate failure on the first combine. In a way it takes the pressure off of me to succeed. I will make better trades and learn more because I am not trying to be perfect. It should be a good learning experience.

Three contracts on 6J or 6E is 37.5 which is close to ultra bond at 32 a tick. I estimated I need 13 ticks a day to add cushion and cover losing days for the combine. 13 ticks a day is double the amount needed to meet the profit requirement in the Combine.

I dont plan on entering the combine until I am ready. I was originally thinking beginning on November (overly optimistic!!) but it will probably wont happen. I need time get things setup. I have been playing around with my setups in NT today. I felt very comfortable trading with software I am familiar with.

As I mentioned before I really want this. Despite my enthusiastic posts to get it done now I know I have to do this right. If it takes me six months to figure out the right way to do it, then it takes six months. No rushing.

Thanks for the feedback!!

Robert

nosce te ipsum

You make your own opportunities in life.
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  #63 (permalink)
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thabazimbi limpopo/south africa
 
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I think your head is in the right place and you are approaching this thing in the right way.
This is the hardest easy job in the world and it gives you the opportunity to learn much of yourself and the markets. Keep your passion going and be great full that you are in a position to work on attaining your dream job.

Best of luck in your mission and I am sure you will make it happen in the end,
Ian

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  #64 (permalink)
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My account is up and running. I took a single trade today to test it out. + 2 ticks. The rest of the day was sim. My mind was not into it today. Did not have focus or correct emotional state of mind to trade. I knew it this morning when I got out of bed. Spent the morning watching the charts taking random meaningless trades. Wasted day.

Best thing that happened today:
  • Recognizing I was not in the right frame of mind to trade.

Worst thing to happen today:
  • Taking trades that meant absolutely nothing.

Robert

nosce te ipsum

You make your own opportunities in life.
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  #65 (permalink)
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6E morning

+15 ticks x 3 contracts

Today I took a breakout trade with a larger target. Two things I did different today; I used a 50 tick chart and I had a max zoom on the chart so I could have a clearer picture of the price action.

I moved my stop up every time it broke a resistance level. The original target was 3075. Ended up exiting 3068. The movement in price felt like a top which is why exited early. (as I am writing this the price is 3056).

What was the best thing that happened to me today:
  • I had patience and waited for the breakout and let the trade run its course.

What was the worst thing that happened to me today.
  • I am still having issues with getting my TST account setup so this trade was executed in SIM101 and will not be reflected in my TST account.

Today was a near perfect trading day. I had full control over my emotions during the trade. I made a rational decision for my exit. Having a longer term view of the chart really helped me see where the price was going. Plus the move seemed smaller when compared to the rest of the chart. This allowed me to stay in the trade and let it run its course.

I am done for the day.

Robert

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nosce te ipsum

You make your own opportunities in life.
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  #66 (permalink)
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Silver Dragon View Post
6E morning

+15 ticks x 3 contracts

Today I took a breakout trade with a larger target. Two things I did different today; I used a 50 tick chart and I had a max zoom on the chart so I could have a clearer picture of the price action.

I moved my stop up every time it broke a resistance level. The original target was 3075. Ended up exiting 3068. The movement in price felt like a top which is why exited early. (as I am writing this the price is 3056).

What was the best thing that happened to me today:
  • I had patience and waited for the breakout and let the trade run its course.

What was the worst thing that happened to me today.
  • I am still having issues with getting my TST account setup so this trade was executed in SIM101 and will not be reflected in my TST account.

Today was a near perfect trading day. I had full control over my emotions during the trade. I made a rational decision for my exit. Having a longer term view of the chart really helped me see where the price was going. Plus the move seemed smaller when compared to the rest of the chart. This allowed me to stay in the trade and let it run its course.

I am done for the day.

Robert

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Great trade Robert Build on this and have a great weekend!

London Calling
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  #67 (permalink)
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I came across an article I had saved many years back by Larry Connors. How many years back? Roger Clemens was still pitching and Lance Armstrong was still racing! It gave some good advice which still holds true today about trading.

At the time I had highlighted 2 parts. (they are in bold below): be a best at what you do and be the best at doing one thing better than anyone else. He is spot on with this advice. I am attempting to be the best breakout trader there is. This is what i am good at and this is what I am focusing on.

I can tell you it is a confidence builder when you focus making your strengths better than they already are. It comes naturally because you are already good at it. I think traders spend too much time trying to fix their weaknesses and get discouraged because its never gets better. A better approach would be to acknowledge your weaknesses and put processes/controls in place to limit the damage when they arise. Then focus on your strengths. IMO As you get better at what you are good at, your strengths will overcome your weaknesses.

Robert


Quoting 
With Sunday being Father's Day, I wanted to take the opportunity to write a letter to you about trading. This letter gets to the heart of my philosophy of how markets work and why traders succeed, and is based on my more than two decades of experience in this industry. Should you decide to enter Wall Street -- a place that I find fascinating, exciting and an arena that takes brains, skills, guts, perseverance, and a little bit of luck to succeed in -- I hope you take my words to heart. I wish someone had given me this letter when I started, and I'm hopeful it will take years off your learning curve to success.

1. BE HUMBLE - You will never be smarter than the markets. Never, never, never. I don't care which schools I send you to, or which colleges you attend or what your GPA will be. It's meaningless. The market will always be smarter. And the sooner in life you learn this, the more successful you will eventually become. Everyone comes into this game believing they possess the clairvoyance to outsmart hundreds of thousands, if not millions of some of the smartest people in the country. They cannot. The collective whole will always win. Maybe not short term, but certainly long term. For every one story of the guy who sits on a trading desk and year after year "outguesses" the market, there are literally thousands of others who have failed using the same approach. It's the one person who smokes two packs a day of cigarettes for 40 years and is still alive. For every one of him, there are thousands of others who are dead. What does this mean? Stay humble, stay focused and stay structured! And don't mistake a few winning trades over a few months or years as genius. There's a person out there I know, who now successfully manages over $1 billion in his money management firm (up from under $10 million dollars a decade ago). He makes money every year for his clients. He also earns somewhere between $30-$50 million dollars a year for himself and his family. You'd think a guy like this has it all figured out. But he doesn't. Here's what he had to say about himself in a recent magazine article: "I am very humble and assume that I will be wrong in my assessment of the environment which forms the basis of my trading." He's making more money in a year than most people will make in three lifetimes, and he always assumes he's wrong. Until you start making this type of money, live with the credo that the market is always smarter than you. Good things tend to fall into place if you do.

2. Worry More About Losing Money Than About Making Money - Worry about the losses first, the profits second. That means you go into every trade assuming the worst may happen. A plane may fly into a building in New York, a company of the stock you own may be indicted for accounting fraud, or simply that the market may have a very sharp turn and your stocks will turn with them. This means you place a PROTECTIVE STOP ON EVERY TRADE IMMEDIATELY UPON BEING FILLED. There's a reason your Dad put this in caps. It may be the single reason why some people make a lot of money at trading and a lot of people don't. If you need to be reminded of just how bad markets can hurt you, punch up the monthly charts of any stock you like beginning in March 2000 and ending at the end of 2002. (i.e. see Cisco Systems (NasdaqNM:CSCO - News), Amazon.com (NasdaqNM:AMZN - News), Sun Microsystems (NasdaqNM:SUNW - News), Applied Materials (NasdaqNM:AMAT - News), Charles Schwab (NYSE:SCH - News) and more). All excellent companies. And all companies that saw their shareholders' net worth mangled because their stock prices collapsed. There was no need to have stops in place for the few years before that. Risk control was meaningless. You were a loser if you didn't make 50% a year. It's so easy to get wrapped up in that nonsense until the day it all goes away and disappears. My guess is that your dad will see at least one more bubble in his lifetime and the three of you will you see at least two more. There will be a lot of money to be made from these bubbles. But, for the majority of your life, you will be living in markets that move like they have moved every decade for the past seven decades. And the only way to secure your future is to preserve what you have earned. And that is done with stops on every trade and daily positions sizes that cannot wipe you out incase the unthinkable happens (and trust me, it will). Focus on the potential losses. The gains will take care of themselves.

3. Learn From The Best - You are being sent to good schools in order to learn from top teachers, you are taking lessons in your sports from instructors who I consider to be top notch and you should learn to trade from people who know what they are doing. It's nice to figure it out on your own. I did that for many years. The path was fun but it was time consuming. I would have been far better off telling a guy like Kevin Haggerty that I would retrieve his golf balls every afternoon in exchange for sitting with him for a period of time, or babysitting Tony Saliba's kids in exchange for being the coffee boy on his trading desk for a year. Work for the firms that are the best and/or find a mentor you trust to assist you from there. The more you learn, the smarter you will be. Wall Street is made up of thousands of very brilliant people who you will be competing against. That means you need to learn from those who know, in order for you to have a chance of achieving long-term success in the shortest period of time.

4. Learn Everything And Then Really Learn One Thing - That means learn everything you can about the markets. Devour the books, the courses, the newspapers, the magazines, the seminars, the financial TV shows and anything else you can get your hands on that will make you smarter. And then, take all that knowledge, and simply learn just one thing. Be the best in the world at one thing. Generalists lose. Specialists win. You play sports so I'll speak in baseball language. This past Friday, we saw Roger Clemens win his 300th game and strike out his 4000th batter on the same night, an accomplishment that ranks him amongst the greatest pitchers ever to play the game. ROGER CLEMENS WILL BE IN THE BASEBALL HALL OF FAME BECAUSE HE DOES ONE THING...HE PITCHES! Yes, he plays baseball. Yes, he knows the game inside and out. But he specializes in one thing -- pitching. He doesn't play center field one game, shortstop the next and work on drag bunts in practice the following day. Roger Clemens has a 5-day routine that is completely structured around him being a great pitcher. Do the same with your trading. Become the best in the world at one thing. Decide what that one thing is and then go full force. If it's options trading, then get all your training in that arena. And only focus on options. Don't look at day-trading stocks and then scale-trading commodities and then something else. Think only about options. Think about them 24 hours a day if you can. Because this type of concentrated focus and effort is the only way to achieve true greatness in one's field. And we just saw this Friday night in a great baseball player who for two decades single mindedly focused on simply throwing a baseball better than everyone else.

5. Be Lance and Magic - And now I come to what I consider to be the single most important trait, not only to becoming a successful trader, but to succeed in life. And that's to stay mentally tough especially when adversity hits.It's knowing when and how to dig in when things go wrong. I know people who become unglued simply because they have a toothache. Their day and everything around them becomes undone because of a minor inconvenience. And then you watch people like Lance Armstrong, who had fourth stage brain and testicular cancer overcome the disease and then win the Tour de France, one of the most difficult athletic events known to man...four times. He did this AFTER he had cancer, not before.

Then look at a person like Magic Johnson, who is diagnosed in 1991 with the HIV virus and should have been dead within a few years. Instead, he's on the cover of Sports Illustrated 10 years later, healthy as can be and reportedly worth over a half of billion dollars because instead of crumbling from the diagnosis, he dug in and focused on achieving his childhood dream of building a business empire. When your father asked him at TradingMarkets 2001 (shortly after he cleaned the clocks of 100 TradingMarkets members in one-on-one basketball) what he attributed his sustained health to, he looked me in the eye, took his finger to the side of his head and slowly tapped his right temple over and over.

Succeeding at trading may be important but being mentally tough in the worst hours in life is many times more important. People like Lance Armstrong and Magic Johnson should be your heroes.

That's my message for you this Father's Day. It's still too soon to know if you'll make your way to Wall Street. If you do, you should print out my philosophy above. If you decide to take a different career path and seek your fortune elsewhere, please print out and memorize number five. Because, when it all comes down to it, it's the one that will ultimately decide where you will end up in life.

Have a great week trading (and happy Father's Day to all the dads out there)!

Larry Connors


nosce te ipsum

You make your own opportunities in life.

Last edited by Silver Dragon; October 19th, 2012 at 12:29 PM.
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  #68 (permalink)
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Silver Dragon View Post
Today was a near perfect trading day. I had full control over my emotions during the trade. I made a rational decision for my exit. Having a longer term view of the chart really helped me see where the price was going. Plus the move seemed smaller when compared to the rest of the chart. This allowed me to stay in the trade and let it run its course.

I am done for the day.



Terrific way to end the week and start the weekend!



Mike

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  #69 (permalink)
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Weekly review:

I spent a lot of time this week thinking about the feedback I have received on my journal and my goals for the future. I have identified what I am good at now I am working to fine tune my setups with different chart setups. I have been looking at other instruments as well however, at the end of the day I keep coming back to 6e. This will probably be my choice for the combine.

My goal to become a TST funded trader is still in play. I determined this week I will start the combine when I am ready.

What I want to work on next is getting more from the market. I would like to capture a breakout and ride the wave like I did today. This can lead the really big days of 50 ticks or more. This would be outstanding.

My best and worst things that happened compilation is short this week:

What was the best thing that happened to me week:
  • I had patience and waited for the breakout and let the trade run its course.
  • Recognizing I was not in the right frame of mind to trade.

What was the worst thing that happened to me week.
  • Taking trades that meant absolutely nothing.

@Hoag - The TST support team has been fantastic with helping me out. Elena, Melissa, GS, Fred. They are extremely friendly and very helpful. Never giving up on the issues I was having. You have great team working there

I plan on spending a max of 4 hours this weekend testing setups in market replay. The rest of the time will be spent with the family and some well deserved time playing the X-Box.

The past few weeks have been the best of my trading career. I am getting more confident in my trades and everything feels right. I am excited about the future.

Robert

nosce te ipsum

You make your own opportunities in life.
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  #70 (permalink)
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Silver Dragon View Post
What I want to work on next is getting more from the market. I would like to capture a breakout and ride the wave like I did today. This can lead the really big days of 50 ticks or more. This would be outstanding.

Looks like we are walking similar paths right now Robert. I am currently working on capturing most of the trading range, which means I should be in a trade when breakouts do happen. Still have to work on riding the trend, because I am realizing I am a range trader, which causes me to always look for the reversal. Enjoy your weekend.

London Calling
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