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GruttePier's trading journal to getting profitable
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GruttePier's trading journal to getting profitable

  #1 (permalink)
Market Wizard
Amsterdam, The Netherlands
 
Futures Experience: Intermediate
Platform: Ninjatrader 8
Broker/Data: NinjaTrader Brokerage
Favorite Futures: CL, ES, NQ
 
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Posts: 960 since Dec 2013
Thanks: 1,852 given, 3,600 received
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GruttePier's trading journal to getting profitable

Hi fellow-traders,

after reading the positive feedback on the journals kept here on futures.io, I decided to setup my own journal.
The reason I'm keeping a journal is because I would like to receive feedback from experienced traders to make the necessary changes (if any) in my behaviour or trading rules to reach my goal.

My goal is to become consistently profitable on the SIM for at least 3 months in row.
Only then, I will make the next step to trading live.

It feels like I'm close to getting profitable since I have clear rules, developed a "sense" of the market and am able to follow my rules religiously. However, I have enough experience to know that it is not that easy and the point of profitablility might be far away also.

I'm able to trade 1 morning session and 2-3 afternoon sessions in a week only. I know this is not much and it extents my learning curve significantly, but it's the best I can do currently with a fulltime job and family life.

GP

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  #2 (permalink)
Quick Summary
Quick Summary Post

This journal documents my journey from being a consistent loser to where I am now.
I’ve documented all my trades, my thoughts, my evaluations and the feedback from other traders on a near-daily basis. I’m now at a stage that I hope my journal can help or inspire other traders.

The journal has become quite lengthy, so I feel a summary of the “main events” will be helpful.
Looking back, my journey was as follows:
(1) The notion that I must make drastic changes to my method
(2) Trading price levels
(3) Adding context
(4) Holding winners longer
(5) Trading 2 contracts in stead of 1
(6) Scaling in and out

Page 1 – 8. You can see me consistently losing with my Brooks-style bar-pattern based method.

Page 8. Game changing feedback from @Inletcap, the beginning of my turnaround. From here I start to trade from price levels instead of bar patterns: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-8.html#post545490 . The results are immediatly visible: within the first 2 weeks my first 5 points profit, then 9 points profit, then 12.5 points, etcetera.

Page 13. Starting to add context to my trading: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-13.html#post551496

Page 13. Comparison of my 17 month struggle with bar pattern methods compared to 1 month of trading price levels: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-13.html#post552190

Page 16. Very interesting discussion (read until post #165) on risk: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-16.html#post553688

Page 21. Suggestion to keep a context log during trading: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-21.html#post557983

Page 22. My first 20 point profit on 1 day : https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-22.html#post558413

Page 26. The March evaluation with the results of holding winners longer. Browse previous pages to see the day-by-day quest: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-26.html#post564504

Page 35. Tipping point to trade range days: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-35.html#post570742

Page 39. Start of trading 2 contracts: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-39.html#post576611

Page 47. Webinar “An Afternoon with GruttePier” where I discuss my trading: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-47.html#post579633

Page 57. Changing my scaling in&out due researching @Inletcap s old journal and a must-read scaling discussion in the journal of @Tap In: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-57.html#post595019

Page 70. Moving to CL to escape from ES' low volatility+ranges and prevent myself from forcing trading due to eagerness https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-70.html#post612521

Page 77. My custom NT8 indicator for plotting the pricelevels: https://futures.io/elite-circle/35208-converting-ninjatrader-7-indicators-ninjatrader-8-free-38.html#post616161
Page 77. My custom NT8 indicator for plotting RVOL: https://futures.io/elite-circle/35208-converting-ninjatrader-7-indicators-ninjatrader-8-free-38.html#post616163

Page 82. How I analyse 120 min and P&F charts: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-82.html#post620490

Page 85. My custom NT8 indicator for plotting the ADR: https://futures.io/elite-circle/35208-converting-ninjatrader-7-indicators-ninjatrader-8-free-50.html#post630091

Page 98. An analysis of various scaling in/out techniques on my trades this year and my decision for "scenario 3" scaling: https://futures.io/trading-journals/37351-gruttepier-s-trading-journal-getting-profitable-98.html#post645956


Last edited by GruttePier; July 2nd, 2017 at 05:13 PM.
 
  #3 (permalink)
Market Wizard
Amsterdam, The Netherlands
 
Futures Experience: Intermediate
Platform: Ninjatrader 8
Broker/Data: NinjaTrader Brokerage
Favorite Futures: CL, ES, NQ
 
GruttePier's Avatar
 
Posts: 960 since Dec 2013
Thanks: 1,852 given, 3,600 received
Forum Reputation: Legendary

Trading background


Let my start with a little background on my trading.

Ever since I was young (I still am though, only 42 ), I had a keen interest in the stockmarket. After messing around with stocks, options and CFD's for a long time, I've been actively swing trading for 2 years. Each weekend, I'd review charts of European and US stocks for potential setups. During the week, each evening, I'd decide which stocks/options/CFDs to buy, add positions or which positions to be closed. Allthough gratifying and having reached the point of about breakeven, I was not getting better at it and not making money consistently.

For the next 1-2 years, I've been developing (having a professional developers background), backtesting and trading automated strategies based on Price Action. However, I got tired of finding small edges and running strategies that would not work in a live environment or work only temporarilly.

I then decided to focus on manually trading the afternoon sessions of the S&P. Since I have a fulltime job and the time difference between The Netherlands and US is in my benefit, I'm able to trade the afternoon session once the kids are in bed. Sometimes, I'm able to trade the morning sessions as well.

I've been trying to master Bryce Gilmore's trading style for almost a year. I found it to complex though and did not see an statistical improvements in my trading.

Since June this year, I'm trading a couple of Al Brooks' setups and found his trading style suit me very well. When backtesting 1 year of data, I experienced a consistent edge and and was able to tune my trading rules. And most important, I see statistical improvements in my trading. At least, I believe I see it :-)

Regarding discipline, I've been there... Adding to losing positions, no stoplosses, gambling, not following my rules, etcetera. Final breakthrough was earlier this year when finishing the excersice that Michal Douglas ends his book with. Since then, I'm religiously following my rules. I've learned that this is the only way to keep me out of trouble and -more important- that my trading rules work.

GP

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  #4 (permalink)
Market Wizard
Amsterdam, The Netherlands
 
Futures Experience: Intermediate
Platform: Ninjatrader 8
Broker/Data: NinjaTrader Brokerage
Favorite Futures: CL, ES, NQ
 
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Posts: 960 since Dec 2013
Thanks: 1,852 given, 3,600 received
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Trading rules

I will be trading the following setups of the 10k volume chart of the ES only:
- L1s and H1s in strong trends;
- L2s and H2s in medium trends;
- 2 legged reversals after a strong trend.

I will be trading 2 contracts. The first contract has a profit target of 4 ticks, the second contract has no profit target but a stoploss that will trail in steps of 4 ticks (stop to breakeven when in 4 ticks of profit, stop to 4 ticks when 8 ticks of profit, etcetera).

The max initial stoploss is determined by the 20-bar ATR. This is 6 ticks for an ATR less or equal to 2.5, 8 ticks for an ATR up to 3.0, 10 ticks for an ATR up to 3.5, etcetera.

Other rules are:
- No trading before 10.00 or after 15.00 ET
- No trading when there are many overlapping bars (chop day)
- Atleast 10 points differerence between HOD and LOD
- T&S must show momentum in the direct of the trade. Eg. buyers/sellers fading away, big guys stepping in, etcetera

Enclosed are the results of the above rules for the past couple of months.
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GP


Last edited by GruttePier; October 11th, 2015 at 03:11 PM.
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  #5 (permalink)
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GruttePier View Post
I will be trading 2 contracts. The first contract has a profit target of 4 ticks, the second contract has no profit target but a stoploss that will trail in steps of 4 ticks (stop to breakeven when in 4 ticks of profit, stop to 4 ticks when 8 ticks of profit, etcetera).

I understand the principle (and I do something similar, myself, on different instruments), but may I ask why/how you arrived at specifically a 4-tick step-level, here?

Good luck with the trading and the thread!

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  #6 (permalink)
Market Wizard
Amsterdam, The Netherlands
 
Futures Experience: Intermediate
Platform: Ninjatrader 8
Broker/Data: NinjaTrader Brokerage
Favorite Futures: CL, ES, NQ
 
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Posts: 960 since Dec 2013
Thanks: 1,852 given, 3,600 received
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4 tick step level


Tymbeline View Post
I understand the principle (and I do something similar, myself, on different instruments), but may I ask why/how you arrived at specifically a 4-tick step-level, here?

Good luck with the trading and the thread!

I'm not sure how I got to this specific approach, probably triggered by one of Al Brooks video's.

Situations in which price pulls back, the 2nd contract getting stopped out and then price moving back in the earlier anticipated direction occur rarely. In almost all instances where the stoploss gets hit, I'm glad to be out of the market and have the profit locked in. So I find this approach working very well.

Depending on the volatility (as in early September), I might increase tick-step-level to 6 or 8 ticks.

An alternative for this stoploss approach, might be a normal trailing stop. It has however no priority for me at this moment to experiment with since I'm satisfied with above approach.

What stop system are you using?

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  #7 (permalink)
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Futures Experience: Intermediate
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GruttePier View Post
What stop system are you using?

Three different types for different systems: one very similar to what you outline above, one with a target determined by the ATR and one in which I manually trail a stop above or below the most recently-formed swing-high or swing-low (the selection of which stop system to use being according to my ongoing back-testing and forward-testing results for each type of trade).

I should mention that I don't trade the S&P/ES at all and know little about it: I'm a spot forex trader. My interest here arose partly because a couple of institutional traders have recently told me that my methods might be well-suited to the e-mini S&P, so I'm just starting to look at it and was "only asking" rather than trying to imply any familiarity. Apologies for the intervention, and thanks.

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  #8 (permalink)
Market Wizard
Amsterdam, The Netherlands
 
Futures Experience: Intermediate
Platform: Ninjatrader 8
Broker/Data: NinjaTrader Brokerage
Favorite Futures: CL, ES, NQ
 
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Posts: 960 since Dec 2013
Thanks: 1,852 given, 3,600 received
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First trading day with journal

OK...here it is, my first trading day with a live journal.
I must say, keeping a journal does affect my trading. Just before placing the order I ask myself: "Am I really sure on this trade? Do look like a fool taking this trade?"
Curious to what this journal will bring me...

Anyway, it hasn't helped me in finishing this low volatile chop day profitable.

Traded 4 setups and ended with -1.5 points:
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Enclosed the chart. Feel free to comment on it.

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Last edited by GruttePier; October 12th, 2015 at 03:54 PM.
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  #9 (permalink)
Market Wizard
Amsterdam, The Netherlands
 
Futures Experience: Intermediate
Platform: Ninjatrader 8
Broker/Data: NinjaTrader Brokerage
Favorite Futures: CL, ES, NQ
 
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Posts: 960 since Dec 2013
Thanks: 1,852 given, 3,600 received
Forum Reputation: Legendary

RR ratio not ok

Exposing the results of yesterday in the journal kept me thinking.

Yesterday's results are indicative for the performance of my system sofar and I believe I found what my problem is:
The risk/reward is out-of-balance.

The percentage profitable of past months is over 50%, which should be OK.
In time, as I get more experienced, I might even come to an even higher percentage.
A couple of months ago itwas just 44.1%, September is at 58.3% and October sofar is in the 60%.

However, per average loosing trade I loose more money than I win with an average winning trade.
The average winning trade is 0.52R and the average loosing trade is 0.78R (average risk R is 1.88 pts)
This is definitly not OK and way out-of-balance.

I've done some digging in other journals on this forum and found that other RR ratios are significantly better than what I have so far.

So...I can either increase the profit per trade or decrease the risk per trade.
Since I let the profits run and I get stopped out when price makes a reversal or significant pullback, there is little I can do to increase the profit per trade.

My mission is clear, I must work on reducing the loss per losing trade.

Within the current trading rules, I can do this by:
(1) reducing the max stoploss. So instead of 6 tick risk for ATR <= 2.5, I can take a 4 tick risk.
I notice that profitable trades often take off immediatly, so a 6 tick risk is not required. A tighter stoploss will however reduce the percentage profitable.

(2) getting out of a trade earlier instead of waiting for the stop to get hit.
This is probably the most challanging to master. However, in most cases I feel that the trade is not going my way and see the warning signs in the T&S already. Instead of sitting like a rabbit and watch the headlights coming at me, I should learn to exit immediatly.

I went through my trade log.
Suppose I'd be able to reduce an average losing trade with 0.5 points, the average loosing trade would be 0.51R instead of 0.78R. That's significant!

This probably sounds very obvious and stupid, but it's my current thought process which I'd like to share in this journal.
Feedback is very much appreciated!

Thanks.
GP


Last edited by GruttePier; October 13th, 2015 at 08:46 AM. Reason: Some typos
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  #10 (permalink)
Market Wizard
Amsterdam, The Netherlands
 
Futures Experience: Intermediate
Platform: Ninjatrader 8
Broker/Data: NinjaTrader Brokerage
Favorite Futures: CL, ES, NQ
 
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Posts: 960 since Dec 2013
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First day with modified rules


Based upon my analysis in the previous post, I realized I need to work on the losing trades.

I have therefore reduced the predefined max stoplosses with 0.5 point.
With an ATR < 2.5 the stoploss is now 4 ticks, 6 ticks for ATR < 3.0, 8 ticks for ATR < 3.5, and so on.

Furthermore, I will now close positions once they start feeling bad. Whenever I get a bad feeling regarding a trade, for example because the breakout is taking too long or I see unexpected buyers/sellers stepping in, I will close the trade immediatly.

With these changes I try to get the RR ratio to a healthy ratio.

Anyway, have a look the chart en results. Not a good day.

The tighted stoploss stopped my out twice which otherwise would have been winning setups.
Also, closing the trade as soon as I get a bad feeling left me with a loosing trade (otherwise winner) and profit left on the table (otherwise banked). It's frustrating that I would probably would have made 1.75 pts at the end of this day without the changes in my rules and behavious instead of losing 4.75 pts today.

I am not profitable and realize that I need to make changes in my trading to become so. I need to experiment and adapt my rules and habits accordingly.

I'm starting to question if I ever will be able to make this system profitable given the current RR ratio. After today its 0.56R (winning trade) versus 0.76 (losing trade).

I'm very curious to how other traders trade similar systems and what their RR ratio is.

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).


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GP

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