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I am part of a prop firm that is based in London but I trade remotely from home. I have been trading full time for 18 months.
I am creating a journal here after being a member for many years. My primary market is the Bund (German 10 Year Bond), which is on the Eurex exchange. I feel my performance has dropped a little in the past month, so I will use this as a less formal diary (I keep a detailed journal for my trades already).
A little more on my approach and trading methodology:
I believe in having a strong, consistent routine. This helps preserve willpower throughout the day, which is key as diminished willpower is what usually causes lower performance.
Throughout the day I complete a checklist for my routine, which I stick to at all times except when there is a data release which is important enough for me to adjust a little. See FT71's webinar on habits and routine for more on this.
I believe it is key to use objective analysis. Trading is already so discretionary, so analysing the market in an objective manner is important. I have broken down my context analysis into the following four categories:
Trend (weekly and daily). Simple consecutive bars moving in a direction is how I gauge trend. (i.e., 3 days in a row we have broken yesterdays low, daily trend is down).
Trade location (where are we right now in terms of higher time frame context, i.e. a large balance zone on the daily - are we in the middle of it, near the high or near the low?).
Volume/volatility trigger areas - usually obvious places for stops that can cause a reversal / continuation move. Think key S/R areas on higher time frames.
Positioning - simple enough, just look at the last two days price action, if its a clear trend in one direction you know positioning. If its mostly sideways then its probably neutral. Can depend on where we are context wise.
I want to trade pullbacks with the trend, and fade the trend if the setup is right. I don't want to fade the trend blind, i.e. picking bottoms or tops. I have broken my plan if I fade blind or take a pullback against trend, except if it is on news or some other game changing event.
I fill out a morning update form every morning and after the close in the evening. I note my strengths and weaknesses for various categories, such as psychological, trading decisions, routine and context analysis. This helps me spot issues and gives feedback for the PM session / next session.
So first trading update:
My bias today is short, as long as we hold 80-85 area.
I wanted to sell on failure of the IBH, but was too slow to sell the retest of the fake breakout after the cash open.
We are inside yesterdays value right now, and it is quite choppy.
I am currently -4 ticks (contracts adjusted). I broke my plan (first time in 20 trades) and bought in the range (at 52) against bias. Have made it an objective not to repeat this for remainder of the week.
Stalking for shorts, will let it break out of the range first / there is an auction now so might help us move.
Yesterdays low is a great target, there is a naked VPOC at 30 and a naked weekly VPOC at 28. Should act as a magnet. If we fail down there I will buy on a retest of the low.
Quite a slow morning, mostly range bound. There is a clear bid in the market as the delta shows (15k at the moment) which is a lot for Bund at this time of day. Probably some covering after 6/7 down days in a row!
I have 80's and then 00's as upside structure. Expecting a turn back lower this PM. We will see.
I really like what you are doing. Interested to see more. I also trade FGBL with volume profile. Although I am a relative beginner. Could you please elaborate a little more on your method?.
Identify context --> identify areas of interest --> look for order flow for entry.
Know what kind of market it is. If it's slow, you can lean on areas much better. If its thin and fast, then flow takes over and you can lean on volume absorbing on the ladder, it can be very clear in such conditions.
Anyone struggling today should note how Bund is behaving right now. 500k traded so far, still 2 hours till the cash close, and it is all in a 38 tick range. Need to wait and let the market pick a direction, which way is hard to say right now, higher is probably logical because of the straight line move down, so shorts covering would be normal. Better to wait and not get chopped to pieces.
Cash close finished with a 1 tick extension of the HOD. A very tight range day of 39 ticks vs 12 month median 51 ticks. I generally don't like getting involved after cash as it can be thin and unreliable.
Didn't take any PM trades. A good day to take a small loss and move on. FOMC minutes tomorrow night + yom kippur tomorrow so expecting possible range trade until Thursday.
These balanced days are generally the hardest, sure, you can play the range a few times, but doing it all day is quite frankly dangerous as "normally" we get expansion at some point.
Anyone trading Bund today could have looked at Bobl and Buxl for clues too (the 5 year and 30 year german bonds). OFten Bund was moving on its own and the others did not care to follow, including the one tick extension at cash close. Bobl was 4 ticks off and Buxl was around 40 ticks off its high.
Tonight we have the FOMC minutes, and yesterday was an inside day (did not break the prior days high or low). The market is likely to be slow and quiet until the data is out of the way.
Treasuries have done quite a lot of volume overnight, with relative volume +60% vs the 20 day median. They have been heavy overnight, in anticipation of hawkish minutes.
Bund itself is at an inflection point - as long as the 163.40-21 area holds I think we can end this down move and mean revert higher, would be looking for 164.50 area.
Trading this thesis is another matter, and comes into play once we get above 163.70.
