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Zen & the Art of The Small Account

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  #791 (permalink)
 thatguy 
New Brunswick, NJ
 
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aztrader9 View Post
I recognize those bars....my trouble is this, on the inside bars just prior, I entered in the trend direction....long in this case. And then the outside bar happens. I normally have my stop just below the inside bar. Is the procedure to simply stop and reverse? I did that once today and got stopped twice on the same bar.

I guess what I am most interested in is how to handle an outside bar if you are already in a trade from a previous entry....If I am not in a trade, I can figure out how to enter the outside bar but today, they were vicious since I don't really know what to do with them if I am currently in a trade.

I would say if you get a bar like that while in a trade, ask yourself what you would have done if you were not in a trade and if this changes your outlook. If you are short and you get an up outside bar and you would have gone long have you not been in a trade, I'd say stop and reverse. Otherwise just stay the course and continue to manage your short.

IMHO, not all outside and inside bars are meaningful. They only become meaningful in the right context. If context doesn't tell you anything or they are against what the market shows, then they are just random. For example an up outside bar in a strong downtrend is not strength to blindly go long with. It is potential strength, but could very well also just be a mini short squeeze and stop run run before continueing the downtrend. I would want to see more confirmation before changing my bias to long.

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  #792 (permalink)
 bluemele 
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aztrader9 View Post
I hit my daily stop today. First time in a while....( my attempt to spin it positive).

Since this journal is for me, I am gonna be honest here. After all the progress over the last few weeks, I feel like shit today and for the first time in a long time, felt like giving up. Seems like its two steps forward and three steps back. Wondering when the quantum leap comes? Will it ever?

Ok enough self pity. Time to focus.

What I did right today:
1. My morning routine.
2. Reasonably good job of holding trades both for targets and stops. I resisted the urge to just get out when price was against me. This was good and bad today.

What I did wrong today:
1. Everything else.
2. To be more specific, I tried to trade both a three minute and a five minute chart. That worked well.
3. I traded to soon after news. I got killed there with two large stops. From now on, wait for two bars before and two bars after.
4. I traded to many lots when I was losing.
5. I started to get an itchy trigger finger and it was HARD to not just trade regardless of signals. I did it twice and immediately exited the trade. That cured that for the day.
6. I was down a lot after the news and then I buckled in and almost got positive, but I collapsed under pressure and got careless. Daily stop hit.

Plan for tomorrow:
1. Back on the 5 min chart. Fewer signals and fewer head fakes.
2. Breath
3. Hold my trades.

Even though I feel like crap today, I know I am on the right track. Less is more, fewer trades is better. Bigger charts generally is better. I am actually confident now in what I am doing.

One thing I am struggling with is the outside bar. It takes out stops on both sides and it seems impossible to know which way to trade that thing. If anyone has any ideas, please jump in. I read the Three Setups thread but could not find any real help there. Maybe I missed it.

Only one chart today. To bummed out to do much else right now. Might put the rest up later.

Cheers

I think one point of caution is to measure the good w/ the bad. To have 'expectations' that you will not have crap out days is unrealistic. I have been reading your thread for about 6 months+ now and I can see your losing days are less and your up/down crazy days (like yesterday) are fewer and far between as well.

So, you are making BIG progress that is evident, but sometimes a person tends to be harder on themselves. I think most people would be very happy with what you have created for yourself. The trick for me would be to allow myself to really accept that.

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  #793 (permalink)
 tderrick 
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Jeez... I missed a whole page while I was working!!

Good progress, my friend.

I learn much more from losing than I do winning...

I don't ever want to hear that quitting crap again, however!! We've come too far to turn back now.

I hate to ever criticize, but I feel I must. It seems your changing your chart a bit too often.
Let's settle on a chart / method for Mike's two week rule and let's see if we can hammer out
something we can feed the world with...

You may now bean me in the head with the rock your holding...


AJ
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  #794 (permalink)
 Linds 
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aztrader9 View Post
I guess what I am most interested in is how to handle an outside bar if you are already in a trade from a previous entry....If I am not in a trade, I can figure out how to enter the outside bar but today, they were vicious since I don't really know what to do with them if I am currently in a trade.

Well IMO for me I dont like stop and reverse its too impulsive - I find it hard to have a good objective analysis of a reversal trade while I am still in the current trade. There are plenty of trades without S and R trades. If I am in a trade and I see an OB closing strongly in the direction of my trade that is good thing and I will generally hold confidently for the planned TP. If there is an OB closing strongly against my position I might be looking to reduce risk. If it is an idescive OB closing in the middle of its range then well thats a doji and is indecision and it wont require particular action until the next bar prints to fill out the story. I like what was said earlier that Outside bars are not in and of themselves significant it is all about their context/location. Not sure if this is any use to you Az but hopefully is.

L

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  #795 (permalink)
 PandaWarrior 
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bluemele View Post
I think one point of caution is to measure the good w/ the bad. To have 'expectations' that you will not have crap out days is unrealistic. I have been reading your thread for about 6 months+ now and I can see your losing days are less and your up/down crazy days (like yesterday) are fewer and far between as well.

So, you are making BIG progress that is evident, but sometimes a person tends to be harder on themselves. I think most people would be very happy with what you have created for yourself. The trick for me would be to allow myself to really accept that.

The good with the bad thing is appropriate. I am still working on the stoic thing at the moment. I have always lived my business life on the edge and I get excited when I win and bummed out when I lose. I'll get stabilized tonight.

THanks for the compliments and the well wishes....

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #796 (permalink)
 PandaWarrior 
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tderrick View Post
Jeez... I missed a whole page while I was working!!

Good progress, my friend.

I learn much more from losing than I do winning...

I don't ever want to hear that quitting crap again, however!! We've come too far to turn back now.

I hate to ever criticize, but I feel I must. It seems your changing your chart a bit too often.
Let's settle on a chart / method for Mike's two week rule and let's see if we can hammer out
something we can feed the world with...

You may now bean me in the head with the rock your holding...

I have made some changes.....I thought about it today. I have not added anything other than the reversals indie and all that does is color the bars I am looking for. I have instead removed several things from the chart. Price action is so much clearer without all the shiny stuff on the chart.

At this point, I really believe it is all about what is between my ears....in other words, its all mental from here. I have good set ups, actual triggers and something I believe in.......But here is my promise, I will not change from where its at today.....for at least two weeks....

SO here is my set up for the next two weeks;

1. Primary trade chart....5M with my fib lines and the reversals indie.
2. 12 range chart with fib lines and a 15SMA.
3. A daily chart with a 50SMA.

A: Targets. 20 Ticks....trying to obtain 60 ticks a day if possible. Actually this is possible almost every day....even today had I executed well.
B. Stops. 20 Ticks and sometimes 30 if price is in an area i want to be in the market.
C. # of trades per day. 2-6 per day....any more than this means I am not trading well.

Set ups:

Basically pulll backs in a trend, looking for support/resistance and a reversal of some sort....that could be an inside bar, or a break above/below the previous bar in the pull back.

This can and should be confirmed by the range chart. This does not always happen but will look for this confirmation.

Ok, there it is.....its all about execution now.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #797 (permalink)
 tderrick 
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aztrader9 View Post
I have made some changes.....I thought about it today. I have not added anything other than the reversals indie and all that does is color the bars I am looking for. I have instead removed several things from the chart. Price action is so much clearer without all the shiny stuff on the chart.

At this point, I really believe it is all about what is between my ears....in other words, its all mental from here. I have good set ups, actual triggers and something I believe in.......But here is my promise, I will not change from where its at today.....for at least two weeks....

Ok, there it is.....its all about execution now.



Oh, yea... Let's hone it in, baby!!


AJ
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  #798 (permalink)
 redegenerated 
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aztrader9 View Post
I have made some changes.....I thought about it today. I have not added anything other than the reversals indie and all that does is color the bars I am looking for. I have instead removed several things from the chart. Price action is so much clearer without all the shiny stuff on the chart.

At this point, I really believe it is all about what is between my ears....in other words, its all mental from here. I have good set ups, actual triggers and something I believe in.......But here is my promise, I will not change from where its at today.....for at least two weeks....

SO here is my set up for the next two weeks;

1. Primary trade chart....5M with my fib lines and the reversals indie.
2. 12 range chart with fib lines and a 15SMA.
3. A daily chart with a 50SMA.

A: Targets. 20 Ticks....trying to obtain 60 ticks a day if possible. Actually this is possible almost every day....even today had I executed well.
B. Stops. 20 Ticks and sometimes 30 if price is in an area i want to be in the market.
C. # of trades per day. 2-6 per day....any more than this means I am not trading well.

Set ups:

Basically pulll backs in a trend, looking for support/resistance and a reversal of some sort....that could be an inside bar, or a break above/below the previous bar in the pull back.

This can and should be confirmed by the range chart. This does not always happen but will look for this confirmation.

Ok, there it is.....its all about execution now.

ok, this is your setup and masterplan for 2 weeks.
you can't change it...not even bar color (damn, i also play alot with this latelly!)...
we are watching you...(i hope we can help)

 
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  #799 (permalink)
 Mickey Caine 
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aztrader9 View Post
With regards to the entries, I have decided to take three kinds of trades, all of which I see fairly easy in real time. These are labeled on the chart as A, B, C and described below. There is a fourth area of importance. The Transition Zone. This area is labeled on the chart as TZ.

A) Trend Trade. (TT) Defined as TOUCHING the 50SMA and closing in the direction of the larger trend. This generally represents a significant pull back in the trend and usually the lowest risk trade possible in the sequence.
B) Counter Trend Trade. (CTT) Defined as closing beyond the 15SMA counter to the prevailing larger trend as defined by the 50 SMA. This must have PA to support.
C) Trend Continuation Trade (TCT) Defined as a trade that continues the prevailing trend as defined by the 50SMA but does NOT touch the 50SMA. For me, these are the most risky trades as there must be support and resistance nearby, I must read that support and resistance well and have read the most recent price action perfectly. Therefore, there are more variables to account for and consequently, more room for error.

I am making a change from candles to bars on the time chart, I can see the open and close better with them. I have also introduced the Reversals indie to help me visualize the price action and key turning points. This is not needed for trading but does aid me in visualizing PA.

.

Good Morning AZ.
With regard to the above, it seems to me you put a lot of thought into the above, however after one not so good day you seem to have thrown some of it out. Mainly I am referring to the 50sma. Sunday it was your most likely trade to succeed and today it's gone. Surely if you want to use a 50sma it will have more relevence to your day trading on a 5 min or even the 12R than on a daily chart. As a day trader the Daily is only really of any significance when approching highs lows and the MA's. Maybe an hourly chart might suit your needs for the longer term picture better.

I think you are on to something with trading the 5min but using the 12R to fine tune an entry. Stick with it, as Mr Belushi once said. "Was it over when the Germans bombed Pearl Harbour, Hell no, and it's not over now. When the going gets tough the tough get going" We are with you, and your journal is an inspiration to me and others too I'm sure.
(No pressure there then!!!)

Good trading today..

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  #800 (permalink)
 PandaWarrior 
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Mickey Caine View Post
Good Morning AZ.
With regard to the above, it seems to me you put a lot of thought into the above, however after one not so good day you seem to have thrown some of it out. Mainly I am referring to the 50sma. Sunday it was your most likely trade to succeed and today it's gone. Surely if you want to use a 50sma it will have more relevence to your day trading on a 5 min or even the 12R than on a daily chart. As a day trader the Daily is only really of any significance when approching highs lows and the MA's. Maybe an hourly chart might suit your needs for the longer term picture better.

I think you are on to something with trading the 5min but using the 12R to fine tune an entry. Stick with it, as Mr Belushi once said. "Was it over when the Germans bombed Pearl Harbour, Hell no, and it's not over now. When the going gets tough the tough get going" We are with you, and your journal is an inspiration to me and others too I'm sure.
(No pressure there then!!!)

Good trading today..

Well you make some really valid points. See the next post for the answers...

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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