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Agree with you both. That is definitely something I should investigate. So far I have just been trying to keep it "simple" but the plan is to definitely layer in more stuff to improve edge.
Weekend Musing
The week started off well and ended bad. Although it was a profitable week, I did not like how I traded towards the end. There are also a few kinks that I need to work through.
Risk & Reward
My trades have also been to risk 2pt to get 2pt (1:1). This was revised from Mack's recommendation of risking 2pt for 1pt because I can't stomach that sort of R:R (also because I am not good at hitting 85% win rate like Mack ). Further, since I am only trading 1 contract, I don't have the ability to keep one as a runner. In reviewing my trades from this week, it seems I am leaving money on the table for some of my winning trades.
With that said, I will implement something new in the coming week. I will still go for the usual 1:1 on my usual setups. However, if the setup takes place in a 50% retracement to EMA, I will target either 2:1 or measured move. I will move S/L to breakeven when I hit 2pts though.
CT Trades
It goes without saying nearly all my losses this week came from counter-trend trades. I am either not good at it or not doing it correctly. Therefore, unless there is a very good reason I am banning myself from CT trades for now.
Trading Ranges
As I was going through the charts again, I made some interesting observations (see below). Key take away is how a price approach top/bottom of a range needs to be observed rather than just relying solely on signal bar.
Trade Psychology
I tend to fall into the trap of always looking for more trading ideas, methods, systems, etc. The purpose is not to trade them but mostly to satisfy my urge to find a "better" way than what I have. This sometimes create certain biases during the trading day that contradicts my existing approach, thus resulting in a state of confusion. I need to move away from that and solely focus on what I do now and MASTER it. I know that almost anything can work and it really depends on how the trader executes. Going forward, I need to just focus solely on executing my rules and trades perfectly. I have already done enough back-testing and scanning through a lot of charts to know it works but my failure has always been in execution.
Can you help answer these questions from other members on NexusFi?
Please note that nothing I say is original, I am just an educated parrot. I accept what others say subject to verification. I try to be the person that lets the facts show the conclusion as opposed to looking for bias confirmation. So with that said-
1. with the micro's if you totally screw up it costs 40 bucks with Mack's 4 contract system. It is such an endorphin rush to have the computer take the first scalp and move you to break even. I can not say enough how much that helps the mental condition. And you know just because the computer puts in a 2 point stop doesn't mean you should not tighten it up to that 1 tick above the last swing (signal bar), but do it immediately so you don't lose too much of your place in line.
I have an automatic profit stop of 3.5 points on the 4th contract (the runner). Knowing that the scalps are automatic lets me focus on agonizing over changing that.
2. I have an inability to stare at the white edge of the chart, I have to have some landmarks.So I have that automatic support resistance level app running. I have volume profile on a higher time frame chart so I know where the high and low nodes are. On Cobra's forum I look at where Bull Bear has his major fibs drawn. I try very hard to listen in to Morad (FuturesTrader71) before the open to get the levels he sees as possible reaction points. Here in the intermoutain west they let you know with warning signs about curves in the road. How you deal with the sign is up to you and your ride but at least you are aware.
3. Be aware of clock effects. When the London/Frankfurt crowd goes home volume drops and those people who have a different price (remember currency has to be converted for them) so the attitude can change. Go look at how often market changes as they exit. Don't forget power hour when other time frame folks run high volume trades like clock work.
4. I try to listen to Mack at night on the days he tapes. I was keeping track on if I saw the stuff he saw. Now I realize his chart is different from mine. So everything that depends on any one price bar looking a certain way is worthless on tick charts cause it all depends on when it started counting. If bars are running about 2 minutes then that is 120 second span for my bar to end at a different price than yours. So what is so special about your bar closing to signal an entry level as opposed to my stinking bar closing 30 seconds later?
To deal with that I am trying to use the footprint charts. It has to be a separate chart because trend lines will not work on those. The red or blue dash line is Fat Tails VWAP. The EMA is his gapless version.
You know there is a classic buy the pullback on that chart but where?
Here is the same thing on my regular tick chart. Support resistance is not valid as this is after the fact. Also I usually have that cheep little Depth of Market running on the right edge. EMA is different because this one is Globex hours, not cash.
I mean you can see where what Mack teaches gives you a clear decision point but the exact price to pull the trigger is really a bit vague. Long way of saying I don't trust so called pin bars
Neutral performance today despite it being a dream day for the way I trade. The market was pretty much trending upward the whole day with retracements off the EMA but I only got +1pt out of it.
I took a total of two trades. One was for +4pt which I am very happy about because it was first trade of the day and also a result of self-reflecting my money management over the weekend (see chart). My second trade on [D] was a loss of -3pt. It was an error in following my rules and still something I need to heavily focus on improving.
Trade [D] was an error because it is a CT trade. I already said no more CT trade over the weekend. I managed to skip a few CT trades but this one I took because I got greedy. Price was closing gap and approaching pivot point. I was given a second entry short / double-top formation so I told myself this is a no-brainer (false). I expected the market to give me something based on XYZ reason but the market does what it wants.
Ranging day so not a lot of trade opportunities. I thought execution went well today despite it being a low profit day. Total gain for the day was 1.25pt. I am okay with the loss in trade [A] because it follows the rules.
Didn't trade yesterday due to early meeting at work. I think I lucked out on that seeing how it was quite a range bound day. On the other hand, today was good. Net +4pt for the day without mistakes in execution other than missing potential trades that turned out to be winners.
Haven't posted/trade in a while. Been traveling for work. However the time off allowed me to re-evaluate my current training style. I started scalping because I like the "instant gratification" of the trade. Meaning I can know whether my trade is a win or a loss within minutes most of the time. I started out trading with longer term time frame and slower style and it leaves me itching all the time for a trade or for my trade to go somewhere (rookie mistake). Nevertheless, I want to think through my current method and refine it. I am going to look into using 2min time frame instead of ticks. My time off also allowed me to go through Al Brook's book that I have. This inspired me a bit to look at trading PA on higher time frame (5min) and I went on a trial run today. Ended the day with +1.75. This seems to be the trend for me recently...no losing days but just low tick win days. Maybe I'm finally on my way somewhere.
I overslept by 15 minutes today which made me miss an amazing trade to start the day. On the first trade, scalped a quick profit but should not have been irrational and followed my initial analysis. +1pt
Took a full loss on second trade. It looked like failed BO of yesterday's high, top of channel, and big bear bar. it also broke the lows of the two preceding bars. BUT it did not close below the third preceding bar or the high of bar 4. That could've been a red flag. The bar after entry is also an inside bull bar. Major warning but I was thinking it's a pull back. At this point I'm also thinking its a trading range day and we will revisit at least 50% of day's range or LOD. Stopped out for -4.5pt.
Last trade allowed me to see the full completion of wedge. Again big bull bar at top of channel line. It is also failed BO of HOD. Shorted and immediately went my way strong. I was happy until it reversed against me to create a massive pinbar. At this point I was thinking "NOT AGAIN". Is this going to be a failed wedge? But I was so confident this is a trading range day and the measured move of a failed wedge would create a bull trend day which I don't think is happening. The trade came very close to stopping me out (1 tick away) and created a double top before hitting my target. It also went to test LOD again which was what I initially anticipated. Made me feel pretty good about that one.
Sat on my hand during the entire session and got no trades in. The day started with a gap up and traded in a tight range for majority of the trading session.
The first big bear bar left me anticipating a gap close. But the entry signal did not materialize.
My plan is to wait for breakout above OR to decide a direction to trade. Therefore I did not take the inside bar as noted in chart.
Best trade of the day came later in the trading session when I'm at work when the market finally decided on a direction.
The trend overshoot hit its MM during ETH. Let's see where price opens tomorrow. I am looking for either another test of it during RTH or reversal back to channel.
What are you using for OR? I have Fat Tails OR function on my charts, and I use 60 minutes. But I get the most bang for the buck out of the overnight high low and cash open lines that come with that.
I don't seem to be using the same set ups as you (should not be a surprise). I do best on pull backs in trends. It allows me to say, if it bounces here is where I would enter, set the entry and wait. I do cancel orders, but when it works it is a thing of beauty to have the computer do all the trading.
You have the added problem of being an hour behind me. The 14th was a stinker after it got into that range, but at 0 Dark 30 your time (5 am) nice little double top and better yet it took a half hour to cross the EMA (on a 2000 tick chart) with lots of room above what Fat Tails calls the Pre-Low line. Crossed back above the EMA right after the open for a big move. About 20 minutes after the open it pulled back to EMA VWAP with a real clear set up.
I bring that up because it seems to be a re-accruing pattern the last week or two. Some sort of drop before the open then a change to up within the first 30 minutes or so followed by an almost untradeable range . It just seems to me that I could not be awake enough to trade at 5:30 and by 7: 30 it was into that difficult range and stayed there for two hours.
I spend my day at a forum where they use 5 minute charts and it works fine for the swing traders who are there all day. Trying to bang out some points during the first hour or two I wonder if you are passing on too many opportunities by not trading the faster tick charts.
I realize all too well we all have to find our own way. I am old and admit to multiple Grateful Dead concerts. There song Ripple , based on bible verses always seems to fit trading to me.
"There is a road, no simple highway
Between the dawn and the dark of night
And if you go no one may follow
That path is for your steps alone"
But that is not to say that Al Brooks and Mack can very much teach you how to see that path. Here in the Northern Rockies climbing is a very popular sport. And it is also a great price action trading analogy. We have climbers in my family. They all read the face and can see the route, but each has to take the moves they are capable of. Me, I do not climb so I can not even see the route, just rocks.
). Further, since I am only trading 1 
