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Todays letter grade is a 'C-'
Day 3 of combine sim is a success
I did manage to follow most of my rules, except for the trend one, yea, I never follow that one, what else...I think that's it. I did manage to put together a another winning day, $353.44 net profit. I even managed to follow all the combine rules. So why the low grade? Why Indeed. Today I took my trades on the ES. Here's how my chart looked by the end of the day.
Without living it I don't think there is a lot you can tell just by looking at this chart. I can well imagine that anyone experienced watching me trade would have tried to snatch the mouse out of my hand some time today and yesterday. At one point I was down over $700.00 and had my last trade was down over $1300.00. I was really close to breaking the rules of the combine- but I didn't. Much like yesterday I saw support at around 4347 and so I rode it out. Either I'm getting lucky, or I'm learning a new trick, maybe its both. Whatever the case, I'm still looking for a better way to trade. This latest iteration of my chart is meant to show weekly, daily and hourly trends. I really am trying to trade trends- despite the trades that I have been taking. Here's how the trades are looking this week.
Today I took more trades than usual. That's because I don't know how to trade yet, but I'm getting there. I still need a defined entry/exit. This latest chart is an attempt at just that. I'm looking to trade the hourly trend in the direction of the daily trend. I don't know if I'll have time to trade tomorrow. I have a project that has to be completed. Technically the last trade that I made tonight counts as tomorrow, is a winner and is over 20 seconds long, so that one can count as day 4 of the combine. How long it takes to finish this project will determine if I trade tomorrow. Lastly, here is today's trade performance only. It's...interesting.
And here is How I'm currently watching the index futures.
I broke 3 Top Step rules today. I put on too many contracts. I lost more than the $1000 daily limit. I lost more than the $2000 weekly limit. I broke almost all my personal rules too. I was once again completely backwards as to the what the market was really doing, but this time it didn't let me get away with it.
I would like to say lesson learned, but have I really?
That idea right there is as much of a holy grail as you'll ever find anywhere.
And a quick look at your numbers, bit over 30% winners, winners almost 5 times the size of your losers, pretty much falls in the same camp, net profitable, winning stuff.
And then at some point it becomes a question of if sthg works don't break it trying to make it perfect...
;-)
I honestly don't know if these so-called funding companies actually have any traders at all whom they have funded or not over any relevant period of time with relevant sized payouts and can actually prove that, or if its a business model 100% oriented towards generating fee revenues from banking on the fact that 99% of people taking their assessments will fail, like the bucket shops of Jesse Livermores day, just with a different approach.
But I totally agree with Bobs assessment that having hard rules limiting your losses is the single most important thing without which success in trading is impossible.
So if one these firms can help you develop the necessary discipline in that area well then why not.
But at some point it will always come back to you and you alone having to do what needs to be done, and thats where micros are simply brilliant because you can start with so little and just compound that up without having to pay anyone else a lot of money for that privilege.
But ok thats really a different subject, and if you find using one of these firms helps you now then again keep doing what works.
What really caught my attention was your method of choice you described above, entering on a lower time frame in the direction of a higher time frame trend which really is as good as its ever going to get.
Don't know if anyone here actually remembers Buffy and dacharts.com, the site is still semi-alive but many parts dysfunctional, they had their heyday in the early 2000's haha oh dear long time ago all this, but I remembered that she had one of the best explanations of price action and combining time frames around.
In her example here she used a 15 min / 5 min combo, but using sthg like that or daily / hourly etc is really down to personal preference, time available, etc, as is the question of whether to use any indicators (I also use moving averages) or just price alone, as long as the basic principle of entering at good spots in the direction of a higher time frame trend are followed many roads will lead you to the same destination.
Really wonder what became of Buffy et al, didn't really engage with her or the equally good trading-naked / nqoos sister sites - which are down - at the time, they also had very active chat groups on yahoo, but always liked their content.
Here are my markets- 60 minutes candles, 200 and 50 SMA's, and a 20 period/3 pole gaussian filter. My idea here is I want to parse trends into periods of time. So the 200 SMA, that's my monthly trend, the 50 my weekly, and the gaussian is my daily trend. I am most interested in the daily trend, I am using this chart to tell me if I am buyer or a seller today.
Now when I drop down to the 15 minute chart to look for a good price to enter into the direction from the 60 minute chart, the moving averages are telling me a different story. Here the 200 acts as a weekly filter, the 50 the daily, and the gaussian and hourly filter. Here on the ES we can see this pullback that is practically screaming trade me. These are the kind of trades that I am now looking for.
In the past I often got lost between the timeframes and often I am backward as to who's really in control at any given moment. This is my latest attempt to correct this deficiency in my trading. Its my belief that if you know whether to buy or sell, and for how long you should, then you will make money trading.
I'm pretty excited by this latest round of trading. I have reset my sim account and am going for round 2 of the top step challenge. I don't know if I'm going the route of the funded trader, but for right now the framework of following rules is really speaking to me. I'm combining some of my earlier rules with those of the combine, and trying to come up with a solid set of entry/exit rules. If all goes well I'll make it farther into the challenge or even complete it. What I am really looking for is something really useable- if I have these rules and I follow them, and I place good trades where I want, when I want, then there is no reason to get emotional about the outcome. At that point I have done my best, and if everything is true- my strategy, my method my whole idea, then at that point I should be profitable. Time will tell.
The thing to know is that, even if you do everything right 100% of the time, and even if your rules are 100% perfect, you are never going to be sure of profits. Over a period of time, yes. On any one trade or any one day or week, not really. It's entirely a game of percentages, and you are only going to be able to shift the probabilities more for you than against you. Then you need to have enough of a buffer to withstand a drawdown, and good enough loss control to keep them small until the percentages turn your results back up.
You probably know this and probably meant this too, but I wanted to underline it, just in case.
Good work.
Bob.
When one door closes, another opens.
-- Cervantes, Don Quixote
The maximum trailing drawdown on the Top Step combine is $2000.00 for the $50k account. I need to give myself as many chances as possible to produce winning trades. 2000/8= 250. That's 8 chances, therefore my daily loss limit for the time being is $250 and therefore my largest stop loss can only be 5 points. This is why I have to use the one minute chart.
I agree 100%, I have taken so many trades over the years without considering where I will get out if wrong. Now as I size up a setup my first thought is where I am getting out and can I handle the risk today... Is this trade worth it? Many times it is not and I pass. I'm slowly getting better results.
That is a recipe to fail. The $50k account is marketing tactic to seduce the uninformed trader. In reality, $2000 is your total equity so your risk of ruin is pretty high if using the E-Mini normal contract. Given the fact they insist on proper risk control i am surprised they let a trader use the E-mini contract.
But you have the choice to use the Micro E-mini, i would suggest a 3% risk per trade which would give in dollar value $60/trade ($2000 x 3% = $60). I'd use 2 contracts giving you a 6pts range to let your trade breath. I'd try to let the 2nd contract run as much as possible and close your 1st contract at the most obvious nearby S&R.
Give yourself up to 3 months to complete the challenge. This is realistic given the amount at risk.
Its the opening statement in this video, and something that I am really coming to understand about trading. A lot of things in life are how you look at it. Its like you can hate and fear loss, and in feeling some way about it let it become your master, or you can embrace it, recognize that every time you lose, you learn something. In this way loss becomes a teacher. This is where I am today. This week I'm not going to focus on winning or losing, but only on the process.
Learning how to trade is hard, but there is a lot of super smart content out there- if a person is willing to do a little mining. One of my many 'edges' is that I am in a situation where I have a lot of time to watch YouTube. I found this video today. I really like this one because its some dudes on a dock talking trading. What they talk about in this video isn't anything new, you've probably heard it before, and these guys trade stocks, not futures, but what I like about this video is that it shows there are people out there day-trading successfully. One of my fears is that day trading itself is a sham, its good to find evidence to the contrary. I'm now watching another video from this content provider, he seems to do a lot of interviews with traders- good stuff.
