swansjr

Day 26 Friday, January 8, 2010 P&L: ($139) on 1 trade. I got dinged today and probably entered not the best entry. The market was a little on the choppy side before the unemployment numbers came out. It was on the wild side when the report came out. I remained on the sidelines and watched the show. Live_Trade_2010-01-08.swf

Day 25 Thursday, January 7, 2010 P&L: $247 on 1 trade. I was unable to trade at 500 today but started looking at the EC market a little after 620. Price was falling under a clean bull trendline. Price began to poke above the trendline and then failed. I shorted the fail and rode it down to a longer term bullish trendline. Once price hit the longer term bullish trendline, I had a strong urge to go long. It's a classic long after price came down to touch a bullish trendline. But the previous shorter-term bearish trendline that was in place all morning remained. Do I wait for this trendline to break? Or do I simply take the bounce off the longer-term bullish trendline? In this situation the longer term trendline should take priority. That is, the bigger picture is bullish and I should have jumped on. I watched for an appropriate bar, but did not take it. This type of situation is not in my Trading Plan so, I sat on my hands. I know last year such setups have worked out. In retrospect this one worked out beautify as well. I completely forgot about this situation happening. I'll need to update my trading plan for this situation. I'm sure there are others situations that I've not accounted for as well. In any event, I followed my plan well. I got a little jumpy at the exit and I dinged myself for it. But everything went rather well. Live_Trade_2010-01-07.swf

Steven, Thanks for the idea. I'll keep that in mind when looking to place my targets. I created a short video response as well. 2010-01-07_M_Pattern.swf Glad to hear you enjoy my trading journal.

Day 24 Wednesday, January 6, 2010 P&L: $160 on 1 trade. When I awoke this morning I immediately saw, once again, a "trendline break and re-test of the extreme" setup forming. I entered the market then had to take some time to figure where to put my target. Nothing was obvious. I started to think a scalp might be appropriate, but according to my recent testing I should place my target at a logical location. I ultimately picked the vwap which was 20+ ticks way. Well, price action languished for a long time before finally breaking down. My target was hit about an hour later. I managed the trade well today, but was slow on the entry. But that was largely due to the fact the setup was forming right when I was starting to get my barrings. I need to maintain my discipline and build my gains. I would like to put in a positive week to get this year started with positive momentum. Hey daedalus, glad to know I was not the only one who screwed up his trade management on the first day back! Live_Trade_2010-01-06.swf

Day 23 Tuesday, January 5, 2010 P&L: $35 on 1 trade. Happy New Year to all! Today turned out to be my first trading day of the new year. Nothing setup for me Monday. When I awoke this morning I immediately saw one of my setups forming. That setup was what I call "trendline break and re-test of the extreme". You can see the set up explained in the video. As the market created a lower, low I saw a bull bar entry. I could feel the pressure to make this first trade of the new year a winner. I entered the trade as planned, set my profit target and stop loss. Price moved in my favor within a few minute however it could not climb above 10 ticks from my entry. When price stalled for nearly 25 minutes, I got spooked and bailed. My trading plan does not indicate time limits on trades and this trading plan violation cost me as price would soon rally to my original profit target. What should have been a $220 trade turned into a $35 trade. Today was a mixed bag as I entered like a pro but exited like an amateur. I'm very disappointed but will work hard to correct this. I know I'm probably a little rusty but I will get back in the swing of things. Violating my trading plan is my biggest problem I need to overcome. This issue goes hand-and-hand with my first goal for 2010: To have four consecutive weeks of profits. It's a modest goal, but it will be a challenge. Sticking to the plan = consistent profits. Live_Trade_2010-01-05.swf

That sounds about right to me. In my Trading Plan I state I need to keep a journal and track my trading statistics. I even list what should be tracked. In short, my Trading plan lists what I should be doing as a professional trader. This includes keeping a journal and tracking statistics on my trades, which are both separate documents. The Trading Plan is like a business plan that governs my trading activity on many different fronts. My Journal and Trade Record are historical documentation on my trades which are both used for tracking progress, finding weakness and overall, improving my skill as a trader.

In my trading plan I discuss my overall beliefs in the market, what markets I trade, when I trade those markets, when not to trade those markets, my money management rules, how I will track my progress, goals for the year and most importantly: A detailed description (with images) on what setups to take.

Day 22 Monday, December 13, 2009 P&L: ($180) on 3 trades. Mondays trading was rather poor. In retrospect, I was not careful with my trendlines or previous areas of horizontal support. You can see in the video that by the end of my trading I adjusted my trendlines and it significantly changed the perspective. A missing horizontal area of resistance near trade number two was missing. This would have been a logical target and it would have been hit. But I failed to draw it while the trade was on. I was then stopped out as a scratch trade. In short, I got sloppy and paid the price. It's interesting to note that nearly all failed trades are due, not to the setup not working, but some other error such as not reading the market correct or taking impulsive trades. Winning in this game is about cutting out the mistakes you make which eat away at your P&L. Live_Trading_2009-12-14.swf

The Exit Test In an attempt to improve my P&L, I wanted to determine what exit would have worked better. So I want back over my charts and reviewed each trade. I then determined what my exit would be based on three different exits and "replayed" the trade to see if the new target was hit or not. Those three different exits are: "Close Beyond EMA" - place an exit order one tick beyond the bar that closes above/below the EMA. "Trendline Break" after allowing price to develop, draw a trendline and exit one tick beyond the bar that closes above/below the Trendline. "Resistance Area" this is simply picking a logical (nearby) resistance area as a target. This could be a previous trendline, a previous trend channel line or a horizontal line representing a previous area of resistance. My current exit style largely depends upon my feeling on how the market is moving and/or the setup. A good number of my trades have been simple 8-tick scalps. For reference, my current Net Profit is $1,584. So what exit technique performed better? Below is a table with the theoretical Net Profit for each of the exits. Exiting based upon the EMA does not provide much help. There was hardly any difference from my current results. Using a trendine is better than my current technique but the best exit technique was picking logical resistance areas. This produced over two times my current Net Profit! What these results seem to be telling me is instead of utilizing my static 8-tick profit, I can set my target based on a logical exit point that will result in me capturing more ticks per trade. It really looks like I should incorporate this into my Trading Plan.

I understand. If it's not recorded it makes it very difficult to improve. So far, posting this on-line journal is helping.

Trading Results as of December 11, 2009 Time to post some results of my trading. My first trade was on November 6th and I've performed 34 trades so far. Most of those have been documented in this thread in video and/or screen capture. I've been trading with real money and I'm happy to say I have a Net Profit of $1,584. That's an average of $46.59 per trade. My method has an Expectancy of .41 and a 65% win rate. I'm only trading one contract. The following graph has more detail including an equity graph. One of my major goals for 2010 is to show weekly consistency in profits. Below is are my weekly totals. So far I really only had one losing week. Finally, here is a list of all my trades: In summary I'm very pleased with my results. I've had a few minor screw-up but nothing major. I'm feeling comfortable with my system and believe I can focus on improving my ability to capture more dollars per trade. One thing I do want to do is review all my recorded trades and see what my results would be if I made each scalp trade a runner. That is, what would my performance look like if I exited trades by placing an exit at a logical place such as a distant trendline, resistance level or simply exited at a break of the EMA. I'm a big believer in trading with a plan and documenting results. I do have a written trading plan. It's actually a 23 page document where I detail my beliefs about the market, my goals, position sizing rules and my trade setups. Also, every day I print out the days chart with my trades and I place them in a binder with notes about each trade. Between my trading plan, my recording of each trade and executing my plan with consistency I feel I'm slowly making progress. Yes, consistency is vital and it's starting to become apparent that allowing trades to run is far better than taking many scalps. I do realize this is very early in my latest experiment into discretionary trading. I only have 34 trades and that's not a lot at all. However, I really feel I'my getting a routine in place and building momentum for 2010.

Day 21 Friday, December 11, 2009 P&L: $107 on 2 trades. Not much action early in the morning. But eventually a bullish trendline did break and created a decisive leg down. Price returned to touch the EMA and I promptly shorted for a quick scalp. Little did I know, if I held on to that contract it would have been a smooth and well paying ride down. However, at the time I was interested in a scalp for two reasons. 1) The trend was still up 2) I often scalp the first trade after a bad day to boost moral. That may not make real sense, but I guess it makes me feel better. Price continued to break support and finally landed on an important low that has held for a few days. I went long thinking I might have captured the low of the day. Once price moved beyond a theoretical scalp level, I placed my stop at break even +1 tick. My target was open. However, price would reverse and take me out for my 1 tick profit before falling more. Another support level failed. By now it was time for me to head to work. It was interesting to note that much of the bullish action was timid and unable to gain much muster. Bullish candles were physically smaller than the bearish ones. As price reached the EMA it just could not gain steam. I was noticing the bears had the upper hand. This kind of thing is not always apparent, to me anyway. But today you could just see which side had the upper hand. Overall everything was executed with precision according to my written trading plan. I think this weekend I'll post my trading summary. I have just over 30 live trades recorded and I'm in the green, which is a good start! Live_Trade_2009-12-11.swf Live_Trade_2009-12-11_2.swf

Day 20 Wednesday, December 10, 2009 P&L: ($280) on 2 trades. Today was armature hour as I made two dumb trades. Just last night I was kidding with myself that my excellent trading streak I was experiencing would end. This morning it happened. What went wrong? Well, I was too eager to place trades. This caused me to enter trades that technically, I had no business entering. I'm looking at my trades now and I have to ask myself, what was I thinking? :doh: I also did not video record these trades. I was kind of distracted with doing other things such as reading the news and checking email and I did not get around to recording. I have to wonder if recording helps me to focus? I mean, I feel like I have to explain what I'm doing and in doing this, I'm more careful with my trades. I'll be recording Friday's trading for sure!

Day 19 Wednesday, December 9, 2009 P&L: $330 on 3 trades. Making money has been easy the last few days. My first trade was a scalp. But after that I tried to let my profits run. As you will see in the video, I had a little trouble with that today. Overall, I've been following my plan well and the market has been rewarding me. Attached are two videos to cover todays trades. Live_Trade_2009-12-09.swf Live_Trade_2009-12-09_2.swf

I don't know about the code you posted, but I use something along these lines: If ( date <> date[1] ) Then Begin PLB4Today = NetProfit; Trade_Flag = true; End; /// Track Today's P&L NP = NetProfit - PLB4Today; OPP = OpenPositionProfit; ProfToday = NP + OPP ; If ( ProfToday > Profit_Target$) OR ( ProfToday <= -(Day_Loss) ) Then Trade_Flag = false; If ( Trade_Flag ) Then Begin // Trade Logic Here End Else SetDollarTrailing(0); // Exit all trades if any

Good question. I have no idea at this time. I don't have access to CL nor do I have any chart settings. Gold would be another one to try.

Day 18 Tuesday, December 8, 2009 P&L: $322 on 1 trade. EC looked choppy early today. But if you took a long distance look it seemed down was the way to go. I shorted a failed test of the 21EMA and set my target at a convergence of a resistance level that I drew days before and a bearish trend channel line. It sure looked far away at the time. But before I knew it, my profit target was hit. After my trade, I did notice that the upside was hitting lots of sellers. I was tempted to take other short trades during the morning, but I was distracted with other tasks and I talked myself out of it. Today would have been a great day to hold though much of the action as the EC spent most of its time grinding lower. Attached is todays trade on video. Live_Trade_2009-12-08.swf

I've been testing various ES and YM trading charts using the Universal Clone day trading software since the early summer of 2009. I've posted some of my results over the months and you can find those posts here: Universal on YM 89-Tick Chart Universal on YM 5-Minute Chart Universal on ES 5-Minute Chart In short, I've been unable to find a satisfactory chart using the stock index futures. Keep in mind I'm using the Universal Clone with static settings. I understand there are methods to trade the Universal Clone with a dynamic inputs however, I've yet to test this aspect. All tests again, revolve around static inputs. However, there is one chart that did perform well and that was the Euro Currency futures (EC). In short, $11,000 in 45 days! This was done with all out of sample data on live market data. I started testing this chart on October 19, 2009 and the results are below are through December 4th, 2009. Summary Info. R Distribution of Net Profit Equity Curve I know this is hardly a massive sample of trades. It only covers 45 days, but it's a promising start. Also, this system requires at least $30,000 in your account based on the daily risk of $800. What I like is the average profit per trade is $45. This includes commissions but does not include slippage. However, many of the trades are executed with limit orders. I was surprised to see how well it worked and feel that my energy will be used to study the EC and other currency futures markets. Would love to hear from others who have used the Universal or Universal Clone on the currency futures markets.

I noticed you can download a free trial copy that's good for the month of December. All you have to do is signup for a email newsletter and you can get a copy to try.

Day 17 Monday, December 7, 2009 P&L: ($127) on 1 trade. The very second I sat down at my computer I saw a 21EMA Touch setup had just formed. I jumped in at 5:11am. Within 60 seconds I was drawing trendlnes on my chart and noticed I was long in a bearish environment. I held on to the trade and was stopped out soon after. I really should have taken a moment or two to view the bigger picture. I would have noticed a bearish trendline was broken and what I was witnessing was most likely bearish action. No video today as I did not even have time to get my software up-and-running.

Day 16 Friday, December 4, 2009 P&L: $710 on 1 trade. I was able to capture some of the movement after the U.S. unemployment figure came out. The market was moving down sharply and I had to sit and watch for a set-up. Painful! Then an EMA touch happened and I took it. Within 3 minutes my target was hit for a $710 profit. The large profit was due to me seeing how fast EC was falling. Thus, I abandoned my scalp target and replaced it with a distant trendline that appears on my daily chart. I also aggressively trailed my stop. Well, EC ripped right down to the daily trendline while I took no heat. This was my biggest daily profit so trading EC. Most importantly, I followed my plan 100%. I was tempted to continue to trade, and if I was a better trader I should have. It is days like this, when the market is rewarding your trading, you should stay in. However, because I'm not consistent enough I backed off. That was probably the right thing to do. I look forward being more consistent where I can continue to press days like this. Attached is a video of today's trade. Live_Trade_2009-12-04.swf

Day 15 Thursday, December 3, 2009 P&L: $107 on 2 trades. Quick update today. Two trades that consisted of a simple Trendline touch and EMA touch. Below is an image of today's trades which are self explanatory. Attached is today's video. Live_Trade_2009-12-03.swf

Day 12, 13 and Day 14 Wednesday, December 2, 2009 No trading on Monday, November 30. No trading on Tuesday December 2. P&L: $80 on 3 trades. Today's trades were largely clear cut to identify and were executed textbook fashion. All trades were setups based on price bouncing of a trendline and/or 21EMA. Most notable today was my last trade which was a long. Price came down to touch a longer term bullish trendline. This trendline extends for days and I think it's an important lesson in keeping trenlines on your chart for days or weeks. I don't know how often I see price react at these levels. Below is an image of today's trades which are self explanatory. I did record today's trades but I accidentally recorded it as a mp4 file.So I will not post it.Instead I decided to comment on a couple of observations about price action. Price today in the EC, at least in the early morning, was following the rules and created very predictable entry points. Trade_Review_2009-12-02.swf

Day 10 and Day 11 Friday, November 20, 2009 No trading on Thursday, November 19. P&L: ($284) on 4 trades. This day simply consisted of frustration as the market proved me wrong. In retrospect, I totally misread the market and discovered that I accidentally placed an important daily supportlevel in the wrong location. This error most likely cost me hundreds of dollars today. :doh: First, watch the gory details of my trading in the following to videos: Live_Trade_2009-11-20_1.swf Live_Trade_2009-11-20_2.swf Then hear my explanation on my errors which caused me to misread the market: Live_Trade_2009-11-20_Review.swf It's all about the details! On a positive note I did keep my cool, I think, and did follow my plan even though I was wrong on my market reading. You can be sure I will be much more careful going forward.

Thanks for the reply. Yes, I do consider Brook's book the "Bible" for price action as well. There is so much information you must read the book several times. Likewise, I found his trading style revolutionary. I find myself buying and or selling in areas where I never would have just a few months ago. But strangely, it feels more natural. I think it's because I understand the psychology behind the price and thus, it makes sense to enter a particular trade as described by Brooks. Yes, my initial impression of H2 and L2 appears to have been wrong. I do find his definition in his book confusing and I'm now adjusting my definitions. Best wishes!