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DbPhoenix
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Everything posted by DbPhoenix
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Exactly. Not really. There is no accumulation in futures since there is no float. But this is an argument I don't want to get involved in anymore (like "volume" in Forex). But it doesn't make any difference anyway. What matters is the failure of the breakdown and the subsequent breakout. What one calls it and the reasons behind it -- if there are any -- are irrelevant. Yes and no. And interesting you should bring this up as its been on my mind lately. The purpose of a stop is not to protect you from loss, exc the catastrophic kind that can occur when the server goes down or the internet connection is lost or the power goes out. Too many (all?) beginners place stops as if they were sacrificial offerings to the trading gods, and if the trade begins to grow wrong, they wash their hands of the responsibility and leave the outcome up to the stop. This is nonsense. The cover stop is there for the reasons I gave above. It has nothing to do with the management of the trade per se. If and when the trader perceives that the trade is going wrong, using whatever criteria seem best to him, he then exits the trade. And that's it (exc for cancelling the cover stop). Where you've placed your "stop" here is a fine place to exit if things stop going your way. But the cover stop should be much lower. Db
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Actually it was pretty easy, but you have to relearn how to tell up from down. You won't be able to do that until you clear the decks. Db
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Just to point out that R is at 2656-58 and the midpoint is 2577-79. The trader who isn't overeager to throw his money away could do worse than sit back and wait. Maybe with a doughnut. Db Edit: Nice little congestion bet 03 and 10. Edit: Pushing against this morning's swing low. Edit: Price choked off that SB, possibly because of all the R, but it's behaving as it should. Edit: Running into multiple though minor congestions. Edit: Tentative DL break. Edit: Possibly finding S at the SB. Edit: Test of R and HH. Edit: Another break of the DL. No nearby S. Edit: Another test and a marginally HH. Quick failure. Compare to previous. Edit: Price finds S at secondary DL. Edit: Sellers still finding buyers. Edit: Tempting to speculate on what buyers are thinking or sellers are thinking, but what difference does it make? That can only create bias. Edit: Price approaching secondary DL. SL showing weakness. Edit: Possibly finding S at last congestion. Edit: Squeeze between bottom of congestion zone and SL. Edit: Breaks the SL but finds R at the top of the old congestion zone. Oh, the drama. Edit: S/R becomes lateral. Edit: A Thrust and Whoa! Edit: And it's 11:00. I made a conscious though difficult effort here not to call trades but rather to describe what I saw, I hope as objectively as possible, at least for me. What anyone else does/did with that information is/was entirely up to them. Post 11:00, FYI: Price finds S at that 10:00 RET, then works its way down to the prior SB. A non-Wyckoff observation: H&S fans will note that this completes the target. Nothing between here and where we started, exc what traders come up with in the meantime.
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Even if all of this were accurate, however, it would not do to buy off the "climax" low but rather wait for the test. When that came two bars later, price made a lower low. Not good. A better test came at 10:11, and this would have put you on the correct side of the market. Look at all of this using a smaller bar interval and see what you think. Db
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You probably answered your own question with the W quote. As the years roll by, I increasingly find that anything other than price is a distraction. But I go into volume and candles and bars and all that in my posts and in my book because the only alternative is to tell people to start over from the beginning, and only one out of a thousand is going to do that. Eventually, those who adopt this approach reach pretty much the same conclusions I have, but they have to do it in their own time by their own routes. If you follow price in real time (and very few message board posters do, regardless of what they claim), you can see the surges and the counters, you can see when activity is trailing off and becoming dull. Even if volume is plotted, you find yourself paying less and less attention to it. If anything, the TICKQ/TICK is a better sign of flagging interest -- or the appearance of flagging interest -- than volume. Big money may be able to fake the book, and they may even be able to manipulate volume, but they can't fake a transaction, and that's all that counts. Beginners are addicted to indicators and bars. This makes them low-hanging fruit for vendors. But since few beginners trade to make money, my making this a crusade of some sort is no different than trying to teach a pig to dance: it doesn't accomplish anything and annoys the pig. An answer that's far longer than it needs to be, but when I read beginners' posts on other threads, I can't help but feel that they'd get far more enjoyment out of their money if they just set it on fire. Db
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How "bullish action"? The short wasn't incorrect, but it was late, as is your short at 4. Take care with over-thinking. You appear to be doing a lot of in-the-moment interpretation of the "meaning" of whatever it is you're looking at. Forget about what it all means. Either a bar or swing point is higher or lower or it isn't. Either price rejects a particular level or it doesn't (you can modify this slightly by the extent of the rejection and the rapidity, if any, of the recovery). Don't try to outsmart yourself or your plan. This is what very many traders do, and they in effect tie their shoelaces together. Db
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I'm not surprised. Wyckoff obviously did not use intraday bar charts. He used the tape. The tick chart is a visual equivalent. So getting over one's fear of it can lead to some new insights. When a range has been established, as here, one often has to take his trades at S & R, and if the range is narrow, he can often wind up not entering until price is very near the opposite side of the range. This leads to a lot of BE. However, if the trader opens up the bar, he will often find his test or his retracement and his entry, an entry which is invisible to everyone else. Doing so also enables a very tight stop. Db
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What does a 30s or 15s chart look like at that point? Db
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The charts I posted early in the thread were intended to illustrate at least some of Wyckoff's more important principles. Those who have studied the Forum and Wyckoff's course will, I hope, understand what I was doing and why. I never intended, however, for the trades to illustrate a "plan". A plan must be created by the trader using criteria which he has tested and found to be reliable. If he hasn't determined the criteria and tested them, he won't be able to create a plan on which they are based, much less follow it. And if he doesn't or can't follow it, there's no point in doing it. If he forces himself to follow it anyway, or at least pretend to be doing so, then the emotions which would otherwise be immaterial will dominate his trading. The point, then, is to understand the principles and guidelines and to develop a trading plan based on them. If my and others' illustrations help, great. But there's no way that anyone is going to be able to copy what atto or head or cows or wj or I or any other contributor has done or is doing and become a successful trader as a result. This Forum will help most beginners leapfrog over most other beginners, but the grunt work must still be done. As for your charts, I'll work on annotating them, but it may take a while. Db Edit: Didn't take as long as I thought. I see now what you were doing on your first trade. I don't know that I would have taken it, given all the preceding clutter, but it appears to me to be legit. My only note here on this first upswing is not to be so tight on your demand line. If you haven't created and tested a plan around this, I can understand why you'd be fearful. But it is sim, after all, and since the bar that breaks the DL does not drop below the bars two and three bars back, there's no reason to panic. And by giving it a little room, you avoid the stopout and having to re-enter later and taking a loss on that later long (3). I assume the arrows refer to the bar you're entering on rather than the entry point itself. I assume you know there should be no long at 5. You're still traveling down. Too tight on the DL after 6. It's holding just fine, and even makes a higher high. That also prevents you from having to enter again at 7 and lose on the SO. You'd also avoid being late on the short (three bars). I don't see a long on that last upswing. Is that correct?
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Yes, some of these are less than good. Before I put in my two cents, could you articulate your plan? I assume you're trying what has been interpreted as the "Trading in 90m Plan (my half-dozen or so charts earlier on)", though I didn't intend for it to be. There is wiggle room, after all. Db
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The two chief reasons for wanting to break even are (a) you don't know what you're looking at and don't know what to do about it so whatever course price takes is pure chance so you'd rather just get out before the chaos loses money for you and/or (b) fear. The underlying purpose of all this is to understand what price is doing and why. Only then can you work on how to profit from these movements. Attempting to short-circuit this process by jumping ahead to the profit stage will actually take longer because you'll never develop the understanding you require. Thus you will be starting over again and again and again. Therefore, leave the stop alone and just sit and watch. If price reaches a point where you think you ought to get out, then write down what that point was and why you thought that. Define that exit point if you want to include that criterion in your plan. But don't exit simply because you don't understand what's going on or you're uncomfortable. Yes. Exactly. Make the modifications later, not during. Db
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One other thing. If the "length" of the bars throws you off, keep a 30sec or 15sec alongside so you can see what's going on "inside" the bar, regardless of whether you use it for entry or not. Db
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It happens. What's more important is that you didn't sit there and mope but kept it together to re-enter at 3. Db
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Again, this is not pertinent to the thread, and Neg may move it if he likes. But moving your stop was not part of your plan. If you're going to gather useful data, you must include everything. If it isn't in your plan, then leave it alone and let the trade take its own course. There's no reason to be fearful in sim. Don't try to show off for yourself and don't try to outguess your own plan. Otherwise, the sim and the journal are a waste of time. As to missing profits, you missed up to five. But there are no "profits" in sim; there is only the plan and trading the plan and evaluating how well you traded the plan. Db
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Congratulations. Why so late on the short at 2? Db
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But you didn't hold to the target. If you can't follow your plan in sim, you sure aren't going go to follow it in real trading. None of which is pertinent to this thread. But I thought the point needed to be made. Db
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Remember to explain in your journal why you didn't follow your plan. Db
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It's too high/low. It can't go any higher/lower. It's ready to roll over/rally. Volume is too high/low. Anything having to do with candles or candle patterns. It's lunchtime. It will be dull. It's Friday. It will be dull. News is good/bad. Price will rise/fall. Etc Db
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As for an introduction to journals and logs, click the link in my signature, below this post. As for a place to keep the journal/log, you can try Traders' Logs. Whether or not you use the other logs as models is up to you. They may not all be great examples of journals and logs, but they're there. As for taking at least one trade per day, this should be done only if a setup meets your criteria. Otherwise, you'll be moving backward rather than forward. If you do not yet have criteria, develop them first using the steps in the journal link I referred to earlier. If you're interested in auction markets and Market Profile, read Auction Markets, then Getting Down to Cases. If you need more examples and further guidance, read Support and Resistance, Trading Ranges, and Retracements. As for gathering your data, doing that in real time could take a year or two. If your software doesn't provide replay, find some that does. By gathering your data via replay, you can accomplish this step in weeks or even days. Db
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At a minimum, the stats. What is your win:loss ratio? Your profit:loss ratio? What is your monthly net (considering at least commissions and trading costs)? Are you maintaining a trading journal? A trading log? Where? If those who are willing to help are going to be able to do so beyond the generic "keep up the good work" and "don't give up", they have to know what you're doing and why. He made so little progress because he thought all he needed to do was keep practicing. There's an old observation about the man who has twenty years' experience versus the man who has one year of experience twenty times. Unless you keep careful track of what you're doing and why and how much you profited from the work, if anything, you'll just spin your wheels. I notice from another post of yours elsewhere today that you missed an entry again. Do you keep track of when and how often and why this happens? Is it happening less? Do you have a plan for dealing with it? And so on. Practice is great. The central question, however, is (a) what are you practicing and (b) are you reaching your objectives? Db
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Assuming you mean the 1m chart, no. I was thinking of the bar at 14:44 since it had tested the S/R line several times and looked as if it might hold. However, the bar you mention, and the bar two bars over, are also justifiable entries. Ordinarily, I'd avoid this kind of entry since it's so late in what is a parabolic move. However, buyers are enthusiastic, and you never really know. So I wouldn't beat somebody up for taking either one. HOWEVER, the trader MUST be willing and ready to get the hell out if the trade doesn't go his way or fails rapidly. This is no time for dithering around. And there's no time for multiple confirmations. He must understand what he's looking at and act accordingly. Which brings me back in a roundabout way to tupapa's question about "is this a RET?" And being mechanical. The trader, even the discretionary trader, or particularly the discretionary trader, must know what he's looking at and what he's looking for. Otherwise, he's very likely to get his hope and/or fear triggers tripped, and that's no place to be. On the one hand, the trader must realistically allow price to come back at least a little, even with cascades. But he must define what he means by "a little". Using bars, is it okay for price to come back one bar? How about two? How about three? (Some advocate letting price come back 50% of the move, and if that suits your risk profile, fine.) If price hasn't rolled over by then, perhaps it's time to exit and breathe a little (and enter, but don't transmit, the order to re-enter). If price rolls over, great. Draw a new SL and go on from there. If it doesn't roll over, then you're out and you can re-evaluate the situation. And throughout, pay special attention to hope and fear triggers. When are they ignited? Where? Why? Whatever you're doing to ignite them, don't do that anymore. Back away. You can't think properly when your heart is pounding and you're hyperventilating. You're welcome. But you and the other lurkers (and, yes, I know who you are) are expected to jump in eventually, preferably sooner rather than later. Db Edit: My perspective on RETs.
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If the trader gets all egotistical and emotional about stopping himself out or being stopped out and wastes his time moaning about how wrong he was and what a useless sack he is and so forth then yes, he will miss most of the move. Unless, of course, there is an immediate reversal after he's out and he congratulates himself on being so prompt and astute and disciplined and so forth and never takes the SAR and misses out on that as well. Too many beginners think that once they're stopped out, that's it. They're too emotional and unfocused to stay in the zone and consider re-entry, much less do it. You yourself have seen how effortless it is to exit when the move appears to be over, then re-enter when it turns out not to have been over after all. In fact, it's not unusual to pick up a point or two in the process. It's just a matter of focusing on the demand/supply balance. In this way, risk is virtually non-existent (FWIW, I used to tell people to use these RETs as opportunities to add another contract, but there's far less risk in exiting the trade and re-entering the trade than in hoping that it is nothing more than a RET and ending up getting screwed; better to trade all the contracts at the outset). As to drawing the SLs and DLs, I don't actually draw them while I'm trading, other than in my head. There's just no time. But if one has spent sufficient time studying old charts and replay trading, he ought to be able to "see" these lines without actually plotting them. When posting the charts, of course, they become necessary. Otherwise, nobody knows what's going on. As for being less mechanical, one needs to avoid being mechanical at all. Learning the guidelines and following them is not mechanical. But it's very different from being all feely. It's trading what you see, not what you think. Db
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As a side note, both the NQ and the ES hit their midpoints dead on this morning after the open, providing simple, easy, indicatorless, long entries. Db
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This is very good. You're picking up on the concepts well. It is not exactly as I would have done it, but not only does it work, you've provided the support for each step you took, which beats the hell out of "feelings". First, I would have placed a buystop above that first RET to the S/R line (when trading around a midpoint, avoid calling it a "support" or "resistance" line; that can bias you toward a direction; what matters is not the line but the behavior of price). This buystop would not have been triggered. But even if it had, I'd have been prepared for the SAR (this is a particular problem when trading "inside bars"; on a tick chart, the indecision at these points becomes much clearer). Second, I'd rotate my first SL (supply line) to the left, tracking the high points of the bars (on a tick chart, these would be swing points). This would get me out faster, though the profit would be the same. After all there could have been a violent reaction rally to the S/R line, which would result in BE. Ditto on the next SL. Third, you were smart to open up the bar and see where price went and when . Same problem here with the "inside bar". That it happens is not as important as not freaking when it happens. If you can stay calm, you can focus on the next entry, three bars later, which, in this case, is above the S/R line, one bar earlier than yours. What you've done is fine; it's just a bit later than it needs to be. Note also that the money you lost by being stopped out at 3 has been paid for by the profits you took at 1 and 2. Fourth, this sort of in-and-out can drive you crazy if it goes on for too long, but there is an eventual payoff at 5. However, make sure that the decision to allow price to come back to your cover stop is not the result of being tired of screwing around with the in-and-out. This trader fatigue can be costly. As to defining a RET, I've read quite a few and none of them are adequate. The RET is the result of conscious intent, or effort that's more than just casual. If the bars involved are, for the most part, sideways, then it's more a breather than a RET. The RET you've chosen for your first exit shows more effort (note where it comes; look to the left). As for the SL, it's purpose is to track those points where supply dominates demand. If there's no RET, then you have to use the highs of the bars (again, if you were to use a smaller interval, these would be swing points). Therefore, your thin line is correct. And once price renews its decline and makes a lower low, the next SL can be drawn as well. And though you don't show it, I assume you re-entered the short at that RET. It's a pain in the neck, but it minimizes the risk to the point of inconsequentiality, which makes managing the trade far more pleasurable. At no point are you hoping for the best. If it's available to you, I suggest you plot exactly the same timeframe using a 15sec bar interval. It may help you to go beyond the "bar" thing and see what's in the bar even when using a longer interval. After all, even when using a 1m interval, you can still blend the bars in your head to see what the 5m people, or even the 15m people, are looking at. Db
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You do understand, don't you, that you didn't really listen to any of the comments that were made? Practicing the wrong market incorrectly isn't going to do much for you other than help you learn how to become proficient at trading incorrectly. Yes, one can become minimally competent by practicing the wrong swing or the wrong stroke long enough, but he will never become a winner. I worked with someone once who was in pretty much the same position you're in, only he'd been at it for five years. I hope you seriously re-examine your process long before that much time has gone by. Db
