Gabe2004

To cure the tendancy of anticipating a reversal (which I do too often) I started to play with the chartgame.com. It was mentioned by DB somewhere. I think that it has the potential - after many hours - to reverse this tendancy and maybe allow one to leave the profitable trades to run (another thing which I don't do yet) Gabe

Hi Forrest What timeframe is this chart? Thanks Gabe

I wanted to close the trade earlier but decided to stick to my guns. In hind sight it was the wrong decision. In any case, I had a small profit that beats a small loss anytime.

One day I hope to trade like Thalestrader (ie - set my target and stick to them) As it is I get out of profitable trades too early. I'll try and leave this one alone. Gabe

Hello Thales Could you tell us what was your reason for chosing 1.4385 as your profit target? Thanks Gabe

Forrest, for some reason I cannot see your last chart.

Hello Thales What is you stop on the ES and could you go through the same reasoning for the ES as you did for the 6B? Thanks Gabe

Since prior peaks act more often than not as S/R points I think that it makes more sense to trade counter the move that got us to the previous S/R level. I noticed that a prior Peak or Trough will be revisited several times before it is crossed, which happens only once. I find that placing a trade above the prior peak (for a breakout trade) or below the prior trough is more risky. Any thoughts about this? Gabe PS Forrest - thanks for the color changes.

Thanks Thales So if account safety would not be an issue, would you say that trading FX and Futures on currencies is equal? Take care Gabe

It may be clearer if youcould mark the entry color different than the stops. Thanks Gabe

The problem I have with the above stats is that they never mention how much time did that 95% spend befor quitting and how much money did they invest in the process. I think that one would find that the 5% that succeeded has put in close to the proverbial 10,ooo hours and they did not have only a few hundred or a few thousand dollars on the line. Gabe

Hello Thales Could you explain why you prefer the futures to the retail instruments? Thanks Gabe

I ran some stats on SPY (ES) in 1 min and 5 min time frames. About 75% of 3 bar combinations have an overlap between the 1st and 3rd bar of about 55% - i.e. bar 3 overlaps 55% of bar 1 (high to low). So if we take the average occurance , 75% of the market is in a Barb Wire state.

Nice fit of the price to previous peaks and troughs. The second chart is identical to the first one except that it is a BAR chart instead of a CANDLE chart.

Selecting the peaks off of which to trade is a tough one for me too. I think I solved the problem by looking at much higher time frames than I would trade off. THe peaks and troughs in the higher time frames are less ambiguous but still which one to choose is a challange. For that reason I am looking at a way to define the relevance of the peaks/troughs by wheir distance from eachother and whether there is a clear LINE OF SIGHT between the current price point and the peak/trough that I am considering. By line of site I mean - if I draw a trend line from the current price point to the peak/trough that I am considering to trade off , there should be a maximum of 1 leg of a swing being cut by my trend line. If my trend line cuts more than one leg it could be a lesser probability entry point.

The following chart shows prior peaks and valleys. The purpose is to find out, how far back can we llok at peaks and vallyes to have a valid entry/target point. Any ideas?

My initial target was the middle purple line but I chickened out and thus left about 100 pips on the table The second chart shows the peaks and troughs that generated the purple lines.

brookspriceaction - Abbreviations

In reply to some of the above posts, whould one compare trading to an exact science like job like engineering or to painting, or brain surgery, or law. All the above require years of practice and a curve ball could be thrown in at any time. Some here talk about the low percentage of successful trades. How many successful people are there in any profession? How many restaurants still exsist after 2-5 years of operation? How many jobs for that matter, does the average person have in their life time? In the statistics about trading success we never hear about how much time did one put in untill he/she were a decided success or failure. I would venture out and say that most of the failures were in this business for a very short time and even during that time they did not completely immerse themselves at acomplishing what they started out to do, and, they were undercapitalized with unrealistics hopes and dreams about how much money they will make with total disregard to their capital. (Some hope to make tenth of thousands of dollars a year from trading while having an acount of only a few hundred dollars. That is not realistic and shows that they are not serious about turning trading into a business but are more like glorified gamblers. The bottom line is, if one wants to succeed in trading or any other venture in life, one has to give all they got without excuses and commit themselves to the cause for a realistic period of time before expecting results.

To become an engineer takes between 3 and 4 years (3.5 years x 8 hours/day x 5 days/week x 40 weeks/year = 5600 hours) and then probably 1 - 2 years of practical experience untill you can manage a project alone (2 years x 8 hours/day x 5 days/week x 50 weeks/year = 4000 hours) so we are back to about 10,000 hours (and that was without overtime ) Asuming one devotes themselves completely to trading, 8 hours/day x 5 days/week x 50 weeks/year = 2000 hours ==>> 5 years. And don't forget that in college you have teachers that guide you, mostly, in the right direction, whereas in trading we listed to all kinds of advise (sometimes given by people who should not have opened their mouth or sat in front of a keyboard to give their "advice/knowledge". Other professions might take much more some, less but not too many. I remember that a plumber in Montreal told me that he had to apprentice for 8000 hours (8k), on top of studiying, to get a liecense to be a master plumber. To be a liecensed electrician, if one has a degree in electrical engineering, one had to be an apprentice for 6000 hours (6K). It seems to me that those who truely want to be traders as a profession should count on 5 years if they cannot find someone to mentor them and shave off a few years off the journey.

Some more trades. In the one that lasted the longest the direction was correct but I was sleeping and could not react to the change in direction (lost 17 pips instead of maybe making 23). The last group of 5 arrows were revenge/hope trades.

Another go at it but in the opposite direction. Eventually I could not take the heat and closed the second half at a loss. 18 pips net for the 2 trades.

Sorry but I tried to compress the file too much to achieve a shorter load time on the users' computers. I won't compress the files so much next time. PS I looked at the charts again (the last ones with 7 charts) try to explode them to full size. They should be clearer. As it is, I took Thales's daughter's trades but got out at different points.

And some more charts. This time these are 5 minute charts (6 lower) of the 15 minute chart (above).

Pictures from a hind sight are useful but looking into failed or successful entries or setups would be even more so. So I was marking 15m and 1H EJ charts to see which condition would be the the least prone to whipsaws. The jury is still out. Thales wrote that previous sing points or areas could be used as Continuation points, Reversal points or both. It seems to me that reversals at a given point occur more often than continuations but the profitability of reversal pattern would be less compared with a continuation pattern. The picute is highly compressed. If any one has a problem with it's clarity, please let me know. Gabe