torero

Excellent intro. Looking forward to the next post on how VWAP filter out this type of entry. I myself am a big user of volume by price so this should be interesting.

I didn't even know about this contest. I knew there was one in investopedia but not for some prize money. Interesting articles.

Oh yeah, that one. Uhhhh, ok, I'm trying to get it down to 1 boss in my life unfortunately, we created 2 more bosses about 5 yrs ago so I'm going the wrong way. Ok, let's just say I'm trying to keep non-family bosses out of my life

Ok. I see what you mean. Basically you're using the aid of the system in identifying your entry. My problem was identifying the structure different from my system. Basically I used it as an entry but ending up trying to exit with a different indicator. If you use it this way, it's fine. You'll have higher percentage of winners with smaller profits, it's ok. So long as you tighten up your stops for the losers, but that will distort your results from the original system. When these failed reversals start kicking in more often, the small winners may not cover the larger losses. I don't think there's anything wrong in system aiding in identifying your entry setup. I have an excel keeping results on the different profit target distances (ie. 2, 4, 6pts for er2) to determine if the optimal exit point. (I know I can do this on TS but I use all discretionary setups myself without auto trades.

Excellent idea! It'll be a problem searching for them unless we have to put some TL tags on them so we can easily find them.

Unless your mechanical strategy's rules are based on the same assessment as your discretionary strategy, then you're comparing apples and pears. They have two different structures viewed by two types of technical analysis. I've tried this myself trying to read the market my own way as the auto trade is in progress. Most of the time, I take over, I end up disappointed with the results, either cutting short my profits or exit before it has a chance to move into profits. The problem with discretionary strategy is that we cannot see the way we program the systems anymore. You mentioned bear flag, you're used to looking for it and not looking at the stochs (example of your mech system) meticulously for an entry anymore, your judgment is no longer trained to view that way. I've had this problem and I have the charts where the strats are turned on and set them aside and not have it interfered with my discretionary decisions.

We mentioned this to James before and he mentioned there is little server space since video files are huge.

Be prepared to blow your account. If it's your last shot, demo trade at least 6 month on a single strategy until you're comfortable and trade it exactly planned on paper in snow, sleet, rain, sun, hailstorm, plague, flood, blah blah blah. If they roof falls on you, expect to pull that same trigger as planned if one of your fingers are still working and the computer is still connected to an order server. I'm exaggerating but just want to point out how discipline plays an important part in not blowing out the account.

Just the thought of operating and reporting to others tie my freedom down. I think most of us came to trading to do one thing: no more bosses. At least that was my main motive for getting into this business.

A quick question to Mark, you leave on audio recording on your video right? Do you talk yourself through the process of prepration and setups? Right now, I only have the audio off but trying to find a more effective way of using audio in it. Thanks.

Adding to the above, I occasionally use a webcam to record and watch myself for any cues of behavior changes that may reflect my mental and emotional state (a mirror is good too but having a view of yourself on screen keeps IN YOUR FACE). It helped me catch occasional habits that showed signs of distraction or nervousness. Hope that helps. Writing emotional stuff might be not enough, you need more visual and audio cues to point them out. One other thing I use that became very effective problems of taking profits or getting out too early is the use of stopwatch or timer, either clock or computer timer (google gadgets). I think we get in a trade and watch and wait, it seems like hours have gone by. When I set the clock with an alarm with an objective to start with 5 mins holding the trade, then move to 6-7-8, etc. until my reality of time is in sync with my mind's concept of time. This is one of the few ideas to merge reality with our perception of reality.

dogpile, maybe it was the jerkiness or jumpy that made it looked more than it did, not sure. But I noticed it followed ER2 as well.

TS might have a problem since they don't have offer ICE (not sure of late of their european data). There are lots of TS-based ER2 traders. We'll see.

I think it's ok to manually exit if it's only a few pips away for swing trades and doing it only from time to time. If you can modify your rules to allow you only 1 exit and only if it's few ticks away, that would be sufficient. You're really well, keep it up!

Since we don't know how ICE handle orders and routing, slippage and spread and of course volume will be an issue in the beginning. It'll take a while for people to trade big size again until they can find how reliable the exchange is with the new index. I've never traded with ICE so I am a newbie but caution is the only thing to do when ICE takes over. If not EMD is not a bad choice for ER2 traders, if volume increase to ER2 level, it may be a good replacement. I'm going to start watching it. I've actually system tested EMD and ER2, they are both very similar in results, the only different is the slippage due to lower volume.

I'm glad you find it useful. I put all these thoughts and ideas I've learned and wrote it down. That's why keeping a journal is the probably the best idea given to me by a mentor. Writing reinforces your beliefs (adding new positive ones and ridding of the old negative ones). Probably got a lot more to learn as I'm don't understand everything yet so still a long way from completing the full cycle of trading success.

there are 2 ways you can do this: trailing stop with an exit at the top of the gap. But one thing you shouldn't do is regretting those extras. Those will come back and haunt you. Forget it and be happy you got it.

Yeah, I work from home and it was tough and still is from time to time. I managed to get locked in a room with occasional interruptions. I used to have a problem dealing with it, especially in a middle of a trade. Now, I just get out and stop trading or just put an OCO and walk away. I accept the interruptions and not let it boil me inside. It's irritating but I accept it like I've accepted losses, comes with territory. I realize that being with my kids is a good distractions from the stress of trading too. As they get older and become more independent, I'll have more time to trade anyway. I just want to take my time is all. I know I can rent an office space, but I prefer to keep costs down (2 hours a day is not worth paying) to keep less pressure on myself to produce. I don't trade everyday anyway.

There are advantages and disadvantages of being young and of being old. Disadvantages of being older: 1) has more responsibilities and obligations to make money, less prep time to get up and running 2) know TOO MUCH and think he knows ALOT, taking advice from others are hard 3) has too much money to lose 4) new tricks harder to learn, going back to school ain't easy 5) too many years of learning real-world B.S. (make yourself look good, never admit mistakes, etc) 6) harder to change old habits/mistakes advantages of being older: 1) raging hormones and emotions no longer take precedence (at least less than teen years) 2) more knowledge of life, correlate and use it in trading (good stuff here but some traders add bad stuff and make trading worse). 3) patience is better honed in 4) once found solutions, has resources and knowledge to apply them. I think there are good and bad from each side. We both admire each others' given assets but in the end, each trader has his/her demon(s) to deal with.

I trade EMD in the past, that thing is much much wilder than ER2. Jumps all over the place, I'd be careful with slippage.

I heard this on JC's video mentioning ICE bought emini index from CME. Instead of buying the entire exchange and all its products, it buys only one products. He thinks the market volume will dry up a bit for a while before normal volume will return. Good thing I'm expanding to other areas (Ags and Forex).

That's great insight, doc! Interesting how changing the style of trading affect other people as the markets and technologies change, the inevitable. It may be that more programs create less herd instincts? Or are there still emotional people behind these programs plug and unplug whenever they "feel" it?

Congratulations, James. And let me sincerely say that you're probably the youngest and the smartest in this forum. At 19, you seem to have matured so much than the rest of us in trading, yet committed the biggest sins that cost on 5K while the rest of us dare not be precise about our tuition. All the best of luck and I admire your path of progress! Hope you stick around and teach old dogs a few new tricks!

This is a very interesting observation and question. The problem with electronic trading as opposed to trading on floor is that we cannot see the emotions and crowd mentality taking place like a floor trader would looking at the pit with people hollering and screaming and expressions in their eyes. Tape reading is difficult in this manner due to lack of these cues. The only cue is the price being broken and by how much and by how many contracts at that price. This is why trading is so difficult, putting together a puzzle that have missing pieces.

That's good news for stocks traders, no change for us emini-ers hee hee.