jonbig04

My it has been some time since I've updated this thing. Why is that? Mostly because this journal has fulfilled it's sole purpose-for me to develop a profitable trading strategy. I can say today that I have done that. I've been consistently profitable for long enough now to say, well, that I am consistently profitable. I want to take some time to recognize that lot of that is due to the help and advice of people on this forum. I was also lucky enough early on to be able to witness and learn from some amazing traders in action. While watching these successful traders was of course helpful strategically, what it really did was to open my eyes to what is possible trading. It showed me what is possible if you work hard and never give up. Just browsing trading forums can be downright depressing to anyone hoping to turn this into a career. Sometimes it just seems impossible. It's not. Having said that, I want it to be clear that I am not where I want to be as a trader. Difficulties have arisen that I could have never foreseen. Difficulties that aren't even really related to having a profitable trading strategy. All I can say is that learning to trade is an intensely personal and subjective experience. And, for me at least, trading profitably is just one part of really making this work. So, having said all that, it seems that the public aspect of this trading journey is over. The hurdles I have to overcome now are more personal, and in some ways more difficult to pinpoint. But I welcome any questions from anyone regarding all aspects of what I do and how I learned to do it. I would love to help anyone who needs it, if I am able to (and I'm not saying I am). I'm not going to be browsing forums and answering questions...that can make anyone go insane. If I can help, please let me know either in this thread or via PM. And with that said, see you in the markets bitches! :evil tongue:

There may exist a better book about trading than Reminiscences, but I'm not aware of it.

Hello TL! It's been a while since I've posted, but I thought this was something that should be brought up. Attached is an article I wrote a few months ago. It's long. I'm not even sure if anyone will bother reading it, but I think what is happening right now is simply unprecedented and that as many people as possible should be aware. In my opinion we are inflating perhaps the largest bubble in history. Not one that is tied to one commodity, sector, or even country. I'm talking a global bubble-the bursting of which would be catastrophic. I could be wrong though. I've attached the article and hope a few of you will get some pleasure out of reading it. Happy trading. Jon GlobalDebtBubble24.pdf

Just thought I'd share my progress with the new setups I'm working on (see previous post). These are on a smaller time frame and are kind of my answer to taking more trades. I haven't perfected them yet. I've learned that these are not breakouts in the same sense as my other break out trades. These small time frame trades usually lead to more of a meandering, slow but steady, break out. Therefor they do require a larger stop. I did manage to find a good one yesterday. Hopefully soon I'll be taking these for real.

In my very humble opinion, if you haven't decided that you are going to work as hard as you can for however long it takes to become a "successful" trader, you are destined for frustration. My trading improved so much when I stopped worrying about deadlines and simply realized that I was in this for however long it takes.

Today was a little annoying. Thought I caught a nice move with an early morning short. was able to book one of the 3 targets, but the rest came back to BE. Bah! Just wanted to share a setup I will be taking. I already take this on large time frames, but I will be taking this one on smaller time frames. I actually thought it had a name already, but I was wrong. I've mentioned it in this thread before, and in Thales' thread in which we entitled it "jonbig breakout" haha. As far as I know this pattern isn't out there yet. Anyway, I like it. I saw something the other day about someone not posting their exact strategies for fear of some kind of edge diminishment or something. As far as I'm concerned, my setups are based on reoccurring human behavior. Since that hasn't change in the last couple thousand years, I doubt I'm in any danger. Anyway, for what it's worth-here you go: I want to mention again that taking setups or patterns or whatever only works if you know WHY they work. The market is too ever-changing for this kind of thing to be plug-in play. Without understanding a setup or patten you will see them all over the place when you shouldn't.

No real action for me. Took 2 BE trades and a few losses for -4 ticks and -2 ticks. Kind of annoying. I am still sim trading that box strategy. Basically it's the same thing I do on a large time frame, only on a smaller scale. The box just keeps me looking for areas of congestions. I've taken 3 so far, and in true sim fashion, they all worked lol. One was the 6E short from the other day. The other was a crude long which I was able to scale the first half off at +20 and got BE on the rest. The other was a 6E trade from last night. May start taking these live soon. Oh I lost 4 ticks on the first try. I'm a little lost on what to do as far as targets and such on these smaller time frame trades?

That box ended up being very important. After I played the breakdown from it, price rallied. I played the breakout above 1.236. I was only able to scaled half out for +20 and got knocked out BE on the rest when it flipped (only by two ticks though, grrr) Oddly, price decided to flip the top of box level at 1.2348 as well, making a double bottom there. Earlier in the night I didn't want to play a breakout above the box because the 1.236 level loomed. But that definitely would have been the way to go. Since I move to BE anyways, it wouldnt matter if price got rejected at 1.236 and came back down. I would simply re-enter above 1.236 after getting stopped BE. Woulda shoulda coulda.

A few days ago I realized that, in a way, my trades are somewhat similar to Db's Cajas Famosas. I've started dialing down the time frames just a bit to try to identify these value areas, boxes, ranges, patterns-whatever you want to call them. The biggest difference is I prefer to play breakout below/above these areas as opposed to fading the extremes. Anyways, as luck would have it, my first intraday box trade worked well. I did take it sim, not like that really matters anyway. It netted 30 ticks or so. I also tried to play a BO below the 63 level, but that didn't pan out and I lost 5 ticks (target was 40 ticks on that one though). I have a potential long and short on 6E and a short on CL. We'll see how those work out.

So here's a link to a funny South Park episode about the economy/market: South Park Episode Player - South Park: Margaritaville

Possible CL trade. Just possible.

I'm using amp. I'm going to watch it tomorrow and confirm that it is that wide.

The following rambling is for me. I'm just reiterating things so I keep my eye on the ball. I'm a big believer in trading setups. But it doesn't do you any good to simply look for arbitrary shapes in a chart. Looking for something that looks like a head and shoulders or a double bottom probably won't get you anywhere. What matters is what those setups mean. Your ability to take advantage of them rests not only on your recognition of them, but you're understanding of why they work. So for this reason, I feel like I should keep explaining why I'm doing what I'm doing. What the setup I'm taking means and why it works. Just to make sure I keep myself on track. I'm trading breakouts, but what does that really mean? What is a break out? I've always thought terms like break out, pull back, trending, reversal etc were all relative terms. For example, I may take a break out reversal to the downside, but on a larger chart that may not be a reversal at all, but just trend continuance. An s/r fade can be (and perhaps even should be) entering on a pul lback of a larger trend. Am I a break out trader? A trend trader? An S/R fader? My answer would be all of the above. I, and a lot of others, use multiple timeframes to see this kind of leaf/tree/forrest action. Therefor I don't think the label really matters very much. So then, why do I call what I am trading "break outs"? I break out to me, implies a short-term sentiment shift. Temporary, but complete capitulation of buyers or sellers, or buying and selling. It may simply be trend continuance on a larger time frame, but to me, when price is breaking out, something different is going on. A breakout move is a special move. For one, break outs are typified by rapid price movement. But why does this happen? I think it's simply one thing: fear. Fear of losing money or fear of missing out/not making money, but that aside, what break outs really come down to is a momentary massive imbalance of supply and demand. I think this is all we can say regarding what happens during a break out. Simply because there's no way to know anything else, and no reason to. There's no way to know if it's "sellers getting hammered" or short sellers taking massive positions. There's no way to know if the capitulation is being caused by people exiting positions or people entering them or both. For example, if a large and well defined range fails and breaks out downwards, I used to think that it was because all the people that used to buy at those support levels (thus creating them) were no longer interested at those lower prices, therefor price falls due to lack of demand. But it could just as easily be massive amounts of supply coming in the market for whatever reasons and overwhelming those same buyers, causing price to fall. Since we don't know, we must simply say that the balance of supply and demand is very skewed...for whatever reason. Speculation about who and why is pointless in my opinion. Especially for me on my macbook in my apartment in Denver. If I was in the pits things may be different. So how to we go about finding these areas where we may see heavily skewed supply and demand? To me this means finding an area that buyers or sellers are vigorously protecting . An area that A. could only be breached if there was some kind of massive imbalance of supply and demand and/or B. An area that, if broken, will trigger a massive imbalance in supply and demand. This is of course where support and resistance comes in. I like to see area that have caused sharp and unmistakeable reactions. When price gets there we see immediate rejection with follow through. Not only do I want to see that happen, but I need to see it at least twice. These are the major levels I'm always looking for. It important that the area be defined. I don't play zones because, for me, the risk/reward isn't good enough. I want to see a line in the sand. A specific place where I can say "if price breaks here, something significant will probably happen". This way I can hopefully pinpoint where I think the momentum from the breakout is going to come in. Do I always nail it? No. I was looking back on my trades today and on a few occasions I've gotten out, only to have the thing breakout right afterwards. But since I'm counting on momentum I don't need to have a large stop. The trade doesn't need room to "breath". If the market isn't proving me right in a big way, I'm out. I will either re-enter or go look for the next opportunity. There's no second guessing myself, momentum is obvious and easy to spot. I know when I'm not being proven right. What I want to work on next is the flip. Very often (sometimes after I've reached all my targets, thankfully) price comes back to flip the area it broke out of. I want to work on a way to take advantage of those at some point.

If you go to ampfutures.com and simply put in your email, they instantly email you a license key and activation instructions for zenfire. You download ninja, follow the instructions and you're good to go for as long as you want. The whole process only takes a couple minutes.

Hoping for a CL short soon (see the Oil Trading thread). I did manage to get a sim trade in with GBP/JPY this morning that didn't pan out at all. The massive spread is going to take some getting used to. I don't like being 8 ticks in the red right off the bat. I'm also still experimenting with time frames. I think I am going to start using the 15 minute.

Amp futures along with Ninjatrader and Zenfire offers free, well, everything. The software is free and so is the real time data. I personally took advantage of this for over a year and was never bothered about opening an account or about buying anything. I think it's worth a positive review because this means that everything you need to study the market, build a trading plan, get screen time, and even get used to the software is free for as long as you need it. I think it's a great deal and it certainly made my life easier.

72.40 certainly is a nice flipped area. IMHO there was a little too much acceptance above 72.40 itself. There was a test to 72.59 and one to 72.50. I was hoping we would get another perfect rejection at 72.40 today, then I could try to a BO above it tomorrow or tonight. But alas the level has been all violated up by after hours trading. Just my two cents. I like a breakout below 70.75 personally. I had qualms about it because there was that probe down to 70.63. But the other 3 tests of the level have all caused major reactions in price and were all within 1 or 2 ticks from each other. That along with the fact that 70.75 was a pretty major area during the end of last month. And of course the larger trend being down (at least how I see it) makes me much more aggressive in pursuing it. I actually decided to be aggressive and short a break below the level this morning. Price came within 3 ticks of my sell stop before again finding support and rallying all the way back up. Specific S/R levels FTW! With an ill defined S/R zone that wouldn't have been possible...or at least not very likely.

Dinero, I just pulled up my CL charts again. Conceptually, that is setup I look for. I didn't take it because the second test (middle arrow) was around 11 ticks in difference from the others. I prefer to keep it around 0-5 ticks on CL, usually. That's mostly just to keep my somewhat honest and to add at least some structure to what I do. I probably break that rule all the time without realizing it ha.

That's sick. I just realized it 375,000 POUNDS, so thats like $475,000. Ouch.

Thanks Dinero, you did a better job defining the setup than I do haha. I closed all my market info, but I will take a look at that level when I open it back up. It looks like a perfect example! I probably just missed it. Volume isn't necessary, I could simply just watch price, but it does a nice job summing up what happened at a glance. Usually there's the initial rapid price spike through the level on high volume. Then a lull, then if price hangs there on low volume it usually is going to break out. The volume bars sum all that action up nicely and I think it's cool to look at. My targets are usually pulled out of thin air. Simple scales that keep my expectancy where I want it. But in short, yea that's all I'm doing. Pretty simple really.

The stop out was a little before that chart.

Thought I was done for the day, but I wasn't! Took two tries to hit the CL short and I accidentally closed it early, but whatevs. Lost 5 ticks on the first try, hit 51 ticks or so on the second try.