jonbig04

Thought I would update the log since it;s been a while. I haven't traded pretty much of all of December, and spent the beginning of the month looking for new instruments to play with. I don't like trading just after roll over, combined with the holidays, I just decided to skip it all entirely. But I'll be back at it soon.

Quick question: Can anyone direct me to a site where I can get a crash course on FOREX? For the life of me I cannot find another future to trade, so it has to be FX. The PA looks very nice in some of them, but I have no idea what the PIP values are etc. I've always just traded NQ and ES.

Sorry, Out BE on this one.

My internet here is crap. I'm moving in a few days though, then it won't be a problem. I'm missing data so the entry chart looks spotty. I will try to reload historical tomorrow so we can more clearly see the entry. For now all i have is this chart. Same trade as last nights BE. Trying again. I will move to BE if/when we make a LL. Target is the S below.

Out BE. Looks like it wanted to run some stops before pushing down further.

Gotcha. My internet connection is acting up right now. I'm going to see how correlated it is with 6E. If its not too much so I may begin watching it to round out my instruments list.

Is this the FX pair or the future? I'm looking for one more instrument to watch along with ES and 6E. I can't seem to find a another future I like so I thought maybe I should look for something in FX.

Oh wow, that's a nice looking chart. Such a large time frame too. Looks like the dollar may start gaining some real strength soon!

Stop to BE. Target of 1085. It's one or the other I figure this is probably a BE trade. I'm only at around +5ES right now with a vulnerable stop going into the globex session, but you never know.

Mind sharing which opportunities you see, and why, on that chart?

Cool, I'll remember that. Even though the exits have been crap on these last two 6E trades (watching 50 ticks turn into BE's twice) the entries were pretty good. For this particular setup what I'm looking for on the 6E, and ES occasionally, are large time frame breakouts. My entry is always at market and I usually take two different approaches: As soon as I see S or R starting to break down WITH volume expansion I enter at market. About 2/3 of the time, this is the entry that works and I'm able to watch price continue breaking out in my direction. Sometimes though, price wants to retest (flip) the S/R, or it can just be a probe. For this reason if price begins to stall, move against me, or if volume dries up, I exit. This is what I did on the chart I just posted and I exited for a 4 tick loss. I then wait to see if price wants to make a LL or HH, in the last case it was a LL. If so I get in on that tick, again at market. This was the entry that worked in the last trade. The thing I keep in mind about these trades is that they are momentum trades. Price should be breaking out on high volume in my direction. If it doesn't, then I'm out. I give myself 2 tries max. My R/R is usually pretty high. On this last trade that missed target by 4 ticks, the R/R was around 8:1. Here is an example of what I'm looking for on ES. Or the same thing could happen if the 6E decided to break above 1.5140. This is just for my BO set up. The bread and butter S/R plays are the ones where I'm just starting to employ the 1-2-3 method. Though I am tempted to just look for this set up on different instruments haha. It just doesn't happen that often on ES. The 6E seems to always be moving somewhere.

Haha thanks man, I'm hoping to get some setups tomorrow on ES. I just started watching the euro (6E). From what I've noticed so far, ES is like the charming, polite, and soft spoken girl you take home to meet your parents. 6E is the spontaneous girl you met in the club who smokes constantly, has a tongue ring and is going to break your heart the first chance she gets.

I wasn't going to post these trades in here because I'm not using the 1-2-3 method for break outs, but I thought it was kind of funny that the euro did this to me again. This is only my 2nd trade with the euro, is it always this wild? I thought the other day was an anomaly bc of all the economic data.

I'm the king of those things haha. The alert had already sounded as we were only a few points away from the level. I watched it for like 30 min. It was like paint drying. I assumed it was safe to leave to make that damn sandwich haha. I was wrong! Stupid reason to miss a trade.

Sorry for the journal inactivty. I've been working on some stuff and wanted to wait until I figured out what I was going to do. I've been trying to figure out a way to employ Thales 1-2-3 method into my test 1 s/r plays for extra confirmation. Since the 1-2-3 is a method in itself, it was difficult figuring out how many of my rules to change and how many to keep the same, but after some pondering, testing, and watching I thin I have come up with what I am going to be doing. I will be looking for the 1-2-3 (described in drawing I posted above) on a 2 minute time frame during RTH or a 5 min time frame during globex. I will be looking fo rthis setuup only after we have reach a major level and seen some climactic volume. I'm also not going to chase it. If I don't get a good entry/set up and price goes without be, so be it. I'm looking for the set up near the top or bottom with a stop requirement I'm comfortable with. Here's a hindsight example: I have also added the 6E to my trading, but only LARGE time frame breaks outs. Just like this one. Only hopefully next time I won't have to watch a 13ES equivalent turn to BE (ouch!). I would like to an one other instruments too. The large time frames BO's don't happen very often, but as you can see the moves are pretty sick when they do happen. I figure its worth watching some other instruments to try to catch this set up a little more often.

Good point Thales. I've often thought about that when my target is 1 tick away, "how much am I risking for this 1 tick?". But you are right, in that I did risk 50 ticks for an additional 15. Unfortunately for my PnL, but fortunately for the discussion, this trade also provided us with an example of trailing. I did in effect trail my stop when I moved it to BE. I can't recall if my stop was 8 or 10 ticks, but in order to protect that I moved my stop to BE. Price then rallied to 1 tick above BE, stopping me out and costing me the 65 ticks. This is an example of why, for a long time, I didn't even move the stop to BE. That one little trail to BE cost me 65 ticks. But we could go nuts talking about this, as was mentioned, there is no right way. I just know that for me all in/out is more profitable, so that's what I stick to.

Agreed 100%. One thing I've been doing from the very beginning is religiously following my rules. Of course in the beginning my rules were horrible and I wasn't profitable as a result, but as my rules have gotten better, I have gotten better. Hopefully as my rules improve now I will get more and more profitable. One day I will yield to the mental ease of scaling out, but giving in to my mind wasn't something I wanted to get into the habit of doing.

I don't want to jack this thread at all, Thales is showing us all such great stuff and this is a hot topic so I will keep this brief. In my book, trailing stops are a no-no. I used to scale out at strategic points, then one day a mentor challenged me to compare my results to all in- all out and I did. All in/out was by far the most profitable, though it did also show the biggest drawdowns. The real reason I was scaling out was because it was emotionally difficult for me to watch a large gain turn into a loss. For me, it was impossible for me to let my winners run on a consistent basis while scaling or trailing. It just never worked. The only purpose they served was to make me feel better on the inside lol. Since then I've been all in/out, though I'm sure I will start scaling again one day just for pure peace of mind. But for now, what feels good emotionally isn't a priority. I challenge you to go back to all your trades and look- see what would have happened if you had been all in/out. My guess is that you will be surprised. I've met a few people who's scaling strategy works out better than all in/out, but in my experience the vast majority (including me) all in/out is the most profitable, but perhaps the most mentally difficult.

hehe, maybe I will! Thanks.

The 6E is volatile! It's had like a 60ES equivalent range today. Anyway this chart isn't educational or helpful, but I took my first 6E trade today and it was wild so I thought I would share.

IMO there is a reason the phrase "react don't predict" is a cliche. The same reason "buy low, sell high" or "cut your losses and let your winners run" are cliches. They work. I don't predict where the market is going to go. I know that in my experience there is X% chance that it will hit my target and Y% chance I will take a full stop. Which one is going to happen is a mystery to me. But as you said, that's just semantics. The reason they say to "react" is because reacting implies that you are following a predetermined plan. It's a reaction because you already know what you are going to do, where your stop is going to be etc. You are reacting to a predetermined setup that you have tested and know works. You aren't making decisions on the fly, you're reacting to a certain set of circumstances that you've seen and tested, time and time again.

Have you ever considered the possibility that you are over-thinking this? IMO a lot of you are making this much harder than it has to be.