thalestrader

That is definitely one for the couldaswouldashoulda file: The initial entry should have been 1.6590, but for whatever reason I hadn't been paying attention (probably reading and posting here to this thread), and I missed that initial break up. By the time I got back to trading, price was above 1.6600. I placed a limit to buy a pullback at 1.6598. No luck. Finally, I settled for a break of the then rally high od 1.6607, so my buy stop was 1.6609 to acount for the spread. Had price started its upward parabola then, I'd easily have held for the 1.6709 target. As it did not, and as I am an instant gratification type of trader, I moved exited at the market in a moment of frustration for +1.7 ticks. Like I said, "couldawouldashoulda." At least I had sense enough to let our long EURJPY alone with a break even stop and go to bed. We had a PT set for 1.3250, which gave +26.5 on 1/2 in addition to +12 on the first half, for a +38.5 +1.7 = +40.2/2 = +20.1 per unit for the night. Of course, holding that GBPUSD couldashouldawoulda have meant a +69.25/unit. Here is how the charts look to me this morning. Best Wishes, Thales

I pulled the rip cord on this trade and net was +1.7 ticks. Perhaps I will prove to have been a tad too impatient with this one, as price is consolidating at session highs, but I entered about 10 ticks higher than I would have liked, and I was looking for a swift break higher. Best Wishes, Thales

PT1 +12, stop is at break even, and PT2 is at +25. Best Wishes, Thales

Current look at the EURJPY ... Best Wishes, Thales

My stop is now -6, but I am losing patience with this trade and price needs to get in gear to the upside soon or I'll pull the rip cord. Here is a look at the 1 minute. Price needs 1) to get back above the doted black line and stay there and 2) get a move on to new highs. I see a long on the EURJPY as a possibility. I'll try to mark the chart and get it posted. Looks like the buy stop would be 132.23/24 Best Wishes, Thales

How are the results thus far, if we might ask? Best Wishes, Thales

I like GBPUSD for a long, with a 1.6609 buy stop, stop loss -25, PT +100. Best Wishes, Thales

So far the ES hasn't even mustered the energy to trade 1107. I really see nothing that I like right now. We may take a peak at Tokyo, but otherwise it loks as though Thanksgiving vacation has started. Best Wishes, Thales

Hi Don, I do not follow you at all. Would you try to explain what you are trying do again? Best Wishes, Thales

So far, a most uninspired break.

Current look of the ES. 5 minute has the look of a little "cup w/ handle pattern." Of course, markets are so thin anything can happen. Then again, even when no thin, anything can happen. Best Wishes, Thales

I much prefer futures to spot too. You are setting yourself up to only be in losing trades. Best Wishes, Thales

She never liked the the 5 tick spread, and she would like it even less now that her trading is limited to the first hour or two of Tokyo becasue she leaves for school soon after the NY session gets underway. While we see some very nice moves in Tokyo from time to time, the range of the NY session is typically of greater extent. If you were to go back to some of the examples I posted of her trades, you will also see that she was trading swings of a higher degree than we find ourselves trading here day to day. Suppose you and I are both looking to short the GBPUSD. We each see a low of 1.6586. My broker's spread is 1 pip, so I place a sell stop at 1.6584. Your broker's spread is 3 pips. But since you do not see the handicap, you place your sell stop at 1.6585. Price declines and your broker shows 6585/6588, and you are filled short. I am still flat, because at my broker the GU was 6587/6588. Price then rallies and stops you out. Now the short opportunity presents itself again, and at the same entry price. This time, you know you have to set your sell stop at 1.6582. This way, you will only get filled if price does trade at 1.6585 in the real world, and not just in the world of your broker's internal electronic trading system. Price declines to 6585/6582. You are short at 82 and I am short at 84. We both see that there is potential support at 1.6558. I set my PT for 1.6559. You forgot the lesson of the spread, but only partially, so you too set your PT at 1.6559. Price declines. My broker shows 1.6558/59 and I am filled with a +25 tick profit. Your broker shows the bid offer at 1.6557/60. You do not get filled. Price actually showed a lower bid at your broker than at mine, but because of the spread, you do not get your PT order filled. Price then rallies and stops you out at whatever your stop loss is at the time. Or, perhaps you remembered the lesson of the spread as price decline. You change your PT order to 1.6561, and you do get filled there. I have a +25 tick profit, you also have a +25 tick profit, but you share 4 of those ticks with your broker, and you keep only +21 for yourself. You think you only pay the spread once? You think it only has an impact if you buy and immediately close the position? You have bought the lie. But do not feel bad. Even experienced traders refuse to believe the edge they are ceding to the market maker. But the spread takes you coming and going. If you do not believe me, then try this: Next time you are going to trade the GBPUSD in your spot account, do the same trade in your futures account trading the 6B. It is much easier to make book trading the single tick spread 6B than it is on trading a three tick spread GBPUSD. Best Wishes, Thales

I would have been ticked out at BE. My BE stop move point would have been 1.3253, and price traded to 1.3254 at our broker, so unless I had been away from the computer long enough to miss the bounce, I'd likely have gone to BE. Best Wishes, Thales

If you are ignoring S/R, and/or if you are ignoring the impact of risk to reward, you are not doing what I am doing. Best Wishes, Thales

Here is another thing to keep in mind that I believe I have implied, but perhaps it needs to be made more explicit: If you are trading this approach, and your broker is padding the your entries & exits with more than 2 ticks in/out, then you should be looking to trade the bigger swings. I'm sure it it nearly impossible at 3+ tick spreads to do well at this. For example, my daughter does not trade the GBPJPY because even at our broker, the spread is usually nearly 5 ticks at bets. That means that whatever spread exists between you entry and your stop loss, and your entry and your break even move trigger, and what ever spread is between your entry point and your first PT is artificially constricted by nearly 10 ticks. That would be some kind of edge if you were able to overcome the edge the market maker is holding at your throat if you are going to play off the minor swings. So, if you are trading Oanda, and Oanda has a 3 tick spread on the GBPUSD, then you have a 6 tick handicap to overcome. Are you good enough to overcome a 6 tick handicap when you are often trying for only a 15-20 tick PT? I'm not. I tried. To be consistent doing this, unless you are playing the larger swings for 50-100 tick moves, you need a broker who is at 2 ticks or less on the spread. Anything else is folly. Some folks probably can do it, but I can't, so I am not going to try. For that reason, we have limited ourselves to the EURJPY, EURUSD, GBPUSD, and USDJPY - each of these typically has a .5 to 1.8 spread at the broker we use. For futures, the 6E, 6B, and 6J usually have a 1-2 tick spread, and this approach generally works very well there as well (6J at times widens to 3-4 ticks, but that is usually a news pending time or the often illiquid period between the NY close and the Tokyo open). If you haven't noticed, whenever I have posted a trade on another pair, e.g. the USDCAD, it is almost always accompanied by a 240 minute chart showing that it is not of the same scale as most of our other trades (even if we also show an entry on the 15 minute, it is based on a more significant level of S/R. Compare the the two screenshots below: The first is the current spreads on the pairs we trade. The second is the current spreads on four pairs I have seen others trading here. Which set would you rather trade? At any rate, here is a little price pattern that I have posted in this thread in the past (as recently as yesterday on the EURJPY. News is pending, so the pattern may not be as reliable as it is when it occurs during the regular course of trading, but under most circumstances, the GBPUSD would be a short candidate here. Again, news pending, so who knows? But if I were forced to take a position going into the number, I'd choose short. Best Wishes, Thales

In real time, in my opinion, your long trade should probably not have been taken, but if it were takene, it should have been no worse than break even as after entry, price rallied back to the prior breakdown point. Everyone knows the old saw, "Prior support is now resistance." In fact, depending upon your broker's spread you were likely buying that test. At our broker, the buy stop would have been 1.6578, and the breakdown point was our sell stop at 1.6584. So there was only 6 ticks between the entry and the point where your stop should have moved to break even. As you were sitting on a 16 tick initial stop loss, you probably should have skipped this trade. Best Wishes, Thales

There were a few things coming together based on different time frames, etc that led me to believe that 1.6542 and 1.6518 would possibly see reactions. Price treated 1.6542 as an almost non-event as it bounced very weakly and very, very briefly there. 1.6518 proved to be somewhat more significant, but even that bounce resolved to lower lows before setting the low launch for this rally. Best Wishes, Thales

By then you may have a profit that you have allowed to run to a loss. Unless you are trading off of a larger swing at a major S/R and playing for big targets, I suggest that you start to develop a "rip cord" mentality where you get out with your skin intact as much as possible. I have twice referred to two posts by Bakrob99 in another thread where he discusses his approach. He does something very similar to what I do. Take a look at his posts and study them, don't just read them. There are bits and pieces of a strategy there that may help you. If the GU goes short, watch price at 1.6542 should it get there. I'll see you in NY in the AM. Best Wishes, Thales

I see you have an entry and an initial stop loss. How will you manage the trade? What will cause you to bring your stop loss to breakeven? Where will you take some profit? What will you do if/when price gets to 1.6550? 1.6542? Best Wishes, Thales

Here is how we set the trade. Our PT1 was the actual low, and we did not get filled. Best Wishes, Thales

I wonder if some here are not trying to knock the cover off the ball with every trade. You have to be willing to take what the market seems to be willing to give you. My daughter and I had two trades this evening. Total PnL in pips is 14.8 (+14.8 on a GBPUSD short, and a +/-0 on a short EURJPY. Be patient, take your swings, but try to swing at strikes and let the balls pass, and be as happy with a single as your are with a homerun. Best Wishes, Thales

A losing trade may be the result of a mistake. But losing trades are going to happen even when you do everything right. I make my share of losing trades. I don't think I made a mistake on either of those two trades today. Unrewarding trades happen. Unfortunately, I still make my share of couldwouldashoulda's as well. Best Wishes, Thales

Hi Folks, My daughter and I were talking tonight, and she made the statement that she is very happy that she she has been able to keep "making 100 before I lose 50." I thought about it for a few moments and then I asked her what she meant. She said, "You know. You told me I should try to make twice what I lose. I should try to make 100 ticks before losing 50." And of course I said, "I said that?" And she laughed at me and my wife made a crack about me starting to have "senior moments." (In my defense, I am sure I was referring to a 2R risk reward, but so be it). At any rate, she explained that she keeps track from day to day how many ticks of closed profit she has made net of ticks lost. Her goal is to make 100 ticks profit before ever losing 50 ticks from her most recent "starting line." Let me give you an example. Suppose today is your "strating line. You start trading. Your goal is to get +100 before (i.e. avoiding) a -50 drawdown from your starting line. "What do you do when you get to +100?" I asked her. She shrugged her shoulders and said she starts over. New starting line, new +100 tick goal. What happens if she finds herself -50? She doesn't know. She has never been down -50 from a starting line. Kids! Anyhow, I know it might sound a bit gimmicky, but it also sounds like a fun way to organize your progress. After all, if you can develop your skills to the point where you know you can reach +100 without ever falling -50 from your starting equity (basically never falling -50 from a recent equity peaks selected at points equal to 100 tick profit increments), well, you have yourself some skill set! Once you make it to +100, that becomes your new starting equity, and you hit the reset button. And why not treat you and your family to something special when you hit that +100? I told my daughter that she should reward herself whenever she hits her +100 ticks. I asked her what she would want, and she said she'd like to buy her mommy flowers. What can I say, she's an angel. Any way, starting tonight, I'm going to join her in the game (I guess I have been playing along anyway, I just didn't know it). Best Wishes, Thales

I took both of these trades today (on the 6B) and the short I closed at +2 after price made a lower low by a tick or so and reversed. The long trade was stopped at entry. Best Wishes, Thales