thalestrader

Here is my Yen (6J) trade from this morning. At the time it triggered I could not connect to TL, so I decided to wait until its conclusion - otherwise it would have been posted in real time. Entry point was 11072, initial stop loss 11091, with profit targets at 11042 and 11012 for +30 ad +50 ticks respectively. It is not a pretty as it looks, however, as my initial position was knocked out for -19 on the whole position on what I presume must have been a news driven spike (no other reason for price to move from +21 to -19 and then immediatley resume the decline other than some external event). My stop loss was11091, high tick of the spike was, you guessed it, 11091). I rentered short at 11072. So net result is +11 on 50% (+30 ticks - 19 ticks) and +31 on 50% (+50 ticks - 19 ticks). Best Wishes, Thales

Hi James, CPU was still running high for a few days after your fix when those ads ran (45% or so). But this morning it is back to 90%+. I saw these ads on a few other web sites, and I see no CPU spike. However, those ads are static without the animation. Perhaps you should look into running the non anumated ads as well. I did a search on another forum (ET) and it looks as though some other folks over there had the same thing happen. I see that ET runs non animated (I'm not sure if that is the correct term or not - what I mean is that the ads for FX Open here "move" while at the non problem sites, the ads are static0> Best Wishes, Thales

One last doodle before bedtime. Best Wishes, Thales

Hi folks, Here is current picture of the 6B. I'm not trading it, just taking notes. Best Wishes, Thales

Here is FNET with horizontal lines at the levels of your two buys (I am assuming you traded this from the long side). How did you decide to take these trades? Best Wishes, Thales

I am curious as to the role of the three moving averages I see displayed on your chart. How do you use them? In your trading, what relative importance do you give them vis a vis your wave counts? Best Wishes, Thales

What do you think about a P1 between 151.30 and 151.40? You have the point you note, and you also have the last little rally high before Friday's close? If I am not mistaken, you entry fill was approx 150.90 and your initial stop loss was about 150.50. So, 151.30, which looked like a reasonably easy target for price to achieve, would give you a 1:1 R/R for the trade. I think that is how I would have traded it. P1 at 151.30, and then P2 between 151.60-70. As a "rule of thumb," if there is S/R in the vicinity of what would be a 1:1 risk/reward, I'll take the 1:1 as my first target. If S/R is beyond 1:1, then I will will certainly play for a greater than 1:1 R/R. Best Wishes, Thales

Could I write down trading rules? Yes, though I am not at all comfortable with calling them "rules." But I do think the way I trade can be communicated in writing. In fact, I believe that it has already been done - by Lefevre, by Livermore, by Baruch, by Darvas, by O'Neil, by Wyckoff, by Schabacker, by Taylor, et al. Support, resistance, trend, consolidation: it is always the same, which leads to the second part of your first question, which is to say, that an effective way to learn to trade in this manner is to observe that the same things happen over and over. Which implies, of course, that no matter what I or anyone else might have to write about trading, no matter how well and clear and lucid the account, reading that material will not translate immediately into the ability to replicate those results immediatley. Trading cannot be learned other than by doing. And doing. And doing. As you are asking about trades involving P1, which I presume is short hand for "Profit Target 1," then you are asking about the manner in which I trade futures. I say this because most of my trades are, of course, individual stock trades, and I do not typically employ profit targets on those trades. I simply trail a stop until stopped out or the market closes. I believe I have mentioned elsewhere at TL that over time, with respect to my stock trades (and I am referring to day trading positions here) I have more losing trades than winning trades. This is not a problem, as my average losing trade currently is 13 pennies/share while my average winning trade is 55 pennies/share. This fluctuates over short periods but has been very stable over a trailing twelve month period. So, while my winning % on stock day trades is only 38% ( a figure that is remarkably stable over time), I maintain solid profitabilty. As far as futures trades, I have posted a good number of trades here at TL, in real time, most prior to the buy/sell stop entry order triggering, some soon after but well before hitting the first profit target. What % of those trades posted have made it to P1? I do not know, but I figure most of them have. You imply that the fact that I am playing for larger P1's perhaps has a detrimental impact upon winning %. I think the fact that I am playing for larger targets actually improves the winning percentage. Though the fact that I am trading based upon observable S/R is what contributes most to any success I enjoy. I am not a scalper. I am not trying to "guess" where the next two or three ticks is likely to be found. I trade for a decent sized swing. Years ago, at a seminar taught by a well known author and "market wizard," said wizard suggested that short term price movement was more easily predicted than longer term price movements. The point this wizard was trying to make was that it is easier to trade for a point or two (this was pre-emini's and the instrument under discussion was the big S&P contract) than it was to trade for 5-10 points. I bought into this for a long time. But I found that once I started to trade for the next main intraday swing rather than trying to grab a point or two (or worse, a tick or two) my results improved dramatically, both in terms of winning percentage and in terms of overall profitability. This change of focus occurred after I decided to try to trade S/R only, and it coincided, by the way, with my movement from the stage of shock to pleasant surprise. That is, once I saw with my own eyes how well I could anticipate price movements based solely upon price action around S/R, it became a relatively easy step to start using S/R as profit targets, and holding for more than a few points, and being able to resist the urge to allow myself to get shaken out on the slightest reaction against my position. Let me give you an example of another trade. I am currently long the 6B. I would have liked to have bought at 1.6587. I missed the opportunity because my attention was elsewhere. However, when I did open that particular chart, I was so sure that price would at least make it to 1.6625, I bought at the market. I was filled on two contracts (which is small - one tick of 6B is only $6.25, but my entry was late and it is the relatively less liquid Tokyo session, so two was enough). My entry was 1.6601, P1 1.6625, TP2 1.6660, and my initial stop loss was 1.6568. As I was typing this, my P1 was filled, my stop loss is now at my entry (not a perfect situation as my entry is not at a good technical position for a stop) but rules are rules, and that is how I manage my futures trades. I have included a screen shot of the chart, the trade blotter showing the 2 contract buy at 1.6601 and the sell of 1 contract at 1.6624. I have a sell limit at 1.6660 pending. Will price get there? I do not know. P2 targets are hit much less often than P1's. I have taken such a round about way to answer your question (finally), because the answer is that I do not often have a futures trade not make it to P1. I choose my trades carefully. I trade when I can see where price is going to go. This is not voodoo or magic or mysticism or anything of the sort. Imagine the shock you feel when the trade goes right. That "shock" is really excitement. It is not unlike the excitement you see in a child's eyes when they at first start to recognize letters, and then words, and then sentences. Eventually the child progresses to the point where she no longer stumbles across unfamilar combinations, and even the most difficult syllables are read and comprehended as easily as breath is drawn. The child reaches the point where she can as easily as you pick up the morning paper and read it aloud with perfect comprehension. Now, imagine you reach the point where you see these trades with the same ease as you read your morning paper. That is the only way for me to explain it. I do have losses. Usually those losses are when I allow my "thinking" to trade, rather than my "seeing." I had such a trade last week. I thought I had a good trade. My daughter saw that I had made a mistake. What can I say, I am human. I would bet that there are one or two folks who regularly post here at TL who similarly enjoy a good percentage of their trades reaching a first scale out level. I would bet that those traders rely primarily on S/R to direct their trades, and I would bet that to get to that point they have spent tens of thousands of hours watching the same things happen over and over again, while simultaneously having the market hand them more than one person's share of humbling. Best Wishes, Thales

Hi subterfuge, Don't hold me to be an idol, trading or otherwise. If you knew how much money I lost during my long apprenticeship you'd now doubt find me more an object of ridicule. I don't trade the ES everyday, but I will try to post the ES trades I do make. Perhaps you can post your trades here as well, with some expalnation on the basis if the trades. Sometimes, the act of trying to expalin your thoughts and actions in such a way as to make an another human being understand you has the salutary effect of making the basis of those thoughts and actions more plain to yourself. Best Wishes, Thales

Shocked is good, as it is evidence both of a necessary humility while at the same time chipping away at the innate human weaknesses that prevent most of us from succeeding at anything, let alone trading. Soon, it will give way to "pleasantly surprised." The problems start when when your shock and surprise are replaced by "calm expectation," which is the stage immediatley preceding "self-assured Guru." It is at that final stage that you blow-up, lose all of your capital, and start selling your system on the internet. Be grateful for shock and surprise. After the long struggle I had to get to where I am now, I am very grateful that I can leave an open position, and after playing outside with my four year old son for two hours on a beautiful late summer afternoon, I can come in and feel that same pleasant surprise at finding my profit target had been hit while having fun. I am shocked that I get paid to do this. Best Wishes, Thales

Hi Forrest, I think your targets, in both hindsight and foresight are very good and better than the ones I used (on the attached chart,I display your targets as the thin black horizontal lines). My targets (thick green lines) were somewhat more agressive than I might otherwise have used, but this long seemed a very high probability to hit both targets. In fact, I am a bit surprised that ES is struggling to print one more tick so as to touch Friday's high. (Isee that during the time I was typing this, ES has indeed exceeded Friday's high). I do not trade the ES everyday. I trade it when it offers a good opportunity. Once in a while I'll even trade it when it is offering nothing, as I did last week, just to keep me humble. The 1031 has been a level of some significance over the last few trading sessions, as can be seen by the blue horizontal line on the attached chart. As ES had two touches there during Globex, a break of that level would likely bode well for the long side. Also, I use Taylor's Trading Technique (full disclosure: as I have mentioned elsewhere at TL, I am a subscriber to richbois's TTT service). Today was a "Sell Short," day in the Taylor cycle, which meant, ironically, that one should be prepared to buy a lower open for a rally to retest the prior day's highs. In fact, the exact quote form richbbois's report that he emailed to me soon after Friday's close said "Monday will be a SS day. We should probably retest the highs before a decline starts." I have used Taylor for several years on my own, as well. Taylor's method is based upon price action, specifically as it plays around prior highs and lows. I have found it to be especially useful to my trading of the ES. You do not need to subscribe to a service to benefit from Taylor's method; I can honestly say that TTT is the only service to which I subscribe, and I do so because the service is very inexpensive, especially given the amount of time and work it saves me. At any rate, I was looking for an opportunity to buy a lower open, and when that opportunity presented itself, since there were high odds of a rally to test the prior day's high, I went a bit more agressive on my targets. Your targets were fine and would have resulted in a very respectable trade. Best Wishes, Thales

I cleaned the chart up so as to better see what is going on; and I have moved the stop loss to 1035.75. To summarize, 50% of original long position was closedat 1035.75 on a limit order for +4.5 points (for the tick counters that is +22 ticks). Stop loss on remaining 50% is at +4.5, and profit limit on the remaining longs is 1040.25 (+9.25 points or +37 ticks). I'm done for the day except for this trade. I am heading out and I'll check back in around 3:40PM EDT to see if it is still open, and if so, I will probably close it then. I would expect that between now and then either my stop loss or limit order will be filled, but you never know. Best Wishes, Thales

50% target filled at 1035.75. Stop loss is now at entry, and the profit target for the remaining position is 1040.50 Best Wishes, Thales

Sorry for the late post - ES long 1031.25

I am looking forward to seeing your charts and your counts. Thank you, Thales

Aussie is weakest against the Yen right now.

You would be correct assuming that your count is correct and that all others will be in agreement. I'm not saying that your count is right or wrong, only that there is no basis for discussing different counts and determining valid and probable counts from less valid or less probable without knowing how one has identified each particular swing. Best Wishes, Thales

To tell the truth, something about the manner in which you asked the question rubs me the wrong way. I believe anyone who has read and studied Wyckoff, (the original source, as you recommend) would readily be able to apply many of his principles concerning support, resistance, trend, etc. to his or her trading without using of volume to confirm one's reading of price.

Hi there, Does it make any sense to discuss EW counts and not include an annotated chart displaying the wave count? Best Wishes, Thales

You can download some original Wyckoff in .pdf in this post of DbPhoneix's: http://www.traderslaboratory.com/forums/30/price-action-only-5074-11.html#post75305 There is a lot of wonderful material provided by Db in his blog here at TL: Traders Laboratory - Introduction/eBook I have not read Db's eBook, and therefore I am only directing you to the material posted to his blog. As Db suggests, study the material at his blog, and then decide for yourself if you might find his eBook useful. You are, after all, responsible for your own trading decisions, and that includes where and with whom you choose to spend your money during your apprenticeship. For what its worth, I consider my own trading to be very much based upon Wyckoff, though I do not use volume at all. You yourself might ultimately find volume to be useful. Volume can provide important information to the trader, but my opinion, based upon my experience, is that price truly does tell its own story, and no additional information is necessary to trade it. Also, I am emphatically not a Wyckoff expert, so I would encourage you to seek out others on this forum to answer any specific questions you may have as concerning the subject. Best Wishes, Thales

Hi Gabe, Sure I will tell you. In fact, I'll do better and I will show you. I have attached two screenshots with annotations, one rolled back to before the entry, and one showing the completed trade. I think that the explanation on the screenshots along with these annotations should be sufficient to explain the trade. As you will see, there was nothing fancy or mysterious involved in setting the entry order (buy stop 1.4549), the stop loss (1.4532), and the profit target at 1.4585. The reason I select any trade parameter is always plainly visible on the chart. Best Wishes, Thales

Some nice numbers on some cheapies. Don't be frustrated ... remember Wyckoff: There is calmness before, during, and after the trade. It is easier said than done, but you want to train yourself emotionally so that a winning trade and a losing trade have exactly the same emotional impact on you state of mind (I hope that doesn't sound too "new age-like". It is meant in all seriousness.

I'm trading Dec now. I didn't manage to get in on the 6B, but I did buy the 6E. Buy Stop at 1.4566, initial stop loss 1.4542, with two profit targets: 1.4597, just hit for +30 ticks, and 1.4695 (next stop the December 2008 high?). With +30 ticks and a -24 stop loss, worst case, is +6 ticks. Best Wishes, Thales

Chart? From the prices you state I assume you are still trading Sept?

I'm not sure I understand the question, Forrest. It was nice to wake this morning and find that the 6E did manage to slog its way to the profit target before dropping off. Best Wishes, Thales