Jonbig04's Log

[brownsfan019 17]

^^^^ look above ^^^^

[jonbig04 10]

Still plugging along.

 

I have a set of rules. I follow them to a T, then I tweak...this has been the routine for a while now. I follow them when they work, and I follow them even when I know they wont work. Hopefully at some point...they will work! haha. I actually had to re-write the whole dang thing today. They are now very simply which I'm not sure is bad or good. I suppose I will find out.

[brownsfan019 17]

Good to hear! I'm sure others could gain a lot by seeing your progress more if you are able to post some updates or ideas.

[jonbig04 10]

Sorry I am way behind

 

One thing I am doing differently than everybody it seems is that I'm gearing my rules to make me a certain number of points per week. I'm not trying to make 50 nq points a day (even though it seems everybody but me can do that). I have a weekly points goal thats in the low double digits. i want my rules to be able to generate that consistently. When it does I will just start upping the cars. No point in trying to make 100 points with little capital when you can make modest points with larger capital. Discipline is paramount of course.

[brownsfan019 17]

I agree. If you are confident in your system, easier to just trade larger size and get your $ goal vs. trading all day and/or trading less contracts out of fear.

[jonbig04 10]

True.

 

I'm at the screen all day of course but my system gives me probably 8-12 trades per week. It can be frustrating waiting and waiting. I've learned that patience is a virtue in trading. My risk reward is 1/10 or higher, but accuracy leaves something to be desired. I always risk very little and my targets are high and I do not exit until the target is met. My rules prevent me from exiting at +14 just because it feels nice. It hurts watching a +14 or +18 go to break even (i move my stop to BE after a certain point) but thats the way it goes.

 

My biggest thing is this : Do not break rules. Ever. Not even if Bernanke calls and tell you he's going to drop rates a full point in twenty minutes.

 

This way emotions don't become an issue, and won't become an issue as long as I stay true to that.

[james_gsx 16]

 

My biggest thing is this : Do not break rules. Ever. Not even if Bernanke calls and tell you he's going to drop rates a full point in twenty minutes.

.

 

If Bernanke called and told me he was going to lower rates in 20 minutes I'd load up on margin and tell him to keep a 10% "finders fee". Isn't that what we would call an edge? :o

 

But on a more serious note, rules are incredibly important simply because trading is an environment where the trader creates the structure. It's unlike anything else because it starts when we want and ends when we want. That's why rules, and more importantly discipline to follow your rules, will simply make or break any trader. You can scream at the charts when you're wrong, but as long as you follow your rules then you are doing the right thing. The worse thing a trader can do is start making impulse traders - I've made that mistake plenty of times and I pay for it every single time.

[AgeKay 10]

I have one suggestion while you begin your trading study - document everything you look at with screenshots, annotations, remarks (good/bad), dates, etc. etc.

 

Just get it all into a Word doc so you have it b/c I guarantee one day you'll say something like - I remember looking at something like XYZ before, but can't remember exactly...

 

I recommend the program OneNote 2007 for that. It's also developed by Microsoft. Best note-taking application ever.

[jonbig04 10]

If Bernanke called and told me he was going to lower rates in 20 minutes I'd load up on margin and tell him to keep a 10% "finders fee". Isn't that what we would call an edge? :o

 

But on a more serious note, rules are incredibly important simply because trading is an environment where the trader creates the structure. It's unlike anything else because it starts when we want and ends when we want. That's why rules, and more importantly discipline to follow your rules, will simply make or break any trader. You can scream at the charts when you're wrong, but as long as you follow your rules then you are doing the right thing. The worse thing a trader can do is start making impulse traders - I've made that mistake plenty of times and I pay for it every single time.

 

 

Haha that is definitely an edge.

[jonbig04 10]

Finally have a system up, will post performance here. Sim is done with 3 cars. I will post the point totals for each car then average them.

to catch up.

 

MONDAY 10/20

 

Tried to short at 8:54 (my time) but price wasnt nice enough for me to get a good entry so I ended up not getting it at all. Too bad because it would have been a nice gain.

 

1st trade short @ 1322, went about 9 points before coming back and stopping me out.

 

2nd trade I hated this trade because I knew i was a whipsaw, the chop just happened to meet my criteria. But I do not under and circumstance break my rules (ie not trading when entrance requirements are met). So I went long at 1318.75. Was stopped out after being up around 4 points (makes a guy want to scalp)

 

3rd trade YES! Finally. Went long at 1321.75. I was up around 15 points and went all the way back to plus 2, then all the way back up again. Had to hold this thing for like an hour and a half.

1st trade= -4, -4, -4

 

second trade= -4, -4, -4

 

Third trade= +22, +22, +33

 

+17 avg

Edited October 22, 2008 by jonbig04

[jonbig04 10]

TUESDAY 10/21

 

I slept 30 minute late and missed the most obvious trade. It was the exact same trade I took yesterday and there is no doubt I would have taken it again had I not woken up 30 min late.Long at 1322 at 7:40ish Lesson learned. That cost me 20 points easy. Stupid. It sucks, but at least I know my rules when have demanded another very profitable trade, even I fucked it up by not being awake. Took 2 more trades, both stop outs. No big deal on these, just was wrong. Stupid oversleeping :evil: That wont happen again.

 

1st trade -4, -4, -4

 

second, -4,-4, -4

 

-8 avg

[jonbig04 10]

Weds. 10/22

 

The trades I lost on weren't that big of a deal. One was +11 before it stopped me out, but thats ok. The only frustrating thing was the morning. One thing about me, I may be a shitty trader, and my rules might suck hairy balls, but I dont break them. Example: The first blue arrow is where I had my finger on the short button, but my rules stipulate how much a point can be broke by along with other circumstances and without getting into it, this move up was too much by 1 tick!! one lousy tick! I wanted to short anyway. But i didnt break my rules. Bastard dropped 25+ points. haha. Then it came back up and (the second blue arrow), without getting into my rules, the test wasn't good enough by 2 ticks! I wanted to short again, but still I didnt break my rules. Sucker went down 20+ points (past my target). Oh well.

 

1st trade -4,-4,-4

 

second, -4, -4, -4

 

-8 avg

[jonbig04 10]

lol sometimes trading cracks me up. Another bad day, but some interesting trades to tell of.

 

1st trade: horrible entry here. I was late and wrong. Tried a short 1236, was quickly stopped out.

 

2nd trade. This one is funny. I went long at 8:27@1233. You might be thinking "hey, that was a good trade because the market rallied 30 points right after that. Too bad it dropped EXACTLY 4 points below my entry before it sky rocketed. Had my entry been better by ONE TICK this would have been a +17/avg trade (one car would have been break even). Damnit.

 

3rd Had to buy the support this time, it had already given its best though and I was stopped out when I went long at 1235.

 

Here is where I really screwed up. I stopped trading. I was so frustrated that I just walked away instead of realizing that a streak of losers, is just a streak. What a loser I am. I should stay disciplined. Keep trading. My rules are tested. They WILL work if I improve my entries and stay there and TAKE THE TRADES. Scanning back through I would have shorted at around 1200 and gotten stopped out ( I also placed blue arrows at these entry points). But I also would have caught the long at the end of the day at 1200 and that trade would have been a +25Avg.

 

What I learned today was to take my stops like a man, just keep trading and dont go on tilt when things dont go my way. If my rules arent working, its not my concern during the day. Thats for after hours and weekend analysis. My only job during the day is to execute those trades via my rules. Thats it. I also need to work on my entry and I have a very good idea how to do that. These things alone cost me 42/avg points today. So instead of being up 25 or so for the day, Im down 12. At least I can see my rules are working!

 

Work on making entries a little more precise.

Never go on tilt.

[james_gsx 16]

Jon, what is your clarification of 1 point? Lets say the ES moves from 980.25 to 980.50 is that one point? Or is one point 980 to 981? I can see it being either in this market, so I just wanted to clarify.

[jonbig04 10]

I consider 1 point as in 4 ticks. 980.25 to 981.25.

 

The AVG thing is just me averaging the point gain or loss for each car, as Im trading 3. I notice some people do it on a 1 car basis which is cool too, I just tend to AVG them.

[daedalus 10]

Just keep in mind the context of what you are trading right now Jon.

 

There is nothing resembling trading in markets like these. There is only gambling.

 

The markets right now aren't acting based off rationality or consistency. Much of what we are seeing is nothing more than computer wars... trading programs executing against each other slamming the markets violently around.

 

Not to mention the increased volatility is going to take your stops that were good 2 months ago and annihilate you with them now.

[jonbig04 10]

Just keep in mind the context of what you are trading right now Jon.

 

There is nothing resembling trading in markets like these. There is only gambling.

 

The markets right now aren't acting based off rationality or consistency. Much of what we are seeing is nothing more than computer wars... trading programs executing against each other slamming the markets violently around.

 

Not to mention the increased volatility is going to take your stops that were good 2 months ago and annihilate you with them now.

 

I have to disagree. I think the fundamental reasons that make PA so affective are still very much in place. The people I trade with are making boat loads in this volatility, using PA of course. While it can be more profitable for the great traders, I do think its more difficult for us beginners. As you mentioned your stops can get wiped pretty quick, but that just means you have to enter more carefully. I think this is a good market to learn in because its tough. I know quite a few people who have fled to ES only because they said it was easier, that may or may not be true, but im happy to get slammed around while Im learning. As long as I am learning, and I am. It may not look like it looking at my point totals, but I'm getting somewhere.

[AgeKay 10]

I consider 1 point as in 4 ticks. 980.25 to 981.25.

 

The AVG thing is just me averaging the point gain or loss for each car, as Im trading 3. I notice some people do it on a 1 car basis which is cool too, I just tend to AVG them.

 

So does that mean than when say your down by 12 points, you're only down 4 points on each contract, which is 12 points because you're trading 3 contracts?

[jonbig04 10]

No.

 

If I'm down by 12 that means that all the losses on each car, added together and then divided by 3 =12.

 

Could be I lost 12 points on each car.

 

Or that I lost 4 on one, 10 on another and 22 on another which would be 12avg.

 

I could do it on a 1 car basis and say I'm down 36, but then if you see that Im trading 3 cars you would think im down 36 points on 3 cars which is wrong. I know some people that do it this way and I think it can be deceptive, especially when it comes to gains. A few months ago I would look at people's journals and, taking my one good trade on monday as an example, they would say since they gained 22, 22, and 33 they made 77 points...which is correct on a one car basis but there I was trying to find this 77 point trade when really it was a 25 point trade. Hope that clears it up.

[jonbig04 10]

The main thing is that I was going on tilt even though I know that having 4-5 losing trades in a row is possible, and even so the accuracy is only around 25%, but the R/R is huge. Now I have a more refined entry system. I've tested it and almost ALL of my entries have been improved, like you said we need to try to get the top/bottom of that swing. For some reason I was searching for the answer in volume like an idiot, when of course it was right there in price all along! This is one of the best changes I've made so far as it improved 90% of my entries by a few ticks or more, which may not seem like a lot but I missed at least 17avg points last week bc of one tick, so...

 

I've been killing the replays this weekend and so far I've gone through 2 days of data in just 3 or 4 hours (yea I speed past the boring parts). The results have been great though, and its nice knowing that I'm not putting a positive curve on the results without knowing...as much as I try not to do that while backtesting it always seems like I am. Replay results so far:

 

10/8

 

1st trade: -4, -4, -4

2nd trade: -4, -4, -4

3rd trade : -4, -4, -4

4th trade: -4, -4, -4

5th trade +20, +20, + 32

 

+5 AVG

 

10/7

 

1st trade: +20, +20, +5

2nd trade: +20, +20, +5

3rd trade: -4, -4, -4

4th trade -4, -4, -4

 

+22 AVG

 

If it seems weird that 2 different trades yielded the same points its because I took the same trade twice...as price made 2 very similar moves, back to back. Kinda weird. Also the fills were done on paper and were approximated on the conservative side. Lets hope I can keep it up. Will post some more replays after I finish them tomorrow.

[AgeKay 10]

No.

 

If I'm down by 12 that means that all the losses on each car, added together and then divided by 3 =12.

 

Could be I lost 12 points on each car.

 

Or that I lost 4 on one, 10 on another and 22 on another which would be 12avg.

 

Thanks for clearing that up. Yeah, I think the way you're reporting your P/L is the "right" way to do it because you can compare your results with other traders regardless of what size your trading.

[jonbig04 10]

Cool glad it makes sense. Going to do a couple of replays and will post results.

[Hlm 10]

I have to disagree. I think the fundamental reasons that make PA so affective are still very much in place. The people I trade with are making boat loads in this volatility, using PA of course. While it can be more profitable for the great traders, I do think its more difficult for us beginners. As you mentioned your stops can get wiped pretty quick, but that just means you have to enter more carefully. I think this is a good market to learn in because its tough. I know quite a few people who have fled to ES only because they said it was easier, that may or may not be true, but im happy to get slammed around while Im learning. As long as I am learning, and I am. It may not look like it looking at my point totals, but I'm getting somewhere.

Of course it depends on your trading style and methodology but I would agree with you jonbog04. If your trading style is grounded on fractal interaction ("a rough or fragmented geometric shape that can be split into parts, each of which is (at least approximately) a reduced-size copy of the whole")...or in other words multiple time frames stacked logically...you should still be doing just fine in the current market. The only difference is that the lowest time frame swings have turned into "noise" (extremely fast) while the higher intraday swings have increased in number. Of course, if you never played the middle or higher intraday swings and only the lowest intraday scalps then you may be having some difficulty. If one has never looked at the market in this way, I would highly suggest taking a look. Even if it's with something as simple as finding "trends" via HH/HL and LL/LH on different time frames.

 

Much of what we are seeing is nothing more than computer wars... trading programs executing against each other slamming the markets violently around.

Even if this was the result of algorithmic trading (which is arguable considering everything is still very technical on all time frames) one could argue that this makes day trading even easier. Isn't a computer more likely to keep the lower time frames "cleaner" than irrational and emotional humans? In my opinion computers have created more predictable and cleaner runs in the market giving an educated trader a higher probability of catching a portion of a move.

 

BTW, great job with this journal jonbig04. Keep up the good work!

[jonbig04 10]

I've got a few more results to post from the replays. I could never have expected the outcome. The previous day's replay results do not reflect these new targets...something tells me I wish they did. Oh, and the days got skipped around a bit because I was missing data here and there. My targets are now 18, 36, and 54 NQ points.

 

10/9

 

This day was the perfect storm of Chop. It hit me where it counted and took advantage of my rules and turned them on my to chop me up. This was my first replay and lets just say after this I was...livid. Stormed around the house, wrestled my dog and came back and tested the day again with the EXACT same results. At least I know I'm being consistent lol.

 

1st trade: -4, -4, -4

2nd trade: -4, -4, -4

3rd trade: -4, -4, -4

4th trade: -4, -4, -4

5th trade: -4, -4, -4

6th trade: -4, -4, -4

7th trade: -4, -4, -4

8th trade: -4, -4, -4

 

-32AVG points

 

Yes that just happened. I couldnt believe it. Worst day EVER.

 

10/13

 

After all that 10/13 goes by without a single trade. Good or bad, just never got an entry. The market is a weird thing.

 

10/14

 

Yes. A good day. 1 trade, 3 targets hit. That was awesome. I tried to get a screen shot of it, but the executions disappeared? Hmm.

 

1st trade +18, +36, +54

+36AVG points

 

10/15

 

I couldnt believe it myself. I had to double check to make sure I didn't fudge anything, but sure enough...1 trade 3 targets hit. Attached a SS of this one, just for fun,

 

1st trade +18, +36, +54

+36AVG.

 

10/16

 

I seriously could not believe it. My brain refused to acknowledge what just happened. But yes I hit all 3 targets AGAIN! Attached SS for fun.

 

1st trade

+18, +36, +64

 

 

The reason my winning days only have one winner is because it usually takes so damn long for the price to move 54 points, I'm in that ONE trade most of the day...therefor no time for me to get stopped out. I went over everything and the results are real, just to great for me to expect. Im sure the same is true about shitty days too, as I saw in the first day. Coupled with my more precise entries (thanks to SB's advice), waking up on time (cost me 13AVG points last week) and a few other things= some great results. The entry adjustment was all PA based of course, so no accidental curve fitting (Im always leery of that). Anyways I look forward to next week. BRING IT NQ! Whew. I'm tired.

 

Results for 7 days testing: +102 points :o

[AgeKay 10]

Very interesting results, especially the first day. But that does not seem to be a big deal considering how small your losses are compared to your winners. Glad you found a strategy in such a short amount of time that seems to be working for you. I am interested how you manage your stops, do you move them up to your first target once it's hit?

 

P.S.: You forgot to attach the screenshot of 10/15 to your post.