Jonbig04's Log

[MidKnight 12]

Hi John,

 

I'm no ES trader, but in two markets I have studied in detail, the Nikkei 225 and the Hang Seng (in particular N225) - probes through obvious S/R are a near certainty. It is rare to not have it probe. The probes are necessary because they take players out who use the prior pivot as a natural stop area, they sucker people in to play a breakout, after the probe occurs it needs to attract participation. From my studies, most of the time the probes do not.

 

Have you studied this on your charts? Maybe you will find that the probes occur more frequently and more reliably than your DT or DB patterns.

 

Just my

 

With kind regards,

MK

[jonbig04 10]

[jonbig04 10]

Hi John,

 

I'm no ES trader, but in two markets I have studied in detail, the Nikkei 225 and the Hang Seng (in particular N225) - probes through obvious S/R are a near certainty. It is rare to not have it probe. The probes are necessary because they take players out who use the prior pivot as a natural stop area, they sucker people in to play a breakout, after the probe occurs it needs to attract participation. From my studies, most of the time the probes do not.

 

Have you studied this on your charts? Maybe you will find that the probes occur more frequently and more reliably than your DT or DB patterns.

 

Just my

 

With kind regards,

MK

 

Thanks MK.

 

The bends/probes do happen often, but IMO they aren't a certainty. Even looking at the most recent chart above for example. Those lines were adjusted (the top R level at 1007.5 was moved down 2 ticks and the bottom S level at 90 was moved down 1.5ES I think) after the first tests. So omitting those (as real time they don't count) we have some good action.

 

Price touches 90 again and holds to the tick before taking off back to 1007.5. That R level is breached by only one tick before sending price down 7.5 ES. When 1007.5 is taken price does so with force (BO). It then falls and breaches 1007.5 again, but only to come back and retest for the flip which only bends the level by 1 tick before falling 9ES or so. Then price comes back and probes above it during globex (wiped out my short). After the probe price retreats dramatically all the way to 90 which is LOD to the tick.

 

So not counting the probe or the first 2 tests which were used to adjust the S/R line we saw 4 near perfect tests of S/R in the last 5 trading days. 940 and 955 were even better. So IMHO price usually tests S/R well, sometimes probes and sometimes flips. Of course nailing the trades is the hard part!

[jonbig04 10]

[jonbig04 10]

[jonbig04 10]

No trades today. Having some major tech issues. Cant even load a chart right now. I adjusted my R up to 15.75 this AM and I see that price has made it back up there. All I can really do is make a mental trade of it lol, which is ok as these first test trades are sim anyway. My stop is usually 1.5ES and targets usually around 10ES so I think I'll be able to get an idea of what would have happened if I had the placed the short.

[jonbig04 10]

Have to take care of some other business today, i'll only be around until 10:30EST. Sim short from 15.25 is still alive, targeting a lower low at 1002.5.

[jonbig04 10]

Finally got my charts back up. Only to see the breakdown I wanted from last night. Finally a good first test trade for +12.5ES. I'm keeping the first test sim trades and the real trades separate. When the end of the month comes I will evaluate them separately and decide if the first test trades should be taken live as well. Today is definitely encouraging regarding them!

 

Hopefully nothing further happens today as I have to leave, but I have my eye on a potential BO below 990. I still see 990 as S even though price probed below it last time.

[jonbig04 10]

 

[jmonday 10]

hey,

 

just a quick question, why did you dump NQ for ES?

[jonbig04 10]

hey,

 

just a quick question, why did you dump NQ for ES?

 

Thanks for following along. I could try to make a case for ES over NQ, but really one isn't better than the other. The main reason I switched was because I was learning from a great trader who was trading ES. It was easier for me to follow along. I find the action on ES 5 sec much easier to read due to the larger tick size, but the price is its not as granular as NQ. I find there to be overall less noise on ES.

 

I know a lot of you are following DB's examples and I think that alone is absolutely enough reason to stick to NQ. Just makes me a kind of loner.

[jonbig04 10]

Thread name changed

 

I started this thread when I was a few days shy of 21, I just turned 22. I've been at this for over a full year now. So that was somewhat misleading. Also, I'm no longer trading NQ. The biggest reason though is that hopefully the next year will be still a ton of learning still, but also a ton of implementation. So my entries will be more like a log than a 2 page summary of why I'm doing what I'm doing.

[jonbig04 10]

Got the BO I wanted to for +10ES, and took a stop sim

 

[jonbig04 10]

[jonbig04 10]

[jonbig04 10]

[JBWTrader 10]

Nice Work Jon !!

 

Best

John

[jonbig04 10]

Thanks JBW. Missed the BO long today though. Bah!

 

[JBWTrader 10]

Lol...Mate Our trading styles compliement each other...I got the long but missed the short that you got !! lol...

 

keep up the good work Jon, I like your style mate

 

Best

John

[jonbig04 10]

No trades today. Looks like the BO from yesterday is legit!

 

Quick note, for the past 2 weeks I have been sim'ing my first test strat, while taking the rest of the trades live. Even though I've only been doing it for 2 weeks, the strat has already proven itself. I knew it would, my S/R picking just had to get a little bit better. With these trades factored in I have surpassed my monthly goal. Anyways from here on out ALL trades will be live. Hopefully I can smash my goal even further within the next week.

 

I'll be looking for a short around 1015.75 again, or a DT around there.

[jonbig04 10]

[jonbig04 10]

Of course I don't have any levels up here, so I'll have to wait it out. It may be a while before I get to place any trades. Only possibility is a long near 15.75 and that seems increasingly unlikely.

[jonbig04 10]

 

Since it seems picking S/R is as much the key to trading as anything else, I figured I would share my thought process behind it in foresight. For right or wrong, its just what I do. Plus it helps me to write down all the basic stuff so I don't get too complicated and stay grounded in what I'm doing.

 

I mentioned I didn't have any levels up here, well I'm about to and here's why:

 

The first thing I do is start big. The big chart is a 30KCVB chart. Then just pick the obvious stuff. What's that? Well for 2 days price hasn't been able to break the area from 35-38ish. This area has caused some major retracements in the overall all uptrend of the past few weeks. Price touched A, the dropped 15 points. Touched B, dropped 13 points, touched C and so far has dropped 10 points. Thats what I mean about the obvious stuff. Now we can safely say that this 3 point area is major R. Duh, right? But for all the complicated stuff I see about trading it seems like people overlook this simple process. Or they write 90 pages about it so it becomes no longer simple.

 

Anyways for me 3 points is too big of an area. I need it to be more specific. So for that I zoom in on each test respectively using a 5 sec chart w/volume. The first test (A) we see R is at 1035 pretty much exactly. The next test though is more tricky. Price makes it all the way to 1038. But looking at this test and the volume we can see that this was likley just a volatility spike. 20,000 contracts in 10 seconds is a lot, even for ES. There was no real interest at 38 and likely no real value built between 35 and 38 at all. But price DID manage to get back up to 37, if only for a minute. To me this isn't enough time to build any real value above 35, but we really don't have to speculate because we have another test to look at in test C. In this test we can see that selling pressure kicked in right around 35, like the first test. Price managed to push up to 35.75 on the high vol bar.This reaffirms what we thought originally, that the B test up to 38 didn't manage to build any acceptance past 35.75 even though price made it to 38. So for me, I would put my R line at 35.50, but we aren't done yet. When price makes it back up here we don't have to short blindly, we can wait for the vol to kick in again and confirm for us where R is (which will likely happen right where we expect it to, but its just more confluence), but hey if it doesn't happen until 37, thats ok too. If we can get a short in there then we have just shorted R. It's worth noting that none of this has any bearing on whether the R will hold or not, but who cares? If it does hold we see the kind of move it can give us and since we hopefully have R pegged we don't need that big of a stop. All we have to do is hold our winners. If price does blow through the R, we still have the flip to play

 

NO we could have started to play this R level after the first test, or we could have after the second. Or we could wait for more tests. Really thats up to you, I chose to wait it out, but thats just me and what I did this time.

[jonbig04 10]

[jonbig04 10]