Jonbig04's Log

[jonbig04 10]

[jonbig04 10]

[jonbig04 10]

[JBWTrader 10]

Bang on JonBig04 !!

 

Well done on the pre analysis and execution of the real deal...!!

 

All the Best

John

[jonbig04 10]

Thought I would go over the entry since that's what I'm working on. There is some interesting action on the larger TF that I will go over later.

 

[jonbig04 10]

[jonbig04 10]

Just some more foresight analysis. Marking my trades and explaining my reasoning for them in foresight really helps me keep everything in perspective.

 

Not that arbitrary time frames like days, weeks, or months matter, but I'm hoping to really smash my goal this month. I'm at or near +20ES so far, so one more good trade will really send me over the top. Its exciting not because its a good month (month being a random time frame really), but because I'm making trades this month that I wouldn't have made last month. That is exciting for me.

 

[jonbig04 10]

A wild day. The market yet again found R at the upper end of the range and made a perfect double top at 98.5, forget the assymetric first peak. Technically the DT confirmed, but did it really? Check the zoomed in view of the action at S.

 

A massive vol spike, and price takes the S at 77.5. But as you can see, the buyers came in and pushed back to S within 4 or 5 minutes. Not what I call I break out. To me, it looks like a stop run. Everyone and their grandmother had their stops below 77, and they all got owned. So what to do?

 

There doesn't appear to be any real acceptance below 77.5 besides the spike, leading one to think that maybe S is at 77.5 still. Then again, price has stalled at 77 (price doesn't move right now anyway though) maybe the sellers will try to flip it to R? Who knows. I'm going to wait.

 

If price drops and makes a lower low, that will suck becasuse I won't catch any of it, but at least we got to see the DT pan out. If price rallies back up into the range I will just pretend like this spike doesn't exist, keep my S at 77.5 and wait for price to break below it again, hopefully with real conviction this time (though I will be more cautious shorting below 77.5, really would have to see buyers laying down). The good news is that our double top is gorgeous and there could be a nice BO to the upside if price breaks 98.5.

 

[jonbig04 10]

Market bitch slapped me today. I took 2 stops. Oh yea, this is why my average R/R is 1:7 lol.

 

Anyway the first trade looks stupid, I basically shorted the LOD :doh:. When you're trying to play a break out below S, thats always a possibility. Sure makes you feel like an ass though haha. Basically the market found S again at same spot in found it yesterday (in that big spike), right around 1072.50. But price stalled after headed back down. Some volume came in and buyers started to lay down, I shorted and they came back with a vengeance and owned me. Bastards. I then shorted the previous R around 1080 and actually got a good entry, but buyers wanted it back up into the range so I got owned again.

 

I probably should have waited for a little more confirmation on the BO play, but its a risk I was willing to take. The other short I am ok with too, just didn't pan out. Stupid day to short haha.

 

We're almost back up to the top of the range. Hopefully this end will be a little more cooperative. I'll me looking for shorts up here and keeping an eye out for a potential BO if price takes 98.5.

 

[jonbig04 10]

Took a stop and a B/E. Darn whiplashing market.

 

[jonbig04 10]

[jonbig04 10]

Can't seem to catch this break down. Every time I short I get shaken out some how some way.

 

 

[brownsfan019 17]

Jon - from a risk management perspective, have you looked at or tested how many bullets to fire before you just shut it down? For example, I will take 3-4 trades per market and that's about it. If I can't get in sync w/ the market after 4 trades, I'm obviously wrong that day. It's purely a risk management technique, nothing to do with the trade setup. I know my setups work when combined with some risk filters.

 

This is also a reason why I do not exclusively focus on 1 market and 1 market only. If I'm not feeling it in market 1, I have plenty of others to pick up the slack.

 

Just an observation b/c I've been where you've been on this recent chart - while in hindsight it looks like your level is a good level, it's easy to buy/sell/buy/sell repeat process till you just get tossed around.

[jonbig04 10]

Jon - from a risk management perspective, have you looked at or tested how many bullets to fire before you just shut it down? For example, I will take 3-4 trades per market and that's about it. If I can't get in sync w/ the market after 4 trades, I'm obviously wrong that day. It's purely a risk management technique, nothing to do with the trade setup. I know my setups work when combined with some risk filters.

 

This is also a reason why I do not exclusively focus on 1 market and 1 market only. If I'm not feeling it in market 1, I have plenty of others to pick up the slack.

 

Just an observation b/c I've been where you've been on this recent chart - while in hindsight it looks like your level is a good level, it's easy to buy/sell/buy/sell repeat process till you just get tossed around.

 

 

 

Thanks BF, and I know what you mean. that 57 level got chopped by opening volatility and now seems to be useless.

 

I still feel alright about the trades though, at least for now. 57 had been S that previous day and it bounced enough for me to buy it. When that trade was stopped I assumed a bigger break down was in store. I shorted hoping to ride some momentum, but was able to get out quickly when none really showed up. The lack of momentum lead me to believe price wanted to retest 57 from underneath, hence the other short. I was surprised when that didn't work. The market opened a few minutes later and chopped up the level. I don't know if it was because of the open or not. Anyways, for better or worse that was my train of thought. Sucks staying up all night and having nothing to show for it!

[brownsfan019 17]

Thanks BF, and I know what you mean. that 57 level got chopped by opening volatility and now seems to be useless.

 

I still feel alright about the trades though, at least for now. 57 had been S that previous day and it bounced enough for me to buy it. When that trade was stopped I assumed a bigger break down was in store. I shorted hoping to ride some momentum, but was able to get out quickly when none really showed up. The lack of momentum lead me to believe price wanted to retest 57 from underneath, hence the other short. I was surprised when that didn't work. The market opened a few minutes later and chopped up the level. I don't know if it was because of the open or not. Anyways, for better or worse that was my train of thought. Sucks staying up all night and having nothing to show for it!

 

I know what you mean - I shoulda just stayed in bed today. But it's the cost of doing business and you take the losses/scratches with the gains and move on. As long as those losses are reasonable, it all works out in the end.

 

Good work on the journal.

[jonbig04 10]

No trades in the past few days. Some levels got chopped up and I'm waiting to see what ones form around here. We had a mini DB today. I don't trust the level enough to try longs there, but I will short if the DB fails with momentum, only because I can easily get out if the selling slows down.

 

Other than that, just watching and waiting,

[jonbig04 10]

haha too bad I didn't get long at 26! Oh well.

 

[jonbig04 10]

[jonbig04 10]

 

[jonbig04 10]

kinda annoying bc i've been planning on this break down for a few days and wasn't able to capitalize, but I think I;ve made the necessary adjustments. Also working on some intraday stuff.

 

[johnjohn1hew 10]

Hey jon, have you ever tried to dissect these larger timeframe moves using a 1 min. chart? I know that when i see an opportunity in a 15 minute chart, all i have to do is look at the 5 min and/or the 1 min and i spot entry opportunities. Also, it is extremely hard to call tops and bottoms (it's basically predicting), so why be contrarian? Why not go with the flow? I always assume continuation and then go from there. When a DB or DT forms, you should wait until the pattern actually indicates a reversal (ie. breaks past the midpoint and stays past it).

 

Another point: if you want into a breakout for the long run, then why not wait for a retracement/pullback back to see if prior support will act as resistance. Your stop is then protected and you have a high-reward-low-risk trade.

 

And another: wait for multiple confirmation - It decreases the risk. Use things like trend lines, candle patterns, volume (higher on BO, low on pullback), s/r levels (swings, long-term levels, etc.), market internals, etc.

 

If this method you have been using is not working out for you then drastically change everything. You're a young guy and following this specific method could cause you to just give up...something that i am pretty sure you do not want to do. Send me a PM if you are interested in some of the materials that i have been collecting that i think could help you (i'm looking for a partner in my research).

 

Note: I am just a beginner, so just take these things as suggestions, and not as the answer to making money.

Edited November 22, 2009 by johnjohn1hew

[jonbig04 10]

I use a 5 sec and a 10k CVB chart, but i haven't been taking advantage of them as much as a should.

 

I'm not sure if you saw, but I am going to join thales thread and try to work in what he does into my trading. I'm not going to over-haul everything. I don't think the money made over the past 4 months has been luck, but I'm getting hosed this month and would like a smoother equity curve and over all more consistency.

[jonbig04 10]

Oh sorry, about the break out setups. You are right, sometimes (about 25% of the time it seems) price does flip the level before continuing downward. The majority of the time though price has enough momo to just go and never look back. If I were to wait for the PB I would miss the majority of the BOs (keep in mind these are larger time frame BO's and my targets are no less than 10-12 ES).

 

With this in mind, typically I just get in on market and wait for the momo to carry me along. But the last two times the setup occurred, that didn't work and waiting for the flip would have been the way to go. two missed trades is around 20ES net to me, so naturally I started to look and here's what I'm going to do on that particular set up:

 

enter aggressively as soon as it starts to break out even a little. This entry will be in case the momo kicks in. If so I will be along for the ride. If momo doesn't come and price just lies there, I exit (usually for a loss of 2-3 ticks). I then wait to see if it flips the level and enter there, or enter when it makes a HH or LL. This will enable me to catch the rapid break out as well as the ones that want to retest before they break down.

[johnjohn1hew 10]

Say if price breaks out on a 10,000 vol chart and then pauses a little, this may be just a single 10,000 vol. bar above the s/r level, but in, say, a 30 second chart, this could be a consolidation (digestion) of the BO and following this congestion a possible continuation. Also, maybe the 5 second is too fast. I read that Anek advised traders to master the 1 min. before trying to read the 5 second (his idea of the tape).

 

 

Here is a quote i got from a market profile thread on TL:

 

"Pull backs in an uptrend are healthy just like rallies in a downtrend are healthy. Why? Because that's the markets way of digesting big moves, allows profit taking, and also allows weak holders of stocks/contracts to exit the market and turn it over to traders/investors with more conviction that aren't going to be shaken out easily.*"

 

So, if a pullback is on lower volume, there is not much interest in the downside and very few traders are putting supply onto the market (but this has to be observed in terms of effort and result - ie. vol.'s effect on price).

Edited November 25, 2009 by johnjohn1hew

[jonbig04 10]

Say if price breaks out on a 10,000 vol chart and then pauses a little, this may be just a single 10,000 vol. bar above the s/r level, but in, say, a 30 second chart, this could be a consolidation (digestion) of the BO and following this congestion a possible continuation. Also, maybe the 5 second is too fast. I read that Anek advised traders to master the 1 min. before trying to read the 5 second (his idea of the tape).

 

 

Here is a quote i got from a market profile thread on TL:

 

"Pull backs in an uptrend are healthy just like rallies in a downtrend are healthy. Why? Because that's the markets way of digesting big moves, allows profit taking, and also allows weak holders of stocks/contracts to exit the market and turn it over to traders/investors with more conviction that aren't going to be shaken out easily.*"

 

So, if a pullback is on lower volume, there is not much interest in the downside and very few traders are putting supply onto the market (but this has to be observed in terms of effort and result - ie. vol.'s effect on price).

 

I agree, low vol pullbacks are straight out of Wyckoff. Though I've always had trouble quantifying the concept. The BO's I look for are BO's on a large time frame, usually 30kCVB ES. You could enter on a PB, if one happens. I prefer to try to get in when it starts to break out.

 

You're right, the 5 sec is a bit fast. I'm actually switching to the 30 sec for my other trades, but I like it for the BO's bc it is like tape. You want to see buyers or sellers get pounded relentlessly-which shows up as a bunch of HHs or LL on the 5 sec w/ vol expansion.

 

A good example of this is in thales thread today, someone posted a chart of oil's BO to the upside. If you look at it you will see why I tend not to wait for the PBs in that particular scenario.