Jay's Journal

[jasont 10]

Ok first off I have decided to move my journal here because I am tired of seeing my journal in every entry of the blog section. I don’t think it’s fair for people wanting to check out others blogs and just seeing my journal there. This way I can post my journal here and the most spaces I take up will be one as opposed to just about every spot I am taking now in the “recent blog entries” section. I also was getting a bit stale and wanted to change things up a bit.

 

Right now I want to start off with an assessment of my trading and how it has been going. Things were doing ok until this week I made a number of bad decisions and earned myself a lesson in humility. In this game I really need to avoid thinking I have conquered it. It allowed complacency to enter my trading.

 

So to begin with I want to outline my statistics. All of them are made on a per contract basis. I don’t want increased size and/or decreased size to alter the purity of my statistics. So here is the overall picture below for my live account.

 

Total Trades: 155

 

No. of Wins: 69

 

No. of Losses: 73

 

Breakeven Trades: 13

 

Win %: 44.5%

 

Av Win Amount on winning contract: $68.48

 

Av Loss Amount on Losing contract: $-49.66

 

Risk/Reward Ratio: $1 Risked to make $1.37 (1:1.37)

 

The above picture isn’t too bad but it isn’t great. The average win amount in comparison to the average loss amount is ok, ideally I would prefer it to be in the 1.5-2.0 range but where it is I can live with. What is really irritating me at this point is the Win %. During my simulation trading and also whenever I do switch to simulation, my Win% is closer to 60%+. Now if that was the case here, the 1:1.37 Risk/Reward would be fine.

 

Overall I am ahead about 6.2% on my starting capital. I have made 21.1% profit with my trading but commissions have cut me back to 6.2%. Prior to this week I was ahead by 15.9% but took a rather irritating setback with only 4 of 16 trades being winners. Unfortunately the winners were not great so couldn’t salvage the situation. So this is where I stand on an overall basis.

 

If I break down the results a bit more I get a more interesting look on my trading. I don’t count the breakeven trades in my further looks as I only count winners and losers. Again the results are on a per contract basis so not to distort the bare facts. The results are as follows:

 

Short Trades

 

Short Wins: 29

 

Short Losses: 55

 

Win% on Short Trades: 35%

 

Average Win Amount on winning Short Trade: $72.41

 

Average Loss Amount on losing Short Trade: $45.91

 

Risk/Reward Ratio On Short Trades: 1:1.58 ($1 Risked to Make $1.58)

 

Long Trades

 

Long Wins: 40

 

Long Losses: 18

 

Win% on Long Trades: 69%

 

Average Win Amount on winning Long Trade: $65.31

 

Average Loss Amount on losing Short Trade: $61.11

 

Risk/Reward Ratio On Long Trades: 1:1.07 ($1 Risked to Make $1.07)

 

So I am faced with a rather strange dilemma at this point. I take way too many losses on my short trades for my liking. In fact I don’t have the same problem when I trade short in my simulation account. I also seem to be preventing my long trades from running their full course however it could be more a result of being in a downward market up to this stage.

 

I am trying to find a solution to this problem. I am in fact losing money with my short trades and making money with my long trades. Prior to this week I was close to break even with my short trades though which was a big improvement. I am unsure how I can fix it at this point but will work towards a solution.

 

Part of finding the solution is that I may revert back to recording my trading via camera. I believe my analysis most likely changes when I trade my live account. I can’t catch that when writing in my journal as I believe I probably filter my typing. On camera I can’t change my thoughts; I will just need to push myself to talk through my trades. I have done this in the past but it sort of faded off as I switched to writing. I couldn’t do so many things at once whilst trying to monitor the market. I also need to make sure it doesn’t slow down my trading platform.

 

I will look at ways to get it up on the net either through YouTube or something else. I will look further into it over the next couple of days and see how viable it is to do. I think I will be able to capture more through video with my trading. I want to take things a bit easier next week and refrain from over trading. Hopefully this can help.

[smwinc 20]

Nice Jason.

 

Working on the win % is easier than working on the av. winner vs av. loser, and you are doing well in that department.

 

Commission really is a bitch. Long term though you can do things about that, depending on the size you trade & your own situation - become a member at the exchange, volume-based commission pricing, etc. The S&P is really one of the most versatile markets out there as far as commission.

 

I would really recommend recording your trading. I heard from a friend a long time ago who used to do it, and started doing it. I would also talk out-loud to myself (yes, weird) why I was taking the trade.

 

It made it MUCH easier to see after a losing day what I was missing. Having the verbal reasoning at the time really helped.

 

Few questions:

 

What period is the above analysis done over? I.e. A month?

 

How many total round-turns do you average per month? I.e. If you traded 100 lots per trade, that's 100 round-turns per trade. If you traded 1 lot per trade, that's 1 round-turn per trade.

 

Your figures for Av Winner / Av Loser - is that including or not including Commission?

[jasont 10]

Thanks for the reply SMW. I agree that working on the Win% is a bit easier than the av win or av loss.

 

The commission side of it is irritating but if I think for the long term, it can be reduced and with increased size the actual gains get better though % wise they stay the same.

 

I have recorded my trading on camera in the past but found writing helped me enter trades according to plan a bit more. Now I have a different problem so I will go back to the recording to see if it sorts out my current issue. I think it will help me see things I cannot see when written down. It is good to hear from someone who has also done it and it has worked for them.

 

The above period is from late January this year. So I don't take too many trades, per month. In my first few days of trading I was 10% down on my account when I made a few platform errors. I would rather not mention how many contracts I trade as I personally don't want too much financial information on here. I will say that I'm not a huge volume trader, I currently am still using only a small portion of my capital to gain consistency at this point.

 

Thankyou for bringing up something I had overlooked SMW. The av win and av loss does not include commissions. The adjusted values below are av win and av loss including commission costs.

Av Win Amount on winning contract: $63.58

 

Av Loss Amount on Losing contract: $-54.56

 

Short Trades

 

Average Win Amount on winning Short Trade: $67.51

 

Average Loss Amount on losing Short Trade: $-50.87

 

Long Trades

 

Average Win Amount on winning Long Trade: $60.41

 

Average Loss Amount on losing Short Trade: $-66.01

[jasont 10]

Here are my zones for the 4th August:

Resistance

 

1263.25-1264.25

1271.25-1272.25

1278-1279

1284.50-1285.50

 

Support

 

1256-1255

1250.50-1249.50

1242-1241

1233.50-1232.25

 

My Outlook

 

Things are pretty mixed at this point. We seem to have found a choppy area in the NDX, the SP and DJIA seem to be doing similar but over a wider range. I'm not willing to take sides at this point as I am cautious that this could last for a while.

 

The VIX has settled its recent decline which could be a signal of further weakness entering the market. Again I am not willing to speculate on where it is heading at this point but will keep an eye out for some direction.

 

Oil has been finding an extended base recently which appears as though it is gearing up for another move higher. Gold has done similar but to a bit of a lesser degree. Last week I noted that we could see an attempt by Oil to run higher which may encourage another wave of selling. I will keep this in mind.

 

The USD is still looking like building strength more than finding further weakness. Things have been looking slightly better for the US economy but not as much as one would like for a kick start out of the recent problems. It still is in a very dangerous area and does risk further weakness at this point.

 

My Focus

 

Tonight I want to try to get some video of my trading. Hopefully of actual trades if it doesn't slow my platform down by too much. I was hoping to get a video up today of how I calculate my s/r levels but I am having trouble getting the right mix for compression. I'll work on it some more and go from there.

 

Currently we are trading at the 1260 area in the overnight market. 1250 is the area I would like to see hold up if the buyers are going to push the market higher. If we get down there I will be paying attention to the Tick and Volume for any buying signals. If we hit 1263.50 without showing some buying follow through we could see a move back down to the 1250 area.

 

I wouldn't like to be caught in the choppy range area from Friday so any trades around there will need to have some solid sentiment readings. I will pay attention to the 1255.50 area but placing any trades down there won't be my first option.

 

For me I want this week to err on the side of caution. After getting caught on the wrong side of the market last week, I would like to put more effort into my market analysis. I think Monday might set the tone for the rest of the week if we see a direction chosen. I am sticking to trades at s/r levels using both the moving s/r (EMA's if being respected) and areas I have identified already. I just want to let things flow a bit on camera so I can recognize anything that can be improved upon.

[firewalker 10]

Hi jason, have you thought of only trading the long side for a period of time?

What would your results be if you only took long trades? Probably a whole lot less trades and less losses. It would help get you more profits in, while you try to determine the cause of the problem with the short trades. There's no rule that says you must do both.

 

If, for some reason, almost 2 out of 3 of your shorts are losses (like in your stats), I'd say why continue taking those trades? Unless the numbers you gave were only from a short batch and not representative for the overall performance of a short trade. Also, you have 84 short trades but only 58 long ones (this is without the breakeven trades as you didn't make the distinction there whether is was a long or short position). So basically, I'd say you're shooting yourself in the foot,...

 

Also, given the fact that only 35% of your short trades are winners, you could try to determine a closer stop. Because the majority are losers anyhow, why risk more if you can set a tighter stop? That requires some testing and analyzing from the profitable short trades obviously.

 

Good luck!

Edited August 4, 2008 by firewalker

[jasont 10]

Thanks FW. I am currently switching back to trading the short side in simulation and the long side in my live account. I did the same thing a few weeks back and it was a big improvement. My short trades were better and my live account didn't suffer from poor short trades. I thought after a week and a half I had identified the problem as entering too early but there seems to be more to it than that.

 

I think I have more short trades than long at this point because we have seen an extensive downward period recently. The opportunities for long trades had been less than for short trades. You are right about shooting myself in the foot with short trades though.

 

I am going to take your advice and analyze my simulation short trades whilst trading the long side live. I don't want to remove short trades all together as I think it would put an emphasis on looking for bullish biases. I have seen that I can trade the short side very well in simulation, I just need to figure out what changes when I switch to Live. I do get the feeling I look for trades more when I trade live than when I trade simulation.

[firewalker 10]

I think I have more short trades than long at this point because we have seen an extensive downward period recently. The opportunities for long trades had been less than for short trades. You are right about shooting myself in the foot with short trades though. .

 

Yes that's probably one reason. But I'd say be careful when looking at the big picture and trading intraday. I was so focused on the short side in the beginning of this year, that I let a lot of long trades slip through my fingers. I remember somewhere somebody saying that there are more up days then down days in a bear...

 

I am going to take your advice and analyze my simulation short trades whilst trading the long side live. I don't want to remove short trades all together as I think it would put an emphasis on looking for bullish biases. I have seen that I can trade the short side very well in simulation, I just need to figure out what changes when I switch to Live. I do get the feeling I look for trades more when I trade live than when I trade simulation.

 

Most of the time there are opportunities for shorts & longs, even in bear market mode You're right, beware of having too much bullish bias...

[jasont 10]

For those who have been following my journal since I began this year I wanted to say thanks for the support and feedback you have offered. The likes of FireWwalker and LiggerPig in particular.

 

At this point I am going to take an indefinite break from posting my journal in a forum. I currently am feeling a bit of burn out from writing the journal with the intention of posting it here. Last night I found in my video journal that I was holding back personal opinions and thoughts on the market due to knowing I would post it up. This is not the way I would like to be approaching my journal and feel it has lacked the substance necessary to provide further growth.

 

I am still going to continue my journal but I will be keeping it private at this point. I feel it is the best way to get the most natural thought process out of my trading and to stop thinking in the back of my mind as to how something sounds. Somewhere along the lines I believe I stopped making the journal for myself and made it for the sake of the journal.

 

Originally the journals purpose was to make sure I remained consistent with my plan. Now the journal needs another purpose which is better met when I keep it for myself, that way I won't refrain from comments.

 

It may be a week, a month, six months, before I return to making the journal public if at all. I may decide after a week I need to get back to it. I'm not sure and I'm not going to make any plans at this stage. I may post updates here but at this point I just feel its best to work on it solo for a while. Again thanks to all the guys who offered some great advice and support as it made a lot of difference.

[firewalker 10]

For those who have been following my journal since I began this year I wanted to say thanks for the support and feedback you have offered. The likes of FireWwalker and LiggerPig in particular.

 

At this point I am going to take an indefinite break from posting my journal in a forum. I currently am feeling a bit of burn out from writing the journal with the intention of posting it here. Last night I found in my video journal that I was holding back personal opinions and thoughts on the market due to knowing I would post it up. This is not the way I would like to be approaching my journal and feel it has lacked the substance necessary to provide further growth.

 

I am still going to continue my journal but I will be keeping it private at this point. I feel it is the best way to get the most natural thought process out of my trading and to stop thinking in the back of my mind as to how something sounds. Somewhere along the lines I believe I stopped making the journal for myself and made it for the sake of the journal.

 

Originally the journals purpose was to make sure I remained consistent with my plan. Now the journal needs another purpose which is better met when I keep it for myself, that way I won't refrain from comments.

 

It may be a week, a month, six months, before I return to making the journal public if at all. I may decide after a week I need to get back to it. I'm not sure and I'm not going to make any plans at this stage. I may post updates here but at this point I just feel its best to work on it solo for a while. Again thanks to all the guys who offered some great advice and support as it made a lot of difference.

 

No worries jason. Don't stay away for too long, I'm sure you'll make the progress you want to.

We'll see you around

[smwinc 20]

I would rather not mention how many contracts I trade

 

 

No problem, I understand. I was only asking with the thought of the number of round-turns you do per month, to suggest considering switching to a volume-based commission rate.

 

If you are doing more than 300 round-turns a month, it's worth having a look (through a broker like I.B).

 

I know broker's like Infinity are negotiable as well. The first day I had my account open with them, after trading the DAX they literally halved my commission rate. Always worth checking.

 

Good luck

[jasont 10]

Thanks for the well wishes FW. I'll still be around the forum and most likely the chat room so I'll see you round the traps.

 

Thanks for the help SMW. I'm not trading 300 round turns per month so for the moment I have to just stick with the commissions. In all honesty futures commissions aren't that bad retail, at least they are less than the cost of one tick. Thanks for the help mate.

[jasont 10]

When I last posted in this journal I was coming up against some strange changes in the market, notably the feel of it seemed somewhat different to the market I was used to. Things I normally looked for were not working so I slowed my trading down quite extensively and began searching for answers.

 

Oddly enough the market since the beginning of this week has resumed its previous tune and appears to be trading in a way that I understand. It has been brought to my attention that we have seen the occurrence of Summer doldrums coinciding with apparently 5 year lows in volume. I’m not certain but I suspect the volume change in the market meant that the regular big traders in the market were away. Apparently the last two weeks of August are normally holiday period for the big players as well. So what this tells me is that the regular guys I trade according to had disappeared and the market was left to what I would rate as strangers.

 

I’m not sure what others say but I personally believe markets have their own personalities which are built around the major participants as a whole. Therefore if you change the regular participants you get a change in personality which I am attributing to my recent troubles and concerns in the market.

 

Unfortunately the slow down in my trading has resulted in me needing to learn the market again. So as the saying goes, it’s time to get back on the horse. I have made a few adjustments to my trading which I believe will be beneficial to my plan however I am yet to test them. Therefore the next few weeks are going to be very slow for me in the market as I focus on getting my awareness of the markets back and trade simulation until I am happy with my results.

 

The changes I have made are not dramatic changes, I was playing with the idea of making major changes during August but once I saw how we were tracking this week I opted to make minor adjustments. Concerns for me prior to August were that my entries needed improved timing and my exits needed a more solid approach to pulling the plug when things weren’t going like I would want to see.

 

Those concerns remain, however I have adapted my plan to utilise a smaller timeframe for the NYSE Tick and the ES chart to zone in on better timing. I still will mainly use the 5 minute chart and 5 minute NYSE Tick for the broader trend but am now placing more emphasis on the 1 minute chart and 1 minute NYSE Tick. Previously some of my best trades were divergences between the 5 minute ES chart and the 5 minute NYSE Tick chart. The downfall of the 5 minute timeframe is that over a period of 3 hours one might only get one trade opportunity. That is a bit of an irritation when I see maybe 3-4 possible trade ideas during that time.

 

Over the past week I have noticed that the 1 minute chart provides numerous divergences to the 1 minute NYSE Tick. Granted not all of them result in a change of direction but the 5 minute chart is a big help in distinguishing which ones are most probable. The reason I place such an emphasis in my entries upon the NYSE Tick is that it is a representation of the underlying asset to the Futures. Oddly enough I find the NYSE Tick tends to lead the ES in many instances. Odd considering the ES is futures yet I’d be inclined to say it lags the stocks rather than leads them.

 

The 1 minute chart and 1 minute NYSE Tick will help fine tune my entries with divergences, that helps to solve my first problem. My second problem was clear guides to exiting a trade prematurely. Simply saying it wasn’t looking right didn’t provide me with a measurable tool to define performance. In other words exiting because it didn’t feel right was hard to get at the core reasons why I would exit prior to my stop being hit. I will admit, I dislike my hard stop being hit. The market usually gives clues to its direction before reaching my hard stops and I needed a way to define that. For that the 1 minute NYSE Tick has been showing promise. Drawing trend lines on the NYSE Tick actually helps me see if the sentiment is shifting prior to my stop being hit. When trend lines are breached on the NYSE 1 minute Tick, the ES usually lags. This often provides a window of opportunity to exit with a small gain or loss.

 

So they are the changes I have made, rather small but they seem to be what I felt my plan was currently missing. In general my main focus still remains with the 5 minute chart and s/r levels. I will be watching the 5 minute chart for reversals and retracements and once identified I will consult the 1 minute chart and Tick to zero in on my entry should the guide’s line up. Over August I switched to simulation mode for a lot of my trading and have developed a tendency to over trade. Funny because previously I had a problem with under trading.

 

This pretty much sums up where I am at right now. I will come back to the public version of my journal on Monday. I will admit my discipline has declined since leaving this journal so it is best for my growth to get back into the routine and make things happen again. Over the past couple of months the chat room helped me reduce overtrading but now it has produced a problem of reduced attention span to the markets. Instead of watching the chart for an hour non stop I flick between the chart and the chat room every 5-10 minutes. Kind of like seeing every 5-10 minutes of a movie and then missing 5 minutes. You get the general idea but you’re just not absorbed by it. Therefore I am taking some time just to watch the charts without distractions. This should get me back to my regular self as soon as possible.

[jasont 10]

My journal is going to take a slightly different format to how it did previously. I am going to refrain from publishing my support and resistance areas and doing a daily outlook. Instead I am going to do a weekly outlook prior to each trading week starting. I will then place notes of interest during the week should something change from my early analysis.

 

The actual journal will be more analysis related and less of my personal thoughts placed into the journal. I am still recording videos which are used for that purpose where as the written aspect which I will be placing here is strictly market concerned. Mixing the two together in journals makes things a little mixed. Things may change as I go along but this is the general gist for the moment.

 

Analysis for the week beginning 8th September

 

Seems like the weekend news regarding Fannie and Freddie being taken over by the government has caused quite the stir. We are currently trading 35 points above Friday's close. This will make for an interesting open on Monday.

 

The Indexes have reached an interesting point. After a rough week being pushed down the Sp, NDX and DJIA managed to muster up some buying into the weekend. Combined with the weekend news (coincidence there was this heavy selling followed by buy up on Friday?) could be what the market needs to push us out of the recent market woes.

 

The VIX has made a decent run higher but was cut short on Friday. Should the market decide to pick up some strength right now it would be likely that we see the VIX begin to decline. Doing so would help add weight to the theory that the market may have a bottom in place, even if temporary.

 

Gold and Oil have both made heavy declines over the past 1-2 months. This has helped reduce the inflationary pressures on the market. Good signs for equities as it puts more cash in their pockets due to reduced operating costs. At least the ones relying on Oil for operations however most commodities are seeing a decline.

 

The USD has also had a nice 1-2 months though the speed of the recovery is a concern. We do appear ready to make a pullback here according to the charts however I will wait for the charts to show me that rather than anticipate.

 

So for this week I am on the lookout for early weakness to encourage some further buying. The big gap weekend will leave many traders behind wanting to close out positions. We may not necessarily close the gap we have created but some healthy selling into it to get more traders on board would be something I am on the lookout for. Should we fail to slow the selling down beneath the 1240 area I would be suspect of the long side.

 

The other side of the coin is an early run for 1300. If that is the case then the market is stronger than I initially thought. Any shorts during that time would be very tight if that is what we see. It will be interesting to see the effect the F&F news has on the market during the market hours. In the past we have seen big ticket news tends to change the direction of the market at least for the intermediate term.

[jasont 10]

Trading For 8th September:

 

9:17 Market roughly 36.75 up at this point. 1282 seems to be holding in the pre market as decent resistance. Something to keep an eye on. No major news releases today.

 

9:27 Entered short at 1278.25 in the direction of the trend here from the 1-2-3 top on the 1 minute chart. Stop at 1279.50, would like to see the market drop prior to the open though. Only in half position due to pre market trade. Looking for some sort of early weakness here that we might be able to buy into.

 

9:30 Bringing stop down to 1278.25 prior to the open. Currently trading at 1276.50. Don't want to risk anything other than break even on this. Support area at 1273.50 which need to keep an eye on.

 

9:33 Stop taken out at 1278.25. Break even trade.

 

9:39 Hitting 1273 support area now, volume picking up as we trade into it. Tick declining currently. Coincides with pre market uptrend.

 

9:42 Have cut through the 1273 support area with Tick declining also. Pre market uptrend no longer holds.

 

9:47 First bounce for day, showing increasing volume as we rise. Had volume extreme as we hit the bottom.

 

9:52 Tested a long trade at 1269.25 and got out at 1268 as it was not slowing its decent. Was according to the plan. 1.25 loss was good that I got out prior to stop being hit at 1267.50.

 

10:01 Hitting the 1262.50 support area. Divergence showing up on the Tick currently with volume extremes on the 1 minute chart. In at 1264.75 after taking another 1.25 loss earlier at 1265.25. 1st profit target at 1266.50 is taken now. Rest moved up to break even.

 

10:07 Took other half off at 1268.25. Will wait for next pullback to jump on board further upward movement. Currently now back to breakeven in positions.

 

10:15 Entered long at 1267.50 for retracement trade off 1 minute. Out at 1266.75 for 0.75 loss. Maybe a touch early on the entry.

10:23 Took a short trade at 1265 which was impulse trade. Took a 0.75 loss on that. Entered long as a reversal for the 1-2-3 retracement at 1265.75. 1st target at 1267.25 taken will leave rest to ride. Stop moved up to 1265.75.

 

10:27 Divergence appearing on 1 Minute chart. Stop taken at 1265.75.

 

10:30 In long again at 1266.50 looking for this move to finally get some balls. 1st target taken, second half moved to breakeven.

 

10:32 Sold out second half as we dropped beneath the 1 minute tick trend at 1267.75. Volume rose on the move up steady, may be out too early.

 

10:47 Pulling back from 1272 after 1 min tick divergence. Suspect it's retracement in further buying. Will keep an eye on trends for further buying opportunities.

 

10:49 In long at 1270.25 out at 1269.25 almost instantly. Possibly way too early on this. A move to the 1267.50 area is more likely a point to see some further buying interest.

 

10:52 Hmm big selling just came in and brought us back to the support area. Interesting, Tick showing declining stocks at this point. Massive volume also came in apparently out of nowhere, shaking out weak longs possibly? Covering longs? Maybe further selling strength?

 

10:56 In long at 1263.75 for Tick divergence on 1 minute at support with volume extreme and ema support. Brought stop up to breakeven on second lot and was taken. Lot of traffic here.

 

11:00 Selling is extremely powerful here. Moved from 1270 to 1252 in less than 15 minutes. Tick making numerous extremes, volatility is way up. Not safe for 1-2 points stops at this stage. Best waiting for things to quieten down.

 

11:07 Snuck a point gain on half position as we retraced on lower volume after the big reversal.

 

11:30 Hmm had a period of undisciplined trading going back and forth. Fortunately didn't do much damage, still ahead but down if including brokerage. Market currently has potential 1-2-3 bottom forming. Tick yet to make new low for day, possibly selling pressure may have exauhsted itself during the big drop. Currently following a downtrend on the 1 minute chart. Volume showing higher traffic during downward swings.

 

11:37 In long at 1260.25 for 1-2-3 bottom pattern. 1st target at 1261.25 taken. Stop on 2nd half at 1258.75, placed beneath the recent uptrend that developed. 2nd Position taken off at 1259.25. Whole trade break even. Hmm.

 

11:44 Took short trade after the 1-2-3 bottom trade failed. In short at 1258 and out both positions at 1256.50. Seems like we are chopping up right now, best taking small gains rather than looking for big trades.

 

11:57 Well time to call it a night. Ended the day up 1.25 points, that's a positive but with 27 trades. Not exactly stellar performance but I guess it gives me something to work with. Some good elements were in there which I can work on and help strengthen my trading from here.

Daily Wrap Up

 

I much rather trade too much instead of not trade enough, if I had the choice between over trading and under trading I'd take over trading any day. At least that way I can see what needs improving.

 

So today saw me take many more trades than my plan allows however I did pretty well with my trade management. I was able to keep stops tight and on most occasions jump out of losing trades prior to hitting my hard stop. Although I am trading simulation right now it is good to see me taking more opportunities. Now I just need to narrow it down to only the best ones.

 

In my statistics today I took 20 long trades and 7 short trades. That is an indication of me looking for the reversals in the market more so than the continuations. Not surprising when my short trades had 5 winners and 2 losers where as my long trades had 9 winners and 11 losers. Overall I lost profits with my long trades but made profits with my short trades. This is the opposite to what I am used to.

 

In general my short trades that provided the best returns were the ones I entered late on rather than trying to sell into the buying pressure. Something that I need to keep in mind with my short trades. I often and entering on the short side much too early and this is a great example of waiting for stronger confirmation on the short side.

 

On the long side I was riding a bucking bronco. At one point I was ahead by roughly 4 points but kept going, at least I am learning from this experience and getting the trigger hesitations out of the way. My best long trades came at points I would ordinarily identify as turning points on the 5 minute chart. That is something I can work on for tomorrow that I feel with improvement will make a big difference with my trading. I gel best with the 5 minute chart so watching that predominantly often keeps me out of less probable trades. Today I watched the 1 minute chart predominantly and it resulted in many more trades than is ideal.

 

So for tomorrow the emphasis is placed on watching the 5 minute chart and once identifying 5 minute chart setups, consulting the 1 minute chart and 1 minute tick for timing the entry. Doing my best to stick on the right side of the trend is also my aim unless of course looking for a reversal.

 

I'm not going to put down each individual trade, the end result was up 1.25 points but brokerage would have left me down overall. I am now aiming for the same or more in point gains but with less trades.

[brownsfan019 17]

I am now aiming for the same or more in point gains but with less trades.

 

That was probably one of the best things I did for my trading - trade less, make more, be happy.

[jasont 10]

Goals For Today:

 

Spend 60% Or More Of My Time Watching The 5 Minute Chart

 

Make 5 Or Less Trades

 

Well each day I have set everyday goals I try to achieve in my trading and each day I come up with two extra ones which will help me focus on improving from the previous day. Today the focus is on watching the 5 minute chart predominantly and switching to the 1 minute chart when a set up appears according to the 5 minute chart. Making 5 or less trades is to encourage me to trade according to plan. The less impulse trades the better. 5 Trades is plenty for my plan when I follow it in a disciplined manner.

 

8:38 The overnight market has seen a rise of roughly 5 points. The plan for today is to be on alert at yesterdays high. Ideally we would see a break of yesterdays high and stop short of the 1300 area to gather strength to maybe test it either late today or possibly tomorrow. Should we pull back from yesterdays high I will be looking for strength to kick in prior to reaching the 1260 area. I am on the bullish side at this point but will not count out a consolidation day today after yesterdays excitement.

 

9:36 Market in sell mode from the open. Approaching 1260 area now. Tick is negative, volume decreasing as we moved lower.

 

9:47 Bounced from 1258.50 and now at 1266. Tick gaining strength, uptrend steep but looks strong at this point. Waiting for pullback in which to enter. Hitting premarket downtrend line.

 

9:59 Damn, jumped in a short trade just now at 1267.25 as we had divergence from the Tick and declining volume on the latest leg up in the higher move. We were trading rather quickly and then I looked at the time. Realized I hadn't checked for news. Took trade off at 1268.50 for 1.25 loss. Good trade but forgot to check news.

 

10:02 Entered short agani after the news at 1266.50. 1st target taken at 1265.50 stop moved to 1266.50 on 2nd position. Going against general trend here so may not last long. Stop hit with some slippage of 0.25 point.

 

10:23 I tried to buy this market a touch early and took a 1.5 point loss. Entered at 1261.50 and out at 1260 which was our low point. Got in again at 1261.50 this time 1st target was hit and now am trailing the second position.

 

10:26 Took second position off at 1260.75. Market failed to continue higher.

 

10:37 In long at 1256.75. Reason being the Tick extreme with volume extreme and Tick divergence on 1 minute chart. 1st target at 1258 taken, stop moved up to 1256.75. Keeping eye on Tick for clues to sentiment. Stop taken out.

 

10:51 Currently tick is residing under the zero line indicating a downward trending day. Only problem is that it hasn't been a steady trend. Need a decent sized bounce to allow me a possibly entry on the short side.

 

11:03 In long at 1249.50, for bounce from support with Tick Div and Vol extreme. 1st Target taken at 1251. Trailing stop at 1248. Stop now moved to break even. If moving higher first area of resistance at 1256. Took exit at 1251.25 as we hit downtrend and Tick failed to break zero area.

 

11:08 5th trade for me so I'm calling it a night for placing trades. Will watch the market for the rest of the night without comments or trading.

 

Daily Wrap Up

 

Today was in fact a big improvement upon yesterday. I spent more than 60% of my time monitoring the 5 minute chart which resulted in me not getting caught out with over trading though originally I thought I had traded 5 times it was in fact six. Forgetting to check for news releases today was a simple mistake. The original entry had everything going for it as we were hitting resistance on declining volume as well as seeing some Tick divergences occurring and a contraction of volatility. It also happened to be at the days turning point which lead the way back down for the rest of the day.

 

Had I remembered the news release I could have waited for the release and then waited to see if we would break the resistance area and then entered short. I will admit it did fluster me a bit when I forgot that I didn't check the news announcements for today.

 

The rest of the day had me looking for bounces, the first one at 1260 was trying to find a possible reversal for us to make a shot at yesterdays high. We couldn't muster up the strength for that so then I found myself buying pauses as we moved lower waiting for a decent sized bounce to short into. We did eventually see one at 11:30am however by that time I had called it a night.

 

The other trade that stood out to me for following my plan well was the one at 1249.50. At that point it was good I had picked up on the fact we were registering a Tick Divergence after making a Tick extreme and volume extreme. Showing the selling of stocks was at least temporarily waning. We were also close to the 1247 support area which was another reason to jump on board. I picked up that the bounce wasn't solid early on and managed to get out for a small gain.

 

Overall I was happy with the day, a few things went against me but I managed to bring myself back from being down 5 points to up half a point. Brokerage on the six trades again would outstrip any gains but it was an improvement upon 27 trades from yesterday. I found it difficult to find a good entry on the short side once we had begun moving but I am happy I was aware that we were down trending and not giving my long trades much room to breathe. For following my plan I give myself a 7 out of 10. The biggest improvement for me today was watching the 5 minute chart the majority of the time and then using the 1 minute chart to time my entries.

[jasont 10]

Trading For 10th September

 

Does yesterdays price action change everything or is it an accumulation period? Volume reached levels that have previously coincided with market reversals. Still yet to pass July lows and even if we do it will be interesting to see how far beyond there we move. Right now fundamentals seem to be getting better. Credit Crisis is becoming last years news, housing is improving and commodities are less of an inflationary problem. To me that seems like the big players who moved to commodities for growth whilst we had the problems in equities might have moved their funds back into equities again.

 

Day's Trading Goals

 

Spend 60% Or More Of My Time Watching The 5 Minute Chart

 

Make 5 Or Less Trades

 

Make At Least One Trade In The Direction Of Established Trend

 

9:16 Market currently at a gain of 5 points in the overnight market. Was pretty choppy action overnight. Current trend up is holding. Only news today is the Crude Oil at 10:35am. Actually looking for a rise right from the open today. Should we hit the 1240 area and fail to continue strength I would be looking for us to break yesterdays low.

 

On another note, I do feel like I am coming down with the Flu so I may not actually trade today. It depends on how with it I feel.

 

9:36 Moved down from the open, volume increasing on the decline.Tick is showing early negativity.

 

9:53 A bit of undisciplined trading here. Entered long originally at 1233.25 and got spooked out at 1232. Reason being a retracement after a reversal with declining volume on the pullback. Entered again as I saw the move take off as an impulse at 1235.25 with profit target at 1236.75. Target was taken.

 

10:13 Not feeling great so calling it a night. Flu is taking it out of me and feel as though it's altering my decision making.

 

Daily Wrap Up

 

Unfortunately my day was cut short due to the Flu getting the better of me. I felt like my analysis was working for me but my decision making concentration was being hit with lethargy. I took two trades, both were good trade ideas according to my analysis. The first one was a touch too early and the second one was an impulse trade in late off the same idea that really acted as a revenge trade to get back what I lost.

 

I ended up a 0.25 point ahead at the end of the day but it was pretty much a non event. The past two days has really seen my analysis pick up again. Keeping my focus on the 5 minute chart has me feeling like I am back in touch with the market action. I feel like a little more confidence is needed in my analysis though.

 

Today, prior to entering my first long I mentally had 1231.25 as our point to reach on the retracement according to the 1 minute chart. I feared we would move before reaching there and jumped in prematurely only to take an unnecessary 1.25 point loss. All great in hindsight but these sorts of things are where my strengths lie so I would like to place more emphasis on that. Something to work on I think.

 

I'm not sure how I'll go for tomorrow. I will still act as though I will trade and if I get to the open not feeling 100% I will make the decision then. I am hoping the worst of the flu is behind me but I have my doubts.

[jasont 10]

Today's Trading Goals:

 

Spend 60% Or More Of My Time Watching The 5 Minute Chart

 

Make 5 Or Less Trades

 

Make At Least One Trade In The Direction Of Established Trend

 

9:02 Well we certainly are in an interesting position here. I'll keep my idea of possible accumulation going on down here until we break July's lows. Beneath there and things are likely to get messy. We are currently trading at 1217.50 which is the previous low point. It could prove to be pivotal right now but for the moment I'd say 1200 is a more important level to watch. Such a substantial gap down has me looking for some early strength. It may be short lived though as I suspect many traders may be looking to exit longs bought in hope of further upside momentum at 1222. If we breach 1230 we may get the buying side moving. Today we don't have any major news during market hours.

 

9:35 Going with the premarket uptrend fixed support and my initial analysis in long at 1217.50 going for a move to 1220 where I have my profit target. Only a half position to what I ordinarily have as it is a reasonably risky trade for my plan. Stop is at 1215.50.

 

9:39 Market took my stop as we moved down heavily, loss of 2.5 points, 0.5 points slippage it would appear. Interesting that we have such a big Tick move lower so early into the day.

 

9:45 Volume seen to be declining on the 1 minute chart on the move lower. Hitting Tick extreme levels. No divergences as yet though.

 

9:51 Missed opportunity for a retracement entry on the long side. Didn't appear to hang around long at the 1214 area before taking off.

 

10:09 Went long in the market at 1217.50 for a retracement entry. Market came back so I got out at 1217.25 for a 0.25 Loss. I then made a mistake by shorting against that move and not paying attention to my analysis. Entered short at 1218 and stop taken at 1220. Lessons learnt.

10:26 Went short in the market too early. In at 1220.75 and had stop at 1223. Market came up to 1223 and then went back down. Rather irritated me but I got back in short again at 1222.25. First target taken at 1220, stop moved up to 1223 on second position. Reason for the trades was 1-2-3 top with Tick showing decreasing strength. Will try to ride this one.

 

10:29 Moved stop down to 1222 as it gives me plus 0.25. Shouldn't reach back there if we are heading lower in my opinion.

 

10:32 Volume declining, does this move mean downward shove is not favored? Hit extreme Tick reading on selling side, if it's not after an extended move I ordinarily take it as some strong selling as opposed to exhausted selling.

 

10:40 Pet hate, having the market come up and take out a stop for just over break even when it was previously good gains. Ah well, stop hit at 1222.

 

10:51 Took a short trade earlier at 1222.50 again for a second chance at the drop. Took 1 point on half and breakeven on the rest. Ended up long 1 half accidentally but took a 0.25 gain on that also. I'm in a hole profit wise right now so time to work my way out of it.

 

11:11 I just had a messy period of scaling into the market way above my risk. Not even worth dwelling on at this point.

 

11:30 Calling it a night. Ended the day ahead but it was only due to my scaling into a position much larger than I should. Will need to work on that.

 

Daily Wrap Up

 

Today brought in a mixed bag. My analysis of the market again was good, that is a positive sign. It means I have my usual way of looking at the market back after it ran into difficulty during August. Each day since Tuesday now I have felt I am in touch with what the market is telling me. I attribute that to my focus remaining on the 5 minute chart for most of the time.

 

There was two good trades that stood out for me today. One was at 10:06am and the reason I liked it was because the entry was following my plan. In a day where following the plan became difficult, I noticed that we had established an uptrend on the 1 minute chart, we were pulling back on lower volume and were showing continued tick strength. I actually liked the entry point too.

 

The next trade I liked was of a similar fashion to the previous one. It was an entry at 11:26 where I saw volume decline again on the pullback and the Tick was still making higher lows. Plus we were near a new support area around 1223 so it was a good demonstration of following the plan. The other aspect of the trade I liked was that it was with the established trend on the 5 minute chart.

 

Things that can be improved upon from today is my trade management and my discipline. During trades I can pay closer attention to the Tick chart to see where the underlying stocks are gaining or losing strength. I have guides in my plan to follow that utilize the Tick for managing trades so that would improve both my discipline and trade management by following it. For following my plan today I give myself a 3 out of 10. I did watch the 5 minute chart for the majority of the time which was good and took a trade in the direction of the established trend.

[jasont 10]

Friday I didn't trade due to the flu getting the better of me. I tried to fight it as much as possible but it kicked my ass in the end.

 

Weekly Wrap Up

 

I was sitting here for some time wondering what I would write about for this week's wrap up. I made a gain for the week which was positive. How I got there was not so positive and honestly a little unrealistic. I had moments in the market where I became so frustrated that I scaled into positions that were going against me. Number one amateur mistake I know. However doing so allowed me to see some things about my trading I didn't pick up on earlier.

 

I do enter the market a touch too early on numerous occasions. It does become frustrating when I see a big move coming, I get on and then it moves just enough to suck me out of the market before making that move I saw coming. I could let that remain the way I trade which would not be of benefit or I could work in expectation of that.

 

Often I see points in the market where we are likely to cause a reaction. As an example let's take Friday's open. At 9:46 on the ES we began to move down pretty hard immediately following what looked like a strong rebound from testing lower prices. At 9:50 we make a lower low on the 1 minute chart which would suck breakout traders in. However we bounce at 9:52 and make a new high on the 1 minute chart. We then come back down to the 1237-1236 area at 10:02.

 

Now this area is a reaction area once we made the new highs at 9:56. The reason being that the guys who entered on a short position and either didn't have a hard stop in place or had a larger stop than the move higher we made are now being tested. Their threshold for loss was tested as we moved against their breakout position and are now near their break even point. Many jump ship as they are thankful not to take much of a loss, at the same time we have the bigger trades loading up. That is the sort of thing I look for in places that are likely to cause a reaction.

 

Now the whole point of the above explanation was to point out that I see these areas but don't use them as best I could. Let's take the failed chance to move higher at 9:58. That sort of action gets me in early as I guess I don't want to miss out on a move should we take off. However then we come back down to the original area I was waiting for. Often in this process I get taken out.

 

So to tackle something like this I have a few options. One is wait for the move to reach my area of potential reaction. I will miss a few trades that take off without reaction that point though which is a downfall. The other option is to enter on a partial position here and allow my stop to be further past the potential reaction point. I get exposure should we take off but I also will be at a fair loss before I actually get to see whether we are reacting where I thought we may.

 

In all honesty the better option for my risk tolerance and trading style is to wait for the area to be hit. I am actually trying to get a data feed up and running for a new platform I am using which will enable me to use a 3 second chart I have been experimenting with. It will help with the better timing and reduced stop placement. Until then though I have to deal with what I have. Identify my reaction points and wait for what happens at them.

 

So that is one thing I picked up on my trading, entering early on trade ideas that were correct. The second thing I picked up on was increasing my risk unrealistically. This came about from entering these above mentioned trades early and adding to positions as the market went against me knowing that I was probably too early. It paid off but that is the problem, it breeds bad habits. It only takes one time for that not to work to wipe out a good portion of an account.

 

The biggest positive for this week was my analysis. For the majority of the time I was in touch with what the market was telling me and I could pick up on the changes in direction. Sounding like a record player, it was due to switching my attention to the 5 minute chart. It is what I have the biggest understanding of and using that for my analysis and then switching to the 1 minute chart for my entries made a big difference.

 

Another positive was the introduction of the retracement trade which I have been having difficulty understanding till this point. When things were going well prior to August I had trouble entering the market in the direction of the trend with retracements. This week saw me picking up on retracement entries according to the 1 minute chart, Volume, the Tick and trends. This at an early stage appears to be helping compliment my reversal trades quite well. Once I am confident in the pair working together I can possibly look into adding positions according to initial entry with reversal and adding at the retracement.

 

So for following my focus this week I am giving myself a 4 out of 10. I stuck to the 5 minute chart for majority of my trading which was good and achieved numerous goals I set myself for the days. It sets the pace to improve upon now so I have things to work with which is good.

[jasont 10]

This Week's Outlook

 

From what I am seeing the recent week appears to be failing to push the SP lower on big volume. Such big volume as we saw in the past has appeared prior to a turn of trend. At this stage the things it has going for it is, large volume failing to push it lower, possible double bottom or 1-2-3 pattern. Thursday's low really sets the point for me at which we should not fall below if we are seeing some strong buying coming into the market.

 

The VIX is still on the rise but does appear to be waning in put option interest. Gold appears to have made a solid move over the weekend, I'm guessing it is due to the concern over Lehman's possible bankruptcy. Though I suspect this recent buy up of gold is not as much an investment in gold as it is an avoidance of banks. It does certainly stir the pot on if your money is really safe with banks right now. Oil is still currently sitting under the $100 mark. A healthy bounce here would be nice.

 

The USD is seeing some easing of strength after its pretty much uninterrupted run from July.

 

All of this information has me on the side of the buyers but think the area we are in is rather touchy. Monday is going to see the Lehman trouble hit the market. If that manages to push us beneath Thursdays lows then I would reassess my buyers position at the time. However after such a volatile week last week I do suspect we may tone it down a touch and make a run for higher prices possibly mid to late week. It is very likely we will see some downward testing prior to moving higher. This Lehman news will really show the strength of the market I believe.

[ochie 10]

So to tackle something like this I have a few options. One is wait for the move to reach my area of potential reaction. I will miss a few trades that take off without reaction that point though which is a downfall.

 

 

I prefer this option and it should show improvement with the smaller TF chart you are working on implementing (I have found a tick chart in the area 20 ticks for NQ) does a pretty good job. Since you are familiar with 1-2-3 patterns, I would consider looking for these as entry patterns on your small TF chart. They do show some S/R level holding strength before retest. These patterns should appear often (instead of the PA bouncing up and down on a single 1 minute bar) and provide better definition of your entry/stop placement imo.

 

 

P.S. Good Work!

[jasont 10]

Thanks for that Ochie. What you have suggested is pretty much what I have been looking at with the 3 second chart. On a 5 minute chart a reversal is pretty obvious but sometimes difficult to catch. After seeing the reversal I monitor the 1 minute chart for the first pullback from the reversal.

 

Currently I am relying on exactly what you mentioned, the "PA bouncing up and down on a single 1 minute bar" as we reach my expected reaction point. In a way I find it becomes more intuition work than solid plan work when relying on the 1 minute time frame in comparison to the 3 second chart. I have noticed the action becomes a fair bit clearer in the 3 second chart with the further breakdown of volume and action showing clear signs of build up.

 

I currently have a slight catch 22 problem right now. The new platform is good and ready for to use for trading. I just need to get my hands on live NYSE Tick Charts. It is the single tool I need. I am waiting for OpenTick to accept new subscribers and it will then cost me $1. However every other data provider charges monthly fees on top of the exchange fees which makes it rather irritating and more costly than I'd like.

[jasont 10]

Trading For 15th September

 

Goals For Today:

 

Spend 60% Or More Of My Time Watching The 5 Minute Chart

Make 10 Or Less Trades

Make At Least One Trade In Direction Of Established Trend

 

The goals are pretty similar to last week except that I have upped the amount of trades I can make. I haven't changed them much because I feel they needed more work this week.

 

8:54 The Lehman Brothers and Merrill Lynch news has hit the market pretty hard. We are currently trading at the 1213 area. This looks likely to blow out the recent low and take us to the July lows. What happens down there is going to be of high interest to me. I'm not sure whether to air on the side of some sort of early attempt at recovery or whether to air on the side of immediate break down. I'm actually going to rest on neutral until I see the action. Oil has taken a whack already and the USD appears to be favoring the news at this point.

 

No major news announcements today so the market is left to purely digest the banking news.

 

9:34 Market opened and moved higher from the outset. Volume on 1 minute chart has shown decline on the rise, Tick has remained negative. Currently testing the overnight market downtrend.

 

9:46 Recovery, false or real? Tick hasn't sustained a move above the zero area at this point. Stocks haven't shown buying strength at this point just less weakness. Volume has increased on recent up move and levels are high. Are we setting up for drop just as far as the rise or are we looking at an up trending day? Right now the angle of the rise is near 90 degrees. Not healthy. Currently s/r levels being cut through like butter.

 

10:23 Shorted the market up at 1225.25 as we showed Tick divergence and declining volume on the move higher. Had a hiccup with orders initially but worked it well. 1st target was taken at 1224 and stop brought down to 1227 on remainder. 22-21.50 are shows possible reaction point.

 

10:27 Second position closed out at 1226. Market not ready to drop here. Just yet it would seem.

 

10:37 Moved higher to 1234 and have now seen the heaviest volume come in we have seen for some time. Tick pulled back from higher area pretty quickly. Trend up still holding.

 

10:53 Something identified to work on. Saw market flattening off at 1228 with decreased volume and meeting trend line. Couldn't bring myself to trade with the trend though. Not healthy for my trading as we moved roughly ten points. Would have been a good trade. Need to assess my lack of faith in going with the broader trend.

 

10:57 Volume extreme coupled with Tick divergence whilst meeting the slow EMA. Could be signs of a reversal. Will stay prepared for the possibility.

 

11:11 I thought it was better late than never to get on this uptrend. Got in for half a position long at 1230 with my stop at 1227. Only wanted to scalp the trade as I don't trust being in this trend so late but it was in the rules and one of my goals. Volume tapered off on the move down as we hit the uptrend of the day. Placed target at 1231.25 which was hit. Small gain but had my rule based reasons behind it.

 

11:49 Been away from the market, was messing around with getting my new platform organized. Will leave today as it stands. Was good trading, remained patient and followed the plan. Big improvement.

 

Daily Wrap Up

 

Less trades today but a big improvement. On a day like today I could be disappointed that I didn't pull more from the market but I feel I made a bigger achievement than points today. I was able to stick to the plan and didn't make any impulse trades. I felt like I was back to my usual self.

 

There were a few more opportunities that presented themselves in the direction of the trend that I didn't get on board. I am happy I can see those opportunities and I do believe the 3 second chart will allow me to zone in on my entries with those better. Seeing the rising volume earlier than a 1 minute bar will give me the ability to get in without a huge stop point.

 

I achieved all of my goals I set for the day which was a big positive. Both of my trades were according to plan. The first one was good because I saw volume declining on higher prices from a reversal candle and a tick rejection from positive values. I also made a mistake where I entered with half a position and when we couldn't make a move higher I wanted to add the second half. However I accidentally added another full position. Remaining strong with my analysis I put an order in to get rid of the extra half at break even and it was taken. My management of the situation was good because I respected my risk tolerance.

 

The second trade was good because it was in the direction of the trend after we saw declining volume on the pullback. I wasn't confident we would make a new high so I entered on a half position just for the scalp. It was managed well.

 

For following my rules today I give myself an 8 out of 10. It is a big improvement on my previous day of trading. There were more opportunities to be taken but first I want to get my trading back on a leash and under control before searching for more opportunities. I felt like I had to go back to square one after August but now I am seeing myself get back on track. I will be trading with the 3 second chart tomorrow because my platform is set up. It will take more concentration but I feel it will give me further guidance. The day ended ahead by 2 points.

[jasont 10]

Trading For 16th September

 

Today's Trading Goals:

 

Spend 60% Or More Of My Time Watching The 5 Minute Chart

Make 10 Or Less Trades

Make At Least One Trade In Direction Of Established Trend

 

9:02 Well it appears that as soon as we broke the July lows we decided to run hard. In the overnight market is has been no different. We are currently trading at 1172, a 20+ point gap down at the open, not quite as big as yesterday but still considerable. I don't have any levels down at this area so it may be a quiet period of trading for me. I will establish what side the big guys are playing and go from there. We could see another rise early on that breaks down or we could see the complete opposite. At this stage things don't look pretty and caution is needed without any s/r levels at my disposal.

 

9:41 Entered long at 1170.75 in direction of new trend formed in the pre market. Market moved my direction as I was stuck trying to figure out the new platform for the simulation trading. Bought and sold a few times before actually settling down. Took first profit at 1274 and took the second half off at 1281.25. Reason for taking the trade off was we were seeing some resistance to the Tick strength and lack of further upside movement in the face of large volume. Was a good trade.

 

9:48 Volume has been rising with the move higher, Tick passed the zero area but now pulled back beneath it. Tick has in fact been pretty quiet up until this point.

 

9:57 Entered long at 1273.25 after seeing declining volume on the pullback in the uptrend. Showed big volume come in on the 3 second with little movement lower. 1st Target hit at 1274.50. Stop moved to break even on the rest. Not sure I trust it but will let it go.

 

10:01 Stop moved up to 1174 after we bounced from there. Took rest of position off at 1278.50. Maybe a bit early... actually really early hehe.

 

10:06 Currently seeing a decline in the volume as we move higher, Tick back at positive ground but failing to make a good move above. Stocks resisting the urge to buy in this market. Will let this play out some more.

 

10:39 Market has been scraping higher but with less oompf than earlier. Volume has not been showing much for either side, become a bit choppy. Tick is struggling to stay above the zero area which indicates only modest buying on the stocks behalf yet we have seen 20+ point rise from the open.

 

10:53 Going to call it a night here.

 

Daily Wrap Up

 

In all honesty the 3 second chart worked better for me than expected. Today it helped me discern big volume prior to it showing up on the 1 minute and 5 minute charts which allowed me to take excellent entries. Of course this is not some magical time frame and I need to make sure it doesn't bring in overconfidence. Most of my work today was done with the 5 minute and 1 minute chart but watching the 3 second at areas I was looking for a change of direction helped get me in early.

 

I took two good trades today. The first one was based in the direction of the most recent trend formed during pre-market. It was good that I saw volume taper off as we moved down and that I picked up on the big volume enter on the 3 second chart down the bottom of that pullback. I was also pleased it was a trade in the direction of the trend. I did have a few hiccups trying to figure out the simulation trading system properly but it worked out in my favor.

 

The second trade was of similar nature, again it was good that I picked up on the declining volume as we pulled back and then the big volume entering in on the 3 second chart as we reached the bottom of the pullback. Again it was good to have another trade in the direction of the underlying trend. I did close the trade out pre-maturely and it would have been nice to scrape out the extra few points but I don't have to get every little tick out of the market.

 

For following my plan today I give myself a 9 out of 10. I made two trades in the direction of the trend, I followed the 5 minute chart for most of the time and I made less than 10 trades. Today I pulled in 20.25 points which is a good way to start my trading with the use of the 3 second chart as well. However during the day after my second trade I became a little cocky and had to pull my head in to make sure I didn't make impulse trades. I was happy I recognized it early and halted placing any more trades until it was under control. After some time I then decided it best to call it a night before sabotaging my work.

 

Something to keep in mind is that day's like yesterday are not everyday occurrences. I need to keep a realistic outlook and accept that they can occur but not expect each move I enter to rise 10+ points. Take advantage of the times we do but don't expect it.

 

Below is the setup with my new platform.

[smwinc 20]

Good job mate, nice pull. Crazy times in the market lately. I've been feeling the same way on some of these days - disappointed that I didn't pull more out. I think everyone has that feeling during these periods. Remember that many people would be losing their accounts / mortgage / family / etc . Two sides to a coin!

 

Cheers