Sandbox

[Niko 10]

This may be important today:

 

Well, it surely is being important, buyers are pretty hesitant to jump in above 91.

[Niko 10]

No trades today for me.

 

But I managed to record some of my feelings, I actually ended up posting on the 20 tick chart what was going through my mind. at every moment during the session and placed "entry" marks on the chart of every trade that came to my mind but that was not taken. I included REVs and RETs into my analysis.

 

1.After the open as buyers failed to make it above 91 I started thinking about taking a REV, but taking into account the width of the bars I avoided taking that short, just didn't feel sure about it and decided to give the next RET a chance.

 

2. This trade I did place but it was not triggered and as prices rose rapidly above the mean I started to realize something was wrong with sellers so I decided to e cautious.

 

3. The strong rejection of 83 (prep level) meant that I had to make a decision about going long there (REV) or waiting for a RET to confirm. But I felt too anxious, I started thinking that by then 87 was the mean, and that I would end up trapped in a TR with a bad trade. But that really did not happen, at least not as dramatically as I imagined, as the long managed to be a couple of points in profit before reaching the top at 90. This is a puzzling part for me, when I took this trades in the past I ended up doing poorly, but then if a trend develops out of this move I end up missing the best entry opp. Perhaps if the range was larger (20pts) I would have considered the trade, but given the tightness my emotions were too strong to overcome fear of entry here.

 

4. After the LH at 90 and the inability to go lower at 83 my main thinking was "hinge on the making", so as soon as the ret at 945 formed I took the next downswing as a hinge BO, therefore I did not take it and waited for a RET.

 

5. This was very interesting to watch and feel in RT, I was not gonna take a REV off a LL but watching price in RT what crossed my mind around 9.:48 was the RET ship has sailed!! as I saw prices bouncing fast and making a HL in the 20 tick. I dont think I would try and take a trade like that in the near future, but it was very interesting to see how it happened.

 

6. The SL was broken and there was a RET above 50%, but I avoided this as there was no upside exploration above 91. By now I was pretty sure I shouldn't be trying to trade inside this mess, so the emotional load went down a lot.

 

7. Now it is clearly a TR between 91 and 81, but at the moment of this trade, I was thinking "this could be a hinge" and the action here could be the RET after the BO, but then I remembered that BOs have to bring company to the party in order to call enough attention and this was pretty much an unimportant poke above the SL of the Hinge so I reconsider my entry and cancelled the order. Had I left it intact it wouldnt have triggered.

 

8. As we were sucked back inside the TR I did not consider any other trade until we broke the DL, but here I was unsure, given what had occurred at 81, we could have a DB and I would be selling the DB so I decided to wait for an extra RET.

 

9. Price rose just above 81, but buyers failed to join, so there was no REV, then I started thinking this could be the RET, Here I Place the entry 1 pt below price, but as price rose I did not trail the entry, My reading was if I end up buying at or above 91 there is the risk of getting trapped inside the range so I better wait for a break. It was not triggered.

 

10. Given the inability to go lower, a REV could have been taken here, after all this was a DB, but then again, 10 pt TR is not really something I want to be messing with. So I avoided the trade.

 

11. The DB was confirmed by a HL, but also avoided it. My feelings were pretty clear at this moment, I was not anxious, because I had taken the decision of not trading until I saw some light.

 

12. Another HL, same conclusion.

 

13. Another HL, same conclusion, and this one was not triggered.

 

14. LHs inside the TR, I marked potential entries, but did not trade any of them.

 

15. Selling stopped at 50% and then price rose faster, this could have been a REV.

 

16. At 10:54 there was a strong buying push, I have to admit that by this time I was already thinking in closing shop and starting to write my journal so I was not paying that much attention to the screen, so I really did not realize we were exiting a hinge and that this one was the RET after the hinge BO. I was thinking more in " we did not clear the range and it is already 11:00 so what the hell".

 

17 Another RET just below the ORH, it worked just fine. But as I said, I was done by then.

[Niko 10]

And the 20 tick with some real time notes on it. I tried the voice recorder, but I just feel better writing my feelings in the chart so that I can relate them to the current PA at the time. I am not sure if this serves the same purpose as the voice recording method.

[Niko 10]

If you're trading in chat, don't.

 

Ok, acknowledged. As kp said, after the chat died, I kept a channel open via skype for anyone who still wanted to discuss SLA and Kp joined. We try not to make calls in RT nor influence each other decisions, but we might be failing at it miserably so we will stop.

[DbPhoenix 42]

You need to revisit the basics.

 

After the rejection of 91 at the open and the subsequent rejections of 84 and 91 again, there are no more trades unless you have decided to trade ranges. If you have, then you have to determine (a) how wide the ranges must be and (b) how clear the limits must be, keeping in mind that © trading ranges means trading reversals. If none of these elements are in place, then you have nothing to do but watch. Getting sucked into minutiae serves only to pull you further and further into the weeds.

 

Reread the rules as stated in the pdf, then reassess what you're doing.

[Niko 10]

You need to revisit the basics.

 

After the rejection of 91 at the open and the subsequent rejections of 84 and 91 again, there are no more trades unless you have decided to trade ranges. If you have, then you have to determine (a) how wide the ranges must be and (b) how clear the limits must be, keeping in mind that © trading ranges means trading reversals. If none of these elements are in place, then you have nothing to do but watch. Getting sucked into minutiae serves only to pull you further and further into the weeds.

 

Reread the rules as stated in the pdf, then reassess what you're doing.

 

Thanks, I was trying to get a grasp of my feelings at most turning points in order to be able to understand what is it that is holding me from trading some valid setups like the ones we discussed on Thursday. Thanks to all your teachings I was able to avoid getting sucked inside the range. Something that I used to do pretty often.

 

I will review the basics as you suggest and will also review the differences between the good days when I avoided good trades and days like yesterday when I should stand aside.

[DbPhoenix 42]

One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do. Most people always have to be playing; they always have to be doing something. They can't just sit there and wait for something new to develop. I wait until there is money lying in the corner, and all I have to do is go over there and pick it up. I do nothing in the meantime. Even people who lose money in the market say, 'I just lost my money, now I have to do something to make it back.' No, you don't. You should sit there until you find something.

 

-- Jim Rogers

[Wolfhound 10]

I made a few trades today within the tight range. Trying to find the balance between overtrading and doing nothing, while keeping the Zen within my soul. It worked okay because it was a very clean up and down day, even though it was in a very tight range.

 

 

1. After opening with a rejection of the highs of the early morning, we turned down and reversed again at the overnight high. With the retracement within the bar a long could be placed here. I did not make an entry.

 

2. Having again rejected the highs we may have been making a range, but I entered a short on the retracement, which was stopped out at breakeven.

 

3. Yet another bounce off the highs, and I entered the short knowing that it could be stopped out with a bounce off the lows.

 

4. Again a short within the tight range. This one lasted a few more points before it was exited with the break of the steep supply line.

 

5. This is a long on the higher low retracement. Exited on break of line.

 

6. A short on the retracement which was stopped out. This may not have been a good entry, because the price never got near the extreme of the range before turning, so I was entering while price was wandering around the mean.

 

7. A long after the supply line break and retracement. Exited on the demand line break.

[Wolfhound 10]

We have continued the upward march, and we reached a high of 800 overnight before pausing. Overnight we have a high of 800 and a low of 92 with a midpoint at 96. Currently we are close to the lows of the overnight range, and a break below 92 puts us back into the previous congestion. The previous lows will come quickly given the tight range on friday. The friday low of 81 is quite close, and could easily be tested.

[Niko 10]

This week I am gonna work on connecting my prepwork with my actual trades, so far I have only identified areas of interest, but my prepwork has not really been a plan of sorts, so when I get to those areas that matter I keep doing the same stuff I was doing before, and that is a mistake. I think I have been doing this consciously, mainly because I was not sure my prep areas of interest were really pertinent and also because I was not sure I was able to execute properly disregarding areas of interest.

 

But after the last few weeks I observe that my prep is getting sharper and my execution is not that bad, so I can try to mix them both "as I am supposed to" and play better.

[eminiman414 10]

3800 and 3793 is what I am looking at at the moment. If we break below we'll see if the congestion from Friday is a place where traders find trades, somewhere btw 86 or 90. I've attached a 60min for the rest of what I am looking at.

[Niko 10]

So far 800 showed up to be the level above which no more buyers want to join, by now there have been already 2 LHs, but selling dried up at 92.50. We are still 20 minutes from the open, so any of these levels could be tested and broken by then, so we will have to watch and see if buyers still think there are bargains out there or if sellers think this whole trip to 800 is just too much.

 

As before, nothing relevant above 800 and below a couple of areas were traders have settled in the past month.

 

89,80,50,40. Be mindful of the 50% levels along the way.

[Niko 10]

10:21 So we formed a hinge above the 50% from 775-80 and below the 50% from 800 to 788

 

Before the hinge formed I took 2 trades, 1 the RET on the expectation that the downtrend would gather enough strength to break below 50p at 88, as that did not happen, and being 89 a level from my prepwork the thing to do was to take the long with the expectation of a HH above 99, but as they gave up at 50% I SCR the trade.

 

11:00 The hinge was finally broken, but the buying interest dried up at the PM mean.

Edited June 9, 2014 by Niko

[Niko 10]

These are today´s trades.

 

1. After trying up for a second time and being unable to reach the peak from the open (LH) the thing to do was to go short, but given that they had already tried 92 and failed I decided to wait for a LL before taking the next RET. Just before taking the trade I felt doubt as prices did not just fall as fast as I wanted, but then after a rise that stalled at 92 I realized that sellers still had the ball, so there was no reason to cancel the trade. As prices started to retreat, anxiety levels started to rise, but I realized that there was nothing to worry about, the stride was just fine at first so I decided to leave my exit level where it was , once it was hit I already had a broken stride so I did not consider reentry.

 

2. Another thing that lead me not to reenter 1 was the fact that we were at 50% (88) and buyers where showing they still wanted more, so instead of fighting the buyers at an important level I decided to take the long. I knew the risk was to get stuck at 50%, but the reward was much bigger, hitting 800 and breaking above it would place me in a perfect position for taking advantage of the trend, and besides, past week entries into the good trends were just like this, so I decided to take it. But, we did not get too far away as 50% at 93 rapidly brought selling, enough of it to overcome buying interest. After buyers were unable to make a HH I decided there was no point holding this trade anymore so I just closed it.

 

After these two trades I was already trapped in a range so I needed a BO to enter again, and that did not happen until after 10:50 and the entry in that case wasn't triggered.

[Niko 10]

Now, regarding things to do better next time, I think I traded according to plan today, of course, in hindsight is easy to tell to myself that I could have tried each REV around 90 and close it at 94, but that is not what I am after, I dont want ending up trading the chop and creating bad habits.

 

After the BO, the entry was not triggered and by then I was already starting to write the review so there was not much to do for me by then.

 

There was an opp that came up after 11:00 but by then live trading was closed for me, it was the long at 95, if taken this one would still be open and awaiting for a LH in order to close it or a break above 800 in order to keep it open.

[eminiman414 10]

I have 3803 and 3783/85 as the limits currently with 93 as the mean. On the way down as a road map I have 76, 68, 57/58 and then back to the top of the sideways movement at 35/40. Again these are just sort of landmarks and nothing to freak out about if price hesitates somewhere around any of these prices.

[Niko 10]

The trend that started in the 4th is being tested at this time.

 

So far we traders have not been able to find trades below 85 and above 90. if we can break out of those levels as we surely will, then on the way up we have yesterday´s MP to deal with and the H of the day.

 

Regarding the areas where traders have concentrated their transactions in the past days the areas from yesterday still hold.: 80,50,40.

 

Above us we also have some trouble between 92 and 96.

 

9:25 Still stuck below 90 and above 85. The current mean is 87.5

Edited June 10, 2014 by Niko

[Wolfhound 10]

1. On the open we reached 99, below yesterday's highs and turned sharply. We made a lower high, and I entered a short on the bar that broke the lows. Looking at it now I should have waited for a retracement a few bars later, but I entered on the tick retracement.

 

2. Not a good entry. Shorting at the bottom of a tight range. One to learn from yet again.

 

3. Long on a retracement. Exited on break of demand line.

 

4. Short on break of demand line. This one was okay, but exited after 10 minutes of going nowhere, and 4 failures to get below 93.

[Wolfhound 10]

Yesterday we made a high of 803 and a low of 83, with a midpoint at 93. The failure to punch past the highs of 800 was interesting after spending an hour in a tight range above 800. The eventual 20 point failure after that showed that the buyers accepted that they could not get any higher, and moved back to the mean area.

 

In the morning we had 2 lows at 85, so this could be important, as will the 83 below that. We have a reent high at 90.5, and obviously a lot of interest in what happens in the area starting at 800.

Edited June 10, 2014 by Wolfhound

[Niko 10]

Today I was definitely not in my best, Not sure what happened to my rationale today, I just let myself be beaten like a piñata.

 

1. My feelings were of doubt at the open, at first the strong rejection from 92 made me think that the course price was gonna take was down, and I just let the long at 93 past by me. Then frustration came to hit me as I saw price rise rapidly.

 

2. Then came the RET and as prices bounced off the DL I decided to take the next long, but it did not go anywhere and hit my exit very vast.

 

3 Having broken the DL and failing to make a HH the way to go was to short this. But here is where my problems started, perhaps I was too focused on my P&L and that just blurred my mind, but I just missed the fact that we had failed to make a Low below 89 and a High above 800 therefore I had the conditions of a 11 pt range in the making. But instead of taking that into account I just kept on pounding the short side. At first at a Reentry at my previous entry level and hen in the next RET, but given the environment and the position of price just above the 50% of the OR I should have known better.

 

4. I finally came to my senses realized where I was and awaited for the 50% to be crossed before acting again, given that We had a LH and then a strong rejection of 99.50 I was expecting sellers to commit and break below 89, but they didnt and I got SCR, Here I think I have to modify the way I SCR trades that end up going my way, for example, here the expectation was to break below 89 as they did not manage to do that the trade should have been closed.

 

Other thing one could do in an environment like this is to give RETs more room, but I am not really interested in that as my previous experiences with that kind of behavior have been very bad.

 

5. I thought about quitting for the day But then came the strong rejection after the break of 89, given that it occurred at the MP of the PM TR I decided to wait and see what I could do with that, given that it was occurring at the Bottom of the OR, so as soon as I got a RET I took the long, at first it looked promising, but then we hit 50% and buyers stalled, I allowed for a RET and then decided that if they couldnt take 50% in the second attempt I was not interested anymore. That is why I scratched the trade.

 

I am gonna go take a walk and think about what I could do better.

[Niko 10]

I am gonna go take a walk and think about what I could do better.

 

Ok, I am back.

 

I thought about today and all I can say is a quote from someone I respect a lot regarding these issues of trading

 

"Eagerness to trade supplants deliberation".

 

I think it has to do with rule #3

 

"If you've been folding a lot, for a long time in the game, and you're starting to think that maybe it's time you got in and played a few hands again – that's not a good enough reason. Keep folding."

 

Regarding specifics I have a dilemma regarding my scratch strategy, at the beginning of the trade I usually allow price more room in order to be able to go through the first RET after my entry. At the time that room level is fixed in 2 pts. Once the trade starts going my way I still give room to the trade in order to get the next RET and not exiting a good trade at BE, that second room level is usually 1 pt, most of the times it has worked in the past, but in the last few weeks that just doesnt work.

 

I am gonna review that and see what could I modify in my rules in order to get that fixed.

Edited June 10, 2014 by Niko

[teevers 10]

Hi,

 

Enjoyed your thread. I only post on forums once every few years but thought I'd write a couple of my observations.

 

Given the current low volatility it appears that 1 minute charts are chopping you out for lots of small losses which will probably add up quickly if a trend day doesn't come soon. A scratch on 1 minute charts costs a hell of a lot more than a scratch on an hourly+ chart, due to spreads/comms, and the fact that your average win on 1 minute charts will have to be much larger on a relative scale than on hourly+ charts to cover the costs of each scratch.

 

Perhaps entering in the trough of the first retracement after the demand line breaks is a bit too arbitrary given that 1 minute charts are extra choppy. Maybe wait for the extreme of the retracement to break out a few ticks before entering, which might cost a few ticks compared to the trough entry, but gives extra confirmation and avoids your entry's first possible point of resistance, at the high of the retracement.

 

You could also add a filter that the extreme of your entry retracement, after the demand line breaks, must also have taken out the last swing point from which the demand line formed. This again removes another possible point of resistance after your entry and all it costs to wait for this extra trade filter is time.

 

Keep up the good work

[DbPhoenix 42]

 

Regarding specifics I have a dilemma regarding my scratch strategy, at the beginning of the trade I usually allow price more room in order to be able to go through the first RET after my entry. At the time that room level is fixed in 2 pts. Once the trade starts going my way I still give room to the trade in order to get the next RET and not exiting a good trade at BE, that second room level is usually 1 pt, most of the times it has worked in the past, but in the last few weeks that just doesnt work.

 

This is not likely to work this time of year.

 

First, as soon as a range presents itself, you can't expect to be able to employ the usual ret strategy since it won't work well if at all in a range. If you're going to trade the range, you have to be prepared to take the revs. If you don't want to do that, and there's no reason why you should feel you have to, then just blow off the day and try again the next day.

 

Second, while it's possible that a good entry might nonetheless be followed by a recoil that comes all the way back to your entry point, the best entries of course generally do not. If they do repeatedly, then you are likely in the kind of environment such as this one, and "hanging on" is not wise, particularly if you're not trading the extremes.

 

Third, the market doesn't care where you enter. Whatever choices you make regarding risk management are independent of what the market does. If you want to hang on for -1 or -2 or bail at BE is a choice you make that has nothing to do with what the market is doing. So pay attention to the market, not to your trade. If price comes all the way back to your entry point, think about what this is saying about buyers and sellers, not about the implications for your trade. If the trade is a good one, none of these concerns are likely to be relevant since price won't come anywhere near your entry level, assuming that it was correct.

 

Given that we remain in this OH/OL/rest of the morning at the mean situation, you may want to look for a pattern of how many days we repeat this pattern before finally moving to one side or the other, as we did last week. Or you can investigate other instruments. But given the pattern of these ranges, it's foolish to keep hammering away in hopes that it isn't a range after all. Or trade the revs in the range just for the hell of it without investing anything of yourself in it (you will likely find that you'd have been better off cleaning out the garage).

 

The SLA points out early on that it is not particularly good with ranges. What it does do is throw you out of them quickly so that you don't keep making bad trades one after the other.

 

You should know within the first ten or fifteen minutes what sort of day you're going to have. If it isn't shaping up to be a trend day, just walk away if you think you can't prevent yourself from trading.

[Niko 10]

This is not likely to work this time of year.

 

First, as soon as a range presents itself, you can't expect to be able to employ the usual ret strategy since it won't work well if at all in a range. If you're going to trade the range, you have to be prepared to take the revs. If you don't want to do that, and there's no reason why you should feel you have to, then just blow off the day and try again the next day.

 

Yes, I know, today I let myself be drawn into trading, before the session I was looking at the daily chart and just wanted to hit myself in the head for missing all of the upmove, that must have set the mood for the session making me look for trades where there werent any. Last few days I had been able to fold as the market did not offer any good trend, and I plan on keep on folding.

 

Second, while it's possible that a good entry might nonetheless be followed by a recoil that comes all the way back to your entry point, the best entries of course generally do not. If they do repeatedly, then you are likely in the kind of environment such as this one, and "hanging on" is not wise, particularly if you're not trading the extremes.

 

Ok, thanks, It was very frustrating and I have been in the path of keep the stop in the LSL or LSH and waiting for the best and I didnt want to go back there.

 

Third, the market doesn't care where you enter. Whatever choices you make regarding risk management are independent of what the market does. If you want to hang on for -1 or -2 or bail at BE is a choice you make that has nothing to do with what the market is doing. So pay attention to the market, not to your trade. If price comes all the way back to your entry point, think about what this is saying about buyers and sellers, not about the implications for your trade. If the trade is a good one, none of these concerns are likely to be relevant since price won't come anywhere near your entry level, assuming that it was correct.

 

Ok, I will do that.

 

Note, for example, how price behaves after it bounces off the midpoint at 1245 and breaks the SL. Thereafter is a higher low. If one entered off that, price would come back 1.5pts after the entry. If he exited and took the next test 8m later, price would come back only a half point below his entry. In either case, the recoil would be shallow. The message is the higher low, not the extent of the recoil after entry.

 

Given that we remain in this OH/OL/rest of the morning at the mean situation, you may want to look for a pattern of how many days we repeat this pattern before finally moving to one side or the other, as we did last week. Or you can investigate other instruments. But given the pattern of these ranges, it's foolish to keep hammering away in hopes that it isn't a range after all. Or trade the revs in the range just for the hell of it without investing anything of yourself in it (you will likely find that you'd have been better off cleaning out the garage).

 

I am actually doing the research since last week, I am looking at info from 2011, doing the characterization according to apendix e.

 

Just remember to do your research in the same quarter. Applying results from the first or third quarter to summer trading is not likely to provide any information that will be widely applicable.

 

The SLA points out early on that it is not particularly good with ranges. What it does do is throw you out of them quickly so that you don't keep making bad trades one after the other.

 

Yep, I realized that today errors would have been avoided if SLA chop detector was used as intended.

 

You should know within the first ten or fifteen minutes what sort of day you're going to have. If it isn't shaping up to be a trend day, just walk away if you think you can't prevent yourself from trading.

 

I am getting more aware of that each day, I think I must prevent myself from trading as that is a critical step in my success.

 

Thanks for your comments.

Edited June 10, 2014 by DbPhoenix

[Niko 10]

Hi,

 

Enjoyed your thread. I only post on forums once every few years but thought I'd write a couple of my observations.

 

Thanks for reading and for your kind comments.

 

Given the current low volatility it appears that 1 minute charts are chopping you out for lots of small losses which will probably add up quickly if a trend day doesn't come soon. A scratch on 1 minute charts costs a hell of a lot more than a scratch on an hourly+ chart, due to spreads/comms, and the fact that your average win on 1 minute charts will have to be much larger on a relative scale than on hourly+ charts to cover the costs of each scratch.

 

I am trading an uncharacterized environment that is very different from the one in which I learned the SLA and my scratching method. I am trying to solve that via characterization in order to include this kind of environment into the mix in order to either change trading strategy and take REVs or just avoid it in total.

 

Perhaps entering in the trough of the first retracement after the demand line breaks is a bit too arbitrary given that 1 minute charts are extra choppy. Maybe wait for the extreme of the retracement to break out a few ticks before entering, which might cost a few ticks compared to the trough entry, but gives extra confirmation and avoids your entry's first possible point of resistance, at the high of the retracement.

 

You could also add a filter that the extreme of your entry retracement, after the demand line breaks, must also have taken out the last swing point from which the demand line formed. This again removes another possible point of resistance after your entry and all it costs to wait for this extra trade filter is time.

 

Keep up the good work

 

I am using an anticipated entry that tries to reduce the price risk/information risk trade off, I have already tried the break of LSH or LSL entry and it did not work much better, but thanks for your observation.

 

As I said at the begining, thank you very much for your comments, I am trying to learn and apply SLA in order to reduce stress levels while trading and be more objective. In the future I will probably incorporate new stuff from my own recipe book or someone else´s but for now I am going to stick to SLA.