Sandbox

[Wolfhound 10]

Friday stayed around a mean for most of the day, before a fall in the evening. Overnight, we have moved up slowly, and are testing our overnight highs.

 

Above here we have a high on Friday of 79, but to get there we have to pass the congestion on the way, and at the moment we are close to the mean area of Friday.

 

We have recent lows at 55 and 50, and also at 44.

[Gringo 10]

Niko,

 

EOD trading is a lot easier on the psyche in my opinion. At least one doesn't have to make rapid fire decisions. With extra time at hand other issues crop up, but the routine is not as much of a time hog. I am paying less attention to what's going on in the intra-day world as it tends to pull me into trading more often. Yet, with slower trading, maybe hourly if one likes, there's more time and less stress.

 

Perhaps changing the bar interval might do the trick. I do believe in your case knowledge isn't the problem, and realistically speaking even SLA in itself, without anything to support it, is enough to keep one from sinking altogether. Take this time to see what you want and whether at this moment in time taking it easier and less glamorously might be the right approach.

 

Gringo

Edited June 16, 2014 by Gringo

[Seeker 11]

I disagree with most of what game said. The SLA is a simple, straightforward, highly risk-averse, self-correcting approach. Those who can't make it work don't or won't or can't follow the rules. This is not the fault of the approach.

 

If one can't succeed with something this simple, adding more tactics and setups and fiddling with trading size and scaling in and out will likely only make things worse.

 

If one is to succeed at trading, whether by this approach or any other, he must "know the game" perfectly and be competent at playing it. If one is more concerned about making money than he is about trading well, he will neither trade well nor make money. Based on the journals I've read here and at ET, I can't point out anyone who is interested in trading well.

 

Hi, Seeker, how's it going?

 

Very good thanks. I hope you're doing well too. Good to read your insights as always. I disagree with some though. I think he may benefit from scaling out. Looking over a lot of Niko's trades, he often (imo) exits too soon and/or usually on a swing against him, e.g. price moves just below the SL and he's out. His scratched trades are quite small losses, so he could, imo, take partial profits. It might give him the confidence to hang on for the remainder of the position or exit it with less emotion, and turn his scratch losses into a scratch breakeven or thereabouts. A decent % of his entries travel several times his typical scratch. He may not feel comfortable with that, but it's at least something he could investigate. As always, I think we should test ways to improve our trading.

 

I think the SLA is a great approach. Although I don't take entries exactly as described in SLA and have my own way of going about it, for me SLA has been invaluable and I wish I'd known it several years ago. Would have saved a lot of pain.

 

I don't see the point in trading real money while still developing a method. I've done it before, so I'm no better, but it didn't help me. All I learned was that it was something I shouldn't do. It's natural to be afraid if you're not sure what you're supposed to do - and if you have no method and are constantly changing it, then how can you be sure what to do?

 

I'm willing Niko to do well, but as I said, I've found it frustrating, because there are a lot of comments about working on this or that, and I'm not sure what the result of that is. Only Niko knows. What does 'rethink my approach to trading' mean for example? The approach is SLA and AMT. What needs to be rethought? Why not just get down to the nitty gritty and write a clear method down? Then demo it. Then finetune, improve, then demo it etc. What is there to think about?

 

Anyway, good luck with your future Niko, you can do it.

[DbPhoenix 42]

Very good thanks. I hope you're doing well too. Good to read your insights as always. I disagree with some though. I think he may benefit from scaling out. Looking over a lot of Niko's trades, he often (imo) exits too soon and/or usually on a swing against him, e.g. price moves just below the SL and he's out. His scratched trades are quite small losses, so he could, imo, take partial profits. It might give him the confidence to hang on for the remainder of the position or exit it with less emotion, and turn his scratch losses into a scratch breakeven or thereabouts. A decent % of his entries travel several times his typical scratch. He may not feel comfortable with that, but it's at least something he could investigate. As always, I think we should test ways to improve our trading.

 

Doing just fine, but I have to disagree with your disagreement. When fear is paramount, trading multiple contracts just isn't appropriate, much less scaling in or out. Until one can follow the rules, adding another layer of complexity serves only to perpetuate and even increase anxiety. If one can get to the point where trading by the rules becomes automatic, he need no longer think much if at all about what to do. This creates about as relaxed a trading environment as possible. Today, for example, there were at least 27pts to be had with only one contract (by 1300), and all one had to do was follow the rules. Wanting more, and adding contracts in order to get more, would result only in winding up with less, probably much less, if one were able to pull the trigger at all.

 

If one is focused on what to do about price action rather than on price action itself, he is far more likely to do the wrong thing -- such as repeatedly going short in an uptrend -- or nothing at all. But if following the rules is automatic, he need not think about what to do at all and can instead focus on price action, which is, after all, the objective.

[k p 10]

If you can entertain a question Db, I would appreciate it.

 

You mention in Niko's journal that today was a 27 point day by 1300. It of course was an excellent trending day on the way up and down, all of which I mostly missed, but I'm curious about how you would mark up a chart with simply SLA trades.

 

I am attaching mine, not that this is how it should look, but if following each bar as it forms, unfortunately the SLs and DLs might very well look like this. (Although I know this is inappropriate, in real time as the bars are forming, you just never know where your swing highs or lows will be to connect with the previous swing highs and lows).

 

As you can see on my chart, it appears as if the first trade to trigger is the short at A. When price breaks the SL, you can draw one of two DLs. The less steep one doesn't follow price at all since it shoots up, so you'd almost have to use the tighter one, which gets broken not too long after your entry which unfortunately isn't till much higher up (The retracement took a while to present itself).

 

Is there a different way of reading the opening to not put you in the short and have to wait so long for the RET to go long? That very first bar at the open, the longest one that opens and closes on the high is certainly what I would call a rejection bar, traders are showing they don't want price so low since it was bought back up. More telling is the higher low that forms 3 bars later, but by this point you are already in your short, having just entered as you hit the low and price turns around.

 

Anyway, as you can see, my lines are a terrible example of implementing SLA, and there are tons of scratches. So if it wouldn't be too much trouble, could you post a chart outlining the SLA trades?

 

It seems so easy at the end of the day, and I feel as if I would do an excellent job of annotating today's chart with the trades, but the swing points I would use to connect to form the SLs and DLs would all be in hindsight since I know they are there.

 

At the top, where we turn around and come back down, it appears as if the first short isn't till "F", at roughly 3777, but price ends up going up to just under 3780 before it comes back down again so I would be stopped out, which since the tight SL broke I would be out way before then. Now we can clearly see this area is a bit of chop now, and it doesn't clear up again till we get to 72, but by this point I would more than likely be worn down and not trusting any move, fearful it will just chop up some more.

 

Lately I have been following the opening range quite closely, looking more at rejections of going high or low, especially if this is happening at levels that I think are important. But I'm not much further along, and as you say, using a simple method such as SLA should be something that I can do without too much thought before I start getting to creative. I am hunting down ways to enter trades even sooner than SLA would allow, and then use SLA as a means of staying in the trade, but even that isn't working out too well as I get out far too quick.

 

Anyway, so in a long winded way, I wonder if you could outline the SLA trades, how you would draw your lines as they are forming from left to right or comment on my terrible attached chart! Thanks.

 

EDIT: Of course I should add that after 2 scratches, you're supposed to wait for price to go to some other level, so hammering away at these shorts and longs is inappropriate, I just wanted to illustrate them as possible entries for the way the lines are drawn the way I would in real time.

[boru 10]

Kp for what its worth, be aware of the failures, I think you could have entered earlier at a for sure and maybe d too.

The more I watch price the more you will see price turn before the lines, db is right after you understand how price unfolds you are better off without the lines just my 2 cents. This is something I am still working on.

Edited June 17, 2014 by boru

[DbPhoenix 42]

So if it wouldn't be too much trouble, could you post a chart outlining the SLA trades?

 

Not again, no. Sorry. No purpose would be served by my providing yet another chart.

 

Those of you who are interested in learning this are going to have to go over your trades for the day and determine how each of those trades illustrate the rules. If the trades do not illustrate the rules, you're going to have to figure out why you took the trade. If the rules called for you to take a trade and you didn't, you're going to have to figure out why you didn't take it (that most of you introduce so much that has nothing to do with the rules may have something to do with it).

 

If the rules can't be followed, it should be remembered that the SLA is not the only trading method there is. Perhaps something mechanical or even automated might provide a better fit.

[k p 10]

Kp for what its worth, be aware of the failures, I think you could have entered earlier at a for sure and maybe d too.

The more I watch price the more you will see price turn before the lines, db is right after you understand how price unfolds you are better off without the lines just my 2 cents. This is something I am still working on.

 

Hey Boru.. yes... I definitely watch rejections/failures now. I was actually just curuious how he would draw them in today given that he had an exact number of 27 for the point totals. and also since the top half of the chart was quite choppy. I know that when Db draws charts, there is lots to glean from the nuances of why he draws the lines the way he does. (ie. what he skips and what he adds in)

[k p 10]

Not again, no. Sorry. No purpose would be served by my providing yet another chart.

 

Those of you who are interested in learning this are going to have to go over your trades for the day and determine how each of those trades illustrate the rules. If the trades do not illustrate the rules, you're going to have to figure out why you took the trade. If the rules called for you to take a trade and you didn't, you're going to have to figure out why you didn't take it (that most of you introduce so much that has nothing to do with the rules may have something to do with it).

 

If the rules can't be followed, it should be remembered that the SLA is not the only trading method there is. Perhaps something mechanical or even automated might provide a better fit.

 

No worries, thanks for the reply. SLA is almost as mechanical as you can get... except of course if you think there is value in plotting moving averages and waiting for a crossover.. (of course I know your answer to that though!)

[DbPhoenix 42]

I know that when Db draws charts, there is lots to glean from the nuances of why he draws the lines the way he does. (ie. what he skips and what he adds in)

 

Nuances come later, after one has achieved competence. You say that your lines are "a terrible example of implementing SLA". Why? You speak of being "worn down" and "not trusting any move". Why? And of being "fearful". Of what? You say you are "hunting down ways to enter trades even sooner than SLA would allow". Why?

 

A large part of the answer to your problems is in your own questions. Either you're willing to trade by the rules or you aren't. If you aren't, then one more chart in addition to the hundreds I've posted isn't going to make the least difference.

[k p 10]

Nuances come later, after one has achieved competence. You say that your lines are "a terrible example of implementing SLA". Why? You speak of being "worn down" and "not trusting any move". Why? And of being "fearful". Of what? You say you are "hunting down ways to enter trades even sooner than SLA would allow". Why?

 

A large part of the answer to your problems is in your own questions. Either you're willing to trade by the rules or you aren't. If you aren't, then one more chart in addition to the hundreds I've posted isn't going to make the least difference.

 

It I'm sure mostly comes back to the lack of a trading plan.

 

In terms of "not trusting any moves", I know enough now that it doesn't matter what I think about a move as what I'm essentially wanting is to predict the future which is impossible. There may be nuances to keep one out of a certain set-up given the context, but I can save all that for later. At the moment, there is simply no reason for not taking an SLA trade when it presents itself.

 

The reason I'm hunting down trades that are sooner than SLA would allow is two fold. The RET is there sometimes, contained within the bar so to speak, and if each minute was actually cut off at 55 seconds lets say, then the bars would be packaged differently and the RET would officially be shown in the minute bars (ie. for a long, in the last few seconds before the bar closes, price might spike up, thereby making that bar not close one tick below the previous bar to show the RET in the one minute bar interval chart). So in essence, the RET is there is what I'm thinking, and hence its somewhat sooner than a straight SLA trade if what would have been my trigger bar ends up closing higher than the previous bar.

 

The second reason is fear of price moving against me if I have a fixed stop loss of lets say 2 points. So if the SLA entry is many points away from where the change in trend seems to be, price can still retrace some more, more than 2 points away from the entry, perhaps even testing the price at which the trend change began, and yet still not invalidate the trade. So then I'm left with either breaking a firm stop loss rule, which mostly comes from fear anyway, or playing the hoping game. After a hand full of trades now, I have seen that on almost every trade, my exists, be they for profit taking or taking the loss, are usually at the worst possible place, meaning that a better exit almost always presents itself for either a smaller loss, or greater profit, or even what was going to be a loss turns around into profit. So giving price a bit of room is essential. (I have been planing for a while now to do an analysis when I get to 50 trades lets say to track the outcome, my win/loss, and more importantly, was the win taken too soon, and could the loss have been less if I held on just a bit longer.)

 

So the lack of a trading plan creeps in with not having defined how steep I would draw my lines, when I would fan them, what constitutes a line break... etc. In essence, its not so much that I can't follow rules, its that I see that in the moment, I don't actually have a rule that specifically tells me what to. If you're going to change the oil in your car, its fairly straight forward in that you get a bucket, unscrew the bolt, let the oil flow out, and change the filter. But when in the middle of it, right under the car, when I loosen the bolt and oil starts coming out, I haven't planned what to do with the bolt for example... do I still leave it in... do I let it fall into the bucket... do I take it out and wipe it off.... etc.

 

Anyway, as you say, the answer to my problems really is in the questions. If I knew exactly what to do in the moment, I would do it, but because I haven't planned this with precision, it tends to fall apart right in the moment.

 

As you have said many times in other threads though, by solving these problems myself, I will trust them wholeheartedly, and by being the person who makes the plan, it should be easy to do what I have myself outlined sine the trust will be there, once I have something solid. Trading is nice in a way because I don't need someone else to tell me that I've done a good job (even though sometimes I think I am looking for a bit of reassurance), because the proof will be right in the chart, and it will be fairly easy to see if the way I'm reading price action is in fact correct after a statistically sufficient number of trades or not.

[DbPhoenix 42]

It I'm sure mostly comes back to the lack of a trading plan.

 

That is correct.

 

The reason I'm hunting down trades that are sooner than SLA would allow is two fold. The RET is there sometimes, contained within the bar so to speak, and if each minute was actually cut off at 55 seconds lets say, then the bars would be packaged differently and the RET would officially be shown in the minute bars (ie. for a long, in the last few seconds before the bar closes, price might spike up, thereby making that bar not close one tick below the previous bar to show the RET in the one minute bar interval chart). So in essence, the RET is there is what I'm thinking, and hence its somewhat sooner than a straight SLA trade if what would have been my trigger bar ends up closing higher than the previous bar.

 

The SLA does not prescribe a particular bar interval. Price is continuous, and waiting for a bar to "close" is a choice. If one is watching price move, he can trade retracements without any regard to bars whatsoever. You're miring yourself in minutiae.

 

In essence, its not so much that I can't follow rules, its that I see that in the moment, I don't actually have a rule that specifically tells me what to.

 

Having rules that you can't or don't follow is no different than having no rules at all, such as your 2pt stop. And if you've "been planning for a while now to do an analysis", why continue trading until you've done it? This is no different that Niko's "skipping" the one-year backtest.

 

What happens after an entry or exit is irrelevant to whatever rule one has developed for the entry or exit. It is more important to prepare for any outcome than to change the rule after every time it's been applied. Changing rules again and again on the basis of an emotional response is self-indulgent.

 

Like nearly everyone else who plays with this, you're twisting yourself into knots because you have no trading plan. The SLA provides the bones of a plan, but you still have to decide what, for example, constitutes a "break". You haven't done that, so what do you expect? Trading success doesn't just "come" simply because one keeps doing it over and over again. If every trading session is an emotional rollercoaster, the pursuit will eventually be abandoned.

 

For the most part, you're just as eager to cut corners and rush ahead as you've always been, so you're not getting anywhere. But this is true of nearly everyone. By taking what they view as every available short-cut, they take far longer than they would have if they had done the work to begin with. The focus is on finding the trade and taking the trade and fretting over the trade and where and how to exit and how to rack up points rather than understanding what's going on. Me me me I I I. The market has zero interest in one's trade, and if one is focused entirely on the state of his trade rather than on what traders are doing, he will find that this approach has been a complete waste of time.

[Wolfhound 10]

Today we had a big trend on the open which I didn't get on. There was a retracement after 10 points but I didn't take it thinking that we had a fast rise and were coming near the highs from yesterday. This was a mistake. The rest of the day was fairly normal.

 

1. We shot right up towards Friday's highs at the open. I placed a short on the double top after the demand line break. It stopped out after a few minutes. We made several lows at 72.5 and then headed upwards.

 

2. I put a short on the little retracement here. This made it back to 75 which is the mid point of the high and low of the last few days. This area seems to be improtant this morning.

 

3. Another short on retracement, which I left to see if it would break the previous swing high or go lower. Eventually it went lower back to the open levels.

[k p 10]

The SLA does not prescribe a particular bar interval. Price is continuous, and waiting for a bar to "close" is a choice. If one is watching price move, he can trade retracements without any regard to bars whatsoever. You're miring yourself in minutiae.

 

Having rules that you can't or don't follow is no different than having no rules at all, such as your 2pt stop. And if you've "been planning for a while now to do an analysis", why continue trading until you've done it?

 

Trading success doesn't just "come" simply because one keeps doing it over and over again. If every trading session is an emotional rollercoaster, the pursuit will eventually be abandoned.

 

For the most part, you're just as eager to cut corners and rush ahead as you've always been, so you're not getting anywhere. But this is true of nearly everyone. By taking what they view as every available short-cut, they take far longer than they would have if they had done the work to begin with. The focus is on finding the trade and taking the trade and fretting over the trade and where and how to exit and how to rack up points rather than understanding what's going on. Me me me I I I. The market has zero interest in one's trade, and if one is focused entirely on the state of his trade rather than on what traders are doing, he will find that this approach has been a complete waste of time.

 

With regards to retracements, I had always thought this, and suspected that it was proper to get in sooner, even if the retracement wasn't obvious on a static chart, and that if you see it form in real time this was good enough, so thank-you for the confirmation.

 

My only explanation for all your other points you make is simply that I wanted to see what would happen. I wanted to see how I would react, what stupid things I could do, how I would be affected by being in a trade. Reading about how Niko was getting chopped up a few times by trading in chop that was a bit of over-trading, I could see that this in fact wasn't my problem. If anything, I was/am under-trading in that I wasn't taking legitimate trades, and the few times I did get in inappropriately was based on fear of missing out, and getting in much too late at that point.

 

As you say, the market has no interest in my trade, and its interesting to see how much this changes my perception when I am in a trade. Seeing this is what made me want to search for better entries, getting a better price, giving up a bit of confirmation.

 

I do absolutely see with my own eyes now how there is no need to panic, and that better exits present themselves as I've said earlier. This is something that for me was difficult to see without actually being in a trade because I didn't think I would be so desperate to get out so quick had I not been in a trade. So in a way, I think I needed to throw myself in to see what my problems would be, to see how I would react to the market and the tug of war that would ensue between my brain and my emotions.

 

Its been a struggle between knowing that trading SLA should be easy if you follow rules, and I know the rules, so why not just go forward live with SLA, and at the same time wanting to make sure I'm not cutting corners as you say.

 

I absolutely appreciate your insight of course. I have a history of doing things the wrong way initially I think, just to see how they turn out, to feel the pain a bit, to make sure I'm not going to have beginners luck and assume this is easy and subsequently fight it all the way to the bottom. In a way, knowing this is hard, its almost as if I'm trying to make it hard so that I don't learn right from the start that this is easy.

 

Your wise words are sinking in, I keep reading them over and over again, and one day my internal fight with myself will come to an end and I will just start seeing what is and accept it and work based off that. I do think I'm actually getting somewhere and the coming days and weeks will be proof of this one way or another.

[Wolfhound 10]

Yesterday we had an up and down day around the eventual mean. Overnight we passed the daytime highs and reached 86, before falling in the morning back to the mean levels. We have highs 81 and 86 and lows at 65, 55 and 50, and it looks like we are in an upward channel on the hourly chart also.

[Seeker 11]

Doing just fine, but I have to disagree with your disagreement. When fear is paramount, trading multiple contracts just isn't appropriate, much less scaling in or out. Until one can follow the rules, adding another layer of complexity serves only to perpetuate and even increase anxiety. If one can get to the point where trading by the rules becomes automatic, he need no longer think much if at all about what to do. This creates about as relaxed a trading environment as possible. Today, for example, there were at least 27pts to be had with only one contract (by 1300), and all one had to do was follow the rules. Wanting more, and adding contracts in order to get more, would result only in winding up with less, probably much less, if one were able to pull the trigger at all.

 

If one is focused on what to do about price action rather than on price action itself, he is far more likely to do the wrong thing -- such as repeatedly going short in an uptrend -- or nothing at all. But if following the rules is automatic, he need not think about what to do at all and can instead focus on price action, which is, after all, the objective.

 

Well you may well be right. It's hard to give advice, and know for sure what will work for someone else. I can only refer to my own history. And that was that I felt a lot of fear when I had uncertainty of what to do in my system (in fact initially I didn't have a system fully worked out). Then later when I did, I still had some fear, because I hasn't proved that the system worked in demo for long enough. I went in circles. So many circles it is dizzying thinking about it now, so much time wasted fooling myself that I was working on it, when really I was avoiding the hard work. Eventually I got down to writing the system, testing it, improving, test, practice and that was a far more productive circle to be in. I was an idiot and lazy for a long time.

[Seeker 11]

No worries, thanks for the reply. SLA is almost as mechanical as you can get... except of course if you think there is value in plotting moving averages and waiting for a crossover.. (of course I know your answer to that though!)

 

There's not one way to do things. DB has kindly given a structure for a plan. Why not make it your own.

 

On the chart you posted, you can take a short at A, but then there's a higher low not long after, so you could take that long on the break of the 8:35 bar (I think that's the time(. Or you could decide you're in a triangle, and wait for a break out from there, 8:37 bar closes clear out. Could take it immediately, could wait for a break of that bar, could wait for the first retracement. DB has given some rules to keep one out of trouble, but that doesn't mean it's the only way of playing it.

 

If you took the short at A, you have a small loss. If you took the higher low, you probably have a large win. The close above the triangle/hinge, a good win, the first retracement after at B, a good win.

 

C you could take short if you want, although you're going against quite a strong up move (DB once posted about if it can't even retrace 50% of the previous swing it might not be worth taking, although that's not set in stone, just an idea). In any case you have drawn a supply line downwards on 3 down bars. There's no lower high as such, or is there? You decide what a swing point is for your plan. For me there's no swing so I wouldn't draw the line, nor would I draw that next demand line, there's not two swing lows to connect, so I wouldn't take D. I'd still be in short from C (if I took it) and see plenty of reasons to not let that trade turn into a loss. The three attempts which couldn't go lower for example. One could even take a long there, or wait for the break from the SL, or wait for the first retracement afterwards, which may be at E, or may be some bars later again depending on how you define swing/retracement.

 

So maybe you take E and maybe a small loss, or maybe you think that the E trade is basically at a new high, and you prefer to trade long near a relative low extreme. Again, choices, so many of them.

 

Then maybe that low near D, you fan the line out when the new high is made for the day. Perhaps when price moves below this DL, you get a shorting opportunity near the top and earlier than F...or maybe not. If F is a swing, then why isn't the SL tighter? If it is, then you have a possible exit for small profit and a possible long 5 or 6 bars later. Or again, maybe since it hasn't retraced more than 50% of that downswing, you decide not to take the long.

 

Maybe you only take trades like this in the direction of the daily trend, or hourly trend or whatever. Maybe just one trade a day. Or maybe you don't just have these straight lines, you also denote horizontal ranges, like the one near the top, or you have a higher timeframe view about where support and resistance might come in. It's your choice, your trade plan. Why do you need DB to tell you, he's already given the idea, test it yourself. Pick a consistent way of doing it, then grab pen and paper (or a spreadsheet) and see how that way does. Try it with market replay if you can.

Edited June 17, 2014 by Seeker

[Niko 10]

Well you may well be right. It's hard to give advice, and know for sure what will work for someone else. I can only refer to my own history. And that was that I felt a lot of fear when I had uncertainty of what to do in my system (in fact initially I didn't have a system fully worked out). Then later when I did, I still had some fear, because I hasn't proved that the system worked in demo for long enough. I went in circles. So many circles it is dizzying thinking about it now, so much time wasted fooling myself that I was working on it, when really I was avoiding the hard work. Eventually I got down to writing the system, testing it, improving, test, practice and that was a far more productive circle to be in. I was an idiot and lazy for a long time.

 

Will follow your path . Will post back when done or if I have a question, whatever comes first.

[DbPhoenix 42]

from the slaamtzen thread:

 

Well you may well be right. It's hard to give advice, and know for sure what will work for someone else. I can only refer to my own history. And that was that I felt a lot of fear when I had uncertainty of what to do in my system (in fact initially I didn't have a system fully worked out). Then later when I did, I still had some fear, because I hasn't proved that the system worked in demo for long enough. I went in circles. So many circles it is dizzying thinking about it now, so much time wasted fooling myself that I was working on it, when really I was avoiding the hard work. Eventually I got down to writing the system, testing it, improving, test, practice and that was a far more productive circle to be in. I was an idiot and lazy for a long time.

 

Your experience is typical except that you came out the other side. Most don't. They find no excitement in putting together a trading plan, no glamour, no opportunities for heroics. They consider observation, hypothesizing, backtesting, forwardtesting, and even simtrading to be drudgery. Real-time trading with real money is where the action is, so they'll spend twenty years or more trying to achieve without a trading plan what they could achieve in months if only they'd learn to crawl before spending hundreds of dollars on running shoes and trying to compete with professionals.

 

It's a mystery. No one believes that he can play championship tennis or golf without ever taking a lesson, that he can become a concert pianist without ever doing scales, that he can become a professional chef without knowing the first thing about food chemistry. But one can become a professional trader simply by buying or shorting what seems like a good idea and hoping for the best. It should come as no surprise that so few are able to make a go of this.

[Wolfhound 10]

Decided to mostly just watch the price today. It was a clean up and down day with many retracements for entries.

 

 

1. It went below the overnight range, and then turned back upwards. There is a subsequent higher low at the overnight low before we head up past todays open.

 

2. There are numerous retracements on the way up to the highs.We eventually stop below the highs at 86.

 

3. Lower high as the rise stops. I marked a short here, and as before we have a number of retracements during the fall to the level where we opened.

[Wolfhound 10]

On the hourly chart we are at the mean of our channel, and may see a movement towards either extreme today.

 

Yesterday we had a low of 63 and a high of 85, and we eventually settled down to the mean of 74 overnight. In the morning we have moved up towards 80 and have held above the mean for now.

 

We have to test the extremes of the overnight high or low at 80 and 71, before we can look at yesterdays highs and lows.

[k p 10]

 

Maybe you only take trades like this in the direction of the daily trend, or hourly trend or whatever. Maybe just one trade a day. Or maybe you don't just have these straight lines, you also denote horizontal ranges, like the one near the top, or you have a higher timeframe view about where support and resistance might come in. It's your choice, your trade plan. Why do you need DB to tell you, he's already given the idea, test it yourself. Pick a consistent way of doing it, then grab pen and paper (or a spreadsheet) and see how that way does. Try it with market replay if you can.

 

Hi Seeker... yes, you're right, Db has provided plenty and its just a matter of testing to see what works. Its kind of exciting also to know that when I have something I put together myself, I will understand exactly how it works.

 

I have already seen myself that each time I'm wanting to exit a trade, its much better for me to wait as at least 80% of the time, price either comes back closer to my entry point and hence allows me to exit at a smaller loss, or if exiting for a profit, there is a bit more profit to squeeze out, or, best of all, what would have been a loss turns into profit. The trouble really is taking the bigger hit once, perhaps a 4 point loss or 5 points, knowing that over the long run, this will actually add up to more points profit since waiting is statistically on my side.

 

At any rate... this is just about the most rewarding en devour I can think of because the potential is really quite unlimited, unlike so many other financial pursuits that either go nowhere or have a built-in ceiling that cannot be crossed.

[slugar 10]

I disagree with most of what game said. The SLA is a simple, straightforward, highly risk-averse, self-correcting approach. Those who can't make it work don't or won't or can't follow the rules. This is not the fault of the approach.

 

If one can't succeed with something this simple, adding more tactics and setups and fiddling with trading size and scaling in and out will likely only make things worse.

 

If one is to succeed at trading, whether by this approach or any other, he must "know the game" perfectly and be competent at playing it. If one is more concerned about making money than he is about trading well, he will neither trade well nor make money. Based on the journals I've read here and at ET, I can't point out anyone who is interested in trading well.

 

Hi, Seeker, how's it going?

glad to see you are still your cheerful self Edited June 18, 2014 by DbPhoenix

[Seeker 11]

Will follow your path . Will post back when done or if I have a question, whatever comes first.

 

Follow your own path Niko. Mine was longer than necessary and I'm nobody to follow. You have all the tools and info you need.

[Niko 10]

Follow your own path Niko. Mine was longer than necessary and I'm nobody to follow. You have all the tools and info you need.

 

Thank you, what I meant was that I need to finish the whole testing, I always started it but never got around it, so I will not make that same mistake again.