Trading The Wyckoff Way

[tupapa 10]

No, your win:loss ratio, your profit:loss ratio, your maximum drawdown, your longest string of consecutive losses, etc. The sample size is not pertinent.

 

Db

 

So far my stats for the reversal pattern I am focused on is:

 

Win/lose=71%

Profit/loss=4.4

Max number of consecutive losers=3

Max Drawdown= 28 ticks

 

Bear in mind that this is just for a 16 day sample..

[DbPhoenix 42]

Even though you made only a point, think of those people who DID do stupid things, like trying to go long all the way down.

 

As for your plan, obviously you must include the micro (1m) as well as the macro in your pre-opening charts. I thought you were doing this since that's what I had done. But now you know to do that, so don't dwell on it.

 

As for having a too-narrow focus, perhaps. But even if you were focused on TRs, you might have taken the subsequent ops to enter at 95 or 93, given that all of this was taking place at the upper limit of that 98 to 2800 TR. Now's the time to write down whatever was running through your head at the time before it all slips away. If it has already, write down what you can.

 

Db

Edited September 27, 2012 by DbPhoenix

[DbPhoenix 42]

So far my stats for the reversal pattern I am focused on is:

 

Win/lose=71%

Profit/loss=4.4

Max number of consecutive losers=3

Max Drawdown= 28 ticks

 

Bear in mind that this is just for a 16 day sample..

 

So 71% of all the trades you've taken over the last 16 days have been winners with a 4.4% profit?

 

Db

[Gringo 10]

First drop caught me by surprise and I started brooding over missing that move. When suddenly the price returned upward in one swoop I got worried whether price was first going to go to the S/R and then decide which way to go. Instead of acting when weakness developed again I overrode the price signal and thought to wait a bit to see which direction price takes (classic Information/price risk again ), and viola the next instant price was gone.:crap:

 

Wider swings in price seem to unsettle me a somewhat. I have to start following price itself and know that I can always exit if price goes against me. My past fear of getting caught on the wrong side and then feeling like a prisoner waiting for the price gods to rescue me might have been playing in the background making me trigger shy.

 

Gringo

[DbPhoenix 42]

Here are examples of the sort of thing you ought to have on your screen pre-open. Regardless of whatever else you've done in terms of plotting TRs and SLs and DLs and so forth, tune in to what traders are up to and what buyers and sellers are able to accomplish. Note the swing points. If and when they start to line up, look for a TR. If you find one, locate its midpoint.

 

As for the R at 2800, that's somewhat old and therefore soft. Focus on what traders are doing, not on exact levels. Traders do hover around 2800, but they're done with that long before the open.

 

 

 

 

 

 

 

 

 

The rejection of 2800 is not dramatic, but there's no reason to believe that price will go back yet again to test it further. And even if it does, what are you out? A point? You can then short at a higher level. And if it doesn't, you're already in.

 

A common problem -- the result of the nonsense that one reads in articles and books and message boards and so forth -- is a reluctance to do the obvious out of a fear that one is being manipulated by the so-called "big money". If this niggles away in the back of your mind, exorcise it. Judge the market by its own action, not by what you think "the players" are doing. What the players are doing is in the price action. If 97 seems too much like a Gimmee, take it anyway and keep your hand on the bar of the emergency exit. You have nothing to lose.

 

Db

[tupapa 10]

So 71% of all the trades you've taken over the last 16 days have been winners with a 4.4% profit?

 

Db

 

No that is obviously not the case, I have only been trading the Bund for 4 days so I have no statistics and I am still in the testing stage.

 

Sho the stats I just gave you are for the backtesting of a reversal pattern that I am familiar with in the NQ, a rejection of S/R with a double bottom or Hl/LH and preferably with volume divergence. I knew from my past testing this pattern worked well in the NQ and from y backtesting in the bund, I have found it to also be profitable.

 

I am not sure what you are trying to get to but if you want to me to accept my trading is shit, you are wasting your time since I am well aware of this.

 

So as I said, I am currently working on my sistem based on reversals and pullbacks, I have nothing for you in terms of stats since at the moment I am just testing...

[DbPhoenix 42]

What I'm trying to get to is an understanding of what you're doing and what your results are. As to whether or not your trading is shit, I have no idea. If the stats you provided are for a backtest of some sort, they are encouraging, but if they aren't proving to be valid in RT trading, then there clearly is a problem. Perhaps your planning isn't thorough enough. Perhaps you're not trading your plan. Perhaps your backtest wasn't constructed properly. Keeping daily and cumulative records of your stats will help keep you on track. Whether you are "just testing" or not isn't pertinent. If you don't maintain stats, the testing is pointless.

 

You say the stats you've provided are from backtesting you did in the NQ. These do not necessarily transfer to the Bund, but you say that you have also backtested the Bund and found your setup to be profitable in the Bund as well. How did you construct your backtest? Did you also forward-test whatever plan you came up with? What stats do you have for the backtest and the forward-test? Since you're trading two different setups simultaneously, are you keeping separate stats for each? You say you "have nothing" in terms of stats, but surely you have stats from your backtesting and, if done, your forward-testing. As for trading the Bund for only 4 days, as soon as you've made two trades, you can begin keeping these stats. If you don't keep them, then you'll have no idea what progress you're making, if any, in reaching your objectives and goals.

 

Db

[franko 10]

db,

regarding post 239; you advised gringo "even if you were focused on TRs, you might have taken the subsequent ops to enter at 95 or 93, given that all of this was taking place at the upper limit of that 78-2800 TR."

would you please post the chart having that 2778-2800 TR?

[franko 10]

db,

pass my last question. i found the chart.

TRs is 2798-2800.

thank you

[DbPhoenix 42]

db,

pass my last question. i found the chart.

TRs is 2798-2800.

thank you

 

Correct. Thank you.

 

Db

[pjohnm 10]

Here's my take on the NQ 100 on 26/09 having watched the opening 60 mins in real time, S/R levels have already been posted by Gringo so no need to provide a macro chart. Note that the market has suffered large sell off during 25/09 session, opening below PDL suggests continued weakness.

 

Pre Mrkt - Supply line established pre open

 

Opening 20 mins (14:30 – 14:48)

Price reverses at the pre mkt supply line (2796), failing to reach the PDL or S/R established at 2800. Steeper supply line drawn (v pre mkt line) as TR midpoint broken, retrcement back to mid point but lower low follows (more weakness)

 

14:48 – 15:00

Supply line broken as down momentum slows.

Note the contraction in volatility, selling pressure has reduced but buyers do not follow through

 

15:00 – 15:16

Selling momentum continues to decline as price approaches S/R at 2778.

Note that price is held at 2782.10 on 3 occasions and that this may actually be more significant than the foresight line drawn at 2778.

 

Lower low follows and creates new supply line, price bounces off S/R at 2778+ and returns to interday S (now R?) at 2782, in conjunction with the supply line.

 

What next? A marked contraction in volitility at 2782 from below.

Consider a sell stop below the bar at 15:20.

This would seem counter-intuitve given that S/R was drawn at 2778 but the interday action showed 2782 to be important.

 

Given the evident weakness (both pre mkt and after the open) plus the potential for interday S to become R, we have a newly drawn supply line aswell as the contraction in volatility at 15:20 to set a tight sell stop below the bar (with the stop just above the bar).

 

Takeaways -

My trading rules need to consider near term trend e.g has the market opened above/below PDH/PDL?

Look for interday S/R, do I consider these more important than longer term S/R? (If it stops you trading countertrend, then yes).

[tupapa 10]

What I'm trying to get to is an understanding of what you're doing and what your results are. As to whether or not your trading is shit, I have no idea. If the stats you provided are for a backtest of some sort, they are encouraging, but if they aren't proving to be valid in RT trading, then there clearly is a problem. Perhaps your planning isn't thorough enough. Perhaps you're not trading your plan. Perhaps your backtest wasn't constructed properly. Keeping daily and cumulative records of your stats will help keep you on track. Whether you are "just testing" or not isn't pertinent. If you don't maintain stats, the testing is pointless.

 

You say the stats you've provided are from backtesting you did in the NQ. These do not necessarily transfer to the Bund, but you say that you have also backtested the Bund and found your setup to be profitable in the Bund as well. How did you construct your backtest? Did you also forward-test whatever plan you came up with? What stats do you have for the backtest and the forward-test? Since you're trading two different setups simultaneously, are you keeping separate stats for each? You say you "have nothing" in terms of stats, but surely you have stats from your backtesting and, if done, your forward-testing. As for trading the Bund for only 4 days, as soon as you've made two trades, you can begin keeping these stats. If you don't keep them, then you'll have no idea what progress you're making, if any, in reaching your objectives and goals.

 

Db

 

If that is the case I appreciate your interest. The stats I provided in my previous post are from a 14 day Bund backtest which I structure in the following way:

 

1- Draw S/R levels on the 60min charts

2- Plot levels on the 1 min chart and start scrolling, from left to right until I see the setup, then I draw the S/L and scale out according to my plan.

 

From my previous bhacktesting in the NQ, I found this reversal setup work well and I can say the same for the Bund (as the previous stats show).

 

When I day trade my plan the results are different due to several reasons, so far I have found the following issues:

 

1- Sometimes I struggle to find S/R levels, or the set-up occurs nowhere near my levels, so I hesitate.

2- On occasions I don't wait for enough confirmation and take a losing trade.

3- Often, waiting for the previous 1m bar to close and then entering one tick above forces me to use a very wide stop, hence I am looking at the tick' to try to find a more effective entry signal.

 

These are only some of the problems I am finding when testing my plan in real-time, and yes, I am keeping stats of each trade I make and each setup individually, so I can evaluate each set-up and my performance and interpretation of it in real time.

Edited September 27, 2012 by DbPhoenix
loosing=losing

[DbPhoenix 42]

1. Define "reversal setup".

 

2. You refer to "scaling out". How many lots are you trading in your backtests?

 

Db

[tupapa 10]

1. Define "reversal setup".

 

2. You refer to "scaling out". How many lots are you trading in your backtests?

 

Db

 

As price approaches a level ®, I want to see buyers coming in aggressively and rejecting price at least 4 ticks. Then I wait for sellers to try again, and when price makes a HL or a double bottom, I enter with a buy stop above the previous 1m bar close.

 

This can take place in a 3 tick range from the level I plotted, so If i S at 40, I will take the reversal between 43 and 37. My stop is place below the LSL.

 

I am testing 2 lots, the first exited at the break of the DL, the second at the next LH or break LSL, whatever comes first.

[DbPhoenix 42]

As price approaches a level ®, I want to see buyers coming in aggressively and rejecting price at least 4 ticks. Then I wait for sellers to try again, and when price makes a HL or a double bottom, I enter with a buy stop above the previous 1m bar close.

 

This can take place in a 3 tick range from the level I plotted, so If i S at 40, I will take the reversal between 43 and 37. My stop is place below the LSL.

 

In your first sentence, I believe you mean "S", not "R".

 

I am testing 2 lots, the first exited at the break of the DL, the second at the next LH or break LSL, whatever comes first.

 

Test one lot, not two. If you can't develop a consistently profitable strategy with one lot, you aren't going to do it with two, for a variety of reasons.

...............................

 

Show me five charts from your Bund backtest that illustrate this setup.

 

Db

[tupapa 10]

In your first sentence, I believe you mean "S", not "R".

 

Yep I did

 

 

 

Test one lot, not two. If you can't develop a consistently profitable strategy with one lot, you aren't going to do it with two, for a variety of reasons.

...............................

 

Show me five charts from your Bund backtest that illustrate this setup.

 

Db

 

Here are the charts, as I mentioned in my above post, I am not a fan of placing a buy stop above the porevious bars close on the 1m chart, I'd much rather develop a mechanical signal such as a congestion on the tick chart or a HH, and HL,..

[DbPhoenix 42]

If I understand your process correctly, charts 1, 2, and 4 appear to be essentially BE trades, resulting in a W:L ratio of 2:5, or 40%. Is this correct?

 

Db

 

Incidentally, if this continues, I'll move it to the Journal thread.

[tupapa 10]

Please feel free to move it to the journal thread.

 

Yes they are BE even trades, although in chart 1, there is a re-entry straight after the first entry and same on chart 4.

[DbPhoenix 42]

Please feel free to move it to the journal thread.

 

Yes they are BE even trades, although in chart 1, there is a re-entry straight after the first entry and same on chart 4.

 

I see only one setup in each chart. Is this incorrect?

 

Db

[tomerok 10]

Hi all.

i finally decided to try and contribute a bit after enjoying this one of many wonderful Wyckoff threads.

In the last month i tried to ditch what i was doing and focusing at wyckoff approach.

Here is my view of today's 27.09.2012 PA.

a quick explanation of my daily routine...

every day i go through 4 charts (long to short range) and try to see if i can notice any S&R.

I'm using range charts.

Solid lines are used for Trend Lines

Dashed lines are S&R lines

Dotted lines are used for less important S&R lines

Blue for S and violet for R

yellow lines are used for intra-day trend lines.

 

 

89 range - Long Range Bull Trend Channel support broken, Long Range Support from previous trading range highs (second box) broken, Long Range Support at middle of previous trading rage (first box) is valid.

 

34 range - last support (first trading range middle) holds, a 20 pt. pullback was formed, currently at the trading range highs.

 

21 range - An inside day with a small uptrend from yesterday.

 

13 range - No HH at today's session yet, still at the trading range (first box) highs

 

Let's watch what the open bring..

will broken S will become R

Will price go into a new trading range?

Or maybe it's long range sellers creating a pullback.

 

Tomer.

 

B.T.W.

Db.

i accidently posted it on the journal thread. please delete it.

[tupapa 10]

If you look at chart 1, there is another rejection followed by a lower high at 07:47.

 

The same in the 4th chart, price makes a LL at 138.98 and then a HL at 139.95.

 

I forgot to point out that I consider any trade that doesn't lose money to be a winner.

[pjohnm 10]

27/09/12

Pre Mkt chart (5 Min)

[DbPhoenix 42]

If you look at chart 1, there is another rejection followed by a lower high at 07:47.

 

The same in the 4th chart, price makes a LL at 138.98 and then a HL at 139.95.

 

That may be, but these trades aren't noted on the chart. If the charts aren't complete, you have no useful stats.

 

I forgot to point out that I consider any trade that doesn't lose money to be a winner.

 

This is incorrect. Even if you're trading commission-free, a BE trade is not a winner. It is null.

 

Db

[DbPhoenix 42]

So Gringo, stop looking at the attachments and post your charts

 

Db

[Gringo 10]

My pre-market charts:

 

 

 

Today's resolution is to focus on price itself and take the entry when it comes instead of over analysing it closer to S/R and pink mini intra-day s/r.

 

Gringo