Reading Charts in Real Time

[Marko23 10]

The support zone slowed the Short.

From the DOM I could feel that I had to get out at break even.

 

I hesitate to write that "feel".

 

[thalestrader 14]

PT1 is filled, and stop loss is now 1.5144..

 

Here is where I am with this 6B (GBPUSD) short:

 

Short @1.5151

 

1/3 profit filled at 1.5120 (+31 ticks)

 

stop loss on 1/3 is 1.5120 (+31 ticks)

 

stop loss on final 1/3 is 1.5144 (+7 ticks)...

 

 

Best Wishes,

 

Thales

[Cory2679 11]

We've reached support on the EUR/USD...I'm actually not trading right now, but if I was, I would attempt a long at my blue support line. If that failed, I would attempt a short and ride it down to my blue rectangle of major major support...a retest of the lows...

[Marko23 10]

Another Short and better Stop

Reentry is key to this play.

 

[thalestrader 14]

Here is where I am with this 6B (GBPUSD) short..

stop loss on 1/3 is 1.5120 (+31 ticks)

 

stop loss on final 1/3 is 1.5144 (+7 ticks)...

 

stops are now 1/3 @1.5109 and 1/3 at 1.5120 ...

 

 

Best Wishes,

 

Thales

[Marko23 10]

FDAX at first target

[thalestrader 14]

stops are now 1/3 @1.5109 and 1/3 at 1.5120 ...

 

stops are now 1/3 @1.5109 and 1/3 at 1.5090 ...

 

 

 

 

Best Wishes,

 

Thales

[Marko23 10]

FDAX touched yesterdays low.

I would prefer a new 3 day low.

[thalestrader 14]

Here is where I am with this 6B (GBPUSD) short:

 

Short @1.5151

 

1/3 profit filled at 1.5120 (+31 ticks)

 

stop loss on 1/3 is 1.5120 (+31 ticks)

 

stop loss on final 1/3 is 1.5144 (+7 ticks)...

 

1/3 profit filled @ 1.5120 (+31 ticks)

 

1/3 profit filled @ 1.5061 (+90 ticks)

 

Stop loss on final 1/3 is 1.5085 (+66 ticks)

 

 

Best Wishes,

 

Thales

[Marko23 10]

FDAX at second target and touched 3day low.

 

[Marko23 10]

FDAX close open gap and made a new 3 day low.

 

That is the rhythm, I observe since many months.

 

[Marko23 10]

Steep decline with FDAX

 

Edited March 19, 2010 by Marko23

[thalestrader 14]

1/3 profit filled @ 1.5120 (+31 ticks)

 

1/3 profit filled @ 1.5061 (+90 ticks)

 

Stop loss on final 1/3 is 1.5085 (+66 ticks)

 

Stop loss on final 1/3 is 1.5026 (+125) which is slightly worse than 1:1 from the low to my target versus the low to my stop (I see the picture shows 1.5027, but that is the demo, my rea-lifel stop loss is 1.5026)...

 

 

Best Wishes,

 

Thales

[thalestrader 14]

Stop loss on final 1/3 is 1.5026 (+125) which is slightly worse than 1:1 from the low to my target versus the low to my stop (I see the picture shows 1.5027, but that is the demo, my rea-lifel stop loss is 1.5026)...

 

Having looked at this I've decided that 1.5027 is the better stop loss, so rather than adjust the demo to match the real, I've adjusted the real to match the demo - stop loss on final 1/3 is 1.5027.

 

Best Wishes,

 

Thales

EDIT: I am also raising the last profit target from 1.4974 to 1.4978

[thalestrader 14]

Here is how the last 1/3rd of this 6B (GBPUSD) short looks ...

 

 

Best Wishes,

 

Thales

[thalestrader 14]

Here is how the last 1/3rd of this 6B (GBPUSD) short looks ...

 

... stop loss is 1.5007 (+144) and my take profit is 1.4991 (+160)... (only because it is Friday and I want to go outside and play!

 

 

 

 

Best Wishes,

 

Thales

[thalestrader 14]

... stop loss is 1.5007 (+144) and my take profit is 1.4991 (+160)... (only because it is Friday and I want to go outside and play!

 

Taken out at 1.5000.

 

Here is how the demo blotter looks for today. I do not know why Ninja counted some of the individual contracts as individual trades, but in my mind I had three trades today - small win on 6B short, large win on 6B short, very small loss on an early CL short.

 

 

Best Wishes,

 

Thales

[Cory2679 11]

I'll probably have a couple questions about the entries we were discussing recently on the thread, but I'll save those for the thread so everybody can benefit...

 

Thales,

 

My first (and maybe last, if you're lucky :o;)) question is about position sizing...

 

Typically, what I've done so far is used a modified version of that spreadsheet you posted. If I'm trading a larger degree 123 on a 15 minute chart, I have plenty of time to calculate my initial risk in ticks based on my entry and initial stop, type it in, and get the proper position size...then type all that into Oanda's order-entry window....and I wouldn't want to rush all this, because I could make a mistake.

 

When trading these types of entries that've been discussed lately, how do you determine your position size? Doing all that I just described would be too time consuming...by the time you know your initial risk, you need to be placing an order!...and if you were to enter on a market order, you don't know until it's too late!

 

Do you basically just make a reasonable estimate about how many contracts you're going to trade based on what you anticipate the amount of risk being?...maybe it's as simple as that, but I wanted to ask you about it...

 

Thank you,

 

Cory

Edited March 19, 2010 by Cory2679
typos

[thalestrader 14]

... question is about position sizing..

 

...and if you were to enter on a market order, you don't know until it's too late!

 

Do you basically just make a reasonable estimate about how many contracts you're going to trade based on what you anticipate the amount of risk being?...maybe it's as simple as that, but I wanted to ask you about it...

 

Thank you,

 

Cory

 

You know that for spot EURUSD, every pip per $1000 trade size = .10 (a dime), and every pip per $10000 trade size = 1.00 (a dollar). You should have an idea of what your per trade risk is. Let's say you are risking $50/trade, and you see an entry at resistance, and you are going to use a 10 pip stop loss, then you should be able to figure out quickly and without a spreadsheet that you can trade $50k on that trade.

 

Whether you are entering on a limit order waiting for price to retrace back to test a level, or on a stop waiting for price to break a level, or you are entering at the market after test of a level, you should have a pretty accurate idea to the tick where your stop is going to go. I rarely enter a trade where I do not have my risk nailed down to the tick before placing my entry order. And by rarely, I mean never. S/R is already there, and it should not be a surprise, right?

 

If nothing else, you can figure that you can always enter at the market, throw an initial and arbitrary stop loss of 20 pips on, which in the example I gave here would allow you to trade 25K and keep your risk to $50. Then you can adjust your stop loss to a proper placement. Even then, you at least know your risk level before you send the order.

 

But most importantly, these trades should not sneak up on you. You need to prepare. And you should practice what you are trading long enough and well enough to be able to size a trade without a spreadsheet.

 

Best Wishes,

 

Thales

[Cory2679 11]

You know that for spot EURUSD, every pip per $1000 trade size = .10 (a dime), and every pip per $10000 trade size = 1.00 (a dollar). You should have an idea of what your per trade risk is. Let's say you are risking $50/trade, and you see an entry at resistance, and you are going to use a 10 pip stop loss, then you should be able to figure out quickly and without a spreadsheet that you can trade $50k on that trade.

 

Thanks for the reply. When you put it like that, I realize it was sort of a stupid question. :embarassed:

 

I think I had basically become too dependent on my spreadsheet, and it had handicapped me.

 

Also, since using Oanda, I've been dialing down to the single unit, but it would be much easier just thinking about lots of 1,000, etc.

 

-Cory

[thalestrader 14]

Thanks for the reply. When you put it like that, I realize it was sort of a stupid question.

 

I didn't think it a stupid question. I certainly did not mean to imply anything of the sort. Don't censor yourself, or you might miss the chance to learn something that may become a keystone to your success.

 

Best Wishes,

 

Thales

[MidKnight 12]

And who says Fridays trading is often lackluster in direction. Huge drop on GU today and despite my long bias, I was glad to have a script to work the short side.

 

Thales, I have a query about your Thursday trades on EU and GU where you added quickly to your winners. I'm having a we bit of a tedious time matching your actions with the spot market as the prices are a little bit different, but my question is about how you manage the risk once you are adding. Here is the excerpt from your post just in case a reminder is needed:

 

Well, in those cases, I wait for price to either firm itself with a 123 or decline to the next tick level. In this case, my next level was in the mid 1.3580's, which would be about a 2/3's retrace of the entire rally from the 1.34xx low to yesterday's high. Price got there, more or less, and did what it needed to do to get me long with a 6 tick stop. I have since added at 1.3610 and again at 1.3622, and I added to the 6B at 1.5152. Had you just traded one contact at each level, you would now have three 6E and 2 6B contracts, with a total open trade equity of $1156.75 on a total initial risk of $137.50.

 

Using your above EU management as an example, you got long about 5 ticks from that low with a 6 tick stop. Then you added at about say 15-17 ticks higher which left me wondering how was he managing the risk there. Still willing to lose no more than 3 ticks below the avg entry (3 ticks * 2 positions = 6 tick initial risk)? And then added again so same question

 

Attached is a 1m chart of how you maybe did the entries. 2 days ago for me can feel like a lifetime ago so hopefully your recall is better than mine!

 

With kind regards,

MK

[thalestrader 14]

Thales, I have a query about your Thursday trades on EU and GU where you added quickly to your winners. I'm having a we bit of a tedious time matching your actions with the spot market as the prices are a little bit different, but my question is about how you manage the risk once you are adding. Here is the excerpt from your post just in case a reminder is needed:

 

6E - Bought 3591, 3610, 3622, with each subsequent trade smaller than the previous trade. Stop at second trade moved to 3591, stop at third add moved to 1.3608 for a worst-case break even, then stop raised to 1.3615 to assure a small profit.

 

The key to pyramiding is doing it in the right direction - a pyramid is large at the base, narrow to the top. The base supports the upper layers of the structure. One mistake folks have is that they tend to pyramid in the wrong direction, building increasingly large layers upon a small base (an upside pyramid). You want, in other words, to build 3-2-1 rather than 1-2-3, i.e. buy 3 then add 2 then add 1, not buy 1, then add 2 then add 3. You define risk by managing the distance between your entry and your stop, but you manage it through position size relative to that risk point definition.

 

Does that answer your question, or have I missed the mark of what you are asking?

 

Best Wishes,

 

Thales

[MidKnight 12]

Thanks for the reply. Not entirely answered because it sounds like you are decreasing position size on each add, but in your post the position size in the example was a constant 1 lot per entry. Maybe that was just for simplicity sake. I understand what you are saying in general though about the pyramid vs the inverted pyramid. Would it be fair to say that each of your adds are based on breaks of some sort of market structure? I think they are, but I'm just checking

 

With kind regards,

MK

[thalestrader 14]

...Not entirely answered because it sounds like you are decreasing position size on each add, but in your post the position size in the example was a constant 1 lot per entry...

 

Don't confuse what I do in the demo account for the sake of posting the trades here with what I'm doing as I trade. I did make a point that even using one lot per entry this trade would have been profitable, and had I traded the demo in as I traded my account, it would have been even more so.

 

Would it be fair to say that each of your adds are based on breaks of some sort of market structure? I think they are, but I'm just checking

 

Low ... High ... Higher Low ... Higher High ...Higher Low ... Higher High ...

 

Best Wishes,

 

Thales