I got burned today (13 March 2007)

[kingking 10]

The market started off with a 60 points gap on YM and the A/D was -1300 to -1700 for most part of the day. In fact, I have a bias on the short side. I took 10 shorts with 1 win but all losses with a stop from 7-10 points. The chart showed only 3 of the loss trade (Red arrow). I real bad day becoz my market bias is right but am not benefits from such a day. Hope some of you can give me a bit of the advice.

[notouch 10]

Your stops were too narrow for a day like yesterday. Also your trade location was probably all wrong. Were you just jumping into the market because it "felt right"? That's how the professionals take your money.

[walterw 10]

I have a complete diferent point of view.... stops should be tight and the issue here was timing... dont panic king, you are more near to realize that some things on your plan have to be rethinked... timing wasnt good, the overall setup was ok...

[rickv 10]

King,

A couple things to help your timing issue -

1. $TRIN - where and what was it doing - Setup your trin on a line chart you want to know what the overall trend is doing. The number is important also but more so the trend. To keep it simple >1.0 is bearish and <1.0 bullish

 

The market was completely rotation in the morning on the 13th. Caution: unless you know how to trade a rotational market. ie. Buy the lows and sell the highs. A gap down to demand is not a short.

 

2. The VIX another simple tool to keep you on the right side of a trade. notice at the open it was sideways also. The VIX is inverse of price action and once it started to trend and we broke the lows it started trending higher.

 

Just a couple tools that will keep you on the right side of a trade - sounds simple but it really works.

 

Good Luck - Don't make more out of trading than what it is. It's all about buyers and sellers and supply and demand. Become a student of price and volume and you will understand the markets.

timing.bmp

[walterw 10]

rickv : can post some charts of vix as you explain ? thanks Walter.

[Robert2617 10]

I made that RadarScreen for TradeStation TT&V (Tick, Trin & Vix) indicator. Color coded for bearish, bullish or neutral, shows the actual number and whether its going up or down. It's in the dl section.

 

With VIX (vix.x for TS), 20 or over is totally bearish, 12 or under is totally bullush, so the experts say.

[walterw 10]

Nice Robert ¡¡ whats the lookback comparison criteria to establish up/ dn direction ? (ej, higher than previous bar, etc) ...

[Robert2617 10]

Nice Robert ¡¡ whats the lookback comparison criteria to establish up/ dn direction ? (ej, higher than previous bar, etc) ...

 

Yes. You have to set "Addition Data" with a right click/format to look back in time.

[Z_trade 10]

I was trying to make $TRIN easy to read and I think one of the useful way is to place Directional Movement and reverse DI+ and DI- color, so you will see overall trend by looking to the DI lines. If its too squeaky adjust the numbers.