TF Trade 28 July

1117h EST Sold TF 546.2 x1
1126h EST Exit 545.9 +$26.00 nett.
1157h EST I am tired. Missed all the opening opportunities. Out the whole day and the evening with the girls. Having the girls hug me and say "I love you daddy" is the best profit of the day. Later, after I have moved my residence and setup my platform. So updates will be inconsistent.

Mish Mash of trades

1141h EST made 9 trades. +$187.74 nett. Winners were CL, 6J, TF, YM and ZS. This method is quite mechanical but still requires some discretion. Though the SIM trades combined with these live ones would have yielded $743.10

End of the week and some results

As you all know, one of my objectives is to reduce my time spent on the screens. Analysis can be my strength but market monitoring is my weakness.

So far I am exploring to automate the simple 5 minute IB breakout method with the help of Todd.

So far I am liking it, not sticking to an instrument exclusively. More like hedging different instruments against each other.

A few days of forward testing on SIM, I have concluded that this methods works quite well on certain instruments. Namely, CL & QM which have exceptionally high wins. Followed by the currency pairs in order of wins, JPYUSD, EUDUSD and GBPUSD. ZB and ZN, the 10 yr and 30 yr Treasury Notes. Then ZS, Soy Beans seem to work quite well. Among the US Indices, YM(DOW) has the best results, followed by NQ(NASDAQ), TF(Russell 2000) and the worst performer ES(S&P).

GC, Gold and the Euro indices, FDAX and FESX does not yield good results.

I will make the best combination of above 12 instruments. I only made 8 live trades this week. Yielded just over US$1000. More forward tests and I will be comfortable to go live fully with 12 instruments.

New week and new method testing

Hi, after an atrocious week last week. I am laying of the live trading and go to some forward testing of a method and hunch. I won’t be posting much. I have go a new place to move to. So I’ll be busy setting up the new place and moving all the stuff.

I’ll be watching FESX(Stoxx 50), FDAX(DAX), 6E(EUR/USD), 6J(JPY/USD), 6B(GBP/USD), GC(Gold), ZB(30 year Treasury Notes), ZN(10 year Treasury Notes), CL(Light Sweet Crude), QM(miNY Light Sweet Crude), ES(eMini S&P), NQ(eMini NASDAQ), YM(eMini DOW) and TF(eMini Russell) for this forward test.

Since I am exploring currency futures, I have included in my right panel is video updates of the FOREX market with Dukascopy TV. They are a Swiss forex broker.

Recent trades

0139h EST I have not been trading actively for this week. Firstly, I am not reading the market right and secondly, I’ll be moving my residence soon. So there is a lot to be done. I’ll try to update as soon as I am able.

6E Trade 15 July simulated

0255h EST sold 6E at close to Murrey Math Line 5/8 at 14070 x2. Insured the 1st contract quickly at 6 pips and move the stop to 14072 pivot high by 1 tick. Target 14039, 1 tick above the Murrey Math line 4/8.

0405h EST flat. +37 pips. Not bad, MM Lines do work quite well.
0430h EST sold 14059 x2
0431h EST +5 Double top. stop 14061
0432h EST flat +39 nett. Should not have been so aggressive with the stop.

ES Trade 15 July

0355h EST So far made 3.31pt nett. Still 1 contract to go to meet the 906.50 objective. Trusting my analysis. We made a gap with the following charts. The daily projection to 913.00 is considered met at 912.75 swing high.



0415h EST an update. ES is in a tight consolidation. 908.50 to 908.75 has been providing considerable support. The Bears need to consistently attack these levels for the breakdown. Upon meeting the 906.50 target, I will look to sell the retraces.

0418h EST flat. +2.72 pt nett

6E Trade 10 July Simulated

0332h EST trying 6E trade using a new method involving range charts. As usual, entered 13910 x2 which is 2 ticks below the 423.6% fib extension. Should be a terminating point and the indicators all in oversold territory.

0338h EST +10 pips 13920. Stop BE.
0345h EST stopped. +9 pips nett.
0442h EST long 13925 x2

0450h EST stopped. -4 pips nett
1205h EST ended this period of simulated trades on 6E with +38pips nett. Will continue further into next week to see if I am comfortable and my risk management is working in my favor.

Financial snippets

Report on Bloomberg stating Goldman-Sachs beating its trading revenue target here. Must be the damned bots they use.

Our super investor says another stimulus.

ES Trade 9 July

0747h EST long 879.75 x2 The signal was the inversed Denver Plateau.
0750h EST +1pt 880.75 stop 879.00 Insurance bought. Looks like counter trend but we are on an uptrend since 1500h EST yesterday. If we have to print 888.00 and above to confirm our downleg has completed and we should be on the final up leg before Humpty Dumpty falls badly that he'll need all the king's(Obama) men to fix him. 0830h EST is the jobless claims report. I might exit or BE before 0830h.

0811h EST exit 881.00 for the 2nd, 5 tops. +2.07pt nett
0815h EST short 881.25 x2, upon the tops as a reversal.

0821h EST +1pt 880.25 Now news in 10 min. I'll be light. Stop 881.75 if they break those tops, more upside.
0829h EST stopped out. Jobless claims must be well received. Hit 884.25. Great that I was light. +2.40pt nett, loss of 0.5 in the last excursion.
0833h EST long 881.25 x2
0839h EST +1pt 882.25, insurance bought. stop remains 880.25. +3.31pt nett

0900h EST stop 881.50
0901h EST stopped. +3.47pt nett
0928h EST long 881.25 x2
0930h EST +1pt 882.25 stop 880.75
0932h EST stopped +3.80pt nett

1109h EST quiting. Very choppy market. Signals are very mixed. Unable to see well. After 20 trades, I only get +2.24 pt nett. Broker must be happy. So many of these trading bots switching on and off disturbing the market. Conditions are not right.

Till then, good night and tomorrow another day.

ES Trade 8 July

0655h EST long 879.50 x2
0658h EST +0.75pt 880.50 stop 878.75 It has to touch 882.50 to negate the down projection to 872.00.

0710h EST stopped by 100 EMA. It has pierced which is a good sign.
0726h EST added 882.00 x2
0800h EST stopped -6.85pt. I turned a winner to a loser. Shouldn't have added. I wanted to consolidate the position by exit early, hit and no fill. Should have just reduced my target. I am not going to try this yet, I will still trail my stops.
0942h EST stopping the trades. Maximum drawdown met.

Some articles regarding automated trading

This is a re-post of an interview that Joe Saluzzi, of Themis Trading did with Bloomberg. VO posted this on his blog. This is a link to the PDF from Themis regarding how these programs work.

This is an article today about an employee, Sergey Aleynikov from Goldman-Sachs stealing the code. Objective is to form a startup and trade, and earn 3 times his annual salary of US$400,000.

ES Trade 7 July

Tried 2 shorts. Got stopped out. Exceeded my daily drawdown. I am stopping.
0432h EST short 893.75 x4
0451h EST stopped.

0547h EST short 895.25 x4
0559h EST stopped. -10.70 nett

0939h EST Sold TF 490.40 x4 Stop 492.4
0944h EST +2pt 489.4
0946h EST stop 491.1
0950h EST stopped. +0.44 nett for TF. I think I was stoopid to move that stop down. This method does not require me to move my stop. If the stop stayed at 492.4, this trade would have stayed and meet the 488.4 target.

I should remind myself not to move my stop for my TF trades, just leave it.

Precision drifting

Yes. I own a Subaru wagon. This is Ken Block's latest performance on BBC's Top Gear. View it, enjoy, and yes I want to emulate. I rode dirt bikes in the army, those moves by Ricky Carmichael is also incredible. Please wait for the YouTube player to load.

Reflections of yesterday's trades

It was a good trade with excellent R/R, 9.75pt gain with a risk of 2pt initially. As I was trailing my stops up, Jeremiel did highlight to me of a better method than trailing my stops, with better performance, getting money in the pocket first.

It is consolidating my positions.

Since I bought at 882.75, I should take profit at 886.50, double top, first. Since the plan was to trail the stop to 883.50, I should buy again at 885.00 to 884.25 and my stop placed at 883.50 where I originally intended.

There is a risk to this, it is if the buy failed, I will get stopped out with a loss. But get this, I have taken money off and bought again at a discount. My nett gain is still better than a trailing stop.

The other way is to put a buy order at the break out of 886.75. This is a safer way, you don't know if the retrace stops you out but you want to reach your objective of 891.50. So buy from 886.75.

I have calculated that if I buy the break out and my usual 2 contracts, I would have gained 10.50pt, +0.75pt better. Safe with 4pt in the pocket should it not break out. If I were to bought at 885.00 SL at 883.50, I would have gained 11.25pt, +1.5pt better with a potential loss 3pt with a nett gain of 1pt from the consolidation. In other words, risking 3pt for 7.5pt gain for the latter.

ES Trade 6 July

0056h EST ES have tested 884.25. Put a toe across and rejected. Both 54 and 100 EMA are sloping downwards, no signs of even flattening. My guess is that it will retest 884.25. If you weren't greedy and bought 884.25, you should have exited 888.50 to 888.75 and reversed. The projection asked for 888.75.

Here is the 10 min chart for the Globex open.

0255h EST Tried counter trend poke at 886.50 x2
0301h EST +1 pt insurance 887.50 stop 885.75
0304h EST stopped +0.07 pt. Broker gets free lunch.

0700h EST gave the 88.6% retrace a try. The down projection was 882.50. Long 882.75 x2 If I make an educated guess, coming back from a long weekend, RTH might be bullish. This pattern has been happening most of the time. We will see. We have a nice double bottom.
0704h EST +1 pt 883.75 insurance bought. Stop 882.00

0720h EST looking good. Placed my last contract for an exit at 891.50 tentatively, stop is unchanged. If it comes back, the broker gets his 2nd free lunch today. This is the 30 min chart showing bullish divergence.

0725h EST slammed into the 54 EMA. This is the 2nd attempt at the 54 EMA on the 10 min today.
0807h EST still looking good. At least this time a toe across the 54 EMA. Projection since that swing low is 891.50. Exit placed there. Stop will be moved to 883.50 once a breech of 886.50.

0835h EST it did not breech 886.50 but still I move my stop to 883.50. I'll bail if it fails to breech 886.50 and goes below 885.00.
1000h EST exit last ES 891.50 +9.65 net for ES. TF trades did not perform today. Long 493.7 x4, +2pt at 494.7. Moved the stop for safety to 492.4 and was stopped. -0.76 on TF. Daily objectives met. Done for today.

A new week and new ideas

I'll update the ES chart and my limited views in a subsequent post.

Today, I'll SIM trade 6E, the EURUSD futures for 30 trading days excluding Sunday. I am trying the 5 min IB for 2 market openings and see which works best.

My test as usual will involve the 1st 5 min bar of the OR; Opening Range. Place OCO stop limit orders 2 ticks above/below bar high/low. Each entry will have 3 contracts in this forward test.

The objective is to test 3 levels of 1/1 R/R ratios. 10, 20 and 30. To find the optimal R/R for the 5 min IB trade. 2 bars involved in this test is 0305h EST bar and 0805h EST bar corresponding to the European and US market open.

Next is also to test the 30 min IB, the 0335h EST bar and the 0835h EST bar.

So 4 entries daily and after 30 days, I will have the results dissected and a conclusion finalized if I could accept the trade parameters.

Inspirations for trading

On a lighter note. My hobby is racing. I am doing less of that now. It is an expensive hobby and dangerous. This is an image of screws in my right ankle due to a karting accident. I might be one of rare people who have a regular orthopedic surgeon.

This was a race last year that I came in 2nd. Lost to my team mate who was with me in 2000. He was much younger and inexperienced then. Just out from university. Now he is so much better. Great race that he was ahead.

This blue car is my favorite Alfa, The 155. This is a great shot of me almost losing in the corner difting sideways.

Do visit Mark's and Jonathan's Blogs. They are much into it than I am.

Trading is very much like racing. You can lose life or limb. There is possibility of losing money and sanity in trading. It parallels in most ways. Even down to the indemnity forms you sign.

You don't get inspiration for trading in trading. You get inspiration for trading outside of trading. For me is racing.

For me to chase the leader or a better driver and try to mimic his moves down the minute centimeters of road space used and how fast he brings his machine to the limits of adhesion without losing it.

Hector who introduced me to trading is a martial arts practitioner. He gets his inspiration in martial arts, which in many ways is also like trading. How often Sun Tzu's Art of War is being quoted in trading? Many times and is applicable. A book he mentions, The Way of The Warrior - Trader by Dr. Richard D McCall.

In the book it mentions

The Samurai A.C.T.I.O.N. plan:

Accept … All possible losses before entering the battle!
Center … yourself in body, mind, and spirit!
Trust … your warrior skills and intuition!
Imagine … success clearly with the mind's eye!
Only … exist in the present moment to control fear!
Never … stop or look back once action has begun!

Something to think about. Have a good weekend.

Weekend summary 29 June to 3 July

The beginning of the week started as a disaster. I have lost a peak of US$1475.50 on Monday due to poor discipline. Tuesday was no better due to the jitters I had from Monday's loss. Wednesday saw the return of my form and Thursday to top it off had the trade of the week with of 0.25pt risk for a 9.00pt gain on ES.

As usual, TF trades was performing better than ES. Fast in Fast out. If it continues doing well, I might try 4 contracts for August.

The nett gain this week US$561.10. Still walk away with profit after that disastrous start on Monday.

The girls forex fund gained US$3.00 with a trade on 1 July. This is a very conservative management of 2% risk factor. Beats putting it in a bank and seeing the money rot with annual interest of 0.25% against a supposed inflation rate of 6%.

I'll try my method for 6E(EUR-USD) on SIM for July. 2 time slots, 3am EST for Euro open, 8am for NY open. I want to reduce my time in the market. One of my long term objectives, maximum gain with minimal time. Time is the only resource that cannot be replenished though I still like ES for the adrenaline it gives.

If it goes well, I might ditch ES. I will not have an argument with my wallet.

I will go long on Monday if the situation permits. 884.25 was the last swing low. If that is breeched; 877.00 is next support. This whole up leg from 9 March might be just a giant Wave 1 count.

I'll end this post with 2 charts. The 88.6% retrace struck again. Seems like we will see more of this in the future.


Lessons for this week.
1. Keep to the plan
2. Trade of the week on Thursday, get more of those next time.
3. If it works, use it. If it doesn't, throw it.
4. Pay more attention to the 88.6% retrace.

ES Trade 2 July

0334h EST Just back from errands. This is the 15 min chart. Looks like a nice gradual decline from the 928.25 high yesterday.

And the following is the 60 min chart. Have to see what happens at the 78.6% retrace at 912.50.
0837h EST made 2 entries with 2 contracts each. Both profitable. 1st was counter trend. 2nd was along with the trend. These are the trades. I am done for today for ES. I will make my trade on TF should there be a signal.

0659h EST long 912.75 x2
0736h EST +0.75 pt 913.50
0745h EST +1.5 pt 914.25 Nett +2.07 pt
0759h EST projection from the last swing low was 916.00 if it was bearish, it will fail to meet it so I placed my entry at 915.75. Filled x2
0800h EST +1 pt. The insurance was fast. Very reassuring. Stop 916.00 0.25 pt risk for an exit at 906.50 but changed to 906.75 to ensure I have a fill. I hate it when they hit and don't fill me.
0836h EST jobless claims and employment situation received badly. Bar plummeth. Exit last 906.75. +11.90 pt. This last one had to be the trade of the week. 0.25 pt risk for 9 pts.
0935h EST sold 501.0 x2 on TF.
0939h EST +1 pt on TF
0940h EST +2 pt on TF. Nett 2.91 pt on TF
Summary +11.90pt on ES, 2.91 pt on TF

ES Trade 1 July

1055h EST I should have placed my blog next to me. I have analyzed 909.50 as support and I did not ride the 925.00 resistance to 909.50. I analyze well but I trade poorly. I should keep that bigger picture in my head and not just react to the minute.

0104h EST this is should be the final push up to Wave 5. I think. Note the AB=CD pattern working out nicely on the daily chart.
Regained my confidence today.
My trades:
0940h EST long 921.50 x2
0948h EST +0.75 922.25 Long on TF 511.7 x2
0949h EST +1 pt TF 512.7
0950h EST +2 pt TF 513.7 Nett TF +2.91
0953h EST +2 pt 923.50
0953h EST long 923.50 x2
0956h EST +0.50 pt News soon, take some off the table. 924.00
1000h EST stopped -.25 pt
1009h EST long 921.50 x2
1015h EST +0.75 pt 922.25
1029h EST +6.25 pt 927.75

Done for today. Nett ES +9.47 TF +2.91