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