P/L: £-14.28 R-0.7
Just before I begin I should say that to me trading requires three areas 1. good Prep, 2. Patience to wait for the correct setup and the 3. Discipline to execute a trade correctly (Execution Bias. This is something I need to add to my method, it's in my head but not on paper).
SUMMARY
Good prep throughout session. Patience was good at first then slipped. Discipline, to be precise discretionary exits (a slip to monetary bias over execution bias) and trading after BW are the problems and what I need to work on. A part of me feels that I've just got to suck it up and get on with it. There was a Churchill quote that I read yesterday that I liked "Sometimes it is not enough to do our best; we must do what is required". In trading it is required that I don't trade after BW or exit a trade early for no good reason.
I enjoy all of my trading, all the prep and the waiting BUT it is just that 5-10 mins of anxiety after entering a trade waiting to see if it will go my way that I struggle with. In these minutes every tick is magnified and becomes more important than a candle, every fluctuation despite the bar not having closed I react to. It's insane and it makes me hate myself and self flagellate. To me there is no pain greater than doing all the work then leaving the profit on the table, I'd rather my stop be hit and trade correctly but I'm not doing this.
I had this problem in the past and overcame it by changing my attitude on success (the problem was then that my prep was off! haha). Instead of defining success as a positive P/L I defined it as correct execution (execution bias). because I don't have it written down in my rules. I've forgotten it and I need to reapply it.
Series of HLs + UWTL = bias on getting Long
1. Day started with a series of overlapping bodies, not quite BW (no doji) at an obvious buy point (prior high 680 into 693) this was enough to make me to avoid any long setup here.
2. looks like a failed BO of 686 short but not in my rules to CTT yet, waiting for a TLB- LL-LH.
3. TLB and LL bias turns almost entirely short, just waiting for the LH.
4. inside bars form another TTR resembling BW this time inc a doji.
5. LH conf short. despite this working out should have avoided it due to prior BW like action. Good Prep, Poor Patience to wait for the trade, Poor discipline/execution avoiding it! R -0.2
6. LH short entry, wimped out on tick above prior high, good prep, good, patience, poor discipline (discretionary exit also worrying too much about weekly goal of break even). R -0.5
Pink Ellipses are BW markers for me while reading
Just before I begin I should say that to me trading requires three areas 1. good Prep, 2. Patience to wait for the correct setup and the 3. Discipline to execute a trade correctly (Execution Bias. This is something I need to add to my method, it's in my head but not on paper).
SUMMARY
Good prep throughout session. Patience was good at first then slipped. Discipline, to be precise discretionary exits (a slip to monetary bias over execution bias) and trading after BW are the problems and what I need to work on. A part of me feels that I've just got to suck it up and get on with it. There was a Churchill quote that I read yesterday that I liked "Sometimes it is not enough to do our best; we must do what is required". In trading it is required that I don't trade after BW or exit a trade early for no good reason.
I enjoy all of my trading, all the prep and the waiting BUT it is just that 5-10 mins of anxiety after entering a trade waiting to see if it will go my way that I struggle with. In these minutes every tick is magnified and becomes more important than a candle, every fluctuation despite the bar not having closed I react to. It's insane and it makes me hate myself and self flagellate. To me there is no pain greater than doing all the work then leaving the profit on the table, I'd rather my stop be hit and trade correctly but I'm not doing this.
I had this problem in the past and overcame it by changing my attitude on success (the problem was then that my prep was off! haha). Instead of defining success as a positive P/L I defined it as correct execution (execution bias). because I don't have it written down in my rules. I've forgotten it and I need to reapply it.
Series of HLs + UWTL = bias on getting Long
1. Day started with a series of overlapping bodies, not quite BW (no doji) at an obvious buy point (prior high 680 into 693) this was enough to make me to avoid any long setup here.
2. looks like a failed BO of 686 short but not in my rules to CTT yet, waiting for a TLB- LL-LH.
3. TLB and LL bias turns almost entirely short, just waiting for the LH.
4. inside bars form another TTR resembling BW this time inc a doji.
5. LH conf short. despite this working out should have avoided it due to prior BW like action. Good Prep, Poor Patience to wait for the trade, Poor discipline/execution avoiding it! R -0.2
6. LH short entry, wimped out on tick above prior high, good prep, good, patience, poor discipline (discretionary exit also worrying too much about weekly goal of break even). R -0.5
Pink Ellipses are BW markers for me while reading
I have a hard time really understanding what is going on in the charts you post due to the colors and the markings, but it appears to me that you waited the break of the trendline and subsequent retest of the high (thus forming a LH) and then taking a short. [Trade plan review: What would you have done if there had been a HH by only a pip?] Looks like a good setup, but I have a few thoughts:
ReplyDelete1) Look how big your bars are - where you entered after the LH was halfway down the previous leg. I understand you are using bar closes and lows and highs as trigger points, but perhaps you should consider using a smaller bar interval for the actual entry. The locational setup was absolutely perfect, but you were shaken out with no profit on an otherwise excellent trade because your entry was so late.
2) Even if you were to get take the entry you take, you have to look left and see the support at ~3676 that was just created on the leg down that broke the TL. Given the absolute extreme flexibility in position sizing in forex, perhaps consideration of partial exits at previous swing points would help in calming tensions, providing some profits to offset swings, and overall increase profitability and probability.
3) If you are going to short LHs after TLBs, and insist upon 5M bar intervals, you should be shorting below the black bar after the big yellow candle (the biggest one on the chart - I can't see the times). This obviously isn't filled, so the sell stop should move up to below the bar prior to the bar marked 4. This isn't filled so the sell stop is then moved up to below the bar marked 4. The next bar, the doji, would possibly take you in depending on how far beyond the low you set your sell stop, but the bar after the doji certianly takes you in. Then you are in earlier, you can draw a proper supply line (on that chart), you don't get shaken out on the retracement. The supply line is then tightened at 6 and you enter the balance of the position following the failure to continue past the lows at 3676.
Information risk vs. price risk, there is a happy medium somewhere although I have trouble finding it to - But waiting for an arbitrary period of time to "close down" and then shorting below it is where Al Brooks loses my attention.
Hey bud...
DeleteSorry for the hard to read charts, I got rid of those nasty red rectangles. Hope this makes it a little easier for you in the future (the pink ellipses are visual markers of barbwire for me).
RE: What would you have done if there had been a HH by only a pip? if it ticked/closed one tick above the prior high I would still remain with a short bias wary of a fBO / M top. However it it made two higher closes above the prior hi I would assume the bulls had potentially retaken control and would look for an entry on a PB to the prior high level. Having said this I am still working out how to implement M tops and W bottoms into my strategy (I would like a prior TLB like what happened here to strength the chance of them working out). Any suggestions?
1) You saying that trade was good really cheered me up , I know I have a lot of work on the execution side but that feels like a real step in the right direction. It must be very frustrating because you're giving me this great advice and i'm not implementing it ie drilling down to a smaller TF. TBH when i get down there my read turns to shit. I lose my concentration and start overreacting. This is my hesitation on that matter. I'm hoping to get better on the M5 where I'm more comfortable and then drill down to the M1 in the future. In all honesty I'm fucking up so much on the M5 still, I'm scared to hit the M1.
2) Partial exits sound like a good idea. What would you suggest in terms of splitting the position up 50/50 72/25?
3) Thank you for going into how to (for want of a better phrase) "trailing entries". I read about this in Al Brooks but it was a little unclear when you should track the the Buy/Sell stop to the next bars lo/hi. This makes perfect sense now and I can see how this would have completely changed the trade!
YES i am finally understanding what you mean about price area rather than a bar specific level. It only just started to gel as I was watching PA this week and noted a setup trigger that I just knew was too early (a short that hadn't rallied back up to anywhere near the prior low) but I took it out of loyalty to my "system" and of course it took out my SL and kept on going up until it hit the prior level than dropped from there. I understand bars entries have flaws but I don't have enough comprehension of price level entries to feel confident changing to them... should I just be entering off prior S/R levels when they're touched? Is it really that simple? (provided I know what direction I should be going in!)
First - your struggle is no different than anyone else that tried to make this work, no different than mine. I am doing great right now, but just as there have been many setbacks in the past couple years, there will be plenty to come. Plus my advice is just one perspective and won't necessarily fit perfectly with yours. If it makes sense to you, then it is something you should pursue - if not, there are other ways of trading. So no need to apologize. Teaching is the best way of learning for me, so I enjoy it. Plus I know the feelings of despair that hit someone truely trying to make it at this profession, not someone that is just fucking around, gambling, but someone that really wants it.
DeleteRE: M/W -> I try my best to refrain from classifying patterns, which includes not talking in terms of patterns. What is happening on the M top? Its a point where either buyers gave up or sellers took over on the first top, and then a repeated failure of buyers to take it higher on the second top -> Sellers in control and the LOLR turns down.
1) I spent a good year to year and a half watching 1 price change charts of the EUR/USD. The transition to think of the market as a continuous series of transactions between willing buyers and sellers was easy for me as that's how I had been taught. The point of saying this is, the bar interval is essentially irrelevant. One gets into trouble when they start trying to assign meaning to individual candle patterns -> again that "pattern" word. Your current point of learning has had you assigning meanings to 5 minute candles, which due to the timeframe that bar interval references, carries some weight. Applying the same analysis to 1 minute bars will get you even further in the hole. Once the open and close start to drift away from your concern, you might start to feel the freedom to explore the lower bar intervals for entries and exits. However, in diminishing the bar interval one trades on, it is important to keep in mind the context of the larger timeframe.
2) I would suggest 2 or 3 parts.
3) Make the market come to you is one way of staying out of trouble. However, this requires through backtesting a reasonable distance away from the current price to let the market come to you, and also forces a slightly later entry than simply fading into an entry. Let the market come to you, however, may reduce some stress as the market is moving in your direciton upon entry.
RE: Entries off price levels - this is one way of doing things. Information risk is infinite however. A better option is letting the market tell you if buyers are failing to make a new high, or sellers are unable to make a new low.
Final note: the market either trends or ranges. From the range, into the trend there are three options - Reversal, Breakout, or Retracement entries. Identify ranges, they provide areas of excessive volume and often are the "springboard" from which price launches into a trend. Once leaving the range, ride the trend until it tells you to stop riding it -> i.e. when the stride of the market changes (Demand line or Supply line fails), when support or resistance is broken against your trade, or when the market reaches a climax.
Becoming a Trader:
ReplyDelete- New Trader always start with wins ( Begginer Luck / No Rules / No Afraid )
- Then suddenly looses starts. No wins at all. At that stage trader starts creating his/her own Rules. Dont do that, Dont do this
- Then with all those Rules trading becomes impossible. Not a single Trade/day
- Then trader start judging of which Rule is correct/wrong
- Keeps loosing money while learning trading ( Learning by doing. Most expensive way of Learning )
- After enough time ( differs from person to person ) becomes a trader ( %5 Only )
- No Rules, Flexible, Logic, Anayltic, Deciplined, Consistant, Patient
Every new rule created with every new loss will sequeeze your trading range. But with every loss you will create a new rule. this will put you into a cycle until you are not able to trade. Your chart will get more complicated & full of lagging indicators, you will create a list of rules which getting longer very day until one day you wipe them all !
If you have coded as much as I did you should know that ( you actually dont need that due I am telling you & you save at least 3 years ) there is NO correct entry. if you do exectly same thing ( any system ) as much as it completes a cycle then you will have BE-COST result.
I know you will not listen to me as usual ( I would do the same he he ) .
I wish I could give you guys pills to explain faster.
anyway trade well
:)
Steve :-)
DeleteEverything you say makes sense and I believe you in theory, but my apprehension is how to control risk especially on the M5 TF. Where do I place my stop? What RRR should I be going for (will they be inverse RRR)? Do I trail a stop? etc
I completely agree with what you say about becoming a new trader and I can relate to all of it.
A Big thank you for your insights , I assure you they are not falling on deaf ears, just anxious shoulders.
Best George :)
You identified areas of resistance/support and congestion, Dr. Alexander "Trading For A Living" put it very simply, "Pros buy support and sell resistance". It's too easy to look at a chart after the fact to determine what a trader could have done, don't beat your self up about it. As for the anxiety while your in a trade, I think every trader can relate to that, I use a fire and forget stop and will literately look at something else not to get in the way of a good trade. I assume part of your trading method is to factor in how many losers and winners your method will produce? If that is the case, you/we have to believe in our method and trust that our winners will make up for our losers.
ReplyDeleteGood trading buddy!
like the idea of Fire and Forget, thanks for sharing.
DeleteRe Win/loss ratio , definitely but I'm not sure exactly how much emphasis I'm putting on it at the moment as I think my winners will end up paying for my losers (IF I'D JUST TRADE THEM CORRECTLY! ahah)
Good trading to you too bud and thanks for the input! :)
I apologize for an interjection here, but I have to respectfully disagree. Setting a stop and walking away is you giving up control and responsiblity for your position. Instead of feeding the fear, I believe, one needs to overcome it through practice, which includes practicing closing trades manually when they should be closed, not waiting for a stop to do the work for you.
DeleteFurther, setting a stop and a target (this is I assume how one would manage a trade if they were to walk away from it) is, in my opinion, completely arbitrary. One; the market does not care where you entered or what you are risking, and thus does not care what you would hope to get out of the trade either (i.e. some sort of R:R multiple). Two; conditions (demand and supply) are constantly evolving.
Now I don't mean to micro manage and fear every minor retracement against your position [because I do this and it leads to lost profits], but I don't think leaving it up to the market to manage your trade for you is of any use in a traders development. Of course this could arguably be different if you had a pure x crosses y system that over the last 500 trades dictates a Z stop and W target. Yet, again, those statistics are based of historical data, not what is actually going on moving forward.
We cannot control the market, but we can control our actions within its context.
JMF3 no need to apologize, your opinion is well respected and appreciated and needed in this small community of retail traders. Let me try to explain my logic behind "walking away". As a discretionary trader, I focus on making my trades very similar in entry and exit based on what the chart is showing me.
DeleteMy preferred trade is the continuation/trend trade after the break out, I have back-tested the range/distance of my preferred trading instrument (YM) will travel when it breaks out, my profit target is based on previous market price movement and where the anticipated support/resistance may be. Many traders whose entries and targets are sporadic in nature will find it difficult for any real consistency.
I also am firm believer in taking what the market is giving and managing the trade accordingly, but without a consistent frame of reference for where the entry and exit should be placed can result in fighting the market trying to will it to meet your expectations.
Consistency is used so often amongst traders, no two traders view it the same way. When I refer to consistency, I am also referring to
1. Stop (how many points am I willing to lose on this one trade?)
2. Price entered (are chasing the market or is this based on good technical analysis?)
3. Profit targets (don't be greedy, take what the market is giving)
Personally I think it can be catastrophically dangerous to a trader financially and emotionally not to place a stop when entering a trade. For some this may be part of their method, but many great traders blew out their account because they believed the market would turn in their favor. Identifying where your stop will be placed is taking responsibility of your trading account, while at the same time having the courage to accept the possibility you might be wrong. No fear of being wrong, and I already know how much each trade will cost me and I have a predefined initial target. When the market is trending, I will let my winning trades run, on most days; I will grab target and be done and content with my trading performance.
I believe every trader who is consistently profitable has found their niche in the market that they can easily repeat as if it was a habit. One of my habits happens to be entering in my stop as I enter the market... no stop can be a slippery slope off the wagon of sober trading : )
[I would like to correct myself, I mentioned "Dr. Alexander" in a previous comment, "Dr. Alexander Elder" lol]
Thank you for the compliments - very nice of you to say.
DeleteJust to clarify, I did not mean trade without a stop. I place a stop immediately upon entry, but one that I never expect to use. It is merely in case of catastrophe. I apologize for the confusion there -