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thalestrader

Reading Charts in Real Time

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It's been a long day, and as I mentioned yesterday, I was out of my office most of the day, so this will be short and sweet.

 

I came across this post by RichardTodd, and borrowed his idea of also marking the larger-scale swings (blue line) on my crayon chart.

 

I'll put together a summary of my experience with this exercise and post it in the next day or two.

 

Hope everyone has a great weekend.

20150130-ES-Summary-Chart.JPG.4a3c69a2fc744d346dcf0ecb1cf81b82.JPG

20150130-ES-Sup-Res.JPG.fb4fd09eb8f2ac7dba0b1504a6d15272.JPG

20150130-ES-Crayon-Chart.JPG.5ff5700ea9afafc74deb72125ba05599.JPG

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As with other exercises like the one I did this week, I probably learned as much about myself as I did about "the markets" and price action.

 

I don't want to spend a lot of my time overanalyzing the exercise, or your time reading this post about it, so I've tried to capture my experience in the following brief summary points (if I haven't covered something fully enough and you have questions, just make a post and ask):

 

  1. At the beginning of this exercise I mentioned how long a week of doing this exercise felt to me. But now that it's over, it seems to have flown by in no time.
  2. Because I wanted to give myself as much time as possible to "experience" this exercise, I began waking up earlier than I'm used to. I woke up at 4:00am on Monday, and then 3:30am the rest of the week. And with the exception of Friday, I traded until my cutoff time at 2:30pm every afternoon. By late yesterday afternoon, I was feeling it. So much so, that I actually went to bed around 7:30pm last night. However, I discovered that I can in fact do it, and it may very wll be something that I will do in some form going forward.
  3. I discovered that trading in the Globex session didn't feel as foreign as I thought it would. Yes, it's slower and the range(s) is/are often smaller, but otherwise it was "just fine."
  4. I was once again reminded how my mind tends to make certain things bigger or more important than they might actually be. For instance, as I was going back through to see how many trades the demo account filled at my target without trading through, I thought it was going to be a half-dozen or more. It was actually half that.
  5. The 5M chart is a slower pace than I'm used to, and I found it less hectic and stressful than the time frames (1M, 5Range, etc.) I had been using just prior to this exercise.
  6. In fact, I firmly believed that the 5M (in the ES) was far too "large" to be able to trade profitably because any opportunities/edges would already have been had by the traders working "inside" the 5M bars. I was quite incorrect in that belief (at least from what I've seen this week). Even as I write this, I'm still struggling with the idea that entering trades based on a 5M "setup" could be practical/profitable because of the conflict I have between what I believed and what I've experienced in this exercise.
  7. When using a demo account it is, of course, easier to enter trades based on the rules, but I found that there was a difference between the way I felt when I started, and the way I felt toward the end. The difference came in the form of beginning to actually have confidence in the plan I had created (due to the results I was seeing). I certainly don't know how well it might "work" if I continued to trade it, but I found myself in an unusual state of mind, where I didn't get too concerned about having several losers in a row because I had begun to believe that over time I would likely come back into profitability. Odd for me.
  8. I already knew, coming into this exercise, that I tend to do pretty well with following a simple, clear plan, and this time wasn't any different (with the exception being that the plan worked fairly well). I find that it reduces my stress considerably because I'm not trying to figure out if I should "let this one run," or if I should "get out because price isn't looking good here." I know (or maybe I've been told a lot?) that trading "mechanically" like I did in this exercise is not "optimal" (and quite frankly "won't work"), compared to using proper discretion. But I also know that I'm pretty good at executing a plan like this. "Knowing that it works well for me," but at the same time believing that "it's not the right way" might be a contradiction that I need to look into resolving.
  9. I was of the strong opinion that "breakout trading doesn't work." I think this is another case of not only being told that a lot (either directly or through reading/watching something), but not doing enough of my own due diligence to actually understand it and prove it, one way or the other, to myself.
  10. For you tick counters out there (as Thales might say), here's a quick rundown of the results for this week. I adjusted my results to account for demo fills that were unlikely at targets where price didn't actually trade through (see the previous charts during this exercise and their annotations). I did this by making them 1-tick (BE+1) wins rather than 12-tick wins per the rules I created for this exercise. I also adjusted by completely removing the winning trade I took right before the report on the last day of this exercise, because it was against my rules (see trade chart). With those adjustments made, the numbers are (if all of my accounting is correct!): 49 trades/+98 ticks gross/51% wins/1.42 Avg Win Loss/0.50pt Expectancy.

As you can see I've reinforced some of the things I already knew, but I've also come to some very eye-opening realizations (revelations?) about myself, about trading in general, and about price action specifically.

 

I printed out and read the Plato's Republic excerpt that appeared in one of Thales's Weekend Reading posts before going to bed last night. While I may be grossly misinterpreting an aspect of it (and I apologize if someone else has already said this – I'm only on page 274 of this thread at this point), I saw a correlation between it and what I'm seeing (as far as I've read) in this thread. It seems to me that Thales, once living in the dark and observing only shadows, emerged into the light of truth. Upon becoming accustomed to the light, and seeing the truth that was in the light, he resolved to return to the darkness (this thread) so he might help all here to understand the truth that the light offers, and to suggest that we move toward the light so that we might, of our own accord and under our own power, emerge into the light as well.

 

I feel as though I've begun stumbling toward the light, and although I'm squinting because I'm not yet accustomed to it, I believe I am moving toward the truth.

 

And for that, Thales, I thank you.

Edited by Atti2dTrader
Minor grammar corrections...

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I'm still going through this thread and I just found some excellent work by Forrestang that precedes the kind of thing I did in my recent exercise. Because they're pretty far back, I thought I'd share links to those posts where he worked with 1-2-3's and Ross Hooks so they can be referenced quickly from this point in the thread if anyone is interested:

 

Forrestang & Ross Hooks 1

Forrestang & Ross Hooks 2

Forrestang & Ross Hooks 3

Forrestang & Ross Hooks 4

Forrestang & Ross Hooks 5

 

Thank you for sharing Forrestang!

Edited by Atti2dTrader

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Even though I usually don't acknowledge it to myself, I realize that I'm in a tremendous hurry to become a profitable trader (and I don't think I’m alone in this). I think this is part of the reason why I have a very hard time trading a "big" timeframe like the 15M chart - and even doing "long-term exercises" (wow a whole week) for that matter.

 

However, I also realize that the name of this game is practice, practice, practice, and I know that I need to do it.

 

I can't promise (even to myself) that I will continue all week, but I'm going to make an effort to post 15M charts of 6E, and possibly 6B, as I'm "reading them in real time."

 

I'll write out a specific plan (set of rules) like I did for the exercise I did a couple of weeks ago and post it when I get time. But probably the only thing that I'll need to explain to anyone having read through much of this thread, is that I'm using a fixed stop 1 tick below the HL/LH of the sequence, and a fixed target of 1.5R for each trade.

 

By the way, I feel an enormous amount of anxiety doing this publicly. As I'm writing this 6E isn't going anywhere (and slightly against me), and I find that I'm really afraid of looking stupid and/or "failing," but I'll see how far into the week I can do it.

 

Note: I'm trading this in my live demo account - not with real money.

20150209-6E-15M-01.JPG.cf9b6b72dbb10dc91d939e570b0f798c.JPG

Edited by Atti2dTrader
Clarification

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Long 6E. I didn't enter on the first break of my entry level because I wasn't at my desk. Because the initial entry was still "in effect" and wouldn't have been stopped out, I entered an order to buy long after price had pulled back. Tokyo just opened about 19 minutes ago. I've marked the immediate support and resistance levels as I see them.

20150209-6E-15M-1823.JPG.9e0fec73011f42f2566f31f963cd0329.JPG

Edited by Atti2dTrader
Clarification

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I had a major computer issue this week (had to replace my hard drive and reinstall my OS). Then last night I wasn't feeling too well, and by 10:00CT this morning I was taking cold medicine and going to bed. So, I haven't been posting 15M charts in real time.

 

I'll continue to watch the 15M on my own, but I'm not going to try to post in real time about it here.

 

Regardless, this thread, and the exercise I did before, have helped me tremendously to begin to understand price action.

 

Now back to bed.

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Thales, I tried messaging you but it seems you have disallowed it. I'm hoping a post might tease you out.

 

This was my Eur/Usd chart going into today. Red and green lines are major support and resistance, grey areas are intraday levels.

 

attachment.php?attachmentid=40435&stc=1&d=1446647327

 

 

This was the setup and target on first half.

 

attachment.php?attachmentid=40432&stc=1&d=1446647327

 

 

This includes the 3rd quarter target and my new stop.

 

attachment.php?attachmentid=40434&stc=1&d=1446647327

 

I don't have a final target as I would like to give it some room, I feel a move through 1.0800 is possible over the next few days and I'd like to give that a chance...

EU1.thumb.PNG.8b6b0929e80da7f96dd59ef46b62cdef.PNG

EU2.thumb.PNG.f4182ec138ffa97fc0762aa6e5fc88a1.PNG

EU3.thumb.PNG.eb308060533c796e20656227c232718c.PNG

eu4.thumb.PNG.4e10178b8371781d6b5af5a70336bde0.PNG

EUa.thumb.PNG.c547f1c5745453c3c93b5eb3cc168f8c.PNG

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Originally Posted by jfw215 »

"Hi all,

 

I have read Thales since the beginning of this thread. I feel a bit down right now that after all these years i'm still not consistently trading. I am up slightly this year (first year ever) due to a nice swing trade. I am curious if anyone here have reached consistency using the 123 trading method. Midknight? Cory? Niko?

 

Your sincere comments will be appreciated.

 

Best,

 

J"

 

I have a friend who is as smart as a whip, and it took him 10 years, studying full time, to become a radiologist. He makes a nice living.

 

I plan to make a nice living trading; however, I am not going to limit myself to X amount of years, or X amount of hours to become a successful trader, especially because I study/ trade part time.

 

Take care,

 

Zoomie

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Mitsu...

 

There is enough truthfulness expressed here to fill a 55 gallon drum. Funny... I wonder how many other "obstinate dickheads" find success in this business (it may be a prerequisite). I was going to elaborate with my own thoughts, but I think you've said it just fine.

 

Nice work...

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The "pleasant surprise" I felt earlier with the AUDJPY trade has now been replaced with dumbfounded amazement as my GBPJPY trade reached its profit target.

 

In the past I would have tried to "manage" this trade which would have resulted in a number of possible pre-target exits that would have cut the profit very short.

 

Best,

 

AT

5aa7127a39bda_2016-11-160903GBPJPYExit.thumb.png.84e24597072566b0333448cd9a44e91d.png

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This EURCHF trade was a terrible one to take, but once again, I am in utter shock at the outcome.

 

I guess this shows the power of 1) using support/resistance, 2) HL's/LH's/etc., and 3) leaving the trade alone.

 

Best,

 

AT

5aa7127a44a49_2016-11-161006EURCHFExit.thumb.png.6249bd374b08ec3110517f44df6a9d76.png

Edited by Atti2dTrader
Grammar, clarity

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This AUDUSD trade triggered after I had left my office. In fact, I didn't realize I still had orders in for it. At this point I'm not optimistic about the potential for this trade, especially with the larger spreads that will come on the New York close in 40 minutes or so.

 

Best,

 

AT

5aa7127a4ce57_2016-11-161100AUDUSDOpen.thumb.png.50a84e499991793ad9bf28a672b26555.png

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I'm attaching a screenshot of today's closed positions as of the New York close. Total is +68.3 pips. I'm only trading 1K lots in this demo account.

 

I still have the AUDUSD position open, so that will be tallied at tomorrow's close.

 

Best,

 

AT

5aa7127a52c1e_2016-11-161600ClosedPositions.thumb.png.b892186989b7a2ba24d481cfc6feb057.png

Edited by Atti2dTrader

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