[bathrobe]

Here is my first entry into P/L Thread. Yesterday I could not trade because of a migraine. Acct. is smaller due to unexpected personal costs. Only 1 trade today.

Chris

[86834]

Originally Posted by XDTrader »

Thanks for your input. Sounds like you are a support and resistance trader.

I am trading short term momentum. The one point is the first profit target on 3 contracts, then there is one contract left as a runner with a progressively tightening trailing stop.

My method does not generally do well on choppy days. I am scalping and participating in the short term trend with my last contract using big relative volume as my bread and butter tool for entry.

Momentum and S/R goes hand in hand, to be able to use s/r levels effectively then you need to be able to gauge momentum and how price reacts around those levels.

To illustrate my point, attached to this post is a trade that i took today. The chart is a 15mins chart and the resistance that i'm using for this example is highlight in red.

Now generally you want to be trading with momentum on your side, so it helps identifying the areas where momentum is likely to pick up. So when the market is chopping back and forth between support and resistance levels, momentum, depending on the size of the range won't be at it's best. However when a key area in the market is breached then one expects an increase in momentum. Trading these areas where the momentum increases will help keep you out of the chop.


On the same chart you can see how once the red resistance line was broken to the upside it then acted as support, then once we were near the end of the session this level (813) was breached. As a result one expects an increase in downward momentum.

Trading with momentum is always advisable regardless of trading style.

[XDTrader]

Originally Posted by 86834 »

Momentum and S/R goes hand in hand, to be able to use s/r levels effectively then you need to be able to gauge momentum and how price reacts around those levels.

To illustrate my point, attached to this post is a trade that i took today. The chart is a 15mins chart and the resistance that i'm using for this example is highlight in red.

Now generally you want to be trading with momentum on your side, so it helps identifying the areas where momentum is likely to pick up. So when the market is chopping back and forth between support and resistance levels, momentum, depending on the size of the range won't be at it's best. However when a key area in the market is breached then one expects an increase in momentum. Trading these areas where the momentum increases will help keep you out of the chop.

On the same chart you can see how once the red resistance line was broken to the upside it then acted as support, then once we were near the end of the session this level (813) was breached. As a result one expects an increase in downward momentum.

Trading with momentum is always advisable regardless of trading style.

Thanks for your useful input and yes your right I could benefit from paying more attention to the longer term chart.

A lot of days however I catch nice moves within the ranges when my volume indicator signals big size coming in. The only problem is at the highs or lows, the market gets jiggy, as I am sure you know, and I typically avoid those areas do to my tight 6 tick stop as well as it being a possible reversal area.

As a newer full time trader I am constantly investigating new methodologies so I will be following your blog.

It would be great if you would post your P&L here with the rest of us. It would be useful to see your daily equity swings with your method.

[daedalus]

basically a wash day for me today. First es trade should've been par (that was the level it was at when I got my exit signal, but I couldn't fill so I took a loss) and second trade I should've got +.75 but price was whipping so violently I got filled for +.25... disappointing but thats real life trading for ya.

Wasn't 1 signal setup for me the entire morning. Not the kind of tapes that are ideal for my style of trading personally so you just take it and move on. The point is that you don't get killed on a day that doesn't jive with your method.

[bathrobe]

1 tick today, learning to be more careful with trades.

[brownsfan019]

3-25-09 update - didn't do much on Tue as I was working on a few behind-the-scenes things for trading.

After some thought and consideration, I am going to take this account in another direction which should hopefully yield a smoother intra-day equity curve.

When trading, there are a couple options that most traders contemplate at some point and one particular consideration is whether to trade 1 market (and focus on that one) or trade multiple markets. There are pros/cons of each that we can discuss in another thread, but I've decided to take this account in the direction of multiple markets, with more strict entry parameters.

The idea being to be more strict on my entry triggers, but trade a chunk of markets vs. hammering 1 market.

We'll see as this could be a very good exercise for everyone to watch - good or bad on the outcome. Obviously I wouldn't be doing this unless I felt the switch was a good thing.

The primary reason for a more broad focus and trade multiple markets is that the bonds seemed to dry up a bit for me after that Fed announcement last week. The intraday movements dried up and got slower, which was causing some issues for the way I trade.

This is also why I tell traders, esp new, while you may want to focus on 1 market, it's always good to at least watch what else is going on out there b/c if you pigeon hold yourself to 1 market, you may be missing other opportunities. While I had been focusing on bonds recently, I constantly watch the indexes, currencies and oil to see how they are reacting. I may not trade there, but I have my charts up to see what's going on there. And it's a good thing I did b/c if I had been so narrowly focused on just bonds, I wouldn't have seen that the indexes and currencies were doing well on my trading parameters (esp the currencies).

So going forward on this account, the markets that will be watched and potential trades coming from will be:

Bonds - ZB, ZN, ZF
Indexes - ES, NQ, YM
Currencies - 6E, 6J, 6B

At first glance that could seem like a lot or overwhelming to some, and it can be if you are used to trading 1 market. The advantage of having all these charts up at all times is that working a trade there is just a matter of clicking the DOM as my eyes are used to the constant checking and monitoring of these markets.

Again, the reason for this is to take better trades on the markets that have the trades vs. being focused on 1 market and feeling like I could be forcing trades.

The downside here is that I will have to trade a few more hours during the day (probably till 2-3pm). So, it's going to require a little more focus and patience, but my stress level intra-day should hopefully go down as I know I am just working my best setups.

[daedalus]

Work till 2-3PM?! Blasphemy!!!

[brownsfan019]

Originally Posted by daedalus »

Work till 2-3PM?! Blasphemy!!!

I know. I hope I can adjust to the longer work schedule.