[HAL9000]

Today I lost focus somehow,
but survived again.

While the first five trades were OK, but maybe not a clever choice,
the last one, was the one I fooled myself with today.
I chased the entry shorting at the wrong point, survived with my stop,
but haven't closed it in green whenever I could,
and after some waves I did it finally for a scratch.
Well and then immediately after that; market went down ... lol

[hedonQ]

If you want a good example of bad trading, here it is:
- jumping the gun. Same problem as yesterday, imagining price action as opposed to seeing it
- absolute lack of focus at the worst possible time
- shaken out of good setups

I have some disconnect between trading ideas and their execution, in real time.
Also, discipline and clarity is something to be desired.



Good Luck.

[MCM]

Got back on the horse today (ok..perhaps pony..or minature pony). And sat around and watched the chop. In the end - two quick trades that were breakout / momentum plays.
Not great. Not horrible. But I needed one of those days for my confidence after the past couple weeks.

First trade missed the goal by 1/2 pt - and just got out to cover commissions. 2nd trade - could have exited later - but end of day and thought better of hanging around in it.

[HAL9000]

Originally Posted by MidKnight »

So you are saying that the noise, by your standard is 5pts and the stop needs to be placed outside of that - sounds logical. And, that your targets are less than 5pts, so effectively within the noise?

Hi MidKnight,

I promised to explain a little bit more, so here it is for you and all other reading it, and I hope it will make sense.
Some thoughts, some explanations.

First of all, the absolute value of what you consider to call noise is somehow dependent from the (time) frame you trade, I guess we all know that.
I like to think about signal to noise, and yes, it plays a role within some sciences,
but lets keep it simple and forget about signal to noise for a moment.

So the question stays, how do I come to the view, that it is clever to use a
5 point stop trading the NQ, while I often just take 1 point profit.
This should be against risk/reward and therefore this should just lead into ruin.

So now, how should I start, I had and have a problem: Early entries.

So last week I looked on a chart like the one below.
Just on price movement, and counted 3 points up, 2 points down, 6 points up, 4 points down ...
So within a trend there a pullbacks, some may measure them as 61.8% retrace, some might call them ambush trades (50 % retrace).
I often found these 3/2s and 6/4 while larger pullbacks might be viewed as new trend, even if just temporary.

So I thought, assuming that I don't take the worst entries,
that a 5 point stop should keep me out of most of the trouble,
and also saves me, if there might start a trend change.
Now if you add other indicators like the linear regression bands you often see double bottoms or tops at the bands,
and these indicators look different on different (time) frames.
So that can be just a help to anticipate what will happen.

Now the 5 point stop gives you some room to stay in the trade or to cut it at BE if the band was violated in a way you don't like.
And well, sometimes you just simply will be stopped out.

Now to the 2 point noise:
The charts below show 2 point range bars (based on 5 s bars, so some are larger and the open of the next bar might be the close of the last 5 s bar, i.e. they are not really range bars).
One idea of me is:
Lets assume that 6 points moves are quite often, but they also stall then.
If you entered missing the first 3 points, why not just exit when 6 points are
reached (with 2 or 3 points profit).
Then wait for a pullback of 2 or 4 points for reentering into the same direction as before.
That would be really playing noise.

Anyway, the idea is somehow in my head, but if you look at my trades,
I haven't traded it yet. So its just an idea.

And now have a look at my charts, and if you like,
start to count the points.







Same view with some more indicators:

[Robert Joyce]

Ok, only sim trading again today. $525. 15 trades; 7 winners, 5 losers and 3 stopped at even. The only good thing is I bailed on my losers before they hit my full 21 pt stop. Oh and I let my winners run till they hit my limit exits which was also good. I feel like such a chump for not trading real money. I guess you would have to say if Bathrobe is playing with 'scared money' then mine is 'terrified'. Maybe tomorrow. Great trading for all of you.

[thalestrader]

Originally Posted by HAL9000 »

The charts below show 2 point range bars






Same view with some more indicators:

What really grabs my attention is that the scaling in the second chart distorts price action to such an extent as to occlude the trade opportunities that otherwise jump out at you on the first chart.

[Robert Joyce]

Ok, so what is Mr. Black's method..... If I may be so bold as to ask....

[thalestrader]

Originally Posted by Robert Joyce »

Ok, so what is Mr. Black's method..... If I may be so bold as to ask....

It might be best for you to search "jack hershey"