The Trading Journey of Lurker

[jacinto]

hi lurker,

as long as all the lessons are being learned, you will be just fine.

Jon mentioned a way to trade, but if you are a day trader ( we are being discriminated, but dont tell him that ) then moving down one level will help out.

I guess that what I mean is that trades have to be planned top down (be it from the monthly, to the daily.....) and your choice of "big picture" should be what tells you 2 things: the expected duration of your trade, and the expected profit.

......if my perspective is intraday, i have to at the very least see the week to understand direction, read the daily and the 240 min to understand overall behaviour, dig into the 60 and 15 min for setups, and once all is together, use the 10, 5, or 1 (whichever, doesnt matter IMO) to enter.

what i am trying to say, is that for me this is a set of rules that keeps me from overtrading. as examples:
a) daily, 240, 60 and 15 point south, its a no brainer
b) if daily and 240 point north, but 60 and 15 point south, i may scalp it knowing i will need a tight stop and a be aware y may only be looking for a few pips
c) daily and 60 south, 240 and 15 north, then need to analyse what the chart says before i trade

look for the combinations and think of them, then go back to your charts and see what i mean. you could get a set of rules from it.


good weekend

j

 

[firewalker99]

......if my perspective is intraday, i have to at the very least see the week to understand direction, read the daily and the 240 min to understand overall behaviour, dig into the 60 and 15 min for setups, and once all is together, use the 10, 5, or 1 (whichever, doesnt matter IMO) to enter.

what i am trying to say, is that for me this is a set of rules that keeps me from overtrading. as examples:
a) daily, 240, 60 and 15 point south, its a no brainer
b) if daily and 240 point north, but 60 and 15 point south, i may scalp it knowing i will need a tight stop and a be aware y may only be looking for a few pips
c) daily and 60 south, 240 and 15 north, then need to analyse what the chart says before i trade

look for the combinations and think of them, then go back to your charts and see what i mean. you could get a set of rules from it.

good weekend

j

Don't mean to get things confusing here, and each trader must find out what works for him/her best, but I hardly ever look at other timeframes than my 5-min charts. I like to have a look at a daily chart from time to time, but without acting on it.

Something that usually offers a decent risk:reward is trading with the longer term trend, but against the short-term trend.

 

[jacinto]

Don't mean to get things confusing here, and each trader must find out what works for him/her best, but I hardly ever look at other timeframes than my 5-min charts. I like to have a look at a daily chart from time to time, but without acting on it.

Something that usually offers a decent risk:reward is trading with the longer term trend, but against the short-term trend.

dont think you confuse them. each to their own styles (including the discriminators :cheesy: ), and if they are profitable, they are both as good IMHO.

and have a nice Sunday FW

j

 

[lurkerlurker]

New Chart Layout

3 minute for entries and exits
Price, volume of YM. 33 period EMA (100 min EMA a la chartman)
NYSE Tick with 3 period (10 minute) EMA, MACD (5,35,10)

Time and sales

15 minute YM with PV
5 minute YM with PV, 100 min (20 period) EMA.

This should allow me to pay attention to higher timescales before putting on a trade. 3 minute is good for candlestick formations, etc, as mentioned in this PureTick.com post.

Third monitor
Laptop to the east of the other 2 screens, keyboard and mouse control from main machine over network (SSH and x2x under GNU Linux, both machines running Win2K in VMWare 5). Laptop used for entering orders on TradIndex.com / MarketMaker, main machine used for static realtime charting.

Market closed, so laptop shows daily charts for overall perspective.

I'm hoping to use the new layout (3, 5, 15 min YM) to trade from Monday. Hopefully a longer term perspective will keep me Trading with the Trend!

 

[jacinto]

that looks nicer, not so many indicators.

 

[firewalker99]

Comments on Chart 1

Overall, a bad two days, but lessons have been learned.
Details in charts.

Red dots are potential short entries.
Yes, they are in hindsight... but more importantly if you shorted on those occasions or anywhere below the purple line, waiting for a retracement or not, the reasonable stop would've been somewhere above that purple line.

Okay, so you say "then I would have even wider stops?" where I would reply: no, you just wait until you have a short opportunity that offers a decent enough entry price without risking more than the normal stop size.

Basically I think your short was a bit premature, although it would've turned out to be a good one.

 

[firewalker99]

dont think you confuse them. each to their own styles (including the discriminators :cheesy: ), and if they are profitable, they are both as good IMHO.

and have a nice Sunday FW

j

indeed, both are valid options
as I think a lot of people have been saying... there's no single "right" thing to do or not to do; you just build your own set of rules and adhere to them

btw nice Sunday to you too... off to bed now been awake for like 40 hours straight almost and things are starting to look blurry on my screen lol

 

[firewalker99]

Comments on Chart 2

I've annotated on the chart

 

[lurkerlurker]

Red dots are potential short entries.
Yes, they are in hindsight... but more importantly if you shorted on those occasions or anywhere below the purple line, waiting for a retracement or not, the reasonable stop would've been somewhere above that purple line.

Okay, so you say "then I would have even wider stops?" where I would reply: no, you just wait until you have a short opportunity that offers a decent enough entry price without risking more than the normal stop size.

Basically I think your short was a bit premature, although it would've turned out to be a good one.

Would you be so good as to do another chart for Friday 8 June?

Those purple lines are support lines. Short on a break of support in the direction of the trend. What I good idea. I feel a bit of a ninny for not doing that.

The first red dot I couldn't trade while sleeping though!

In hindsight, I can't see a valid reason for my first short trade. I'd actually need to go back and look at what I posted as a reason for that because that trade seems nothing more than a high risk scalp.

My second trade was very very premature. The candle with the long upper wick, which failed to close above resistance, would have been a good short. I was tempted to go short again (not move my stop away, because I never do that) as soon as I was stopped out. (and I would have had my daily loss limit not been triggered - at least I had the discipline to keep to that).

My second short was seeing a failure to break resistance at 13360.

Your third red dot is too close to the close for me to trade, and I don't hold overnights, although it may have turned out as a good trade for a trader who did.

Thanks for the input. Sometimes I just don't see what is under my nose until it is pointed out.

 

[jacinto]

this is how the chart looks to me on a 5 min chart

edit, and on 15 min charts

edit 2: and a 5 min with MACD....which i dont use, but confirms higher lows all the way till the exit.

 

[firewalker99]

this is how the chart looks to me on a 5 min chart

edit, and on 15 min charts

spot on... the higher highs and higher lows are a clear indication
overlay this with my previous chart with small purple horizontal lines and this seems like piece of cake (it always does at the end of the day)

anyway, another view of June 8: symmetrical triangle, with breakout to the upside could've gotten you in the move even earlier

 

[lurkerlurker]

I've annotated on the chart

Okay, so my first entry was very good and was closed prematurely due to broker issues.

I should have taken another short when R held at 15:55. (why I did not do this, I do not know, I can only presume that I was away from the screens)

My second short was taken on a perceived failure to break a lower resistance, but it was premature and unconfirmed. I stopped out the trade when the market told me I was wrong.

The observation on the two swing lows was a good one. Lower volume on the higher low indicates less selling pressure. That is a gold nugget. I didn't even see that.

That break I keep threatening to take isn't happening yet. Seriously, I'm off till half five.

Okay, so I was away from screen until 6, but I thought I had studied the chart properly and I didn't even notice the higher low on lower volume. Big mistake.

I was looking for clues as to which way price would break. I had predicted a rally into the close the previous day.

Longs towards the end of the session in anticipation of a rally into the close

There was evidence in PV as firewalker has pointed out, yet I didn't see it. Then I made the mistake of prematurely calling a bearish reaction off resistance, and the minute I called that in my mind I stopped looking for a trade and started looking for a good short entry. The price went higher, which agreed with my plans to find a good price to sell at. I ended up selling into an uptrend.

I have observed that a SAR given the momentum would have been profitable, but I required to stick to my loss limit and stop trading.

Ironically, taking another short after I hit my loss limit on Thursday would have been profitable, and a SAR held to the close on Friday would have made me whole also. I've lost money by sticking to a daily loss limit (okay, I lost money due to bad trading, but you see my point,)

Thanks for the charts fw - you are a diamond. More analysis and ponderings to follow.

 

[firewalker99]

this is how the chart looks to me on a 5 min chart

edit, and on 15 min charts

added a white line to your 15min chart, it clearly shows the uptrend

 

[lurkerlurker]

Jacinto, firewalker - I've looked at your recent charts.

I have no way to prove this, but I kept thinking "the trend is up" on Friday. I noticed that on the EMA. For some reason, I kept looking for shorts to the exclusion of longs. Something tells me my bad trading was as much due to some irrational desire to shorts as much as failure to interpret the obvious on the charts.

Jacinto - thanks for your comment on my new charting. Firewalker especially will understand this. Okay, hindsight charts or not, but I think I am "seeing" things more clearly without a cluttering of indicators. PV seems the best indicator right now, with a few lines drawn in the right places.

Firewalker -on your latest chart, was the long entry on the break of the upper downtrendline or the third bounce off the lower uptrendline?

 

[firewalker99]

Firewalker -on your latest chart, was the long entry on the break of the upper downtrendline or the third bounce off the lower uptrendline?

I didn't take that trade, I wasn't around on Friday. But IF I would have, and supposing I would have seen the pattern materialize in real time, I would have waited for some clear break. So the green dot refers to the break of the upper downsloping line. Notice also that the real (big) volume only comes in two bars later, because that's the real break of resistance (see comments on chart 2, first horizontal purple line).

 

[jacinto]

lurker,

please mind that all the charts FW and myself have posted have been done with the benefit of hindsight, and to put it in a "spanish" way

it is not the same thing to see the bullfight from outside the ring than from within

outside the ring, one shouts and wants to get in and tell the bullfighter how to do his job., and even jump in and do the job
(analogy to trading without a reason )

inside the ring, the bullfighter is only trying to survive and win
(analogy to not seeing everything that is happening and taking the "best decisions" as opportunity arises)

good weekend and good evening.

j

 

[brutusdog]

3 minute for entries and exits
Price, volume of YM. 33 period EMA (100 min EMA a la chartman)
NYSE Tick with 3 period (10 minute) EMA, MACD (5,35,10)

Time and sales

15 minute YM with PV
5 minute YM with PV, 100 min (20 period) EMA.

This should allow me to pay attention to higher timescales before putting on a trade. 3 minute is good for candlestick formations, etc, as mentioned in this PureTick.com post.

Third monitor
Laptop to the east of the other 2 screens, keyboard and mouse control from main machine over network (SSH and x2x under GNU Linux, both machines running Win2K in VMWare 5). Laptop used for entering orders on TradIndex.com / MarketMaker, main machine used for static realtime charting.

Market closed, so laptop shows daily charts for overall perspective.

I'm hoping to use the new layout (3, 5, 15 min YM) to trade from Monday. Hopefully a longer term perspective will keep me Trading with the Trend!

hi lurker,

just out of interest which company / platform are those dow charts from? would like to change to it as they are much clearer than mine!

with regard to my earlier post re the pschcological aspects of trading, what i was trying to put across is not specific, more of an over view on how to aproach each day. still for me the hardest thing to do is to accept loss and view it as a positive.

also whenever we do something we are able to do it as we have learned it. when we take an action the brain refers back to how that action was performed in the past and the feelings associated with it and then repeats it in a similar way.

like if you have a bad experiance as a kid or get drunk when your young on a specific alcahol (mine was wiskey) and end up puking all over the shop and feeling rough for days (or ending up in hospital!) that will stay with you there will be an automatic assosiation with it (still cant stand even the smell of the stuff)

its the same with trading, if you make some losses and have a bad run it plays on your mind your brain will refer back to it each time you go to make the next trade, you get indesicive and question your own abilitys, exiting profitable trades early due to fear or thinking it will turn into a loss.

of course it is possible to reverse this, to get to a point where each action is positive, the only assosiation when you press the button is calm assured belief that you are making the right trade and if you win you win and if you dont you are protected and will look for the next set up (looking forward to getting there one day!)

all the best..:cheesy:

 

[lurkerlurker]

NinjaTrader and OpenTick

hi lurker,

just out of interest which company / platform are those dow charts from? would like to change to it as they are much clearer than mine!

Glad you like them. My exact setup is:

Gentoo Linux running VMWare 5 which runs

Windows 2000 Professional in VMWare
NinjaTrader
OpenTick​

If you use Windows you can get NinjaTrader for free (you need to register your email address. You can display charts, indicators, time and sales, level 2, place simulated trades, and backtest strategies. All of this is free. If you wish to place actual trades using the program (it talks to Interactive Brokers and almost everyone else) you need to pay for it. I use it for charting as I am still spreadbetting, so it is free to me.

Now you need your data feed. Ninja is compatible with OpenTick, which is free except exchange fees. This means you get ECBOT eminis (including the YM) and the ECNs for free. I pay $1/month to the NYSE through OT to get access to $Tick. otFeed is US exchanges only, but it does AMEX, NYSE, Nasdaq, CME, CBOT, etc.

There you go. A sharp, fully featured charting package, unlimited US historical data, and free realtime YM feed for free. Two months ago I was using AIOTrade for Linux with a Yahoo feed for the Dow and FTSE. One month ago I thought CMC MarketMaker (with the skewed SB price) was the bees knees. Now I know better

If you use Windows you are good to go with one download. If you have Mac you'll need an emulator like VMWare or QEMU, or a newer Mac which dual boots. If you have Linux, you'll need VMWare also.

Enjoy! (out of interest, what were you using?)

with regard to my earlier post re the pschcological aspects of trading, what i was trying to put across is not specific, more of an over view on how to aproach each day. still for me the hardest thing to do is to accept loss and view it as a positive.

also whenever we do something we are able to do it as we have learned it. when we take an action the brain refers back to how that action was performed in the past and the feelings associated with it and then repeats it in a similar way.

like if you have a bad experiance as a kid or get drunk when your young on a specific alcahol (mine was wiskey) and end up puking all over the shop and feeling rough for days (or ending up in hospital!) that will stay with you there will be an automatic assosiation with it (still cant stand even the smell of the stuff)

its the same with trading, if you make some losses and have a bad run it plays on your mind your brain will refer back to it each time you go to make the next trade, you get indesicive and question your own abilitys, exiting profitable trades early due to fear or thinking it will turn into a loss.

of course it is possible to reverse this, to get to a point where each action is positive, the only assosiation when you press the button is calm assured belief that you are making the right trade and if you win you win and if you dont you are protected and will look for the next set up (looking forward to getting there one day!)

all the best..:cheesy:

I totally get that. It can be difficult to condition yourself to break patterns and responses, but it can be done, with enough time. Hopefully the same is true for the more specific example of trading. Douglas talks about this in relation to recovering from the damage caused by a string of losses for example.

I'm more worried about my ability to call market direction than my psychology right now, but both are a problem to an extent.

Thanks for the feedback.

Cheers

 

[brutusdog]

totally understand that, just looking at it from the other direction, maybe market direction can be called better if your in the 'zone' as it were?....imho


was using igindex for dow have seperate programe for fx on tenfore data feed, might try and get dow on this.

 

[lurkerlurker]

totally understand that, just looking at it from the other direction, maybe market direction can be called better if your in the 'zone' as it were?....imho


was using igindex for dow have seperate programe for fx on tenfore data feed, might try and get dow on this.

See my post the other week which firewalker told me to print out....ahh, here it is. I think I was in the zone that week, and I really want back there!