JillyB's Blog

[JillyB]

More Downward Movement Today?

It does seem quite likely, I have to admit, even though there is a major line of support at around 11,350 area.

At the moment the Dow is at 11,364 - this is 8 points below the low of Friday.

This is Trade 4.
It says to expect an initial test of the low/close range of Friday, but after this to place a SELL trade and to hold until at least 6pm - possibly through to 8.30pm just before the close.

If the open of the Dow is lower than this say 11,355 or lower then these would be new trades for the system. (I will not be counting new trades against the reliability of the Trading Plan).

Equally if the open is a little higher say 11,376 area, this would also be a new trade for the system - with the open, low and close all very near to each other.

We will have to wait and see what happens at the open.

 

[JillyB]

It was a New Trade

In the end the Dow opened at 11,342, which was 32 points below the close of Friday and 30 points below the low of Friday. As I thought, this gave me a new trade - Trade 35.

On the days where I have a new trade I don't trade myself but I watch and record what is happening - though I do, as today, try and predict what will happen. The bounce at the open back up to the low/close of yesterday was a given. However the return downwards I thought would have been longer and a more drastic drop, as it was it bounced off the open again and returned upwards closing above the close of Friday giving a positive day in all.

In short it looks as if Trade 35 will give a possible 3 trades, a BUY, a SELL, then a final BUY trade. This has yet to be tested again and as it is quite a rare occurance for the Dow to open so drastically below the low of the previous day, it may be some time before I can test the validity of it. I have noted though, that today the lows were along a line of support on the daily chart and this is something that has to be taken into consideration.

So from last week we still carry the figures forward of 8/10 trades correct.

From tomorrow I will be on holiday and not back to the 31st May - even then I'm not sure whether I will be around for the open of the Dow - flights permitting, I should be. So until then there will be no more entries, but I will update the journal once I am back.

Bye for now.

 

[JillyB]

Back from Holiday

Well, when I left the journal we had a new trade - Trade 35 - on Monday. We also had 8/10 trades correct - so let's see how the last two weeks have gone.

Tuesday 16th May - Trade 6 - SELL trade from open - target hit - 9/11

Wednesday 17th May - New trade - Trade 64

Thursday 18th May - Trade 58 - Stand aside day (too complicated to predict this)

Friday 19th May - Trade 3 - BUY at 2.50pm - 3pm to go up to high - WRONG -9/12

Monday 22nd May - New trade - Trade 20

Tuesday 23rd May - New trade - Trade 43

(Yes it's filling in all the gaps on the system all of a sudden. Does this indicate a major reversal on the cards? Since I started with info on this system at the beginning of October the general trend has been upward with minor retracements. Are we looking at a more major reversal now?)

Wednesday 24th May - New trade - Trade 69

Thursday 25th May - New trade - Trade 16

Friday 26th May - New trade - Trade 44

Tuesday 30th May - Trade 24 - SELL to low and on to 11,136 -46 - target hit - 10/13

Wednesday 31st May - Trade 58 - BUY at open and hold until 5-6pm - excellent trade - possible 40-50pts - 11/14

So that brings it up to date. Since the start of this on 8th May it has generated 14 trades - 11 correct and 3 incorrect, which gives a 78.5% success rate. Still too early to tell what it's going to be like in the long run and with 6 new trades in 2 weeks, I feel a definite shift in the market occuring.

I've also designated some stand aside days - Trade 58, I've mentioned before is a difficult one to predict, unless the close is near to the low of the previous day. So I have decided that on such days I will stand aside - better to do this, that to struggle with the market and take a loss. Trade 10 is starting to look very similar to Trade 58, so I'm going to watch this one too. So far it's not giving me any discernable patterns I can work with, but when I'm less tired I will look at it in more detail.

I'm signing off now and going to get an early night - I haven't slept for nearly 36 hours now. (The flight back from holiday was overnight - then we had 3 hours before check-in for the Guernsey flight at Gatwick. Not enough time for a hotel and sleeping upright in a chair isn't something I'm good at. So I've been awake since 8.30am Tuesday morning and I'm feeling jaded, so an early night is called for.)

 

[JillyB]

Cable Trading

So I'm working on a theory for trading the cable. I'm leaving the Darvas boxes out of this for the moment and looking at a new strategy.

Whilst on holiday, I read Dr Alexander Elder's book 'Come into my Trading Room'. Excellent book, well worth buying if anyone is interested.

I decided that when I came home I would apply his theory to the Cable and see how I got on.

I am using a 30 min chart for the general trend patterns with a 20EMA applied to the H+L+C+O/4 and two channels of the 20EMA applied to the H+L+C+O/4 with a vertical shift% of +0.6 and -.06. I also have on a MACD histogram 12,26,9. For entry and exit points I am using a 5 min chart, again with a 20EMA applied to the H+L+C+O/4 and with two channels of the 20EMA this time with a vertical shift% of +0.2 and -0.2. I have a MACD histogram on this chart as well - same settings.

At 10.15am I paper traded a SELL trade. The reasons for this were:
- downtrend on 30 min chart
- at EMA and with change of guard (green bull candle followed by red bearish engulfing candle)

Channel width 75 pips
Class 'A' trade - 30% + of channel = 23 pips or more
Class 'B' trade - 20%-30% of channel = 15 -22 pips
Class 'C' trade - 10%-20% of channel = 7-14 pips
Class 'D' trade - <10% of channel = less than 7 pips

Traded at 1.8654/57
Target - last support line at 1.8603/06
For 48 pips
Stop at 1.8668
R:R ratio approx 1:3

11.40am - move stop to 1.8645/48 - lock in 6 pips
11.50am - move stop to 1.8643/46 - lock in 8 pips
12.15pm - move stop to 1.8631/34 - lock in 20 pips
12.20pm - move stop to 1.8625/28 - lock in 26 pips

The target of 1.8603/06 has just been hit whilst I'm writing this. So my first paper trade of the new system has bagged 48 pips and is a Class 'A' trade.

The grading from the trades is taken from the book also. Rather like the grades you got when at school. I'm hoping it will help me see any problems - such as major swings between 'A' trades and 'D' trades - and bring some consistency to it.

Time taken for trade 2 hrs 12 mins. (Also important that I keep a record of the time for trades which will then, hopefully, give me an idea when I'm real time trading how long I need to hold the trades for.)

I'll be back just before the open of the Dow with the predictions for todays trading on this.

 

[JillyB]

Today's Dow

Currently the Dow is at 11,157/61 (CMC). If it opens here or in this area, then todays trade will be as follows.

Trade 1
BUY up to the close at 11,164 and possibly on to the high at 11,179 (use a trailing stop above 11,164 to lock in profits).
Then a reversal for a SELL trade down to 11,164 and possibly on down to 11,134 -24 range (again use a trailing stop with this).

If the Dow opens at 11,159/63 or above then it will be

Trade 6
BUY up to the high at 11,179 and possibly on to 11,191-201.
Then reversal for a SELL trade down to 11,159 or 50% of total rise since open.

Any higher than 11,170 will give Trade 58 - which would be a stand aside day, but in light of the consensus on the other two trades a possible initial BUY trade may be favoured.

 

[JillyB]

Short and Sweet Trading

So, the Dow opened today at 11,159 which gave me -Trade 6

BUY at the open to the high of 11,179 and on to 11,189 - 99. Then look for a reversal SELL trade back down to open - trail a stop after 50% of previous rise to lock in profits.

BUY at open 11,159 - initial target 11,179. Rise on Dow went straight through 11,179 and carried on to 11,190. Stop placed at 11,189 to lock in profits and stop triggered at 14.49 for 30 pts less spread = 26pts.

SELL at 11,189 - target 11,159 - stop placed at this when target was hit - stop triggered at 15.10. Again for 30 pts less spread = 26 pts.

Total points today 52.

2/2 trades correct - running total = 13/16 trades correct. 81.25% correct.

 

[jacinto]

good job. you are definitely good. keep it up.

 

[JillyB]

No trades today

There's nothing going for me today. The Cable was in consolidation until the news at 1.30pm when it shot up over 100 points. I still have to master this breakout thing on the Cable. The Dow can sometimes give a false break up or down, before the real move, but watching the cable it doesn't seem to do this. More observation of this is required before I can be certain.

Looking at it though, setting a limit order for an entry above 1.8695 the high of yesterday afternoon would seem to have been a safe thing - but then hindsight is a wonderful thing. I shall have to watch more closely in future.

The Dow opened up as well 27 points above the close and 10 points outside the range. This gave me a new trade - 32. So I am just watching and making notes.

Roll on Monday, I'm itching to get some more trading done.

 

[JillyB]

What the Hell is Going On?

Todays trade was Trade 1.

Which was a BUY trade at the open - 11,216/20 to go up to the close of yesterday at 11,245/49. After this to look for a reversal SELL trade back down to the low of yesterday at 11,186/90.

Today it failed on the first trade. My stop was at 11,186 and I got out once this was hit. I have previously found that there shouldn't be any more than 30 points noise on any opening trade. So my stop was set and was triggered. I have to say that it was only placed as a mental stop, as I was aware that this level was also the low of yesterday and it was possible that there would be a shake-out caused by the market-makers to get stops to be hit and limit orders to be filled. However when the bounce back up failed to materialise, I exited.

So today we have a losing trade that gives us 17 trades: 13 winning and 4 losing trades.76.4% win rate.

I'm glad that I did get out. A lot of strange things have happened since then. At 2.57pm CMC froze until 3.02pm (5 mins) when it gapped down over 10 points. Then it spiked down to 1,000 (yes, 1,000 not 10,000) screwing up all the charts. From then on it's been jumping around - up 10 points, down 12, up 8 points etc. You get the picture. I don't know what the hell is going on today, but it does make me glad that I got out of the trade when I did.

 

[JillyB]

It's All Gone A Bit Pear Shaped

Todays trade was - Trade 58.

Now in the journal I've explained all the problems that I've had with this trade and how I've searched for a common denominator in the statistics. I'd thought I'd found it, when I noticed that whenever the close is within 25 points of the low and the open is nicely above the close, then the index will go up for most of the day. It's never let me down - yet. However today proved the exception to the rule. The close of yesterday was only 11 points above the low and the open was another 27 points above the close, signalling an excellent chance of the index bouncing back up.

I placed a trade at 11,076 - 2 points below the open and traded it to take 11 points before I started to get nervous. On a 2 min chart the index had stopped making higher highs and was stuck with 11,092 failing to push past it. I took my profit.

There are times when I've seen it do this before - test a line of resistance before falling back to the open and then bouncing upwards even more strongly to break through the first level. I thought that I would take this profit and wait for it to drop back and look to get in at a lower level. I waited for the change from downward back to positive upward movement but it never came. There was a bullish divergence on a 1 min MACD chart around the 11,019 level and from there it did bounce up to 11,040, before resuming it's downward trend. After the low of 10,920 another bullish divergence appeared on the MACD of a 2 min chart and again this signalled an upward move to finish the trading day.

So although it was a positive trading day personally - I cannot call it that as far as the Trading Plan is concerned. Once again we have another losing trade which now gives me a total of 18 trades: 13 winning and 5 losing. 72.2% success rate. Still above average, but I would now like to see a few more winning trades to up the percentage - if not that, then to make me feel a bit more positive about things.

 

[JillyB]

Stand Aside Day

It's 13.46 and the Dow is currently at 11,019. If it stays around this level and does not drop significantly prior to the open then todays trade will again be Trade 58.

However, as the low is 77 points below the close of yesterday, then it does not generate a definite trade as yesterdays did (even though it was wrong!) Therefore today's trade 58 is to 'stand-aside'. In short I do nothing as I have nothing to tell me whether it is going to be a trade that goes up all day, or that goes up until around 2.45-2.50pm and then goes down for the rest of the day. So due to this uncertainty - I have designated it as a 'stand aside trade'.

 

[JillyB]

Another New Trade

Today always looked as if it was going to generate something different. Initially mid-morning we were more than 40 points below the low/close of last night. By the time it got to the open we were just 10 points below. However this was enough to generate a new trade.

With the low and close being so near and the open 10 points below this, we had Trade 38. Because of this, it was an observation and recording day.

I won't be trading tomorrow as I'm off for the day. Boat trip to one of our neighbouring islands - Herm. Just hoped I don't drink too much of the old vino and miss the boat coming back.

 

[JillyB]

A Possible Upside Day

At the moment the Dow is at 10893/98. If it stays at this level - no lower - and I would prefer it to be up at slightly higher levels as it was earlier this morning, then we should see a day of upward movement until around 5-6pm.

If the Dow drops lower than this - nearer to the close of Friday then it is more likely we will see a retest of the low of Friday before a possible bounce upwards. The bounce up would then meet resistance around the high of this morning - which so far has been 10930.

 

[JillyB]

A Difficult Day to Predict

It's 2 minutes off the open, so I will make this brief and update it after the open.

The Dow is currently at 10779 which would indicate a Trade 4, at the open there would be some upward movement to the close/low of yesterday - possibly up to around 10809 -819. The to look for a reversal SELL trade and hold this until the 6-7pm.

Back later.

14.39.
Open was at 10785, target is now 10815 - 825 before reversal.

14.41
Stop moved up to 10800 to lock in 11 points profit.

14.43
Traget of 10,815 hit, stop moved up to 10,810

Profits taken at 10,825 - 40 points less spread - 36 points.

14.55
SELL trade taken at 10,842, Stop at 10,858. Target - initially 10,785 - maximum 10,745.

15.00
Stop moved to 10,838 - break even point.

15.04
Stop moved to 10,828 - lock in 10 points profit.

15.08
Stop moved to 10,820 - lock in 18 points profit.

15.19
Stop moved to 10,800 - lock in 38 points profit.

15.22
Stop moved to 10,785 - lock in 53 points profit

15.28
Stop hit - taken 53 points from second trade.

TOTAL FOR DAY - 89 points.

 

[JillyB]

What Went Wrong Yesterday?

It was Trade 58 again. And once again it failed with my modified trading plan.

Oohh!!! 15.19 and my initial target for today's sell has been hit at 10,785. I've now moved the stop down to 10,800, locking in 38 points profits - I'll also add this onto the previous journal entry for todays trade.

So back to yesterday. According to the trading plan with the close being near the low and the open well above this we should have seen upward movement all day. But it wasn't to be. An initial penetration and close below the low of the previous day on a 30min chart signalled this and after a bounce up to the close/open, it was downhill for the rest of the day.

15.22 Stop moved to 10,785 - locking in 53 points.

Back to Trade 58. It seems that with these days it is going to test either the high or low of the previous day. A failure to close above/below this level will result in it heading the other way.

So I'm testing the following.


At the open wait until the index has tested either the high or low of the previous day.
It will need to close above/below it on a 30 min chart to confirm this.
If it has BROKEN the low it will then be a BUY trade up to the close at ???
It will then reverse and continue on downwards until 6-7pm, perhaps to the close.

If it TOUCHES the high, but FAILS to close above it, place a SELL trade and hold until 6pm - perhaps later.

If the high is BROKEN then it will continue upwards, wait for it to draw back to the open and place a BUY trade to continue up until 5-6pm, perhaps later.

So with that trade we now have a total of 19 trades but only 13 winning trades - this brings the percentage down to 68.4%

However today we have 2 out of 2 winning trades - If I close now I would be 36 points on first trade and 55 points on the second trade making a total of 91 points. - 15.28 Stopped out at 10785 - so make that 89 points for the day.

This now takes the total to 21 trades and 15 winning - which gives a percentage of 71.4%. So by 3.30pm I'm all finished for the day.

Edit:
Just thought I'd add some more detail to this for the 21 trades.

Total winning points(15 trades) = 449
Total losing points (6 trades) = 114
Nett points = 335

 

[JillyB]

Yet another new one

Yes, today we have a new trade - once again.

The trade has all the hallmarks of Trade 57, but with the low and the close being in such close proximity, then I don't think we will have the initial sell trade to the low that Trade 57 has. Instead the low/close will act as support and I believe we will start off with a BUY trade, which will go up a minimum of 40-45 points.

EDIT: 15.10pm I've now raised the stakes on this and said 40 points is the initial target, then trail a stop up after it and look for +60-70 points up on the open.

This means that todays trade has a new number 74, and although very similar, it will have its own text and targets. This is probably why I have so many variations, as subtle differences can slightly change the prediction eg. the low and close being so near and acting as support.

Trade 57 is also very similar to Trade 58 when it is in BUY and hold until 5pm mode. I believe that this is what we will see today on the Dow. So my thoughts are to look for the initial BUY trade at the open, lock in any profits above 40 points with a trailing stop and let it go.

 

[Pat494]

doing well today

 

[JillyB]

Retest of Yesterdays high?

It's 14.15 at the moment and the Dow (pre-open) is currently at 10,838 - this is 27 points above yesterdays close and 26 points above yesterdays high (CMC).

At the moment I don't have a trade for when it is so far outside yesterdays range, but still less than 40 points away from the close, so I won't be trading this today. (The 40 points away from the close seems to act like a gravitational pull on the index - more than 40 away from the close and the pull of the previous days close has no effect - less than 40 points and the index is drawn back to it. This was one of the first things I noticed back in January this year).

So based on this - could I suggest that we may see a return to the high/close of yesterday? Then - as these two are so close - we could see a bounce and a continuation upwards - as I don't know the trade yet, this is pure speculation today. It's also possible that any upward movement may only last for the first half of the session. After lunch we may see a reversal, but then again if the early movement is strong, a continuation may be on the cards - at the moment it's hard to predict.

Once I have seen the trade and recorded it, then I can look into the sentiment behind it and add this into the trading plan.

2.21pm: 10,842 - still in this range for the open I think.

 

[JillyB]

Similar Day to Yesterday

It's 7.45pm and the Dow has a little over an hour left to trade.

It's been a somewhat similar day to yesterday trading wise. We didn't have the drop to support (close/high) at 10,811-12, but instead continued the uptrend for 80 points max.

I've entered in the trading plan - as for yesterday - to have an initial target of +40 points on the open and to then trail a stop up to a maximum of 70 -80 points.

From there we look for a retracement, taking our sell at or above these levels and our target is 50% fib retracement.

Again, like yesterday, we have an afternoon (evening over here) rush of the bulls to push the prices higher again. We have a line of resistance around 10,965, so I think it will struggle with this level.

On a 3hr chart the index has now pulled away strongly from the 20MA, which means it will not have much strength to push further in this session. It will either consolidate tomorrow at this higher level or retrace slightly towards the 20MA. My partner, Paul, likens this to 'baby on reins'. You know the ones that mum's have to control their toddlers. Every so often baby wanders a bit too far away from mum and she gives a little tug on the reins to bring baby back towards her. The price and the 20MA act like this. The price wanders off - either up or downwards - and the mum (20MA) gives a gentle tug to bring baby (price) wandering back again.

I can see a choppy day instore for tomorrow as the bulls and bears fight it out over this new price level. We have seen a substantial rise over the past two days, can it be maintained?

 

[JillyB]

Not Much of a Trade

I'm a bit late with this entry - been enjoying the sun too much.

Todays trade is Trade 1 which gives:-

BUY up to the close at 11,006 and possibly on to around 11,034.

If the higher value is hit befoe 3.30pm place a SELL trade and hold until 8-8.30pm, the target here is the low of yesterday at 10,830.

If the higher value is not hit, or not until 6-7pm, then look for a smaller reversal and a SELL back down to the open at 10,994.

I'm off back to enjoy the sun now.
Hope everyone has a good weekend.