How it went
Got off to a good start today. I felt much better about today. Felt in-synch for the most part with the market. I focused much better today and did a much better job at my trade selection. I had one issue with my charts. Something seems to cause my Volume based Investor/RT chart to recalculate and redraw. And when that happens I lose all volume breakdown indicator data for the current day. The indicators continue working on new data, but I have to re-download tick date to “rebuild” the indicators prior values. I hope Linnsoft can figure that out for me real soon.
It has been a while since I have had a day where the price action was this active and I took this few trades. All the other times I can think of were dead flat days that went nowhere.
I’m changing my format slightly. To try and save me some layout headaches, I’m going to list the trades all together in a single block and then have my thoughts and comments on each trade referenced below in a new Narrative section.
Trade Log of My Trades.
Trade Pos. Entry Exit Entry Time Exit Time Result
1A Long 1512.25 1513.25 5/4/2007 9:05 5/4/2007 9:11 +1
1B Long 1512.25 1514.25 5/4/2007 9:05 5/4/2007 9:30 +2
2A Long 1513.25 1514.25 5/4/2007 9:41 5/4/2007 9:50 +1
2B Long 1513.25 1513.25 5/4/2007 9:41 5/4/2007 10:08 +0
My Take Today
Captured Points +1, +2, +1, +0 = 4 Points
By simply managing these trades better and not taking any more trades, I had the option to double my profits. I managed too lose today and let some paper profits get away uncaptured.
Could have had +2, +3, +2, +1
Trade Narrative and thoughts about My Trades
Woulda Coulda Shoulda - Felt like just blindly buying 1509. We opened above this price and dropped down to it. This was such a strong level yesterday I figured we would at least get a tradable bounce there. Not really part of the plan right now so I passed. But I hate it when I’m right and pass up a good trade. May very well be the low of the day. :-( Have to trust your instincts sometimes.
Trade 1: A Good entry – As I watched some “high Risk” long entries go by my feelings of “Missing out” started trying to come back. I played some music, to sooth the savage beast, and just told myself to wait for the NEXT entry. Look, a good entry was provided. Price action made me sweat the entry for longer than I would have liked. But as I reviewed everything I was still confident I was in a good trade. It just needs to work. :-) I think I took the 1st half off too soon because of how long I had to wait for the trade to start moving. Then I tried to play lose on the second half to “let it run” and got stopped out at +2.
Trade 2: Houston we have reentry – I waited patiently for the next entry. There was a “weak” entry signal right after I got stopped out. The Volume Break down indicator tried to tease me into taking this one, but it really was not a good enough signal. I'll wait. Then there was a decent entry around 1513.75 or so. But wait… The last entry gave a secondary entry before it worked. I'll wait for one more push and take that entry. I got my entry, but I did it again. As soon as price stalled around +1 I took half off. I would have been better off if I just parked the stop “prematurely” at Break Even and let this trade work for better profits. After all, we are in a perpetual up trend and I have not been letting my longs run and I have been forcing too many short entries. Would have filled at +2 if I held. I hate to tell you this. Now I tried to let the 2nd half run and did not manage it close enough. Out at +0. :-
Hey Navigator, did we just miss our turn back there – Who is driving this thing anyway. Really messed up the last trade. Out too early and too late on the same trade. Missed all 4 of the clues.
- We put in what could turn into a “lower top” just before 10:00 CT. Ideally this should have been a higher high if we were going to keep trading higher.
- The Advance Decline is weakening and also not making a “Higher High.” The difference of the Advances and Declines has been trending lower for some time.
- The NYSE Tick made a “lower low” thus far.
- Volume started declining from 9:45 Ct until the 10:00 CT "Lower High."
Should I let this long trade try to run? You may be surprised, the answer is YES! But make sure it has a short leash with all of the above going against the trade. Always watch for the warning signs. I used too long of a leash and that one got away from me. At least I saw the clues before I tried getting long at 1513.25, but I need to get back in synch now.
Making Blog notes is helping me after I put on a trade with what I feel is a good entry signal. Typing notes helps keep me from second guessing the trade and actually makes me give the trade time to work. But I’d have to say it is hurting some as I’m not managing my trades as good (or close) as I should. I got caught thinking, let the market run to the “up side” when I should have managed the trades.
Flip a coin – A little after 10:30 CT and we are either trying to put in a turn back higher or we are trying to build up some steam to push lower. I have weak signals for both a long and a short in the 1513 area. I think I’ll pass and wait for the good signals and take them. No definite signs of a turn, so if anything I should be short. I had to say that to myself because I think I was starting to get to the point where I may have “forced” a long trade.
What did I miss – A lot! Technically it started when I passed up the short signal at what turned out to be the peak of my second long trade. You know the place where I should have protected some of the profits. The next few short signals were weak at best. There was a "should try" short signal just above 1511 that I missed in real time. Now I'm looking at a potential long at 1507.50 not ready to risk my (self minimized) profits yet.
You calling me short – I may not be real tall, but I should be short at 1509 or maybe 1509.25 for the entry at 11:45 CT. Step back; take a deep breath and focus. Now I spooked myself out of the last short thinking about the long I passed on. That long trade that is working so far. The 1509 area was troubling me too. It was so strong yesterday and now we are chopping back and forth around it trying to decide the direction. Now it looks like passing on that short trade was for the better.
Am I looking long now? – It’s getting close to noon, I’m leaning long again but the signals are saying be careful right now. I’d like to see the NYSE Tick press higher if we return to the upside. The last few NYSE Tick tops have been lower than I like to see for good sustained movement higher. So far there are no entries I like yet. Just a long under 1509 that should have had me protecting the short trade. (if I had traded it) Looking closer (a little late now) that long signal was at a re-test of yesterday’s Market Profile Value Area High (VAH). I think I missed a Long entry. :-(
Luke, Trust the Force – Just past noon. Price pushed back to 1509 again. What to do…. Feels like the market is trying to tempt me into a trade here. I passed. :-( It was a signal I should have taken. I’m having problems taking signals at these Market Profile levels. I don't know why. I should pass on other signals and wait for and take every signal at the Market Profile levels. In general, I need to trust my signals better. Especially signals in the direction of the trend.
Thoughts About Today
Reflecting back on today, while I felt in-synch, I did not act on enough of my signals. I started out good with the first two signals. Then I found myself starting to question the signals more and more and I’d have to say I started having feelings about not "giving back" what I have already made.
There were many more signals that I wanted to take and did not even list above. The worst signal would have produced a break even trade. Most entries had 2 or more points potential. I also lost focus or “checked out” this after noon a little early. When we were in the afternoon grind higher, I decided for the market that it was going to finish the afternoon too flat to trade. I prefer a bigger move or pull back to enter on and find these bigger moves to be more reliable at delivering profitable entries.
Lessons Learned - Or still needing to reinforce
Almost feels now like there are too many lessons to list. Well here goes:
- Take each day and that day’s signals with the market action they produce.
- Don’t let thoughts of mistakes already made, especially mistakes on prior days, take away from your focus on the market.
- Every entry will not be perfect. Take more continuation entry signals in the direction of the last trend.
- Trust the signals you see and consistently take the signals as presented.
- Maintain focus, or let go of any trades that you “could have” taken.
The Biggest lesson today – My biggest take away today is combining focus and trust. I let myself get distracted with Blog notes and did not maintain enough focus on “what trade would you put on right now if you have to make a trade.” With good focus, I should have the anticipated trade direction "of the moment" in my head and just be waiting for confirmation to enter a trade or invalidation to pass on the trade and look for the next signal. This may be in my words, but this comes from reading the TraderFeed blog. Brett Steenbarger does an awesome job with his blog and Weblog. I think there is something there every trader needs to help them with their trading.
I’m not sure I found the blog entry I was thinking about. But in my search I was reviewing many of the great posts on the TraderFeed blog site. Here are several that I ran across, remember, and highly recommend every trader review, then review again. I'll go back through them.
Three Relentless Steps You Can Take Now Toward Becoming A Better Trader
Four Overlooked Qualities of Successful Traders
Five Guiding Principles of Trading Psychology
Six Keys to Trading Success: Lessons From a Successful Trader
Back to today. I think I started filtering out trades because I wanted to protect the profits I already earned. While I did not make any really bad mistakes today, I did not manage my trades well. I did not protect my paper profits in these first trades. I “Hoped” the market would just keep going in this perpetual up trend mode. As noted above, I could have doubled my take today just by managing these first trades better. We better not talk about the trades I did not take that would have worked. I have all weekend to try and forget.
On the positive side - I did not trade in the choppier part of the afternoon. It is too easy in these periods to “think” you need to jump on a more “before it gets away” when you should be waiting for your entry price or pass on the trade and wait for the next entry.
Trade Well, Trade Wise
John
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