Macro Overview: I do not see any type of significant pullback (ie. 3+ up-days in a row) till early next month. Going forward we might see 2 up-days and 3-5 down days. The bond market is anticipating higher inflation and an increase in interest rates. In the past month or so I have noticed that when crude went up a dollar (say for example 60 to 61) the S&P was down 5-6 pts, but when crude retraced 20 cents(from 61 to 60.80), the S&P would rally 10+ points. But in the last few days there were not too many buyers even when the crude retracted. This tells me that even if we see lower crude prices in the next few days/weeks, the market will probably not move much higher. I feel that we are officially in a new bear market. Only time will tell. I will sell into any strength for the next month.
Monday's Rcap: Still short here with a stop at 1238.75. I am considering moving my stop to 1233. I guess I will wait one more day and see tomorrow's market action. I still feel good about my short position considering today's action.
Tuesday's Recap: The market was down for the day although it managed to rally a bit during lunch hour. 1225 seems like a resistance for now. I'm moving my stop to 1233.75 from 1238.75. Still short here.
Doublea, It seems you are not a daytrader, but at the same time you're not a swing trader. So are you a trend trader? In other words, are you trying to catch and ride a big move? If you are a trend trader, what is your strategy for moving up your stop loss each day to lock in profit? Also, I cannot understand how you are coming up with your initial stops? What is your money management strategy? Basically, it would be much more constructive if you laid your your trading rules and trading goals. After that we can all help massage those rules to meet those goals. If you want to see a constructive, well thought-out journal (which I believe your journal is aspiring to be) look at TriPack's journal.
I am trading price action and would consider myself to be a momentum trader. I do not how to define trend. If we look at a long term chart the action right now can be considered a pullback or other people can see this as the start of a new downtrend. I wish I can tell for sure whether this is a pullback or a start of a new trend. Initially, I put my stops at a point when if touched I know I'm obviously wrong. I do not want to be stopped out due to random daily noises. My trading goal is to make money-- pure and simple. I'll take whatever the market gives me. I wish I could maintain a nice, well laid out journal but I do not have that much time. I work 50+ hours and go to school too. Basically on the 1st post I have mentioned few patterns that I would like to trade and that's all I'm doing. If it goes my way I stay with it or else I'll get out.
What a beautiful day to be short here. I added another short position at 1225. When the market rallied (from 1216 to 1225) I thought that I might be stopped out today but I wanted to follow my plan and sell into the rally/resistance. I'm glad I followed my plan. After about 30-60 mins. the market took a nose dive. Current position: 2 short ES. My target is 1202. 1200 could be a nice support.
Covered one position at 1214 last night. That is a profit of 11pts. Not bad. Still short one more contract from 1225.25.
Well it was a bad day. The thing that annoys me is that I did not follow my own plan. I traded my opinion than what my plan told me to do. For the people that have been following my journal, you'll notice that one of my problems was adding a short position into weakness. I had promised myself that I was not going to do so in the future. But today I added another short position at 1202 with a stop at 1210.75 on both positions. The market rallied and I got stopped out of both those contracts. So, basically I gave up 8.75 pts. for not following the plan. I will not make the same mistake again. I guess you live and learn. Another thing that I have noticed is that if the futures are up or down huge before the market opens, it is probably a good idea to fade it. I had a nice profit till last night, I should have just covered my short position. Here is another rule that I'll follow. If the futures are up or down big and I have a nice profit, I'll take it. I'm still bearish here but it looks like the short term momentum has changed. I'll initiate a short position tomorrow night or Wed morning. We might see some carry over buying tomorrow. We'll break 1200 in the downside before we see any valid rally.