The FED’s position is clear, what are you expecting them to do? Market refused to drop having had digested the FA and technicals on weekly show a higher low and a higher high. Could it be false indication of bear phase reversal? Of course. But we must trade what we see and not question signal/s.
I agree. Even if you were to anticipate the next move, eg price drops down to support level and you go long in anticipation of other traders looking at the same level and either going long or closing short positions and this collective action would drive price up, you would still be reacting to price action (price reaching support). Every trader has his/her own plan of action based on price action. Actually, whether you are early or join in once you see some form of a potential reversal, you would always be anticipating, otherwise you would be late, these people are referred to as FOMO and they mostly get killed in markets, eventually anyway.
I know what you mean, but I see a contradiction in what you posted here and few posts prior to, when you said this is going to be the big one, surely this expectation was based on what you were/are reading in the news and not so much what you were seeing in the technicals.
Technical trading, which happens to be what I also do, does not ignore the effect of news, nor does it say that news or fundamental factors doesn't matter. This is what @Overnight seems to fail to grasp. The premise of technical trading is to focus on price movement and how the market or major players act causing price movement. Markets can move on news and they can move in absence of news as well. When players act in the market that is shown as price movement. Technical traders seek to exploit that price movement. Beyond that, there's not the slightest doubt that the market can move technically both short term and even medium term. For anyone who's paying attention it's happening day after day and week after week. The market's are clearly not moving randomly.
Yes -- what is known or fathomable isn't of any value. As you pointed out, this week was a clear sign that the market was no longer going down on hawkish speak from the Fed. Even in the technical space, though, most folks are analyzing the markets in 2D -- which includes most of the folks in the media. And many who use technical analysis are still biased by the current narrative in the media. An elite few figure out how to analyze the markets in 4D.
The key to becoming rich in (day) trading is to increase stake size as your account grows. For now, I allocate $10K per contract as my standard size and $5K as my maximum size all in/all out. So far, I have not used my maximum size and I'm generally trading only one contract. I have however added 2 and even 3 contracts to my initial position. For example, if I'm long from 4000, I can add another contract at 4005 with a 5 point stop which would be breakeven for the entire position. In the past, I've been in a hurry to scale up and done so too fast, so I'm taking my time this time. Reflecting on past misfortunes it's encouraging to see that I've failed mostly because I've traded too large and not because I'm a bad trader. If you're trading smaller you're more relaxed, in tune with the market and it's much easier to cut a loss since it isn't that big. Eventually, I hope to allocate even more per contract as even $10K is a bit too much risk if you want to trade a bit more conservative. I find there's a sweet spot, though. If the size is too small it's easy to get sloppy and careless. Right now I'm sharp and focused trading one contract.
I'm a bit surprised by this as you've persistently been calling this the big one. The latest time earlier this week. What's the significance of this weekly bar? I'm no expert on fundamental analysis and as I said I'm a technical trader, too, but it seems to me that the conditions that have been driving this market over the last decade are gone for now. So, for me this is just another bear market rally. We had far stronger weeks than this one in the most recent past which were sold hard.
One of the things I see you say often is that you know its going higher, but of course need to take a profit to either end up green for the day after a drawdown, or simply to take the profit so that you walk away a winner. (It would suck to not take 10 points because you're hoping for 20, and then have to close out at 0.25 if it completely retraces) Jumping to 2 contracts is clearly a huge step up because hitting that max stop the very first time you make a 2 contract entry will be a painful stroke of bad luck. So why not go in with 10 MES instead of 1 ES? I'm paying $0.57 for an MES contract, and even though its been a while since I traded the full ES contract, its maybe between $4.50-$5. So very comparable to pay $4-5 for 1 ES vs. $5.70 for 10 MES. And now, you have sooooo much flexibility. Maybe you will get the odd slippage for exiting 10 every time at the same price, but I honestly think that this extra freedom and flexibility will do wonders for you. Imagine walking away with just 2 MES as runners for an EOD rally after you already took profit on the first 8. With these days of the ES able to run another 20 or 30 points, I think it will make a huge positive difference to your PnL to have some runners, and also a huge positive difference to your mental/emotional composure because it will allow you to do what you want to do deep down but can't because you're trading the PnL.