Abe, I haven't looked at either with regards to my strategy, yet. I'm sure it would work but I just find the DAX slightly random in its behavior as it merely tracks US markets most of the time. I frequently see it go from +1% to -1% all too often which doesn't really make it a trustworthy benchmark index. Erasing a solid profit intraday in an instant is rarely observed in the US. I rather stick to the mother of markets, the ES
Call it dumb luck, or simply incompetence that I have not found any entry opportunity according to my tactics in recent days. There were no visible support or resistance bases forming in the 1H time frame. The current triangle pattern in the daily chart is a particularly challenging environment to trade as a trend follower. I would have had great difficulties maneuvering the market. I'm also not someone who wants to force a trade. Meanwhile I have composed some statistics of my trades since initiation of this journal.
I find it a little strange that you can't find setups. Perhaps you should look at more than 1 time frame? Many books talk about this and how it can help. I think these past couple weeks shows why it's wise to come up with another strat that incorporates RTM strategy. So many days I catch a big move early, only to have most of my profits vanish the same day. Yes, you're right about it being hard to trade as a trend follower, look at the past couple weeks, we haven't gone anywhere! I've been mostly flat but (a couple trades a week) active this month. The main issue is figuring out where the exit should be. I'm currently up a little, but most of my trades are plus/minus 5-10%. I am learning towards bearish as most sentiment says we should go down.
If you look at more than one time frame just because you cannot find a setup, you are basically forcing yourself into trades. I backtested my strategy back to mid 2009 with precisely this 1H chart and it has never failed fundamentally. I cannot recall to have had such a long phase without a single trade, though. In this environment I would have done badly anyway and I thank my discipline for not placing a trade. It's not about being involved in the market at whatever cost, but preserving what has been captured and refraining from trades when there is no opportunity presented. I'm looking for a very particular setup as illustrated in my previous screenshots. Nothing resembling has emerged recently. You mentioned already that the exit would be a major problem nowadays. I totally agree. Each momentum causes so much enthusiasm, only to extinguish the same or the next day. It's vicious. Yet, it's simply a range in the broader perspective so I hope to enter at the first break of visible support or resistance.
Staying out of trouble is half the game. It appears to me that you`re doing very well and following your plan? If anything, you could consider developing a new independent strategy for range bound conditions?
Perhaps we can talk over the long weekend. Though I don't know what your goals are long term, I want to be able to trade for a living down the road, and be able to handle huge size, so the ES or ETFs like SPY are a necesity, and being unable to trade for the period you have feels strange to me. I've been slowly making progress, of course it's difficult without strong trends, but because I realize the power of a short timeframe, I've been able to capture some decent profits during this timeframe. I don't know that timeframes are all that relevant. Think about it, if you cover up the x axis on your charts, can you tell the difference between one that's 1 h or one that's 10 minutes? I sure can't. I've been shorting Crude & Russell 2k recently.
I don't have a particular goal with regards to trading but to make right decisions. Even if I lose, it is only worth it if it was executed based on the right decisions. The rest will take care of itself. I don't feel the urgent need to trade full-time, because most who dream about it here don't make it in the end. I dreamed the dream once, like many here, but came to my senses early enough as this has lead me nowhere. Only resulted in emotional trading. Therefore, I have no expectations with regards to this. I have been mentored for a full year and I don't find a full-time trader's job that desirable (no insult to any traders out there, just my viewpoint). What I do enjoy with great passion is to talk and write about the markets and share my insights. The social networking tools out there nowadays make it a really fun thing to do. You can trade shorter time frames, though I am of the impression that the shorter the time frame, the more randomness and ranges will emerge. So I rather stick to my mantra of objectiveness and trade those trends that are really there to stay and not fade within a few minutes time. I wouldn't be able to manage that, I would get severely frustrated, I would perhaps abandon trading altogether if the only way was to day trade. Thankfully, I found what fits me for the time being. Perhaps I am missing out on the large move down now, I may have been able to simply short somewhere during the range, but I will wait for a real opportunity to come.
Well, to each his own. As always you must do what you're comfortable with. It seems you are a bit of a pessimist, don't take that the wrong way. I guess this is where we differ. I have definite goals, this helps keep my head on straight and thinking logically. You shouldn't group yourself with others, everyone is unique. Actually the fact that most people lose actually encourages me to trade, because that tells me there is more than enough $ to make it's way to me. I also know I'm in the top 5%, most every statistic about me has proven it. You are right, you should never trade emotionally, and avoid what makes you do it. You helped me get through my emotional trading when you told me that you found your trading didn't interfere with your day job. I used to let it and I was really depressed because I was always like, "I can't believe I'm here working for $180/day when there is trillions exchanging hands in the markets!" Now I realize my day job shouldn't stop me from being a good trader. Yes there likely more noise on shorter time frames, but that's where a stop outside the noise comes into play. Again, if you find yourself frustrated, it's best to stop. There comes a point where a great trader realizes this, you have no doubt saved yourself a lot of time and money by realizing this and sticking to it. I've cut off my nose to spite my face many times on this one. Finding something that fits you is very important, and one of the most important steps in trading I've read. The part that will always boggle me is the "waiting for opportunity." You can't say there isn't opportunity every day. I think you already know what I think about this so I'll just add, be careful about being rigid. Though there is a very sound base for your entry and exit style you've proven, I've read numerous posts on here about sticking rigidly to systems. One example I can recall was a trader saying he had a system that had done beautifully for a year or so but when 2008 came around, things "would have been disastrous." This wouldn't likely happen to you with your style, but remember the market is ever evolving, and so, you must recognize this and be able to adapt. Even though you are sitting out, which is stopping you from risking anything, there are other costs, I'm sure you are aware of: loss of any profits, as well as the most important: experience.
Very nice journal Bomb. Seems, that the shorting opportunity is appearing and bulls are slowly giving up.