We have 2 huge gaps up with a day in between. 1227 is yesterday's low. Could be tested tomorrow or overnight as overnight lately has a large range. I expect 1220 and potentially 1206 tested. Most likely not tomorrow, may be Friday after the reports. At least half the gap at 1210-1212 should be filled. 1210 is also this week's R1. potential upside is 1260-65. 1265 is R2. To be sure, because of the huge gaps I don't' have a very clear read for tomorrow, so I need to be careful. Let's see what develops overnight. Also, we broke out above last week's high today and closed almost at b/e for the year.
the overnight session was rather non eventful. look like consolidation so far. 10 Am report may be the mover.
Hello PO I trade the ES using an automated system - strictly hands off. I do this because if I don't, then my emotions (fear and greed) get in the way and I end up doing stupid things. The system has been running for the past 7 quarters and has never shown a loss (past performance is no indication of future results) - and I have not modified its settings since I started using it. I have tested various settings only to discover that over the long term, less optimization returns the most consistent results (not necessarily the largest profit) The biggest reason the system works so well is that I limit my daily trading losses and I protect my gains (maintain gain) - the last being the most important - I am out when I make my allocation - regardless of what the market is doing - regardless if even I KNOW THAT I COULD MAKE MORE! Another reason it works so well, is that it is automated - I am not trying to analyze the market bar by bar - trying to do so has proven to be a black art for me. I am also working on a new scalping system - I practiced with play money and the instant I went live - Fear & Greed got the better of me - so I am in the process of automating this as well. It is proving to be difficult and will still require human discretion out side of the system. The reason for this post is to emphasize three points 1) Limit your daily trading losses - stop trading, walk away - no more for the day - regardless of what the market is doing. 2) Maintain your Gain - once you make your allocation - stop trading, walk away - no more for the day - regardless of what the market is doing. 3) Try like hell to codify your system - the more that your computer does for you the less chance you have of doing stupid things. By the way, the technical aspects of my system are not that important, I have applied the above rules to a variety of systems I designed and at the very least - they keep me from experiencing excessive losses. Good Luck!
my daily prediction and live screen http://www.elitetrader.com/vb/showthread.php?s=&threadid=228133&perpage=6&pagenumber=17 I will prepare tutorial and live screening my trade platform on real time good luck
PO, you keep analyzing the market conditions at a given point in time and using phrases like "probably will", "often results in", "most likely", "less likely", "should", "could", etc. Anyone with some basic analytical experience can look at the chart leading up to the hard right edge and provide a description of the price action environment in one's trading time frame at that point in time. Let's say it's 5 minutes from the market open this morning and I look at a 5-min chart and describe the PA environment: The overnight session traded in a 10-pt range, broke the lower trend line following the jobs news release, but printed a swing low slightly higher than the previous swing low. The original lower trend line is currently acting as resistance and the new adjusted lower trend line is holding as support. What you're missing, PO, is a battle plan based on the analysis of current price behavior. Cutten posted here some time ago: "What is the bull scenario, the bear scenario, and the neutral/ranging scenario? How would the market act under each scenario? How will the market act if it transitions from one scenario to another? How do I identify each scenario or transition, and how should I best respond in each case (bull, bear, neutral/ranging, transition)?" By answering these questions, you lay out your plan! Don't consider putting on a trade until you've laid out the scenarios and your best response to each of them. Your responses are either long, short, or wait for more clarity. Part of the plan involves projected price targets and stop loss placement so you can assess the risk:reward opportunity of the setup. Once you've answered those basic questions, you're ready to trade without emotion getting in the way. Back to this morning's chart just before the open: The overall trend is up, making longs favorable until a previous pivot low breaks with some conviction and lower resistance is then established. A weak break through the new lower trend line followed by a push through the 1244.00 high of the current consolidation range is a long trigger. Reason: A weak break through the LTL shakes out the weak longs and attracts the early shorts. If price then moves back up through the range high, the shorts buy stops will trigger and the shaken out longs will chase back into their positions. A minimum profit target in this scenario will be a test of last night's 1249.50 high. A break through the range low of 1241.50 places the bulls on alert. A subsequent failure to test the high of the range would print a lower high and via a break of a previous bar's low and set up a shorting opportunity for a test of the overnight low. Now we have a plan. Not the greatest plan because frankly the PA leading into the open this morning is choppy action in a fairly narrow range, but it's a plan nonetheless. The market opens, price breaks the LTL, but 1241.50 support holds to the tick. A buy stop @ 1244.25 (one tick above the high of the range) means a minimum survivable stop loss is 1241.25. If 3 pts stop is too much for me I can either trade smaller, or wait for a second entry setup using the 1-min chart for guidance on placing a tighter stop if I get a second chance to enter at that price. With a minimum profit target of 1249.50, a 3 pt stop isn't that bad, so I take a first entry in case it's a strong break out of the range. Price eventually breaks through 1249.50 and I tighten my stop to lock that in as my minimum profit, and am stopped out at that price. Do you see the value of having an advance plan? It eliminates having to make decisions in the heat of the battle. There are clear lines in the sand for entry, risk management, minimum profit targets. Although you recognize the larger trend is up, you're prepared to trade without bias, allowing yourself to trade to the short side if the price action signals that the bulls are relinquishing control to the bears. When you turn on your system and evaluate the price action, note your plan in writing (use abbreviations so you can work quickly) until you get to the point you do it all in your head without messing around with it, then trade the plan.
I traded much better today, took only 2 impulse trades. The first one was the first trade of the day, but I was journaling my entries and reasons behind it and realized right away that it was not a disciplined trade, but an impatient trade. I believe journaling in real time helped me recover and reverse my behavior. The second one, I've realize right away, was just a greedy trade and I closed it immediately. It's a work in progress and the goal for tomorrow is the same - work on my discipline, not on making money.
So far the market is in an uptrend after a break out. Tomorrow is a very important report before the open that will set the tone for the day. Unless it's really horrible, mostly likely we have a continuation of the up move and a potential up gap. If we have an up gap, I will look for a set up to sell the market for a gap fill. This will be the 3d gap this week. Will know more tomorrow morning. The key is discipline, not rushing into trades. It's OK to miss a trade, there will be others. The goal is to be patient to trade my set ups, not to trade in a hurry to make money.
nor being a columnist,1st order of biz is a setup,,one was an impatient and two was a greedy,neither a setup,with a setup ,you have a probable winning percentage,without you have a 50/50,those trades drain your acct,or give back your profits,keep watching,you will eventually see something that works repeatably,trade that ,sit on your hands as you are still a student.leave the plane in the hangar til you can fly it without risking your life,livelihood,watch more than one market,you have the time,get adept at monitoring 3 or 4,so it becomes secondhand,the s/r's will work together like a herd or they won't,when the do,you will have more confidence in a trade and go in with confidence and learn to hold it,knowing from your hours watching that the likelihood of your target is high percentage due to the action, ,confirmation ,in the multiple markets..this columnist stint stills smells of an ego needing that hasn't been squashed,check that out
Imho traders are some of the most disciplined SOBs to ever walk the face of the earth No Drill Sergeant barking out commands No Headmistress / Nun rapping our knuckles with a ruler No Coach making us do drills / benching us for a bad play No Cop to make us follow our own rules Nothing/ Nada / Zilch⦠But our own devices upon which to rely And it only takes one slip to prematurely end a career â one small loss not taken⦠one lapse in patience or discipline Just oneâ¦â¦ Yeah PO â absolute discipline â is absolutely necessary â when tradingâ¦. Best you get some â then never lose sight of it RN