I was on a break when the low of the day happened...had already taken a trade and decided to eat breakfast. Well, I think I'd better go back to eating breakfast before the open and not taking breaks the first hour. The low of the day was very clear on the 15 minute and higher charts and I really wish I'd been waiting and watching for it to happen. No trades shown, just a very nice, clean looking 15 minute chart showing the low of the day practically screaming what it was doing. I better start getting these!!!
This week wasn't too bad, but it wasn't great either. I had 7 losers and 6 winners for the week. I didn't take any premarket trades or trade in any other accounts. I'm generally getting the direction right, but timing the entries badly. I think it's because I'm still not used to the way the ES moves on the 1 minute chart. This week I focused on trying to find repeatable patterns in the way the ES behaves to narrow down exactly what I'm looking for in determining a buy or sell trade, thanks to easymon1's question. My overall trading plan hasn't changed. I use the same indicators and general plan for finding direction and timing entries, but adjusting how I was using it on the NQ to how it works on the ES has been difficult. Yesterday's chart below shows a few of the things that I use for getting into trades. There are 3 numbers on the chart, so here are the explanations that go with the 3 numbers. 1. Overall down trend, so bias was to the downside. There can be strong moment around the open, so a retest and rejection of the lower high at the open is where I went short. If you were to look inside the candle you would see that it shows the same problem I'm having with most of my trades....I traded the momentum instead of waiting for a small pullback, which seems to be important in trading the ES. 2. This shows the reversal at the bottom I also posted yesterday. I really, really like the price action there. The way the ES seems to bounce at every support and resistance level, I think...though I don't have the experience with ES to know for sure... that it should be very easy to know that the ES is likely to have some sort of bounce at that level, even if only a small one, and so it seems like it was a high probability reversal. Also, considering the time of the day....reversal in the first hour after the open, adds to the trade's potential for continuation, in my opinion. What's also nice about this reversal is that there were a lot of opportunities to get in safely around that area. Unless someone is like me and tends to buy late. 3. Hey, I DID buy that late. Very late, because I was on a long break and missed it all. The next trade had the direction right, that we were likely to continue moving up, and it followed my rules for the Nasdaq perfectly. But that doesn't seem to be working for the ES. Instead it seems to consistently make very distinct retracements while still trending. That trade was stopped out, but I re-entered, although, again, it was a late entry and was nearly stopped out, but that trade worked. So, at this point my thoughts are that the triggers to use for a good a buy or sell trade is to find a larger trend and wait for a retracement. Rejection of that retest of support or resistance....likely a trendline, is probably a good place to jump into the overall trend direction. Today's trading: So, I tried waiting for a larger retracement to get into the trend this morning on the ES, like I explained about in #3 and never took a trade in the first leg up after the open. Opportunities were there, I just kept thinking they could drop even more and waited too much. So, I'm still finding it hard to be really accurate with the ES. However, a little later I took only one trade today on the ES, and did get a perfect entry. 1 tick retracement, then it went straight to 10 ticks. So, maybe all this time studying how to STOP buying AFTER it starts moving is starting to click. I might start posting charts of my trades again someday, but I'm not ready to show my trades each day. What would be nice would be getting the low of each day and holding onto it, rather than going for only 10 ticks. Those would be good trades to post.
If I can get these entries down so I'm getting in at the retracements and I actually start showing profitability in demo, then I want to try live trading and see how it goes. It's really hard to wait to trade live, but I'm just not quite ready.
So, I have a plan. Gonna go for making 8 ticks a day by taking a high probability 8 tick trade. If I lose, I will try again, but only a maximum of 3 attempts in a day. I won't allow moving the stop loss or target. I'm can use a larger than 8 ticks stop loss if that is what the trade set up calls for. The most important thing is that I'm not changing this. At least not for this week. And probably not after this week either. I'm actually not comfortable with a potential for a large stop loss, however, it does have this benefit: If the trade doesn't work, it's going to cost a lot. That means I'll have to learn to be really good at choosing the best trades. I do like having a very defined plan to try to get to know. If I have a losing week with this, then I'll know that I'm not picking high probability entries, and I'll work on learning to find those. If I do well with it this week...well, it's one step closer to being a real trader. Demo only for now. I plan to post my trades for this week.
This makes 3 days in a row that I only had to take one trade to make 8 ticks. This trade had a 14 tick stop loss. Using a larger stop loss than 1:1 risk to reward is not what I like to use, but it is helping me to not overtrade because I have to wait for a high probability set up.
All of yesterday and this morning I've been trying to mentally prepare myself to handle a losing trade correctly. I fully expected that today I would have a losing trade, or trades, and possibly wipe out all my gains this week. But somehow, I had another winning trade. 4 days in a row of only winning trades. I'm overdue for a losing streak, LOL. I seriously don't even know what to think. Time will tell if I can maintain consistent profitability with this and trade the same with real money. Right now, I guess I'll just enjoy feeling like I've become a successful demo trader.
I didn't take a trade today. There were a few set ups that kind of followed my rules, but there was something slightly concerning about each one, so I passed. That's the key to making this system work. I need to make sure all the factors line up correctly. I usually don't trade with strict rules as I did this week. It was definitely a learning experience. I had to carefully consider if each set up followed the rules. I also had to not listen to my desires to jump into what seemed like other good trading opportunities. It was difficult to follow rules that I hadn't tested in trading the ES yet, so I wasn't sure how well they worked, which made it mentally challenging when placing a trade. In trying to evaluate all the factors for getting a really good trade, I learned A LOT about the way the ES moves. This last week I've been thinking about how I want to use this journal. Posting trades and even sharing how I've been doing does bring about some stress when trading, since I don't want to mess up and have to post it. I still haven't decided if that is something I want to continue with or not. But earlier this week I decided I will be taking a break from posting pictures of my trades. I will likely go back to posting a general update once a week or so, and maybe sharing some videos on the mental aspect of trading. 4 winning days in a row. 1 trade only each day.