If I may so ask, would you share why you think you are ending with negative Net. As you mentioned, maybe one needs to wait. Maybe, a break of the Demand Line may not mean a reversal until a LL or LH is formed. Maybe as even Db says somewhere that a break of a TL is only an indication of a change in Trend and need not be a reversal. Or maybe, the results could differ if you wait for the bars to complete and then be stopped into the trade. Maybe, I just misunderstand it all. These are the things that I keep getting confused with and would like to know you have come up with. Thanks.
I believe I am ending up with a negative net because of three reasons: 1) Wrong strategy: I agree with your observation about my entries being too early after a trend has stalled. I am biased towards wanting to get in on the start of the turn. While I have been getting a lot of practice in observing the stalling of a trend, my judgement about it's reversal has been off. I will attempt to define what constitutes a reversal through some more observation. 2) Wrong tactic: My entry timings have been off. I have been tentative during RET entries, especially on longs, where my entries are late and too high up on the RET. I have been too aggressive on shorts, where my entries have been too early. 3) Reliance on set up/Ignoring price action: Over the last week I have turned my attention towards watching for RET setups. This has taken some of my attention away from observing price action within the set up. This has led to missed opportunities and late exits. The positive is that I see this method work. That motivates me. I appreciate your interest in this journal and I hope you continue to contribute.
The re-entry on the short is below the last lowest low. Would you categorize this as a breakout trade, where the last lowest low represents short term support?
No, just a re-entry after a failed effort to move back into the range. It isn't necessary to categorize everything. By the time you figure out how to classify it, it'll probably be too late to do anything about it.
The river guide and the rapids It's probably not an accident that rapid (as in rapid change) shares a root with rapids (as in Lava Falls in the Grand Canyon). The river guide, piloting his wooden dory, has but one strategy. Get the boat to the end of the river, safely. And he has countless tactics, an understanding of how water and rocks work, and, if you're lucky, experience on this particular river. The thing is, the captain changes his tactics constantly. He never whines. He doesn't stop the boat and say, "wait, no fair, yesterday this rock wasn't like this!" No, the practice of being great at shooting the rapids is a softness in choosing the right tactic, the ability to hold the tiller with confidence but not locking into it. If your pilot keeps demanding that the rapids cooperate, it's probably time to find a new pilot. Domain knowledge underlies all of it. Give me an experienced captain over a new one any day--the ones that got this far for a reason. Yes, the reckless pilot might get lucky, but the experienced pilot brings domain knowledge to her job. It takes guts to go onto the river, but once you're there, the one who can see--see what's coming and see what matters--is the one you want piloting your boat. - Seth Godin
Net: 3.00 http://www.sierrachart.com/image.php?l=1368731636824.png Trade 1: Reason: Reversal trade. The breach of the range had failed. Bet was that price would come back into range. Entry & Exit: Saw support and got out as price once again crossed range boundary. Thoughts: This kind of reversal trade seems a much better bet than getting in early on anticipated reversals during trends. Trade 2: Reason: Uptrend had resumed as price crossed LSH. Entry & Exit: This was the wrong time to get skittish and bail. Price had broken decisively out of the range and the previous bar was short showing a natural temporary support level. There was no reason to get out that quick. Trade 3: Reason: Anticipating price to get out of RET range since this was an uptrend day so far. Trade 4: Reason: Uptrend Thoughts: Look at the range of the RET bars. Price had come to a virtual standstill. These trades have to be taken since the R/R is so good.