Without regard for context, note that the premkt is a range. Until price is able to exit that range, there's little or nothing to be gained and more likely something to be lost if one attempts to enter a trade. Price does exit the range right after the open, and a short is justified. However, the trader should note that price reverses immediately and he should therefore exit immediately. After he does, price returns to the range. During the next exit, price even makes a lower low, but, again, price reverses immediately (this is much easier to see with a smaller interval, e.g., 15s), so the trader must again exit immediately. After he does, price returns to the range. It isn't until 0853 that price exits the range and stays there. However, at 0858, price can't make the higher high and the trader has again to exit. At 0901, price fails a third time to make a higher high and also breaks the support line. This leads to a shorting op. That one already has three unproductive trades by now and a half hour has gone by may be dispiriting, but that's the way it goes. One can't think about that right now. The shorting op is good, so it has to be taken. Everybody else is just as impatient as you are. This can be held until after 0920 (a 9pt trade +/-), when price makes a double bottom and the resistance line is broken. When the next support line is broken (not drawn) at 0935, the first reaction might be to look for a shorting op. But note how strongly price rejects 2828 in the next bar. This doesn't necessarily mean automatically go long, but it does suggest that one should exercise extreme caution about trying a short. If one doesn't take this long, there's another entry four bars later. If you're watching price move, pay close attention to what it does between the "open" and the "close" of the bar. If that presents difficulties, open up a shorter interval on the side so you can better see just what it is that price is doing, even though you may not want to use it for entries. http://cdn3.traderslaboratory.com/f...262450-re-trading-off-daily-charts-image3.png
As Erik Falkenstein says: "In expert tennis, 80% of the points are won, while in amateur tennis, 80% are lost. The same is true for wrestling, chess, and investing: Beginners should focus on avoiding mistakes, experts on making great moves." Thank you for the feedback. It was encouraging to see that atleast some of my trades were based on the general principles of PA. At this point, I need to pay attention on not making the big mistakes. This means seeing the bigger picture. Getting comfortable with identifying the trend, watching S/R form, researching context and getting a better feel for price action within the 1 min bar. The goal is to get a vague sense of probability - a sense that situation x generally leads to y. Price is very dynamic and the odds are constantly changing. There is a lot of nuance to this once the general principles are understood. I need to remember this to remind myself of the perseverance needed ahead.
I don't know about nuance, but keep in mind Sherlock Holmes' pronouncement that "the dog didn't bark". One would expect an owner's dog to bark when a stranger approaches the house, giving warning of possible danger. But the dog didn't bark, leading to the conclusion that the dog knew whoever was approaching. When price first drops out of that narrow range, one expects it to continue its move downward. But it doesn't. When it drops out of the range a second time, it still doesn't, even though it makes a lower low. The dog doesn't bark. If price then does not do what's expected, it will more likely do the opposite. If price won't fall, either buyers are supporting it or sellers aren't very motivated to sell. Either way, pressing for a short entry will not likely be productive. Price isn't doing what's expected. The dog didn't bark. All of this goes right past those who see nothing but bars and lines, but that's not your problem. Don't worry about the why. Focus on the what. The why is unknowable. The what is right in front of you. It may be somewhat in code, but the more you learn about trader behavior, the clearer it will be.
4/29/13 Trade 1: -0.75 Trade 2: -0.25 Trade 3: +2.25 Trade 4: -2.00 Trade 5: +2.00 Trade 6: +1.00 Trade 7: +3.25 Net: 5.50 8:38 Trade 1 Buy at 2845. Trend is down since the high of 2847.50. Drew the supply line. See last bar brought back strong by buyers. See price cross the supply line to further confirm turning of trend. Cover stop at 2842.50. If goes up, look for price to stall around R at 2847. If goes down, look for price to cross supply line confirming downward trend. 10:27 R forming at 2845.75. Tick chart showing lower double top. If price goes back to R, watch and sell if it stall. 8:41 Price makes a thrust past R and quickly comes back. Before I can act, it falls all the way to supply line. I am now looking to get out because price is showing weakness. It bounces back up a little and I get out. Exit at 2844.25 Watch for price to cross most recent R at 2845.75 before taking a long. 10:36 Trade 2 Buy at 2847.50. Was watching the tick chart to enter as soon as price showed strength above R. It went up fast but I may have got in a little late. So now I have bought at the previous high. Cover stop at 2845.50 If price goes down, give it room till the S at 2845.75 If price breaks R, stay with it. 10:41 Price breaks free of R and goes up. But then it retraces back. The tick chart showing 2 retracements for a double top. The last retracement was lower than the previous swing low - now this could mean that the thrust has failed. If thrust fails and price goes down, give it room till the S of 2844.50 on the tick. If price breaks previous double top If price stalls and makes a range on tick, stay in the trade because the larger trend is up. 10:47 Exit at 2847.25 Price was stalling. My If statement had me staying in the trade if price stalled. But I reconsidered and sold because of how high the entry was. I can always re-enter if price breaks R and thrust is confirmed. 10:51 Trade 3 Buy at 2849.25. Price thrust past R with strength. I re-enter, even though the entry is about 2 points higher than last time. Could the previous trade been given more room, since the general trend was up. What eventually happened was a retracement that shook me out and now I have re-entered the trend at a higher price. Cover stop at 2846.25 If price declines/stalls, give it room till support of 2847.50 8:52 Watching the tick chart as price keeps advancing. The retracements have been shallow, showing strong buying pressure. Most recent support level at 2852. If price crosses support at 2852, then sell. 8:53 Exit sell as price crossed support on tick chart. (coincidentally also broke DL at this point) Thinking the last up wave is now in a retracement. Right now, there is selling pressure. Look to go short if price crosses support at 28050.50. Otherwise, look to get back into the trend is buying pressure increases. Wait to see if there is a double top first. 8:56 Trade 4 Sell at 2849.75 Price crosses short term S, showing retracement turning to reversal. Cover stop at 2852.75 If price declines/stalls, give it room till short term R at 2852 9:00 Exit Buy at 2851.75 The short was invalidated through HLâs and move towards R. 9:02 Price in narrow 3 point range. Wait for it to get out of range. 9:03 Trade 5 Buy at 2854.50. Price crossed range on previous bar and met with R of day. Then the next bar crosses this last line of defense. Now that trend is confirmed, I am watching the tick chart for entry. See it go to last swing high of 2854.50 and hit buy. Cover stop at 2851.50 If price declines/stalls, give it room till 2852.25 9:06 Price goes up. Exit if price crosses LSL of 2854.50 on tick. 9:08 Exit Sell at 2856.50 Price crosses DL. Thought about giving it some more time, but previous bar was short and failed to make HH so got out. 9:10 Buying wave retracing in a 2 point range. Look to trade outside this range. 9:11 If the primary trend for the day is up with, then what are the odds of a short working if price dips below S on the retracement. On the other hand, this recent buying was shorter than previous wave - meaning a short could work.... 9:14 Price thrusts below S, but is brought back strong into the range. 9:19 Price thrusts above R. Now since the general trend is up, I should be more likely to enter a thrust on the upside. Wait for it to cross previous high of 2858 on the tick. 9:20 Trade 6 Buy at 2858.25 Price stays above R, indicating thrust might not fail. Cover stop at 2855.25 If price stall/declines, give it room till range midpoint, but get out quick if it shows tendency to stay in the range. 9:22 Exit Sell at 2859.25. Price crossed S at 2859.50 on the tick. Previous bar fails to make HH. 9:24 Trade 7 Buy at 2861.75. Price crosses last High. Cover stop at 2857.50 If price declines/stalls, give it room till midpoint of range at 2860 9:26 Exit Sell at 2865 Momentum slowing with short height of last bar. Price crosses DL. Summary: Focus today was to 1) Set cover stops but not sacrificial stops. 2) See Left of chart for short term S/R to manage trade 3) Use If/Then framework. 4) Observe tick chart for S/R levels. Drawing S/R lines, S/L lines, and using If/then kept me fully occupied. There was not much time left to feel anxious.
Nonetheless, it's common to feel a twinge of anxiety when price comes back to your entry instead of just taking off. Remember that the market doesn't know you've entered and doesn't care. So don't expect the market to react in any particular way just because you've taken a position. It may take a few minutes to pop the clutch. Otherwise, take a bit more control over the situation. You needn't let the market take care of everything. First, consider entering inside the peaks of retracements in a downtrend and the troughs of retracements in uptrends. These retracements are opportunities for those who didn't enter to take advantage of the second chance. If they don't, then you know that perhaps the entry wasn't all you thought it would be. If they do, their entries will propel you into the trade and into profit. Second, place your entry a bit farther into the exit from the retracement, i.e., instead of just jumping in, place your entry stop perhaps a point away from the peak or trough of the retracement. In this way, you're forcing the market to come to you. If it does, you're in. If it takes off in the opposite direction, your entry is never triggered (this is particularly useful in those situations where you're not sure whether a short or long is called for; just bracket the trade and let the market decide).
4/30/13 Trade 1: +3.50 Trade 2: +2.75 Trade 3: -1.25 Trade 4: -0.25 Trade 5: -3.00 Trade 6: BE Trade 7: -2.00 Trade 8: -1.75 Net: -2.00 Start: 8:30 a.m. 8::39 Missed an opportunity to buy after the hinge resolved on the upside. 8:41 Price hits R at 2864.50. Tick chart breaks below last LSL. Look to go short. 8:41 Trade 1 Sell at 2863.25 If price/declines/stalls wait till R of 2864.50 8:43 Exit Buy at 2860.75 Price retraces above LSH on the tick and crosses SL. 8:46 Range being established between 2864 and 2859. 8:51 Trade 2 Sell at 2863.50. Price hitting R at 2864.50. Tick makes a double top. If price fails, wait till R at 2864.50 is breached with strength. 8:52 Exit Buy at 2860.25 Price dropped fast to S zone. Did not wait for any SL breach. The speed of the drop and price being near prior S, led me to exit. 8:54 Price has broken through short term S and is now at dayâs low. R is increasing. If price slows and forms a retracement, look to set buy limit above LSH on the tick. 8:54 Looking to set Buy stop for a reversal, but it may be too early. Getting biased to the long side. This may continue to go down, so also look to enter short on the retracement. 8:55 Trade 3 Buy stop triggered at 2859.50 If price fails, give it room till R at 2858 8:56 Exit Sell at 2858.25 Trade was working until a sharp bounce back showing sellers joining the trend or the creation of a range. See if double top forms. 8:59 The short trend is well underway and I missed the break. When I saw sellers bring back the potential reversal with strength, it should have tipped me to the greater likelihood for trend continuation and I could have set a sell stop a little below. 9:00 Volatility is very high. Not getting time. Not seeing any low risk opportunities because of the reversal fakeouts as well as the lack of a stable range. 9:03 Last thrust to make new low, brought back up strong by buyers. Also in the overnight S zone of 2856. Now I could go long here but the trend has been down although it has not been smooth. 9:03 Trade 4 Buy at 2856 If price fails, donât give it much room. Look for S till LSL of 2854 on the tick. 9:07 Exit Sell at 2855.75 Trade was working but pressure changes fast and price crosses LSL on the tick and crosses DL. This may be turning into a continuation of trend. Look to go short. 9:07 Trade 5 Sell at 2855.75 If price fails, look to give it room till S at 2857.50 9:08 Exit Buy at 2858.75 9:12 Trade 6: Buy at 2860. Was thinking there are no trades for now since the downward trend has broken, with the last buying wave going deep and bouncing against R of LSH. But volume spiked at 2859, indicating that there was a lot of S at that zone and that the buying wave had a good chance of breaking the R at of 2860.50. If price fails, give it room till S of 2859. 9:14 Exit Sell at 2860. R rejected 2 breaches and I did not want to remain in the middle of a narrow range. Look to buy if breach is successful. 9:16 Trade 7 Buy at 2861.75 Breach goes further than past attempt and long term hinge is breaking up. If price fails, give it till previous R which has now become S. Since there was a strong chance of price breaking up here, I could have set a buy stop instead of buying the breakout as a chase. 9:18 Exit sell at 2859.75. Sellers come back strong and price is once again back inside the range. 9:19 Trade 8: Sell at 2859. The breakout outside the hinge fails and price goes strong in the other direction. I have seen this pattern before and price seems to move sharp after failed hinge breaks. If price fails/slows, look to get out at 2860.50 9:20 Exit Buy at 2860.75. Summary: Timing was off. Went over trades but could not see any glaring mistake based on principles. Trade 3: There was a bias here. I wanted to go long and took the first opportunity to go for the reversal. But it was too early. The trend was down and there had not been any significant congestion. My bias came from betting that the range would hold. Trade 4: This was a better reversal entry because the last selling wave had become shorter. Trade 5: Donât see any error here based on principles. The fact that trade 4âs reversal logic had failed, seemed to indicate that the trend would continue, making me take the short during the retracement. But the retracement failed too, turning into an eventual reversal. Is the logic sound here? Trade 6: I am buying at R. Thinking of getting in during the retracement of the buying. I reasoned that R would be broken because 1) The general trend was down and 2) Previous barâs strength showed that a breach was imminent. Trade 8: I have seen this pattern before - where the break on a hinge fails and then the reversal of break becomes the convincing trend out of the hinge. In this case, the break on the upside failed after 2 breaches were rejected at 2862. Then the hinge reversed abruptly and broke out on the downside. Donât know why this happens. Could be that the R at failed breaches convinces traders that price is not going to break in the direction so now all the pressure created within the substantial hinge is diverted to the opposite side. In general: Was focusing too much on retracements/reversals and failed to see ranges being set up that chopped up the trades. Was expecting "trend".
I'm afraid I don't understand why you're making many of the trades you're making, so I can't speak to the logic, but this is how I would have traded it, for what it's worth. I rarely trade anything but retracements, and I avoid chop like the plague. http://cdn3.traderslaboratory.com/f...47475-re-trading-off-daily-charts-image10.png "STOP" means "stop trading".
Does your "LH = STOP" mean that you will watch that zone carefully as it may be indicative of coming chop? I am seeing your 2 longs here as reversals and 2 shorts as continuations. Is this accurate? That second short is looking like a continuation breakout. Regd the logic question: It was for Trade 5. Trade 4 was a failed reversal entry. Price changed direction and continued in direction of down trend - the 9:07 bar. At this point, I closed my long bet on the reversal and took a short based on continuation of trend. Was this logic sound? Would it have been a better bet to wait to for the price to atleast cross prior low before validating the continuation? Based on the shorts in your chart it seems you would have waited for the price to reach the swing low before taking a short. In general - Why am I taking 8 trades vs your 4? I know you don't know what I was thinking in real time - but I am asking more along the lines of common beginner mistakes and thinking. Edit: I meant to say Trade 4 was an entry betting on a reversal that failed. Edit: OK. Read that again. STOP = Stop trading.