Yes, you are correct volpri, Everyday is a learning episode. But one thing I like to focus on more than anything is am I trading in consistent profitable manner and making good chart reads REGARDLESS if the trade is a loss or win. That is why I like to listen and watch Al Brooks videos alot because show alot of example and I apply that real world day-to-day action. I am sim trader by the way. No live trading yet. As a trader in growth, sometimes the mind can play mind games on those loss trades.
Thanks volpri, I responded to your post below I understand. If there was no pull back after my red arrow signal bar for an acceptable risk and price keeps falling down, I just have to accept it and seek another entry downwards. Yes, this has happened many times. I use a max 20 tick SL per trade. I use a price action SL placement. After signal bar occurs, I calculate an entry price (SL price - 20 ticks) and use limit order at this price for a retrace fill. There are times when I get no fill for sure and I miss out on the trade. lol , the 20 ticks goes to 25 ticks risk some time when I high probability of a win. I agree, and I look for high probability setups just like this. I agree with your comments.
Thanks Volpri for the explanation. I use price action stops as well. I completely understand the averaging in on contracts when price goes against the intial position. ESPECIALLY when trading those trading ranges. Your premise can be right, but sometimes price wants to play around before going in your favor.
It is 11:30 a.m chicago time. 4-17-2020 MES 5 min charts. Both charts. First is RTH’s second is 24 Hr. Same trades on both charts. Here are 10 trades I took this morning. I’m tired and still don’t feel well so I am stopping. I am not going to explain the rationale of every trade this time but I want to just drive home a point or two. By the last trade the profit was $1102.50. 51 contracts bot and 51 sold. Net after commissions $1002.54. Nine winners. 1 trade was basically BE and should have been profitable but I by mistake allowed by finger to slide on the touch pad (I trade from a laptop) and inadvertently moved by PT to BE.
I don’t want to explain the rationale for each trade this time but here are the 10 trades. Follow the colored coded arrows. Exits are where the arrowhead is located. Four trades were averaged down shorts ( trades 1,2,6, and 10). One averaged down long (trade 5). Three straight short scalps (4,7,8). One straight long scalp (9). One BE (trade 3)
I want to make a few points about these 10 trades taken today 4-17- 2020. Look again at the two charts above and meditate upon them. 1) Everyday there are many scalping opportunities. Just look at the chart and the trades I took. There are 81 five min bars in the RTH’s session. On most days many 1 to 12 points profitable scalps can be taken, at almost any moment. As a scalper or a manual HFT trader (as I love to call myself) you will ALWAYS have trades to take, everyday. If you miss one, another one will hasten along. If you cut profits short...just don’t fret about it. You can always get back in. And your broker will love you. 2)I never fear averaging down because I know what to do if I am wrong on a trade and get caught on the wrong side with an averaged down trade. I know how to turn a loss around. 3) Stop losses need to initially be in the right place or you will just get whipsawed out, over and over again. It is NEVER alright to take a loss because of a wrong SL placement. A loss should only be taken when one’s premise and reason for taking the trade has been proven wrong by PA and/or by the dynamic I.E. ”the how” the PA is being made. grudgingly...swoosh...etc?? Stop losses should never be carved in stone but they should be fluid and adaptable to dynamic market action. Always be prepared to move Stop losses. I do on almost every trade. Uh oh a non trading guru just had a coronary arrest on that one LOL. 4) My favorite way to take profits on “averaged down trades” is once I have built my position and price gets back to where my initial entry and is a little profitable I am willing to get out and lock in my profits. Every thing is thus paid for on the trade, including commissions. Don’t get greedy. “A bird in the hand is worth two in the bush.” Too many traders get a profit then to their chagrin just sit there and watch it evaporate right in front of their eyes. 5) A manual HFT (don’t you just love the term) must ALWAYS endeavor to maintain a high win rate. This can only happen if one IS NOT GREEDY. While Dozzy’s boyz are scooping up the loaves of bread be satisfied with the crumbs that fall out as they scoop them loaves up. Most traders ain’t got a big enough scooper to be grabbing loafs. 6) You must, know or learn, when averaging down is viable to do and when to refrain from doing it. 7) It is ok to look quickly at other Time Frames or say 24 hr/RTH’s charts but take your trades off ONE TF. You have to stayed focused on one TF or you will get scattered brain and confused. 8) Don’t worry too much about R:R. Uh oh another non-trading guru just killed over with a major heart attack. The only risk that really matters is the actual risk you endured as the trade was unfolding. The initial risk, more often than not is never hit, if it is placed correctly. There will be plenty of time for figuring up R:R AFTER the trading session is over with. And that will and should be based upon what you ACTUALLY endured as the trade was unfolding and not some initial risk you placed that would keep you in a trade or avoid a catastrophe. A general rule is: on averaged down trades try to get at least a little profit on that initial entry as price moves back in your favor after averaging down. That is not always possible, as you may lose on a contract or two, and make money on the rest of the averaged down contracts in the trade, but you are generally going to have a winning trade anyway, so it an’t the end of the world if you jump out with a little loss on your first one or two entries, made on an averaged down trade. Whoa, now that is a sentence! 9) Averaging down points or levels have to be correlated with the volatility and dynamics of the session, as you build your averaged down position. On low volatility days I may average down in one point increments. On days like today I may average in on 2,3,4 point levels from the previous “average in” position in the trade. I have no set rule for this. I just generally, intuitively, make those decision as I see PA’s Dynamic unfolding, the volatility of the day, and where we are located at any price pattern such a a range or channel..etc. I will also vary on the position size of each average in incident within a trade. Sometimes, I will start with 2 contracts then add 2 then 2 more for six total. Other times I will start with 1, add 3 then add 5 if I sense price is stalling and gonna move back in my favor quickly. That loads me up on the back end which gives me more leverage as price turns back in my favor. Smaller movement will be needed for bigger profit kind of thing. 10) Take the time to learn these techniques and for sure practice them alot on SIM. THEY NEED TO BECOME second nature. In the heat of the battle you don’t need to be learning how to quickly get your sword out of the scabbard. Fumbling around and all that BS, thinking the market is gonna wait around for you. Just learn to execute instinctively, precisely as you can, and quickly. Don’t dick around. 11) Realize that on EVERY single 81 of the 5 min bars there are institutional bulls and bulls active, without exception, no matter how small the bar is. Price does not move nary a tick unless an institution wants it to. There is no such thing as noise in the markets. That concept is a myth propagated by gurus that can’t trade. 12) Remember and NEVER forget this. Your money is ONLY at risk when it is in the market. That is the beauty of manual HTF trading. In crashes investors are crushed unless they have really deep pockets to wait it out. As a manual HTF trader it doesn't matter what the market did yesterday..last week...or a month ago. Or even not too much 2 hours ago. I am only interested in what it is doing NOW. 13) Learn price action trading well. It is always the same. Has been for 100’s of years. No one can ever take that from you. You won’t need to buy more trading courses...pay huge fees for mentoring...learn price action, and how to employ these techniques within that framework. Then just mess around ONLY on a SIM just for the fun of it. ROFLMAO. 13) I’ll think of something else to say probably later on. LOL Well I said I was gonna drive home a point or two in my earlier post...well it grew...what can I say. It is what it is. WARNING: You can lose ALL your money and more ...plus your shirt and your billfold trading the markets and especially following the things I discuss so I ain’t telling anyone how to trade here. I am telling here, how I trade. All of these posts are for learning purposes, educational purposes, and just plain BS’s around. When I use the word you I am using it in a very generic way and am not talking about YOU the reader. You, (now I am really talking about you here) do whatever you wanna do. It is totally, 100% your decision. I ain’t giving you advice. You may be better off to not even waste your time reading my posts. That is ok.
Probably not in the way alot of people see it but I do. Like the edges of a trading range. DT’s ...DB’s ...swing lows ...swing highs...50% PB’s...stuff like that. I try to be cognizant of previous day’s low/high MA’s and what price does around those areas. I don’t use pivot points or Fibs...etc. I don’t use MA’s crossovers.
Hey Volpri, I am enjoying your posts very much. I was wondering if you could give me some advice on where to learn price action. I am reading the last three Al Brooks books, but I am not sure if maybe reading just the Bar by Bar book might be best. I have Al's video course too. Do you recommend something else apart from this? Many thanks!