the previous journal I wrote was for the euro and I stopped updating it on May 23/2011 writing the journal completely destroyed my 'intuitive' trading system, and caused me to stop using the Elliott Wave theory, the main TA method I used for over 30 years but the journal also led to several original discoveries; made me for the first time write down how my new trading method works, detailing the individual components and how they work; splitting my trading method into Analysis and Trading; and to write an analysis of all timeframes prior to trading, noting any price and time targets the above would never have occurred without me starting the euro journal, and like many others have done, I recommend writing a daily journal, public or private
I've done very little trading this year and haven't followed the ES at all till Friday, so I'm jumping into the void by starting this journal and trading my method without a period of demo trading the idea is to 'double' and make $1M in 12 weeks: 6E contract day trading margin: $500.00 = 40 pips at $12.50 per pip - 4 points doubling weekly: 8 pips per day = $100.00 x 5 days = $500.00 per week, rt extra . . . or ES contract day trading margin: $400.00 = 32 ticks at $12.50 per tick - 8 points doubling weekly: 7 ticks per day = $87.50 x 5 days = $437.50 per week, less rt include Sunday, 5.33 ticks rounded to 6 = $75 x 6 days = $450 per week, less rt week: . . . . . 1 . . . 2 . . . 3 . . . . 4 . . . 5 . . . . 6 . . . . 7 . . . . . 8 . . . . 9 . . . . 10 . . . . 11 . . . . . 12 contracts: . . 1 . . . 2 . . . 4 . . . . 8 . . . 16 . . . 32 . . . 64 . . . 128 . . . 256 . . . . 512 . . . 1024 . . 2048 6E margin $:500 . 1000 . 2000 . 4000 . 8000 . 16000 . 32000 . 64000 . 128000 . 256000 . 512000 . . . . $1,240,000 ES margin $:400 . . 800 . 1600 . 3200 . 6400 . 12800 . 25600 . 51200 . 102400 . 204800 . 409600 . . . . $819,200 now the above is very simplistic, but my opinion is, in theory, a good - master trader could hit 2000 contracts in 12 trading days rather than 12 weeks, however . . . broker is AMP Global Clearing, Chicago http://www.ampfutures.com/ minimum account $500 using NinjaTrader with the CQG feed start time, in front of monitor 4:30am arrrrrrrrrrrrrrrrgh PST I have NinjaTrader with 1min and 15sec charts displayed plus the Basic Entry utility and MetaTrader 4. I have Broco and FXPro demos, each display the ES, but, there's a difference in the price data between them and NT. the Alpari MT demo works well for the eurusd/6E NT combo, but I might have to rent an additional charting program and data feed since my analysis is thrown off by the difference between the NT-CQG data and what's coming off the MT demos. currently using the FXPro demo have 1 5 15 60 4H plus 15sec NT charts loaded, 1m on the left side of the screen and switch between the others on the right side, full screen for MT 15/5 60 4H D 1 loaded one thing I was thinking was that large 6E trades - 1K and plus can cause a spread of 20 to 50 pips/ticks, and if when I get into trading the hundreds and thousands of contracts, I was concerned about trading those quantities and getting a profit, thinking I should switch to the ES now I've had a few wows watching 15sec ES bars shoot up when multi K trades hit the market, realized I was looking at a half sheet chart and the giant bars weren't giant amounts of ticks. examining the high volume trades later found the spread was often only 3 ticks, sometimes 5, a world of difference from the 6E don't think there's any logic with ES trades volume and spread, sometimes there's a small spread, sometimes it's larger, but if always that narrow a range, nothing to be concerned about. eg: 33,407 vol trade on one 15s bar, spread 5 ticks, 3 tick dip
Monday session Apr 30 no trades I've spent a lot of time yesterday afternoon-evening setting up charts and loading and setting up the MTs, then crashed in the early hours, woke late and continued to setup the NT charts Sunday trading's often but not always a great trading day and I see the o/n trade was where all the action was, an 11.5 points $575 drop between midnight and 7am and I've already got a conflict the low daily 6/7 tick target suggests using small timeframe charts, 15s 1 5m, but as well known, it's a lot of noise, and I'm only seeing one, three and five ticks on those charts, so I'm wondering about concentrating on the 15m which gives me a 14 points 2 day view on full screen, a much better perspective it also allows gives me a lot more time to make notations on the chart which are an essential part of my method, and from which trading decisions are made, and also allows me to note my waves component that I leave off the 15 1 and 5 my method's much simpler for Day-to-Days trading, requires only 5 minutes a day to check the price, and 30 minutes analysis during the weekend for the week ahead notations on the low tfs can be a distraction from what the price is doing and also whether or not a trade should be made DtDs trading also means one can have 24 hours or more to make a trading decision rather than the seconds of the low tfs, but in either case, the whole idea and purpose in using notations is greater accuracy in making more profitable trades. we'll see
Tue session May 1 great first trade, I lost a 7 tick $87.50 plus comm the chart makes it look like I was Buying the top, but I was just late out of the throne room. at one point I did an 'oh-oooooh' when I realized the formation was possibly the right leg of an H reversal. could have got out, but . . . the most sinful thing I did was to not do the written analysis report. in part I was thinking of last nights down, thinking the rally - an expected Up day would happen early. if I'd written the report I'd have known about the economic releases and TTed those for the possible start of the rally. I'll chalk this one up to 'sea trials', better to have the propeller fall off in trials than in battle â Friday's NFP the great thing about the journal is writing down thoughts and ideas, once thery're out of my head and on 'paper', something Has to be done about them, as follows. last night I ditched the 15sec chart. I'd put 2 T3s on all the charts, this was a carryover from last year and an attempt at a Green Buy, Red Sell system, just an MA crossover system, but something that's just not part of my method, so deleted them all and put an MA 1 C on the charts which is sop for me. I still have the 1m up, in part to use it for making an image of trades, not sure yet if I'll use it for analysis I don't use Stops and last night's trade made me think what I should be using as a maximum risk loss amount. for fx Day-to-Days trading I'd use the margin amount which is the same as the intraday margin. if I'd stayed in the trade last night it would have come back to me plus a 1 point profit, even tho the price dropped an additional 6 ticks. I could have closed the trade earlier than I did for a tick or two loss, but closing where I did was affirmation the price was going lower in theory my method is Very accurate, but . . . the first law of trading : The Price Time Waves Movement Is IRREGULAR I'll have to think-on the Stop amount I'd much prefer doing the analysis in MT but especially in the lower tfs there's chunks of time missing and differences in the formation compared to NT charts, I know the Ds aren't the same but think the W and M may be, but Have to write the reports so for the present I'm stuck with NT @ 1:40pm PST, es bottomed ? around 1400.0 may or may not trade this evening, otherwise tomorrow ?
Wed session May 2 no trades my opinion of the es is that it topped in March and is going thru a reversal formation I update the SP500 index from Yahoo and looking at the 1440-1450 area for the price to top out. if you look at the 06-07 top you see the higher right side of the V formation TTs Have been hit for March and there's no reason May has to have a HH or HC for the price to fall. new highs are I think dependant on Friday's NFP. if the numbers are poor then the downside is going to accelerate over the coming days I've decided to switch back to trading the eurusd/6E IF I ever do trade hundreds, thousands of contracts I'll worry about fills then not now I'm also more familiar with the euro and don't have a problem working with 2 different data sets, the 6E and spot eurusd, and MT as far as I'm concerned is the easiest and most efficient charting program I've used, and of course free Thurs session May 3 I need to catch up the euro charts so this is just a note. downside began last fri and think there's another week down at least. will do a full analysis on the weekend then post some info sun ECB announcement should be a non event US UCs: these have been increasing since mid feb and there was a spike in May 2011 so, if the uc isn't down this week, it may start down next week ? which leads into fri's NFP. an increase ? a surprise increase ? generally down I think into the nfp
Fri session May 4 the UC was technically positive and I've been hearing 'them' talk down what the NFP numbers will be - 120K , and any number breaking the 244K . . . . . . . . . . . . . . . . . . . . . . . . . . Prior . . . . Consensus . . . . Consensus Range Nonfarm Payrolls - M/M change 120,000 . . . .165,000 . . . . . 105,000 to 244,000 I expect the euro to continue to drop into the end of next week, numbers on sun this session may be a bit up, lots of sideways until 5:30am PST, then Down ? no trades are you a REV trader ? I keep forgetting to use it, now written down, I'll remember charts updated NT charts: 1 5 15 60 min MT charts: 5/15 60 4H D 1m I now make notations on all charts, a major component of my method, keeping track of TTs plus waves, although I only started the waves notations this week, so I'm doing a lot of testing before deciding whether or not to retain this. is it beneficial to use when live trading, or just use waves in analysis. but for all of the notations, the method still remains completely discretionary. where it's a lot simpler to use my method is Day-to-Days - dtd trading there's 1440 1min price bars in a day, even 24 60min bars, much simpler and less complex to be dealing with a single bar than many or hundreds, and of course there's much less analysis to do, and a much longer period of time to make trading decisions but my method has no absolute entry rules, and this is a problem with the high leverage futures trading offers for intraday trading, the temptation is to trade a very small tf, but is it temptation ? think I'll try a seconds chart, 15 and 60m and see how it goes. trying to notate a 1m or seconds chart is crazy, especially all the waves but there are ways around that when referring to the spread of high vol trades, I should have been using 'range' - the L-H of that price bar. there's 2 examples on 'Gotcha !', first a 5K 6E trade on a 1m bar where the range was 40 pips, second, an ES 12K trade on a 5s bar where the range was 1 tick : http://www.elitetrader.com/vb/showthread.php?s=&threadid=226053
Fri session May 4 no trades some comments NFP: haven't watched a lot of these but surprised as I can't recall seeing high volume trades going thru Before the release. both the 6E and ES had large trades entered about 30s prior to the release - same trader ? resulting in large ranges. see attached charts including an insert of a 14+K vol trade with only a 1 point range, again near the 4pm 'Gotcha !' ES time period a complicated correction that started on May 2 lasting until the release was what I interpret as a potential base prior to a major economic release, but in this case it was a strictly sideways correction formation elections: Greece: "Thirty-two political parties are competing in these elections. The most recent polls suggest that eight to 10 parties will elect deputies in the 300-seat Greek parliament. In the past, a five-party parliament has been the norm. The latest polls show that the conservative New Democracy party will likely get the most votes." http://blogs.wsj.com/eurocrisis/2012/04/30/greek-elections-2012-a-practical-guide/ voting between 5am-5pm GMT -5/8hrs 4/1pm E/PST exit poles are likely to update throughout the day into the night but many parties mean waiting until the count's complete http://www.forexcrunch.com/3-scenarios-for-the-greek-elections-and-the-euro/ althought the party in power result may give some indication of what's to come re the debt and austerity measures/?re-negotiations, it will be some time before the rumours begin and then facts start to be stated France: similar voting times to Greece, bit of a non event that shouldn't affect the euro prices with Hollande the likely winner http://blogs.reuters.com/great-debate/2012/05/03/what-happens-if-hollande-wins/ fyi: Oanda offers 24/365 trading so their charting programs will display any trading that's occurring before most brokers/Globex open for the Sun/Mon session unlimited FXTrade and MT4 demos, FXTrade includes news
Mon session May 7 11:45am pst down 50 pips and bouncing - Oanda - Hollande's in a Down day 1.3050 ? 1.3000 ? - close down ? a down week ? 1.2830-00 1.3000 level, the price has bounced off since the beginning of the decline in Feb but not yet closed on or below. that could happen this week but I don't expect it to hold it'll take a while to sort out a Greek coalition government and who knows what it'll be attached the NFP charts I forgot to post
Tue session May 8 Alpari NY eurusd gap: 1.3080 - 1.3032 thinking the price may drop down below the gap to the 1.3020s area and may begin a rally that'll eventually close the gap starting in the 0:4H bar, looking for 1.3292 area, but I may be being a bit optimistic about how quickly it'll close the gap the LL thru the 1.30 came within 2 pips of a 61 on my MT charts, and the 76 is around the 1.26 level. the Greeks are looking as tho they can't form a government so they'll be voting again in June, and for the moment debt problems are in abeyance until a govern- ment can be formed question then is, will the 1.26 level will hold, perhaps temporarily, but it's then on to the June 2010 lows, or lower ~~~~~~~~~~~~~~~~~~~~~ took Sunday off for an afternoon in the sun and dinner with friends in the evening think that may happen more often with the summer fast approaching, one day off - Saturday isn't enough of a break, so maybe I'll take every second Sunday as well
Wed session May 9 early post, 1pm: price could close below the 1.3000 Tuesday, at least with spot I'm having some difficulty deciding what the price is doing and going to do, none of the charts are giving me much inspiration. best I can say is a possible base in the 0:8H bar euro session, so we might see an Up day ~~~~~~~~~~~~~~~~~~~~~~~~~~ trade: 2 pips less comm. trade dissected in attached