The total loss on any one trade is no more than 2-3pts. If you were to read the material, you'd know that.
As Buy1Sell2 has been so kind as to grace us with his presence lately, extensively, I decided to return the courtesy and spent the day on the ES Journal thread with 40D where we went through the process of trading a range from before the open up to the time of this posting. Those who are not yet clear as to how to trade these ranges (this one turned out to be wide enough to make the trades worthwhile) should review today's posts on that thread.
Regrettably, he did not take me up on my request to show (or tell) precisely what he means by "1 minute upside breakout" and how this differs from a "5 minute upside breakout" and how both of those further differ from a "15 minute upside breakout." When trading ranges, of course, an upside breakout is an upside breakout, regardless of the bar interval on chooses to view.
Rather than let this lesson go to waste, I'll point out here that this current activity provides an example of when and where and why to segue from AMT trading to SLA trading (see post #101). The trades all day have centered around trading this range, long at the LL and short at the UL, all of which is strictly AMT (if one had drawn a bunch of lines within the range, he never would have held from one end to the other). But if and when price breaks out of the range, which it eventually must, one can switch to the SLA since the AMT trades are for the time being done. This means letting price make a swing point, as it did at 1335, so that your DL can be drawn if you absolutely have to draw it. If you want to backfit your line to the LL of the range, you're welcome to do so, but it's easier to see what's going on if you don't draw it at all. The main thing to remember is to let price make that retracement so that you can judge the level of demand. If the "retracement" turns into a reversal, so what? But if it's confirmed, then you have some extra points to put in your pocket. Edit, 1430: And now the stride is broken. What are you going to do? How much room are you going to give price so that it can tell you what it want to do? Are you going to exit immediately? Give it a point or two? This has to be decided in advance. It's up to you to define "break". Note: if price penetrates the previous swing, which it will not do in a nice trend, then you most likely have a problem. Remember that re-entry is always an option. Edit: 1456: Today just keeps on giving in terms of lessons. Note here that after the stride was broken, there was a retracement in the downmove at 1440-1445. If one were to follow the rules and go short there, he'd be stopped out for 3-4pts when price changed its mind and advanced past the retracement high at 68+. Those are the breaks. But 3-4pts after a 32pt move is essentially tithing.
My editing window is closed so I'll start another post to point out that, yes, price decided to do something atypical and advance anyway, which means that anyone who's trading this can fan his line. And I don't mean that in a kinky way. A range day and a trend day on the same day. An embarrassment of riches. 1358: And you'd be stopped out anyway. I suggest that those of you who are actually trading this, or learning how to, print out today's chart and the posts referring to it from the ES thread and this one and study it all. There was a lot of good stuff today.
I suggest that those who are sincerely interested in this read what I posted to lajax' journal this morning, having to do with "midpoints" and swing points/retracements. No need to comment there. Any questions should be posted here.
This kind of situation always threw me off centre - what to do if the pre market moves away from its established range and extremes closer to the open? These days, with more knowledge and experience with AMT etc, I'm able to shift gears and simply look for the nearest area of interest rather than simply getting flustered. It seems to be sinking in finally!