That all makes sense... Do you have a min risk:reward ratio you work off of? After going thru my previous trades and doing some backtesting, 80-90% of the time with my breakout trades, the trade either works right away or it doesn't. Back to NoD's comment yesterday, it seems just giving that 1-2 points of wiggle room (or whatever wiggle for the day's volatility) is all thats needed. If you have a 2 point stop with a 2 point target, not a great R:R but if the set-up there, is it worth taking? I guess I will have to go back and do some more backtesting with taking these 1:1 type trades and see what the win rate is.
My stop is always -6 ticks, and I try to keep my target no closer than +12. My stats have shown that a) yes, these types of trades either work right away or they don't, and b) average profit for these entries is at least 12 ticks. The more testing you do and as you define what your exact setup is, you will have a better idea of what to expect profit wise. Are you still trading for today, or do you have a chart of the morning action?
Still trading today...pretty frustrated with myself today. I've made some of the same mistakes I've been making in the past couple weeks. I don't know what my deal is. Times like these I wish I had someone (like a coach) looking at me ready to chew me out or hit me over the head and tell me to stop being a moron What's the definition of insanity? Doing something wrong over and over again and expecting a different result? Anyway, going to finish the day out and I will post a chart at the end of the day.
Hi, TLOW. I am done the day early today. Didn't get the major move from the market today. My insanity is to "make assumptions". Nodoji has been warned me over and over "trade what you see"... I dont think I am capable of giving you any suggestions or advice since I am pretty struggling myself. But I can't help asking you the same questions now. And I believe those questions are going to help solve some of your frustration and my own. I am working on point 3, 4 and 5. 1) Do you know what type of trader are you now?(I asked you before , you mentioned you were exploring) 2) How many setups do you have now? Do you have one, just one solid setup you are confident with? I see you mentioned your trading plan one time in precvious post, but to say "i will take pullback, breakou trade" is not enough... 3) Do you have stats on each of your setups? such as winrate on each setup/method? R:R?Profit Margin etc? If you ask any profitable trader, Nodoji, Bolimomo,Went Fishing,~~~. They would answer you without hesitation! If you search "lescor", I read his jounal too, he is very very experienced. He has mentioned how important those "stats" are. Why most traders fail because they don't know their method and success rate. I felt very inspired! Especially after my 3 week live trade. I asked myself the question, but I couldn't answer myself clearly and loudly. 4) In your trading plan, do you have strategies for each type of days? Range days, Trend days, Trending ranging days. Note: you don't have to trade in each type of those days if you are not comfortable with. 5) Have you had your trading musle memory now? Btw, are you SIM or Live trading? I think we can make it as trader. It just takes a lot of diligent study, patience and time. Then work on some discipline issue. Matcha
Yes, but I am still realizing this as it is a work in progress b/c my emotions are dictating a lot of my trading. Yes, I agree, my set-ups are way more specific than that, those are just my better set-ups. I do have 1-2 that I am comfortable with that Im "trying" to focus on. Honestly, the mental/emotion/implusive mistakes are what are killing me. At least, thats how I feel. I don't think I am making excuses for my set-ups, as I said, they trade fine in backtesting but maybe I am wrong and not seeing a clear enough picutre when backtesting. hehe, I laugh b/c I am still back testing a lot at night and doing more research and I have found my set-ups are plenty profitable with favorable winrates...there's that whole "human" element that is absolutely killing me. I can't put a lot of weight into those stats at the moment, b/c i wind up screwing something up when i go to do it live...late entry, not well thought out, hanging on too long, etc. Yes, but this is something I am still working on...identifying the days more clearly and what days I really struggle. Is it due to the market, my previous trades affecting my latter trades, my set-ups, etc...still exploring. Ha again! I wish! I am live trading. In all reality, if I cant fix these mistakes I continue to make over and over again, that will be it for me and day trading. Im not throwing in the towel yet but if I cant correct my errors, I might as well give my money to the homeless guy down the street...at least he can get drunk off my lost dollar This is new area for me as a person. In all other aspects of my life, I correct mistakes pretty quickly and easily, but trading is a whole different animal. I am struggling with correcting my mistakes and finding ways to keep those mistakes from popping up again. Most times it comes down to something as simple as having the trade completely planned out before I enter. With those trades, I either limit my losses, learn something about why the trade failed, or profit. The emotional mistakes, it is hard to even focus on the trade itself b/c I don't feel I did the due diligence to make it a winning trade in the first place.
Yes, determining a good R:R for your method(s) of trading is all about the win rate. If you have a 50% win rate, then a 2:1 R:R should keep you profitable; if you have a 60% or better win rate, then a 1:1 could work well. I've been trading one thing for so long now and studying the price action every day live and then bar-by-bar after the close, that I've developed different trade management strategies for different methods, for various price action moves, for micro-trends within different macro pictures, etc. Breakout and counter-trend trades, for example, I handle differently from other trades: I move my stop to b/e very quickly and I look for solid follow-through, targeting a specific minimum move, but willing take more if offered. All this will come with time, but the first step is to find one or two absolute best setups and master them. That means learn to set a stop and target, move your stop only after a specific move in your favor transpires and then allow your target to be filled without further micromanagement. I had a "Trading 101" ES trade today. Often a day's early low or high gets tested later. ES worked hard to test the news-induced high and struggled, producing a double top @ 1157.50. I wanted to get short for a possible test of the news-induced low. I saw that the nearest support pivot whose break would also break the 20-bar EMA, was 1154.00. I didn't want to fall victim to a 1-tick false b/o at the 20 EMA, so I added confirmation to my entry by placing my sell stop @ 1153.50. Nothing happened for a while, but price failed once more to break 1157.50 and my order was triggered on the pullback. So I noticed a potential setup, decided to enter only on confirmation, not earlier, placed my order in advance at a level that would help protect me from a bear trap, and used a stop order so the price momentum itself would take me into the trade. My R:R with ES is 2:1 and my stop is almost always 2 pts. I targeted a test of the low, moved my stop to b/e at 2 pts profit and was stopped out. This was a basic setup, basic R:R, and basic trade management by the rules. Find 1 or 2 basics like this and practice trading ONLY those setups, strictly by the rules. I like to keep my R:R at least 2:1 on all trades because that allows me have a bad day and screw up my entries and trade management and still have a recoverable loss. This happened to me yesterday when I started the morning down nearly $300. By limiting my losses, then stepping away from the trading platform to locate my sanity, I recovered pretty quickly. If I start cheating and taking profits too soon, or moving stops to b/e too quickly, I limit the "reward" side of the equation and lose my cushion against periods of insanity. Matcha, the trade I describe above is based on just that. There was an internal double top at a lower high and I ASSUMED price would go down. But what I SAW price was above the 20 EMA and 3 higher lows put in. The bulls were in control, so I only want to be a bear if the price action (what I see) places me in the direction it's more likely to go. It's more difficult to accept an entry price that's 2.5 points worse than where price is when an assumption is made (when I first noticed the internal double top was put in), but in the long run, I save myself from many losses by being patient. I could've shorted the close of the 9:50am ET bar @ 1156.00, but at that point the chance of price immediately running back up through the 1158.00 level and beyond was still high.
That's I call a real "trader". (I am just a wannabe now)Someone know what they are doing. Someone know their business.And that's what a stats should be. And on top of trader's heads. So , no emotions will be invloved while trading. No hestitation, nervous and uncertainties before enter and exit. Simply react to the set up in various situation....I am not sure when I can achieve that analysis..wow...
I think there will always be emotion, but something you can do to help get rid of the hesitation and uncertainty is to look at price at any point in time and ask yourself: Is there a prevailing trend in my time frame, (or is there a tradable range)? What would price have to do (or is price about to do something) to signal a trade that meets my criteria? What is the safest way to enter the trade and can I place a survivable stop that doesn't exceed my max loss parameters? Then if you can place a limit or stop order in advance to get you into a trade, you'll be more clear-headed than if you want for price to get to your entry point and try to jump in at the last minute. I had 2 trades skip far from my unfilled orders today when I hesitated just a few seconds. That was frustrating.
I have a general question about how you guys define a system... How specific do you get? I mean, with PA it can be very very specific or maybe not so much... IE. For me to trade ALL of the following must happen: Must be positive trending maket, take a break out trade once at least 1 HH has been put in, pullback has to X%(or ticks) of main leg, has to do it in X amount of time, target must be X%(ticks away) from bottom of latest pullback based on previous leg, must not go thru any major previous resistance from prior days, on and on and on... Even if one chooses to be less specific, there's the other question of how did the trade get there in the first place... IE- all of the above, plus had a "W" bottom formed or maybe range bound in an uptrend, whatever...