Another Straight Line Analysis Journal

[BonScott]

Monday 10th November 2014 :- 1 Min Chart Review
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Today was not a fast breakout day, we stayed within the boundarys of the overnight session for over and hour. I did get two low risk entries and I kept to my plan on each of them, so it was an acceptable day. I stuck with the original exits that I have in my plan, but I have work to do to get myself to have full belief in them. That is job number 1 for this week.

We had a 30 point rise from a higher low, from sometime around 8:55 on my chart. Well done to anyone who got in on that. It is beyond my skill level at the moment. Baby steps at the moment.

I have included a small section of the 5 Min on the chart. There are a few retracement entries there for the 5 Min people.

Chart Notes:
1. I put a short on here because we had broken through a previous swing low at 55, and I could get a small stop loss on the trade. The initial target was the overnight low at 44, but I exited the trade when we turned back up on the next bar.

2. We made a higher low at 49, broke the trend line and retraced. This is a possible long, but we are moving back into the opening area, and possible congestion.

3. I had a long wait of an hour, just watching the bars and seeing no entry. These are the times that my mind can wander into seeing trades that don't exist, but I was well behaved today, so I am happy about that.
Anyway, I finally got a trade above the overnight high. There was a retracement to touch the high, and I could get in with a small stop loss. I set a points target which was triggered quickly.
I'm not worried about potentially missing a trip to the previous day's high, because I took the trade the way that I planned it.

 

[BonScott]

Tuesday 11th November 2014 :- Market Preview
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On the 10 Min chart attached we can see the rise up from the lows of yesterday, which eventually reached 78 before moving into a range for most of the day.

Overnight we broke above the highs, but returned back into a small range which was above the afternoon range. We have again tested the highs in the early morning, and fallen back into the range.

I will look for longs above the overnight range at 82, and shorts below 67, because we have some room before we reach yesterday's lows. I will try to stay out if no good trades are available.

 

[BonScott]

Tuesday 11th November 2014 :- 1 Min Chart Review
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We moved down and back up today, within yesterday's range. There were several points of retracement to allow entries, but we didn't go on a crazy breakout outisde the main highs and lows, so the moves were relatively small compared to some previous days. For myself, I took no trades today. I would have liked to take trade number 1 on the chart, but Multicharts gave errors. I'll be back for more tomorrow

Chart Notes:
1. The price breaks through the support that has been in place since late yesterday evening. It then retraces to that level and falls for a potential short.

2. We eventually reach the overnight low and retrace twice. The second retracement starts to break downwards but stops in a few minutes.

3. Higher low after the break of the downward trend line. This could be entered at any retracement above and not break any swing lows, but there is a nice entry when it retraces above the previous swing high level, and touches the line.
For the remainder of the morning, it moved up to the previous day's high, and then became indescisive.

 

[BonScott]

Wedensday 12th November 2014 :- 1 Min Chart Review
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I'm a bit late with Wedensday's report.
We made it up to the overnight high, and back down again, but there were no clear retracement entries for me with reasonable stp losses, so I stayed out of it and I made no trades today. If I was knew how to make entries off trendline touches I could have traded, but not today.

Chart Notes:
1. A touch off the trend line with a reasonable distance to the swing high and overnight high above that. One day I will be able to go long here.

2. After the trendline break it goes sideways before the fall. The better entry is on the rejection of the overnight high.

3. Here I marked a point where I was thinking short if it went below the line of lows in the previous few minutes. We made a little lower high just before the fall.

 

[BonScott]

Thursday 13th November 2014 :- 1 Min Chart Review
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Today we went straight up from the open, and there was a retracement to allow me to enter. That seems to be the limit of my abilities at the moment. Thats fine, I'm happy to be able have at least one entry. I am currently gathering more detailed figures, on where my exits should be. This will take a while, but I have a few days free at the moment, so I should make some progress.

Chart Notes:
1. We opened with a rejection of the overnight low. The trading gods amongst probably us put a long on at 203, but not me. I eventually got a retracement entry around 209. It had an acceptable stop loss and was still 4 points away from the highs, so I gave it a chance to move. Initially I thought that we were stalling at the highs, and might make a fall, but it shot up 5 pts in an instant and took out my target stop. I was moving the stop up as I watched the price, but didn't move it quick enough to get out of the way of that bar. I would probably have exited soon after this anyway, but I should be more careful.

2. There is a retracement here, but I really took this because I had been stopped out of the last trade while making money, and I wanted to get back into what looked like a fast rise. I exited on the next bar when my stop was hit. I will say that smaller stops are definitely helping me, and my exit should have been even sooner that this according to my plan.

3. Here the price retraces to touch the previous highs. I put a long on here, but it went nowhere fast and it failed to get above the swing high. I exited when we made a double top and retraced to the entry point. I find that when when it moves so slow, I am better to get out rather than take the full stop loss. At the moment I am analysing the data to see how statistically true that is, but for now its what I am using.

We have come up to the highs of our daily channel, and we have made a large rise from the open, so it may get harder to go upwards. That's enough trades for now. Back to the backtesting.

 

[BonScott]

Friday 14th November 2014 :- 1 Min Chart Review
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I took some trades today but went nowhere.
I have much more analysis to do for my best exits, but for today I went with what I have used all week to keep it consistant. This exit has kept my losses small all week, but also stoped me out of some profitable large trending trades early. Thats fine for now. One step at a time.

Chart Notes:
1. There is a retracement here for a short. The large down bar has stopped around the opening lows. I'm unsure are we going to get a rejection of the lows and a possible long.

2. Long on retracement. My feeling on this was that it would eventually go up to the overnight high. However I moved the stop loss up with the bars, and I was taken out when we retraced after initially moving up 6 points.

3. There is a retracement here but I would prefer it to be much closer to the line break, and not right after a massive down bar. We are also right back a the opening point, which is also the 50% of the previous day. However, the initial stop loss was low, so I put a short on. I moved the initial stop loss down to breakeven when it had moved down 2 or 3 points. If it wasn't going past the swing low quickly then I was out. Stopped out on the entry bar.

4. I put a short on here with the break below the previous support. This is okay and was exited for a small loss. There is a possible short well above this, but these 8 or 10 point bars are surprising me and I am unsure about entering after them. My feeling here is that I am getting out of sync with what I should be doing. I will pause and go back to the backtesting.

Its Friday, and I made enough today to buy a nice bottle of wine. It would be unwise to ignore such an omen, so I will make some Mexican food, and have a glass or two. Enjoy your weekend.

 

[k p]

Hope you don't mind Bon, but since I promised not to update my journal... I can't comment there, even though we both had very similar ideas today.

One of the things I'm looking at which will help me not having to think in real time is the expectancy to reach profit targets once the stop is known. I marked up your chart, but let me explain.

So for this first trade, I'm not sure where your stop is once the trade is on, but I have marked it in for where mine would be. Then I also mark in where 1x the profit target would be once you know how many points you're risking, and then where 2 times the profit target would be. This first trade reaches both 1x and 2x profit targets. (I just eye balled the numbers though.. so they may not be exact to the tick, but they for sure reach their targets before the stops would trigger)

The 2nd trade, which I would have taken as well, same thing happens. Now in this trade, it goes against you way more after your entry, but the stop, of course depending on where it is, but given where my stop would be is never reached. This way, you can enjoy both a 1x profit target and 2 times profit target.

Now the math of course is that for 1x profit target, you gotta be winning like 70% of the trades consistently. But for 2 times, even slightly less than a 50% win rate is still profitable. So going forward, I'm just doing stats based on the setups that I'm looking for, how often can I reach 1x and 2x profit target once I see where my stop would be. Once I know this number, and its profitable, I can just put each trade on and let the trade either go to profit target or loss target. Far too often I'm in and out like you and I've come to just realize that there is no point in trying to think this through on a one minute chart. I think these swing highs or lows in retracements will be defended.

Now some days of course you might always hit your stops and be down 5 or 10 points. But if you know that over a series of many many trades you have an edge, you just gotta let it play out and not mess with it. Today your profits were cut way too short it seems. (this is what I always do and hence why its so easy for me to see). Other days you might think you did good because you prevented the loss by taking a BE trade, but taking this BE trade and saving the loss might be doing more damage by preventing profits in the future.

Hope you don't mind me rambling on and that I didn't get this wrong. Perhaps one of our local resident experts can back me up or correct this newb!

 

[BonScott]

Thanks k p,
I am aware of what you are saying.
Hopefully my testing will show me the right balance between being too safe and too risky.
For now while I am still testing I will try to be too safe.
The testing s going slower than I would like, but the counting of smal details is very worthwhile.
Looking forward to this week already.

 

[BonScott]

Monday 17th November 2014 :- 1 Min Chart Review
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I made 4 trades today. The tight exits only allow profits to be made when the trend breaks out and doesn't come back before hitting the target, which is not everyday. My testing of better exits is improving but it is going to take longer than I thought. I will post today, but there may not be much gained by posting these type of trades everyday. The trades are going to be the same until I have completed the necessary work.

Chart Notes:
1. I put a long on here below the overnight high because it felt as though we were pushing to get above the high. I had a target of the previous days high. The high was never reached and I exited when we broke well through the trendline.

2. Missed this good short. Too busy typing up the last entry.

3. Short on retracement, with target at the opening lows. I exited when we returned to the entry price.

4. The price moved down from the highs here, and I was thinking that this was a retracement for a long. This never happened. The trend line was broken, and we actually had a retracement for a short, but I was still thinking about the long and missed it.

5. This one is a long that was exited when we returned to the entry price. Given that we had made a double bottom with the opening low, I could have stuck with this one for longer. Ultimately we made it to the previous high which would have been my target if I stayed in the trade. So far we have spent an hour going nowhere in particular today.

6. Even though we are going nowhere I placed another trade within the small range that we are having. My target was the previous low. It came within a tick of stopping me out, so feeling that I had been given a let off for my hasty behaviour, I exited below my entry price. Enough for today.

 

[BonScott]

Tuesday 18th November 2014 :- 1 Min Chart Review
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We started with a big move up from the open with easy retracements to provide entries, matched with small stop loss placements. I tried to be consistant with my entries and exits, but I am still overthinking at times. I guess that will ease with practise and experience.

Chart Notes:
1. Long on retracement, with a target at the previous day's high.

2. Long on retracement with a target of 5 points or more. I exited when the price turned, and I took the 5 points.

3. This is essentially the 3rd retracement, so I guess I can expect it to slow down a little. I exited when we failed to breakout, and moved down instead.

4. Here I was seeing a breakout from the congestion, but it looks like no one else saw it, and again I exited when we moved straight down after entry.

5. There is a retracement for a short here which I didn't take.

I am happy enough with what I have done today, and I will go back to my testing.