Awash's Journal

A

Awash

I decided to post my journal online. I've been keeping a journal for quite sometime now but I never wanted to post my trades. I'm actually using ET as a place to store my graphs, pictures etc. My journal notes will be posted at another private website. However, I will attempt to explain each trade in detail to anyone interested in providing feedback. Thanks in advance!

Daily S/R Levels can be found here:
http://home.houston.rr.com/aarondwashington/

Caveat: intraday numbers change daily


Trading System
 

Attachments

Entry & Exit Rules with Rationale.

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Today's trades!

Trade#1 – Overall bad entry because I jumped the gun on this trade. There wasn’t a clear signal plus I didn’t wait for a confirmation candle to form. I was anticipating price would reverse because earlier there proved to be some resistance around 995. Next time I need to wait for a confirmation candle inconjunction with a signal from my indicators. [Short 995 @ 10:40 EST & Stopped out 997 @ 10:45 EST]

Trade#2 – For some reason I wanted the ES to go down. I should have known it wasn’t going to retrace significantly because the NQ showed a lot of upward strength plus so did other indices. I should have closed this position at 997.25 eight minutes after opening it but I thought a few sell stops would be below the 997 level and had price traded below there it would have triggered a few stops sending price down lower because the opposite happened in trade#1. After this trade I completely stopped trading! [Short 998.25 @ 13:47 EST & Covered 998 @ 13:59 EST]

For tomorrow: Since I’m a trend follower I need to execute trades in the direction price is going or look for the overall market trend and momentum. Today there was a lot of upward pressure on the market and for some reason I must have wanted price to go down instead of up. Next time I need to wait for signals and stay with the trend.


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In prior post I’ve highlighted my trading system and market entry and exit rules (Please review). However, I didn’t explain how I decide to take a trade. I am a TREND FOLLOWER, so I try not to place a trade unless price is in a trend and I’m usually strict about adhering to this rule.

The system I use is a divergence system that relies on double tops and bottoms, higher lows/highs during up trends and lower highs/lows in downtrends. I use candlestick charts in short time intervals, preferably 1 & 3 minute charts only. Buy & Sell signals are generated by comparing price on a 1-minute chart to the MACD signal line and a slow stochastic oscillator. Signal confirmation is achieved once price & both indicators are moving in the same direction. I also use intraday support & resistance levels to determine price trend & direction. At any given time I’ll place a trade with the trend if price considerably breaks a support or resistance level, ignoring all indicators.

The charts I’m posting will only reflect 3-minute candles albeit signal confirmation comes from a 1-minute chart. I may have to post two 1 – minute charts.

I decided to post my journal online because I want more constructive criticism, not to mention because I’ve been paper trading since March 2003 and I plan on going live in October. Truthfully, my situation is similar to other novice traders here at ET. I too, have taken losses early on but I decided to stop trading real capital because I realize the losses stemmed from me not knowing what the hell I was doing.

Consequently, I’ve spent the past five months learning the basics; reading and studying the market (futures mkt). More importantly, following ES price movements. I’ve learned that trading is a slow and gradual process because there are multiple factors that influence market sentiment from monthly economic data releases to world/national news events. I’m hoping I can learn more with this Journal so feel free to provide constructive criticism.

By the way, my biggest problem is CONFIDENCE to enter a trade. I know when & how to enter a trade but I’m always telling myself to just wait (Hesitation) and see what develops and sure enough the market moves on without me. I infrequently make mental mistakes like enter without a confirmation and/or not take trades consistent with my trading methodology.
 
Hello Awash,

I use a trend following system (slope of 20 ma indicates trend) to trade SPY and I take my signals from ES. I went Long just as you went short (trade taken on the 5 min chart). If you look at the 1 min chart, there is an inverse head and shoulders pattern in play at that point. Plus, the Gap held as support. I don't understand how your rules justified the trade.

On trade 2 you shorted within the context of an intraday consolidation pattern after a strong move up. I rarely made money on these types of trades, therefor, I don't take them anymore. At this point, the trend had changed from up to sideways. Again, I don't see how your rules Justified this trade.

Good Luck
 
Hey fan27, my trades were all over the map yesterday! Thanks for sharing your thoughts.

As for TODAY:

It was an excellent day for trend trading but I didn’t have my head in the game nor did I try to eliminate the mental errors/mistakes I always make and have been making for over a month now. However, I do feel as if I placed trades consistent with my trading methodology.

Trade#1 – I waited to see which direction price would move after the Mich. Survey released at 10:00 EST. Once the numbers hit the ES quickly broke out of its small sideways range to the downside. I entered short a bit late at 998, price pushed down to a low of 996.25 before it reversed slowly off my pivot of 996.50. This trade turned out bad because I failed to close the trade and didn’t take a long position with the new reversed move. I finally closed the trade with a loss of 2 ticks but I could have a least made a point plus more if I took the opposite position. [Short 998 10:05 EST & Cover 998.50 10:24 EST]

Trade#2 – After watching the ES early on trade from a high of 1002 down to 996 back up to 1003. I decide to go short after price reversed off my resistance level of 1002.50 around 11am EST. I covered this position after price stopped at the new support level of 1000.50 and lingered around it for a considerable period of time. I wasn’t going to repeat what happen in trade #1.

Mistakes for today:
1) 10:13 EST Failed to close position on reversal signal in timely manner
2) 12:16 EST Failed to enter market on a double top pattern (missed opportunity)
3) 13:15 EST Fell asleep during the lunch hour after getting tired of watching price (distraction)

Stopped trading at 14:00 EST (Too many mistakes today)

Remember to enlarge chart for better viewing!
 

Attachments

Quote from Awash:


Trade#1 – I waited to see which direction price would move after the Mich. Survey released at 10:00 EST. period of time.
More...

The only economic news I saw (consumer sentiment) was scheduled for 9:45 EST. Did I miss something?


regards,

Bruce Hawkins
 
Quote from Tonkadad:



The only economic news I saw (consumer sentiment) was scheduled for 9:45 EST. Did I miss something?
More...

The University of Michigan Preliminary Consumer Sentiment survey was scheduled to release at 9:45 EST. I don't think you missed anything because it came out on time, however if you did, that information is available at http://biz.yahoo.com/c/e.html.

I'm sure you're aware that most news station will report this information upon its release and will continue to report it as financial news throughout the trading session (roughly ever hour). I normally don't trade off of economic news because it clouds my judgement and I become more indecisive.

Nevertheless, I heard the survey report around 10 EST, fifteen minutes after it was released at 9:45 EST and didn't place my first trade until 10:05 waiting to confirm price direction.

I realize I was a bit late with the report but I do this purposely. As I become a better trader and eliminate my weaknesses, I will then attempt to trade off economic reports. But that'll be a while!!!
 
Quote from Tonkadad:



The only economic news I saw (consumer sentiment) was scheduled for 9:45 EST. Did I miss something?


regards,

Bruce Hawkins
More...


It was due out last week , but was rescheduled b/c of power outage.


Happy Trading:cool:
 
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