Bond Trader 2009

1035 EST

In a current short at 116 040 which is fluctuating more than I would like to see. I may bail for small loss. I'd like to see at least 116 020 on this, but it also could run up to 116 080 or 116 120.
 
1038 EST

Out of the 116 040 short at 116 035. I'm not getting a warm and fuzzy feeling at the moment about us going lower. Could still happen, but as I mentioned, the short trades of the day towards yesterday's low (not quite that low, but considering I warned you about it pre-market, close enough) have already been made.

1041 EST

I see the trade continued in my favor after my exit, hitting what I thought would be a minimum target, i.e. net 3 ticks profit, at 116 010.
 
1048 EST

Turns out that trade would have worked even better than I expected.

If you are short, I am counting on a target of 115 270, maybe even lower.
 
1101 EST

I've bagged my daily limit both time wise and money wise, and like any professional athlete (I wish!), I know it is wise to take a break.

I don't know that we will get back up there, but a short at 116 070 to 116 080 looks very tempting. All posted caveats apply.
 
0849 EST

I wasn't able to do a pre-market post today. In any event, here is something even better. When you figure out how and why to do what I just did in this trade, I would say that you are able to trade price action and support and resistance and there is no need to second guess yourself anymore. More importantly, it is time to stop reading my journal.

What you see in this chart can't be taught. The question to ask yourself is why did JP go long when everything was screaming short?

On a many orders of magnitude easier note, I would and should have gone short at 115 240, but was managing the buy at 115 190.

One more thing, while I was confident in this long trade, to give you an idea of trade size and money management, I have allocated a maximum size of 8 lots today. I went with my standard 2 lot trade, BUT I would have been comfortable taking up to 4 lots on this trade. In a nutshell, I was reasonably confident, but I'm certainly not foolish.
 

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0902 EST

Market Analysis for Wednesday 05 August 2009

I certainly didn't expect price to get as low as it has today, at 115 130. Nice short near the incredibly important level that I posted days ago, 116 050. (Ahem, ahem.) Don't worry, I wasn't up that late, i.e. 1530 EST to take the trade, although 0215 EST gave us another close opportunity.

Common sense levels that will be important today:

115 240

115 190

Important levels:

116 050

115 160

The fact that we have broken below 115 160 is very bearish. However, remaining above it is a positive.

I probably won't post much today. I want to focus on trading.

I think 1000 to 1100 EST will be a solid window of activity for multiple trades.
 
1106 EST

I'm done for the day. Today was one of my best days ever in terms of execution. I even managed a mistake to a small profit.

What am I most proud of today?

1) Buy at 115 190 at 0839 EST.

2) Managing the bad trade in the first oval. Shorting at 115 195 is a fine trade. I should have exited sooner around 0929 for a loss. In any event, what I'm proud about is even though I felt we could go lower, I recognized that something about the structure of the market was changing and if I didn't want to go long, I certainly needed to exit my short at a minimum. Now if I could only bottle that feeling up at that time and use it to reverse.

3) My buy at 116 075. I had an order in at 116 060 for 4. I raised it to that price based on PA and a quick glance at the two day's before PA at that level. Bottom line, I knew that at least one test of the highs was in order. I didn't know that I would collect so much off of the trade. Also, to show you again, how to manage size, I was so confident of that trade, that I even had an order to buy 4 more at 116 055. Yes, that was going to be my single 8 lot trade for the day.

Since Friday, we've had really excellent trading days.
 

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