boru's price action journal

[boru]

Ok for maybe the first time in my trading career I am going to try to think about this differently. I don't want this journal to just be a "boru draws lines on a chart", I don't think that's what I need right now. I have drawn lines and squares on charts ad nauseum and I'm no closer to being a successful trader today than I was 4 years ago.

No I'm going to have to understand price action in a way I never have before . The SLA to trading is an incredibly simple and effective method to trade, and having seen Db 's charts and explanations and my own limited success I know it's the real deal. and I have decided to master this approach to the best of my ability. but I don't want this to just be a mechanical approach WITHOUT understanding why.

"if one keeps an open mind the markets will tell him what to do"

How?
By watching price in RT , watching the price form the HH's , LL's, DB, and DT's. not because of the patterns being formed but why did they form. What are the traders doing ,expecting, thinking that they would push price to a HH, or stop price at a HL.

This is where I think I need to go mentally and emotionally.

I don't know if this is accurate but I do know that what I've been doing isn't working , it's time to change how I think about trading, about why price moves.

back to basics , after one day I'm rethinking my exit strategy. I wanted to keep this simple by exiting at a break of SL/DL lines but since I have some fear issues I may as well resolve to stay in the trades longer (if price warrents it) by staying in until the LSH or LSL is broken.

as usual open for comments and suggestions thanks........chart to follow

 

[niko]

At the level you are, not far away from me . Come up with a plan and test it, back test it I mean. If something good comes out, forward test it. If it works it works. If it doesnt, then and ONLY then tweak your parameters. If you dont get it yet, dont think in entries, just watch price and come up with hypotheses. And then think in entries to experiment with, is the scientific method, not so hard to describe, just a little hard to do.

 

[boru]

Hey Niko
you make good points, I usually used the larger bar interval chart (60 min ) and higher for S/R , then as I lowered the bar interval I would try to find the ones closest to price , the one that would make a difference . the 15 and 5 min. what you're saying dials in a more in depth analysis of where price is thanks I like it.

Ever since Db made the comment on the bride thread about the S/R I realized how much it influenced me, took me right out of watching price . I'm not sure I'm explaining this right I think someone said S/R is the servant not the master or something to that effect.

I can't imagine looking at a chart without S/R but its going to have to take a backseat to price action for a short while anyway.

thanks for you're comments

 

[dbphoenix]

back to basics , after one day I'm rethinking my exit strategy. I wanted to keep this simple by exiting at a break of SL/DL lines but since I have some fear issues I may as well resolve to stay in the trades longer (if price warrents it) by staying in until the LSH or LSL is broken.

It doesn't have to be one or the other. By following this course, you're requiring of yourself that you be absolutely right. Every time. All the time. That's not the way it works. And the more rigid you are, the more likely you are to break.

Stay flexible. Simtrade two contracts. Exit one at the break of the SL/DL and exit the other at a breach of the LSH/LSL. If the latter is never breached and you end up with a continuation instead, you're already in.

 

[boru]

1. SL break HL ret went long and price makes HH price then declines to
2. DB where buyers again push prices higher to
3. 3451.50 followed by a small pullback
4. and a push to HH 3454.75
5. price then takes a breather and forms a small TR
6. until price spikes out of the bottom of the TR looking for selling interest not finding any they go the other way and price breaks out of the top of the TR
7. ret after the BO scratched quickly (wasn't strict SLA)
8. but the entry at 3447 was exit at 50% of small preceding range
9. break of SL RET scratched quickly
10. break of the DL never saw a RET until 11 minutes and 25 points later, strict SLA says take the short at the RET at 29.25 (I don't think I could have done that RT)
but price drops to 3412, and here is where not exiting on a break of DL/SL comes back to cost me I wait until a HH and exit at 3423.
11. SL break with a HL and RET long at 3423.25 exit 3425
12. DL break LH ss 3425.50 exit 3425
price moves into chop

open to comments and suggestions thanks

 

[boru]

forgot the chart

 

[niko]

8. Could you have entered earlier?

After 10 seems like you lost focus. Not sure why you fanned the line.

Great day BTW.

 

[boru]

Hey Niko, yes I could have entered earlier if I didn't take the entry at 3456 or better yet put a SAR into my trading plan, thanks for pointing that out.

when you say lost interest after 10 were you referring to the time or #10? I was in and out and I forgot to label 12 on the chart .

fanning the line, nice catch didn't make a LL my mistake

thanks for your comments

 

[boru]

Db I don't know how many times I've read in various threads about trading 2 or more contracts and scaling out. I never thought about doing it myself, that was a tactic employed by better traders not a noob. but intelligent tactics don't know I'm a noob. thanks for your help

 

[boru]

After Niko encouraged me to analyze the 60 min chart using the SLA principles, it made a big difference in understanding where price was in the bigger picture and showing where the buying and selling imbalances are (per the bigger chart).

Coincidentally I had a very good day trading (simtrade). It didn't hurt that I was in chat and some of the better traders were helping me along.

Another change today was trading 2 contracts. At the urging of Db I entered positions with 2 contracts intending to scale out 1. at a break of SL/DL 2. the breaking of the LSH or LSL. It would be difficult to find a better day to start this , big trend day. Will have to put some study into this, but for the most part the hardest thing I did all day was stay in the trade.

the chart
1. SS 2 @ 3459.25 covered the 1st at 3457.25
covered the 2nd at 3456.25
now I know I wrote in the above paragraph about my exit strategy but this is new to me
and it was exciting to watch this unfold as the trade went my way immediately, I took profits and felt a sense of freedom as I still had 1 contract working.

2. SL break HL bought 2 @ 3460.75 on any other day I'm out on the little probe at 9:29 but for some reason I hung in there, maybe it finally sunk in to look to the left or maybe it was subconscious but I knew price bounced hard of a DL on the 60 min at 7:45, that we were close to a DB at 8:55 (not because it was a DB but because buyers stepped in and were pushing price higher).

3. price advances to 3476.75 and while taking a small breather penetrates the oh so tight DL that the fearful are so good at drawing, so I exit at 3472.25. but thanks to Db I still got one working.

4. Price advances again to 3483.50 where it takes another break barely trades below the 3480.75 and I exit my 2nd. I did notice 2 more trades they are marked with a green dot but I was busy taking notes, writing down observations and printing charts I didn't take them.

I have no illusions, every day is not a trend day, I will be tested by more difficult price action, but I enjoyed today.