Brent's Journey to success Journal

Been a while since i posted an update.

Well I did not get the internship I had been describing. It appeared as the perfectly internship for me in terms of the program and practicality. I am taking this in stride not letting it get me down. I am really going to focus on improving my credentials and of course being able to convey my ideas comes with time.

I have been paper trading again for a little over a month now. Have been trading stocks only on a pretty crappy simulator but its for now.

Starting 2/15/07 through 3/23/07

+4.12%

31 Trades (I do tend to scale in and out of trades so in reality it was a lot more

22 winners
9 losers

Winners are roughly the same size as my losers.

It would be nice if the simulator allowed me to use options to hedge or stop orders so it has limited my exposure.

What I have gained the most out of this has been practice on exits and also experience scaling in and out. Previously I had always tended to get all in and out at once. I tend to scale a lot more often now.

Ways i can improve are to increase the magnitude of my winner compared to my losers. Also begin to quantify my risk better. I have not been taking equal risk on all trades. I want to base my bet size on the reward to risk ratio when i enter a trade.

I will be posting a primer for my methodology soon.
 
Hey Brent....haven't talked to you in a while. What simulator are you using for stocks? I've been trading with openecry's demo for futures for the past few weeks and I would reccomend trying it out if thats something you might be interested in. Good luck.
 
I am the administrator for the stock competition for my finance group. We are using virtualstockexchange.com I wanted to gain some experience trading a basket of stocks because after about 9 months I really felt out of tune with individual stocks. The more I think about it the more I lean to Day trading the YM. When this competition is over I will switch over to YM futures.


The problem I have heard about open Ecrys simulator is that when you put in limit orders you are FIRST in line. That is a ridiculous edge that doesnt exist in real trading. Transact's limit order system is more realistic but you need some sort of charting service to accompany the data.
 
please reference my attached chart for my analysis.

Tomorrow look for support at todays lows and 12375. If the market breaks 12375 the next support should occur near 12300. Current resistance is todays highs and again at 12475 and 12500. The way the market reacts at these key areas determines the play. What makes my use of support and resistance a little different is I leave it open to be interpreted what the market is doing. Interpretation of price action and being able to react on the market action is key.

For now the market is in no mans land and until I find a way to trade when in no mans land i will remain on the sidelines.
 

Attachments

Quote from bigbrent701:




The problem I have heard about open Ecrys simulator is that when you put in limit orders you are FIRST in line. That is a ridiculous edge that doesnt exist in real trading. Transact's limit order system is more realistic but you need some sort of charting service to accompany the data.
More...

That's true....most of my entries are at the market though. It's still worth checking out though if you want to trade the YM.
 
So far todays session is about what i expected. Typically i have found that the bulls will tend to regroup just above prior highs and prior but also at the base. This is similar to the way the dow behaved going into the morning session. Since the dow blew through 12300 its next support was the bottom of that channel which was roughly 12265 roughly where the bulls regrouped.

Mondays and Wednesdays are tough for me to give my commentary as i have 3 classes spread evenly through the day.
Hope everyones trading is going well. Will post my key zones for Thursdays session tonight.
 
Please reference the attached chart for my analysis.

So for Thursday I expect things to go the bulls way at first but ultimately i am expecting a wide trading range. Look for support in the YM @ 12350 and resistance at 12450 and 12500. Also there is minor support at 12370 and minor resistance at 12430. Right now as i write this as of 12:30am EST the bulls have the advantage. Happy trading tomo.
 
So today pretty much went along the lines that i said it would. I have to admit though, while the market was plunging this afternoon i was skeptical at first about whether the support was going to hold but i came back by the close astonished to see that the dow had indeed V bottomed to close back in the green.

So i am going to talk a little bit about the mechanics of my system here. My system like any good system consists of entry, exit, and money management. Then these main 3 categories can be further broken down.

Entry- Entry is determined when the market appears to be forming a top or bottom at a predetermined zone from the night before. It is important to account for an expansion of these zones. At this phase I am still in the research as to how wide of an expansion to account for but I would say right now its roughly +/- 10 points. The main conditions to look for is that the market needs to appear to be running out of gas one way or another before initiating this position. For this reason this makes this a descretionary system opposed to a mechanical system.

Exit- Exit is probably the second most difficult aspect of this system. The most challenging being the discpline to follow it! Exits like entry are depenedent on the predetermined zone from the night before. Also like the entry the exit must allow for an expansion of these zones. For exit I like to also focus more on the minor zones which may or may not be noted from the night before however they are clearly determined as they develop on the chart itself. I will now describe the types of exits.

Profit taking exit- These are the best, this is when everything went well and hoping you just grabbed a 30+ point move in the dow which is pretty good. Use profit taking exits when the market appears to run out of gas. Use profit taking exits at key zones either major or minor.

Partial profit taking exit- These are are also the best because hopefully you have grabbed a large move in the dow. What makes these different is that you are scaling out in hopes of getting more out of the trade. Use these when you want to reduce exposure and take some profit off the table.

Stops- Nobody likes stops. Right I am researching just how far to place my stop away from the entry. If I buy into a break or rally attempting to call the top or bottom i must account likely for a continuation of this break and the stop would be wider. Right now the absolute maximum stop is 15 points in the dow. This translates to $75. More realistically the stop is probably going to be closer to 5 to 10 points. Place your stop where it would appear your trade idea was completely wrong.

Money management- Positions will not be held overnight. Trade 1 contract for every $2500 in capital. Stop trading for the day if stop is hit 3 consecutive times. Money management is still in the research stage.

This in a nutshell is the primer for my trading method. By far the most difficult is following it and avoid overtrading. Its important to not chase a trade if you miss it because this usually leads to disasters. I hope you found this useful. I will post tomorrows key zones later tonight. Happy trading.
 
Please reference chart for analysis.

So for tomorrow expect support at 12340 and resistance at 12460. Right now the bulls have the upper hand and should drive the market to or near 12460. Largely i expect a trading range unless the bulls can push through 12460 with momentum. If thats the case prices go higher. If the bulls do break 12460 expect resistance at 12550. Should be interesting to see if we get a trend or another range day tomorrow. Happy trading.
 

Attachments

You must log in or register to reply here.
Back
Top