ES Journal - 2019/2020

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NQurious said:
Let me preface this by saying what follows is my answer to your question. It is not the only answer. But it is the only answer that I know to give.

1a) There is no substitute for a period of sustained market observation with no thoughts of trading or looking for "set ups." Live with the 5 minute bar interval real time chart for 30 days, 20-22 market sessions - ONE MONTH. Just watch it, tick by tick, bell to bell. You should take notes but only when something strikes you. Do not put undue pressure on yourself to have frequent flashes of insight. Insight is the objective and it will come. But don't force it. Watch price, its rhythms, its flow. I say "tick by tick" to emphasize that the bar is merely a collation of data. Price is live, it is flow, and it should not be confused with being the "the bars."

You should journal this activity. And I do not mean open an ET journal - I mean get yourself a notebook and a pen or pencil and physically (not electronically) journal your thoughts and observations daily - even if your only thought is you have no idea what you just watched for the last 390 minutes. The objective is not to identify "set ups." The objective is to learn the character of the market you wish to trade. That is all. And the ES does have character.

I cannot stress just how strongly I believe in the superiority of the 5 minute bar interval to all others specifically for learning the character of the ES market. I also cannot stress enough that there is no substitute for this exercise of simply watching the market unfold tick by tick, minute by minute, hour after hour for six hours and 45 minutes each day for 20 RTH sessions. None. But nearly no one does it. Skip this step and go to the next ones and you might still manage to put together a plan and succeed. But skip this step and no matter what success you might muster in the future, it will be a fraction of what could have been.

Also, more bars are not better. Resist the temptation to look at any bar interval less than 5 minutes. And yes, for swing trading big picture is monthly, weekly, daily, 240 minute and 60 minute ... but specifically for learning the character of the ES relatively quickly where the price action will correlate with larger bar intervals over longer timeframes, the 5 minute is king.

1b) Co-requisite: Read Zen and the Markets by Edward Toppel. Start the meditation exercises now. It will augment your fitness for the mental and emotional pressures of trading.

AFTER completing 1a and 1b:

2) Read The Trading Rule that Can Make you Rich by Edward Dobson

3) Study Al Brooks's Trading Course. What will you get out of his course? Take the exercise I suggest above - sit and observe 20 to 22 market sessions bell to bell of simply observing price action, one month of market observation - and multiply it by 60 - that is the knowledge and experience you can pour into your brain by intently studying Brooks's price action course. But you will get even more out of his course if you do the exercise in step one above first.

3) Read Trading the Measured Move by David Halsey ... My only complaint about this book is that the charts are nearly useless. They suck. Terrible. But the material is invaluable to understanding the underlying structure of the ES as it is exploited by today's algorithmic trading systems.

You can do the above and, assuming you have the mental and emotional fitness for active trading, and you'll be running a profitable operation in six months time. Or, don't do any of it, and instead do what everyone else here does, and 20 years later you'll be like some here who tell us that they are (finally) "just getting started."

Prove to me you've gone through all the above, and I'll help you put it all together. But do all the above, and you may not need me to help you put it together. But if you do all that and you feel you need a little more direction, you'll get it.
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NQurious: excellent advice.
I suppose you did 1a,; did you do 1a when you just started to learn trading or after you have learned how to trade for some time? Somebody suggested this 1a to you or you figured it out by yourself? Thank you very much.
 
Huyang said:
did you do 1a when you just started to learn trading or after you have learned how to trade for some time?
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I'd answer but that would only tell you about me. And my answer might lead you to believe you must do it as I did. The best time to do it is when you are ready to do it. Let me show you what I mean by answering your second question.

Huyang said:
Somebody suggested this 1a to you or you figured it out by yourself?
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It was suggested as the first step toward coming up with a trading plan by @dbphoenix. I found this quote from him here from 2014. I found him elsewhere on the internet years before this post (he's been around for quite a while), and it was easier for me to to find something from him here on ET.


dbphoenix said:
It should be remembered that there are five phases here: observation, backtesting, forwardtesting, simtrading, real trading.

First, one must observe in order to find those "tells" which show the market's hand. In broad categories, these tells will manifest themselves in reversals, breakouts, retracements. This is analogous to meditation in that if one finds himself thinking about entries rather than focusing on price behavior, he should start over from the beginning. Eventually he will get tired of doing this and focus on the behavior in order to get through it.
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Whether one is brand new to trading or has been at it for years, the exercise of observation "is analogous to meditation in that if one finds himself thinking about entries rather than focusing on price behavior, he should start over from the beginning. Eventually he will get tired of doing this and focus on the behavior in order to get through it."

The key is to observe the market as it is an not as something to be "entered" and "exited" in the hope of earning a profit. You will note that 1A is accompanied by 1B: "Read Zen and the Markets by Edward Toppel. Start the meditation exercises now. It will augment your fitness for the mental and emotional pressures of trading." It will also help you with the exercise of observing. As meditation involves clearing your mind of extraneous thoughts and distractions. "Where to enter" is a thought that you must allow simply to drift away and then get right back to the exercise of simply observing the market's behavior.

Whether one is brand new or has traded for years, the exercise is the same: "observe in order to find those "tells" which show the market's hand. In broad categories, these tells will manifest themselves in reversals, breakouts, retracements."

I remember dbphoenix said of all those to whom he had suggested it over the years very few ever did it. I think he once said he could count on one hand the number of people who took his advice with fingers left over.

I am one of those few.
 
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NQurious said:
I'd answer but that would only tell you about me. And my answer might lead you to believe you must do it as I did. The best time to do it is when you are ready to do it. Let me show you what I mean by answering your second question.



It was suggested as the first step toward coming up with a trading plan by @dbphoenix. I found this quote from him here from 2014. I found him elsewhere on the internet years before this post (he's been around for quite a while), and it was easier for me to to find something from him here on ET.




Whether one is brand new to trading or has been at it for years, the exercise of observation "is analogous to meditation in that if one finds himself thinking about entries rather than focusing on price behavior, he should start over from the beginning. Eventually he will get tired of doing this and focus on the behavior in order to get through it."

The key is to observe the market as it is an not as something to be "entered" and "exited" in the hope of earning a profit. You will note that 1A is accompanied by 1B: "Read Zen and the Markets by Edward Toppel. Start the meditation exercises now. It will augment your fitness for the mental and emotional pressures of trading." It will also help you with the exercise of observing. As meditation involves clearing your mind of extraneous thoughts and distractions. "Where to enter" is a thought that you must allow simply to drift away and then get right back to the exercise of simply observing the market's behavior.

Whether one is brand new or has traded for years, the exercise is the same: "observe in order to find those "tells" which show the market's hand. In broad categories, these tells will manifest themselves in reversals, breakouts, retracements."

I remember dbphoenix said of all those to whom he had suggested it over the years very few ever did it. I think he once said he could count on one hand the number of people who took his advice with fingers left over.

I am one of those few.
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For those of you that are just developing your methodology & in process of self discovery... as well as those whom have been in the game a while... these are Golden Nuggets given to you as a gift! Utilize it...
 
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