ES Journal Archive (2011)

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Quote from Buy1Sell2:

I believe that the initial stop here should have been 1279.25 instead of 1274.75 and no second long trade. Going short at around 1281.50 with stop at 1284.50 would have worked and allowed you ride it down. This is all hindsight, but looking back at the charts, I don't believe there was a long signal when you got in--only some continuation price action of the short term trend. :)
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Looking back I see that. When I made the entry it was too early. Also, the longer term charts did not jive with the indicators on the shorter term charts. Now the longer term look better and the shorter term doesn't look as appealing. Either way I am unfortunately back in.

At this point I have limited my trades for today to this last one. If this fails I am out for the day.
 

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Quote from Buy1Sell2:

Excellent points. Especially with regard to ES. Many people feel that since it does generally return to the mean or oscillate that there will be a bottom that can be bought. The problem is that on the days when it is a true trend day, there is no bottom to trade and the averaging will give up most, if not all, the profits from the back and forth days. It's better to trade and take small losses even in an oscillating market like ES every day. Also, to your first point: Yes, the shorter time that a trader is emotionally attached to a trade going against them, the better chances they will have to think clearly and make a good re-entry. :)
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I've always felt markets condition a behavior before they punish it - kind of like a sick joke that someones playing.

Anyone who traded the flash crash saw first hand what averaging down on leverage can do. Once the market broke that 1095 level, liquidity disappeared, and we basically gapped 30-40 handles lower. Then for good measure rallied all the way back up to rub it in.

One of the reasons I don't let a loss run at all is I hate the idea of "getting even". You've already taken the loss, now you're essentially in a second trade, by default, to make it back. To me getting even is an edgeless gambling mentality that's risks far outway the reward (big loss vs. even or small loss/gain.) Even a pure discretionary trader needs some mechanism for not getting caught up emotionally.

A lot of traders tend to have this mental hangup about losing days. I've always found on days where I have small losses in the morning I tend to have big(ger) losses in the afternoon becase 1)my gut is just off that day and/or 2)the early losses affected the later entries. Now I just quit early, and start fresh the next day. But that's just me.
 
Quote from joneog:

I've always felt markets condition a behavior before they punish it - kind of like a sick joke that someones playing.

Anyone who traded the flash crash saw first hand what averaging down on leverage can do. Once the market broke that 1095 level, liquidity disappeared, and we basically gapped 30-40 handles lower. Then for good measure rallied all the way back up to rub it in.

One of the reasons I don't let a loss run at all is I hate the idea of "getting even". You've already taken the loss, now you're essentially in a second trade, by default, to make it back. To me getting even is an edgeless gambling mentality that's risks far outway the reward (big loss vs. even or small loss/gain.) Even a pure discretionary trader needs some mechanism for not getting caught up emotionally.

A lot of traders tend to have this mental hangup about losing days. I've always found on days where I have small losses in the morning I tend to have big(ger) losses in the afternoon becase 1)my gut is just off that day and/or 2)the early losses affected the later entries. Now I just quit early, and start fresh the next day. But that's just me.
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That should have been me. Great insight.
 
Quote from joneog:

I've always found on days where I have small losses in the morning I tend to have big(ger) losses in the afternoon becase 1)my gut is just off that day and/or 2)the early losses affected the later entries. Now I just quit early, and start fresh the next day. But that's just me.
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IMO the best way to solve this problem is to make sure you have profits in the morning, so that you can take the rest of the day off.:p
 
Quote from eudaemon:

IMO the best way to solve this problem is to make sure you have profits in the morning, so that you can take the rest of the day off.:p
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No way, profits in the morning = big(ger) profits in the afternoon:)
 
Quote from joneog:

No way, profits in the morning = big(ger) profits in the afternoon:)
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Now I can see that you are addicted.:D

In any case, problem solved with profits in the morning. Next!.:p
 
Quote from eudaemon:

Now I can see that you are addicted.:D

In any case, problem solved with profits in the morning. Next!.:p
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It's the tiger blood.

Seriously though, if you're trading a small-loss/lower prob. strategy you have to be agressive when you're on imo.

Let others pick up the nickels, as long as you're driving the steam-roller.
 
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