ES Journal Archive (2011)

keeptradin' · Oct 7, 2011

Quote from Picaso:

Then wait for confirmation and enter with a buy stop above the chop zone or on a pullback to the bottom of the range with a tight stop-loss (we'll see when/if we get there)

Seeing as how we went from the 50's to the 70's and back to the 50's, where would you say the "bottom of the range" is? Just curious...

JoshDance · Oct 7, 2011

Quote from mastacoli71:

Where are all those trend traders that say jump on the trend. They should be buying into this recent weakness.

You don't get it--you don't buy into weakness if you're a trend trader. Fading current strength is suicide, that's why you and others got burned. You buy with the strength on a pullback. This is an opening drive down, sellers look aggressive. Up until just now if anything I'd want to be short until buyers establish themselves, which they seem to be trying to do 2 ticks below yesterday's close.

edit: this is the essential mistake that shows lack of patience. You have to WAIT. Buying into strong selling is gambling, and vice versa.

cashcarewins · Oct 7, 2011

Quote from JoshDance:

You don't get it--you don't buy into weakness if you're a trend trader. Fading current strength is suicide, that's why you and others got burned. You buy with the strength on a pullback. This is an opening drive down, sellers look aggressive. Up until just now if anything I'd want to be short until buyers establish themselves, which they seem to be trying to do 2 ticks below yesterday's close.

Actually, if you are a trend trader, you establish the trend. If it is bullish, you buy weakness, if you are bearish you sell strength.

EON Kid · Oct 7, 2011

Quote from JoshDance:

You don't get it--you don't buy into weakness if you're a trend trader. Fading current strength is suicide, that's why you and others got burned. You buy with the strength on a pullback. This is an opening drive down, sellers look aggressive. Up until just now if anything I'd want to be short until buyers establish themselves, which they seem to be trying to do 2 ticks below yesterday's close.

edit: this is the essential mistake that shows lack of patience. You have to WAIT. Buying into strong selling is gambling, and vice versa.

do you consider 16:00 or 16:15 as the close?

cashcarewins · Oct 7, 2011

Quote from Picaso:

Risky it is.

But it depends on many things, key among them your (capital) staying power. Witness thereof that 20 up-and-down move.

Also, Volente dixit: market goes up before employment report and goes down afterwards.

So we'll see. Vol may be wrong, but he's no rookie.

Staying in a trade because you have 'capital staying power' is really not a great way to trade. I call it marrying a trade. Once you do that, your judgment is completely clouded.

mastacoli71 · Oct 7, 2011

Quote from Picaso:

First wait for the gap fill (check)

Then wait for the chop (in progress)

Then wait for confirmation and enter with a buy stop above the chop zone or on a pullback to the bottom of the range with a tight stop-loss (we'll see when/if we get there)

All contingent on price action

Always what you see, not what you think

Good luck to both longs and shorts

Way to complicated for me.

Picaso · Oct 7, 2011

Quote from keeptradin':

Seeing as how we went from the 50's to the 70's and back to the 50's, where would you say the "bottom of the range" is? Just curious...

The top and bottom of the "chop" range. Right now between 58-ish and 63-ish.

I.e. you'd be buying right now via a stop (stronger confirmation, but wider stop) or on a pullback to 57-58 that cannot break down (or on the first close above the 20 5' EMA after one hour, blah, blah, blah...)

The point I was trying to make is that (unless you're trading on a very long timeframe) if you're a trend follower you don't buy a news spike (that'd be a momentum trader).

Just my 0.02, not telling anyone how to trade.

mastacoli71 · Oct 7, 2011

Quote from cashcarewins:

Staying in a trade because you have 'capital staying power' is really not a great way to trade. I call it marrying a trade. Once you do that, your judgment is completely clouded.

If your thinking is cloudy you are trading too much size for your risk tolerance.

bigsnack · Oct 7, 2011

Short 63's, but I think I'm gonna.... yup just got tagged for b/e.

Picaso · Oct 7, 2011

Quote from mastacoli71:

If your thinking is cloudy you are trading too much size for your risk tolerance.

Actually that's a very good point.

But don't forget the mojitos