ES: patterns & rockets

1

1contract

I've been trading ES intraday for a little over a year now. I have had occasional profitable months,

but mostly the wrong side of break even! I'm hoping that the process of keeping a journal will help

me, and that going public with my plan will help me stick to it. If anyone wants to comment, then so much the better.
 
I mostly trade continuation & reversal patterns (triangles, flags, W, H&S) on the 1 & 3 minute charts: generally looking for 2-3 points profit per trade with stop of 1-2. The main problems that I've identified in my trading are:

1. Overtrading (not being selective enough about the trades I take).

2. I'm too slow to identify (or to act on) failed breakouts. I often let my protective stop get hit

when I should have exited for +/- 0.25 when the trade didn't follow through.

3. I'm often too quick to take profit. I will snatch +1.00 - out of relief - instead of waiting for 2-3 points.

4. I'm too fond of the 1 minute chart. This contributes to the overtrading and I often find myself on the wrong side of every whipsaw.
 
My plan for this journal is to continue trading the patterns described above, but to try to correct the problems 1-4.

- To correct 1 & 4 ,I will trade off the 3 minute chart ONLY.

- To correct 2 & 3 I need to distinguish between failed & sucessfull breakouts early. I will use low volume bars to do this (might have to peek at the 1 minute chart).
 
In addition, I will also take "rocket" trades. These trend following trades are described in detail here (http://www.elitetrader.com/vb/showthread.php?threadid=14129).

My understanding/interpretation of them is as follows:

enter if:
- MACD(5,13,6) histogram > 0.4 (< -0.4) on a recent peak (trough)
- Stoch(14,1,3) fast & slow lines > 80 (< 20)
- signal when bar closed - enter next bar

exit when:
- Stoch(14,1,3) fast line < 0.4 (> -0.4)
- signal when bar closed - exit next bar

I will use some discretion with these around S/R, end of day etc.

The original rocket thread takes signals from the 5 minute chart but suggests that they work on any timescale. I will take them from the 3 minute chart.
 
I trade most days, but not all. On days that I do it may be AM only, PM only - but seldom both.

I welcome any constructive comments.
 
Quote from 1contract:

My plan for this journal is to continue trading the patterns described above, but to try to correct the problems 1-4.

-

- To correct 2 & 3 I need to distinguish between failed & sucessfull breakouts early. I will use low volume bars to do this (might have to peek at the 1 minute chart).
More...

Try watching T&S
 
Quote from 1contract:

I'm hoping that the process of .... going public with my plan will help me stick to it.
More...
Good luck with your trading 1c'.

I absolutely do not mean to be negative here, but I have yet to see one person stick to their plan because they go public with it in a journal.

I truly hope you are the first of many to come.

Edit: T&S is Time and Sales, or affectionately known as the tape.
 
T&S now added to my QCharts workspace.

I guess I'm just interested in whether they're trading with or against me - so I've coloured 'best bid' red & 'best offer' blue. I might also filter out smaller trades in order to concentrate on the big orders. I'd be interested to know how others configure and use this.
 
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