Greg's Forex Journal

Russell 2000 - June 14, 2009

I'm just going to describe what I'm seeing on the chart, and maybe say something about what I think might happen.

I forgot to say also that I'm keeping my analyses here so that it's obvious that I'm not pretending to know anything or be a professional, etc.

Monthly: just bringing attention to the channel that PA has just approached this month (trendline importance confirmed with other channel line being significant) as well as the strong support at the lows (which I believe is more defined than the other indexes - I think the SPX just has the last bear market low). At the bottom, we have a nice pin that has shown nice confirmations into its uptrend (although now I think that signal is too outdated to predict future movement) - unfortunately, nothing else will be relevant while I have this chart on the monthly, because next month I will have a new instrument.

Weekly: It is interesting to see that it does appear that there has been a full five defined waves in this bear market. It also seems we have a *temporarily* bullish break of the trendline. The break of the inside bar (close only) will dictate my new opinion on this chart.

2-day: isn't the channel interesting? I just drew the other TL to show how badly this recent uptrend has been losing momentum. Based on PA I'm still looking for upward and downward breaks, but I'm leaning in the direction that our current consolidation breaks downward to the 500 level at least.

Daily: nothing entirely significant to add to the 2-day except for the fact at the last up move is up-curving. It may not mean much to you, but to me this means that there was some solid, steady, exhaustion buying in this mini-trend. That means PA would need time to both regenerate demand if the uptrend were to continue as well as the possibility that PA needs to consolidate in order to wane demand if PA were to begin to retreat. This puts both bullish and bearish options well into play.

30 min - that's more trendlines I've had on a chart in a very, very long time. Is anyone else fascinated by these S/R patterns? By the way - tomorrow, PA will gap up from Friday's close. I'm going to stand by that claim (partially because I couldn't care less if I'm right or not).

15 min - I guess I could have taken all of those S/R lines and put them here instead. Oh well.

5 min, 2 min - it's Sunday. Who cares about intraday PA on Friday? I might take a look at highs/lows/closes (and if I was really into this, pivots) but as of now I'm not interested.

Attachment: If that chart grid came out like I think it did it would definitely show why I like TOS so much.
 

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Anyone remember the shoulder n heads pattern I posted?

Interestingly, this was a shoulder n heads within a head and shoulders. lol

The funny part is look how perfectly it followed its formation from last time, except this time the following decline was much stronger.
 

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Russell 2000 - 6/15/09

Oops, so I guess the gap patterns I normally see don't transfer from Friday to Monday. Makes sense.

Today's trading day: opening was straight and consistently down, and from there we got channeled before a break near the closing bell.

I think the final move up is something we will see in the next day or two that I'm going to guess (although I know little about TA in stocks) is a return to test the prior s/r that was broken in today's early selloff.

Daily: added a TL that I didn't have earlier. Although this TL represents the turn from the lows to this point, it should NOT be important because it does not represent PA very well to this point.

Unfortunately, I do know that TLs in stocks are often more primitive than the ones needed in intraday forex, so I will keep an eye on it. My initial expectations are that it will be enough to initiate a slight pullback/consolidation/stall/inside bar, etc.
 

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Because I haven't done so well lately, I'm planning on posting my trades for today's Asian session. I've also started that session a bit early today because I wake up for work at 6:45 a.m., need sleep, and also have nothing better to do.

I started about 30 mins ago, and my first order is a long at 1.3955 for a continuation of the 15 min - hourly WRB exhaustive rally. This is a classic play for my strategy, if it fires.

Edit: A little background to why I'm doing this - my last three sessions were all losers with a win-loss record of 1-6, while my previous six sessions were all profitable with a total record of 14-6.

Clearly, something is very wrong here.
 
Order reinstated at 1.3955, as the 30 min especially is looking attractive for a possible rally.

Normally in these conditions I would do something dumb like leveraging up on a 5 min rally by taking an aggressive signal with a tight stop so as to throw my R:R to maybe 8:1 with maybe a 7 pip stop (or that would be my goal anyway).

This time, that is exactly what I won't be doing. I'm looking now at a 30 min entry and stop because that's what looks tradable to me.

Side note: Even now this might be a 16-18 pip stop and makes me look insane if I thought the stop was too wide, but I think most of us know in better market conditions (first times I've traded Asian all year) the stops for 15-30 min bars might be 30 pips. In many of those conditions I try to drill down stops to 10 if I can, which means I can increase my R:R by 3x.

Often, this does not also mean I lessen my probability of success by a factor of 3, so it is usually an attractive option.

Unfortunately, it takes immense skill to repeat with continued success, and once I started to slide a bit I got swept by the mental problems.

While I'm writing this I went long a few minutes ago. And what a great signal on the 15 min. :)

Edit: what I meant was my limit signal fired, and the 15 min signal looked good at the time (lol).
 
Stopped out for a full loss. This is paper just so anyone knows.

The funny part about this one was that, if you looked at a 5 min chart, I bought the absolute high and rode it straight down to the current absolute low.

This happened because I put my limit order just pipettes above the last swing high and put my stop just pipettes under the second-to-last swing low!

What a moron! At least the buy should have been more lenient, but probably both. :p

It really has been those kind of mistakes that are the difference between me losing a full stop and never being in the trade at all. Unfortunately this also means my analysis was a bit wrong as well so I guess I have two glaring problems - identification and execution.

Fix those two and I should be okay...
 
Today I'm back and also early gain because I don't know anyone where I live and have nothing to do.

Also, I'm going to be changing up my strategy to get back onto the road toward success. And by that I mean getting rid of all the progress I've made so far.

I believe the strategy I had so much success on is centered on an aggressive 5 min strategy, and I believe I can still do well with it as long as I am extremely smart, shrewd, and just overall good at what I do.

Honestly, I do not see the point to waiting all day for the opportunity of a single 30 min trade and then blowing it. Even with the 5 min charts I generally had 2-4 per session , and my drawdowns are extremely strict to prevent any blowups.

As long as I pick the best signals and I know what I'm doing I want the chance to limit my risk as far down as possible and have several chances to make a good trading day (by taking several trades, which can't really happen on the 30 min).

After all, I am trading paper so I am going to do and try what I want, as long as it is within my trading rules.
 
Closing for the day already.

I had a long early in the session which I ended up closing at b/e. I actually wish I had it until now because it was one of those trades that I had it right but then as I perused around I drew a new trendline, was looking at resistance in the area, and then got caught up in it and closed it based on a meaningless 5 min signal (which I was expecting to be temporary like it was, unfortunately).

Then I reversed and got stopped out.

What should have happened was I should have held my long until I got the clear signal to reverse, which may or may not come. I unfortunately wasn't surprised by anything that happened, I was just overthinking things and reacted too quickly.

Mistake I haven't made in a while but I'll work on it another time, I just feel like stopping and having my family over for dinner. Good night.
 
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