Help, I've been chopped!

[heavenskrow]

Are there supposed to be trades on those charts?

Well I made a huge mistake today and let my emotions get to me...I made good points in QM and TF early morning, then just slowed my trading and waited patiently for a good setup(which I thought was going to be this YM trade).....after the first few YM trades chopping me out, I was determined to make the losses back. But in the end, I just got humbled.

Starting from 11:17PT, I thought we would break out as all the other majors were breaking out from an area of resistance. The YM looked like a clean bull flag and with CL rallying near close, I thought YM should be the strongest of the majors. The one thing that set a warning signal for me though is on the supposed breakout at 11:17PT, volume spiked which is usually not a good sign for a true breakout thus I sold it immediately instead of holding.

But when I was looking back at your old posts, you claim, "I'm no longer afraid to miss the first big push of a breakout or a new trend. I know that once that first momentum run happens, there's now a clear winning side and a clear losing side (the antithesis of "chop"), and the market can be ruthless when a group of traders who can't take a hint are now trapped, hoping and praying. I want that winning side to have my back; I don't need to be the trailblazer because I'm trading small size. I can just latch on and get a free ride if I'm patient." - Lesson learned today.

The trades down below are not what I strive for at all usually. I usually tend to be selective. Emotional trading at it's finest. The dark red line on the chart is the important area from August post crash highs.
I'm curious as to see how you would have identified it was going into a chop after the 11:17 period. When a clean bull flag turns into a H&S reversal on the resistance line......Another thing to add to my lessons learned folder.

YM BOT 1 16729 11:17:16
YM SLD 1 16730 11:17:30
YM BOT 1 16720 11:25:20
YM SLD 1 16711 11:26:10
YM SLD 1 16710 11:28:02
YM BOT 1 16722 11:29:17
YM BOT 1 16722 11:29:22
YM SLD 1 16723 11:32:18
YM BOT 1 16730 11:34:20
YM SLD 1 16719 11:41:13
YM SLD 1 16723 11:47:28
YM BOT 1 16724 11:47:34
YM BOT 1 16723 11:47:44
YM SLD 1 16697 11:55:23
YM SLD 1 16697 11:55:23
YM BOT 1 16696 11:58:09
YM SLD 1 16696 12:00:45
YM BOT 1 16695 12:02:06
YM SLD 1 16693 12:02:59
YM BOT 1 16706 12:04:13
YM SLD 1 16700 12:06:10
YM BOT 1 16702 12:06:47
YM BOT 1 16709 12:09:27
YM SLD 1 16693 12:10:39
YM SLD 1 16683 12:12:48
YM BOT 1 16693 12:15:54
YM BOT 1 16695 12:16:03
YM SLD 1 16698 12:18:23
YM BOT 1 16704 12:21:58
YM SLD 1 16703 12:23:37
YM BOT 1 16709 12:23:51
YM SLD 1 16694 12:26:36
YM BOT 1 16715 12:30:16
YM SLD 1 16705 12:35:20
YM SLD 1 16690 12:41:58
YM BOT 1 16700 12:43:04
YM BOT 1 16700 12:43:40
YM SLD 1 16690 12:44:17
YM SLD 1 16690 12:44:50
YM BOT 1 16695 12:52:20
YM SLD 1 16678 12:57:43
YM BOT 1 16683 12:58:14
YM BOT 1 16687 12:58:45
YM SLD 1 16679 12:59:24
YM BOT 1 16616 15:13:33
YM SLD 1 16618 15:17:51

 

[NoDoji]

I'm curious as to see how you would have identified it was going into a chop after the 11:17 period.

I personally use a 5-min chart to signal chop based on the factors I outlined early in this thread, but I’ll share the ways I’d identify chop on the 1-min chart you posted starting at the 11:17 time. The entire chart looks like chop to me, again because I'd be trading off the 5-min chart and using the 1-min chart for entries, but from the left edge of the upper chart, the first signal that tells me there’s not going to be a lot of powerful trending action for a while is the rapid rejection during bars 23 and 24 of the breakout of the previous swing high. It’s basically a failed break of that high.

Then price pulls back to the high of bar 19 (the price turn pivot level) and attempts once more to gain traction. (This pullback to that bar’s high is a fairly common price action pattern; study how often that happens during a trending move.) The failure to revisit the failed breakout level is confirmation for me that chop or reversal is in play. It’s now a scalper’s playground.

I looked at a few of your trades and it looks like you’re chasing price or basing entries on sheer belief/reaction instead of taking carefully planned entries.

For example, it would make sense to me to buy 16720 at 11:20 (fade the break of a previous 1-min bar low because price is trending up nicely), but to buy that price at 11:25 when price failed to test the previous high and is therefore pulling back off a lower high at that time, doesn’t make sense at all. It's a reasonable scalp to the short side, but not a buy at that point.

Placing a buy stop a tick above the high of bar 19 makes sense to me as a long entry because a) the sellers are taking their feet off the gas (small bodied doji-like bars) and b) there’s enough airspace between that buy stop entry price and the minor swing low of bar 12 appear to allow for an escape if price is rejected there.

So I’ve given you a taste of my trading tactics, hopefully enough to give you ideas for further study.

 

[ubo]

For example, it would make sense to me to buy 16720 at 11:20 (fade the break of a previous 1-min bar low because price is trending up nicely)

Hi Nodoji,

I assume that it is a limit buy order to buy 16720 at 11:20? When you mention fade the break of the previous 1-min bar low, which bar are you referring to? I'm a bit confused because 16720 is below the two prior bull dojis before 11:20?

Thanks.

 

[NoDoji]

Hi Nodoji,

I assume that it is a limit buy order to buy 16720 at 11:20? When you mention fade the break of the previous 1-min bar low, which bar are you referring to? I'm a bit confused because 16720 is below the two prior bull dojis before 11:20?

Thanks.

Counter-trend traders tend to place sell stops below uptrending bars hoping to catch a reversal. So you'd "fade" that common practice by placing a limit to buy below the lows of bars 10 and 11, looking for CT traders to get trapped and their stop losses to trigger further upward movement. It's an unusual tactic, no doubt, but makes far more sense than buying a few bars later when price is coming down off a lower high. That setup, a 1-2-3 potential reversal setup, makes more sense as a short for those playing with the fire of the 1-min chart exclusively.