Hooti's Journey

Hooti, you went long near the high and when price broke that little resistance shelf and took you into your trade and didn't go any higher to test that previous high, get out, it's a failure. Your ideal long entry is off the higher low put in around 9:50 ET, buy as price breaks back up through the 20-bar MA (1270.50) or play the breakout through the previous high (which never triggered).

Once price failed, look to reverse short on a break through the 20-bar MA, or a break through the previous pivot low. Notice how well that breakout through previous S worked, once the LH was put in. The wide range leading into that reflects indecision between the bulls and the bears (there's no strong trend making HL/HH or LH/LL, it's rather weak).

Now on to the 6-point loss:

Did you actually place a 6-point stop loss, meaning you had, perhaps, a 12- point target?

I think not.

I think you had a strong opinion, which is fine for entries, but suicidal for trade management.

Until you start regularly capturing profits greater than 4 points, stick with a 2-point stop loss.

And always be alert for a reversal signal and switch sides!
 
Quote from NoDoji:

Now on to the 6-point loss:

Did you actually place a 6-point stop loss, meaning you had, perhaps, a 12- point target?

I think not.

I think you had a strong opinion, which is fine for entries, but suicidal for trade management.

Until you start regularly capturing profits greater than 4 points, stick with a 2-point stop loss.

And always be alert for a reversal signal and switch sides!
More...

Yes, that's where I was. ...I lost my alertness for taking a small loss and switching sides.

So sad to hear about Gabrielle Giffords. Having lived in Tucson I've been at that intersection many times. Hope and pray she lives and has minimal lingering brain injury issues. She is such a bright light.

The Brain Injury Association of Az says that fully 50% of people will have a clinical bain injury at some point in their lives. Tho they are defining that broadly and including cilinical depression, etc.
That is part of my decision to share what's happening for me, a lot of us have 'life' happeneing... many have it worse than I.
I have hope of a functionally full recovery, it's just a lot of work.

It's embarassing at times, and probably confusing to watch. But, it is what it is.
You said NoD that your aim is to teach elementary school. That is so cool. I also have the thought that recording my process here will be, I guess educational? Most won't need what I do, but some might find it insightful? We all have life challenges happening all the time.
Like I was making entry errors daily. The special ed teacher had me use 3x5 cards and make an entry system. I used the cards for a week and then didn't need them any more. My brain learned that 'compensation' and I could do it without the physical structure. That is education! I'm so glad this 6 pt error happened right now. Because I've done the exact error before too.

So how do I learn to have the judgement not to do it? There are comments on ET elsewhere that some fail to become traders because they never learn not to make those errors.
Well, I'm taking this to the Cognitive Training Program I start tomorrow
I'm expecting to work through it. It's a kind of education. I'll try to share the process. If the special ed teacher could help me with the entry errors, surely the cognitive trainer can help me with this and more!

The comments you all make really help. This is concrete... the trading gives me something that is measurible. And challenging! Thx.
 
The cognitive training program helped clairify some of my experiences and observations... like, it's common to experience having the equivalent of vary little 'ram' memory. So I can be a fast study one day and then seemingly not have access to those memories the next! Because new information coming in pushes out the old. Until it's reviewed over and over... and over...

At this point the program to help that seems very generic. So I'll have to see if I can really work with it to apply it.

I should be over the 10 day flu today, so will start catching up... which means limited trading for a few days. Hope to trade premarket econ repts and the open at least.

I'm in the open today short at 1270.5
stop at 1272
tgt 1266.5, set stop at BE if get 2 pts ahead
 
Hi Nodoji,
that was my intention, but I missed it. Wound up doing the Geez thing. Which I"m coming to the conclusion is not be the best strategy for trading ES?
 
Quote from Hooti:

Hi Nodoji,
that was my intention, but I missed it. Wound up doing the Geez thing. Which I"m coming to the conclusion is not be the best strategy for trading ES?
More...

I think what's important is that you adhere to your plan, which was to move stop to b/e after 2 pts in your favor. As a 5-min chart day trader, I also move my stop to b/e after 2 pts in my favor when trading ES.

Nice thing about following that plan in your case is you're stopped out b/e and then you re-evaluate. You'd have been stopped out b/e after price found support at 1268.50. 1268.50 is higher than the previous established support level of 1267.00. That implies a higher low IF price can close at or above the 20-bar MA without going lower than 1268.50.

Price breaks thru the 20 MA to 1271.00 and closes below it, but at higher low (1269.00). Price breaks thru the 20 MA again and finds resistance at the same place (1271.00) and closes at the 20 MA. Now you have a resistance shelf and what appears to be an ascending triangle forming. Sure enough, price tries again for 1271.00 and closes at the 20 MA off another HL (1269.75).

What does this tell you? It tells you that the sellers are losing ground, but there aren't yet enough buyers to push price thru 1271.00.

What if a buyer was willing to pay 1271.25? Could just be a bull trap, or could mean price is going back up to visit the previous high of 1273.00 and break out to a new high.

If you like that setup, then buy 1271.25 if someone else buys it first (place a stop order to buy there, meaning someone else has to go first): "I'll jump off that rock if you jump off that rock first..." :p

OK, so you buy above that shelf and it breaks to a new high and once you're 2 pts in the money, you move your stop to b/e again. So far you've lost nothing, and you've positioned yourself to go whichever way the wind blows hardest.

Price pulls back (retraces) and finds support at a higher low again (1272.00). Things are looking good! But wait, price doesn't make it back up to visit 1273.75; instead it leaves a lower high and pulls back to 1271.50 (back to the 20-bar MA). This could just be a common 2-leg pullback, but you're on alert now; it's important that previous resistance (1271.00) holds up as support, otherwise we will have not only a lower high, but a lower low, which implies a potential trend reversal.

Your trade stays intact as price ranges around the 20-bar MA, establishes support @ 1271.50 and eventually breaks back up thru the initial lower high of 1273.25. This means we should see a revisit to the high of 1273.75 and a breakout.

The move to 1273.50 pulls back to the 20-bar MA (1272.50), finds support and tries again for the high.

What does it mean if price can't break through 1273.50 and at least touch the high now? It means there aren't enough buyers to drive price higher and there will likely be some profit-taking.

Price fails to break out and comes back to the 20-bar MA. You can hold your long position until it's stopped out break even and reverse to a short there, or you can aggressively reverse to a short @ 1272.25 which is a break of 20-bar MA off a lower high. If you do that, you've locked in a point of profit from the long.

The break thru the 20 MA results in a quick breach of previous support (1271.50) and you can now target breaks of each previous support level, with 1265.25 being a rather major level from the early overnight session.

Looking at the chart and my personal style of trading, I would've likely taken profits @ 1268.25 (4 pts being a standard target to my 2 pt stop), then re-entered @ 1269.50, break of the 1:30am ET bar pivot low with another 4 pt target (doubtful if it would be filled).
 
At the risk of sounding like a complete idiot, isn't the futures index price driven by the spot index (i.e. Dow/S&P/NASDAQ). Also, the spot index is driven off the specific movement associated with the weighted average of the stocks within each respective index. Furthermore, the Index EFT (i.e. SPY/DIA/QQQQ) tracks the spot index by investing in the same shares as is tracked by the given index.

If the above statements are true, then ultimately the "tug-of-war" between ES buyers & sellers are not nearly as relevant (if at all) as the net aggregate movement of the stocks within the given index. I'm sure that arbitrage algos ensure the constant alignment of the futures index, the etfs, and the stocks tracked by the respective index. Therefore, wouldn't the notion of buyers vs. sellers of the ES be a "red herring", as the true driver of the ES price direction are HD/BAC/WYNN and the other stocks in the S&P 500?

Please forgive me if I'm off base here...

Walt
 
Quote from jones247:

If the above statements are true, then ultimately the "tug-of-war" between ES buyers & sellers are not nearly as relevant (if at all) as the net aggregate movement of the stocks within the given index.
More...

Buyers and sellers are driving the price of the stocks.
 
opps have to read in a min

bracket at open
in short
stop at 1279.25
tgt 2 pts, 1276

If I'm here (!), might move stop to BE and let it run.... if goes that way.

Moved my stop to BE...
might fail, but seems possible for it to test the O/N low

...of course if it does like yesterday, will go up from here! That's likely too!
 
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