Making of a method

I have always admired the way you look things through. :) Very interesting stuff.

game said:
All these months of analysis, synthesis and testing have brought me to the conclusion that success in day-trading is proportionate to one's quality of in session awareness.

Awareness of what?

Of attractive combinations of Energy and Risk, where energy is defined as the intensity of the Line of Least Resistance and risk is defined as the intensity of potential adverse movement.

States of energy and risk are inferred by observing Price Action markers of Time, Quality, Position and Pressure. Various combinations of these markers herald future movement. Clear awareness leads to clear recognition and decisive action.

A dynamic, time sensitive environment does not lend itself to formal in session analysis. Apart from the time pressure, the movement of price invokes intrinsic biases rooted deep within the trader.There is no time to make a pros and cons list or draw decision trees. All analyses has to be done outside the session. One has to know the base rates before the session starts. So the line of least resistance in this case is not to fight one's nature, but to recognize it.

The purpose of in-session attention is to observe for cues and to then weave these cues into a coherent story that explains past action and heralds future movement. The medium of narrative keeps one rooted to the fundamentals, i.e. the behavior of both traders and of the system.

The goal of analysis and synthesis is to clear distortions that separate awareness from reality. The end is reached when awareness and reality merge as one.
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niko said:
I am puzzled by your first short. What happened?
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The sharp fall after the Failure up top, along with the long term position at the upper limit of the Daily TC led me to give the short position as much room as possible. I did not want to be shaken out at this level. Wasn't expecting a sharp V Reversal - but they do happen. Regardless, I held too long past BE - hoping.
 
[Originally Posted by niko
"I am puzzled by your first short. What happened?"

The sharp fall after the Failure up top, along with the long term position at the upper limit of the Daily TC led me to give the short position as much room as possible. I did not want to be shaken out at this level. Wasn't expecting a sharp V Reversal - but they do happen. Regardless, I held too long past BE - hoping.]

Hi Game,

I also think that short trade was really striking. Have you tested rules that involve exiting part of your position when price goes in your favor a certain distance?

My trading involves capturing short term trends. When I started exiting half my position according to specific rules, followed by trailing the remaining half, my profitability went up strongly.
 
Slope Trader said:
[Originally Posted by niko
"I am puzzled by your first short. What happened?"

The sharp fall after the Failure up top, along with the long term position at the upper limit of the Daily TC led me to give the short position as much room as possible. I did not want to be shaken out at this level. Wasn't expecting a sharp V Reversal - but they do happen. Regardless, I held too long past BE - hoping.]

Hi Game,

I also think that short trade was really striking. Have you tested rules that involve exiting part of your position when price goes in your favor a certain distance?

My trading involves capturing short term trends. When I started exiting half my position according to specific rules, followed by trailing the remaining half, my profitability went up strongly.
More...

I am sure one could set a fixed 'target' profit based on studying the character of a given market's moves. I have not done any such profit taking study. My approach is based on exiting according to the Demand/Supply balance at any given time. My weakness has been in not recognizing this balance during trend runs, as I often exit too early. There are certain markers that help to differentiate between an ordinary swing versus a large trend run. Trying to get that down.

In this scenario, price dropped about 18 pts after an attempt at upside exploration. Based on my observations of the NQ, I know that this kind of a drop (context included) rarely V Reverses itself. So my decision to keep holding was based on that observation.

Thanks for the feedback. It helps improve my trading.
 
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