Making of a method

I am not trying to give you a specific program to trade. I am just trying to help you see some of the areas that matter to everyone else versus the areas that matter to you. This will help you recognize the events that influence the behavior of the largest number of market participants on a volume weighted basis.

A Held Bid at the Open and at a prior RTH HVN occurring simultaneously in the NQ and ES following a test lower in both instruments is an extremely informative event for a very large number of market participants.

Also a Held Bid or Offer event is a supply/demand event. So yes I use Supply/Demand though I tend to refer to this as Liquidity.
 
Quote from horton:



A Held Bid at the Open and at a prior RTH HVN occurring simultaneously in the NQ and ES following a test lower in both instruments is an extremely informative event for a very large number of market participants.
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What were the price levels for the NVPOC and prior RTH HVN? Just want to make sure I am seeing the same thing as you.
 
Quote from horton:

I am not trying to give you a specific program to trade. I am just trying to help you see some of the areas that matter to everyone else versus the areas that matter to you. This will help you recognize the events that influence the behavior of the largest number of market participants on a volume weighted basis.

A Held Bid at the Open and at a prior RTH HVN occurring simultaneously in the NQ and ES following a test lower in both instruments is an extremely informative event for a very large number of market participants.

Also a Held Bid or Offer event is a supply/demand event. So yes I use Supply/Demand though I tend to refer to this as Liquidity.
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The POC at 3189 was broken by 10 points before it came back up. But what if there was no Rev yesterday?


Is not the PA offering Supply/Demand information much earlier than by waiting for the testing of these levels? Why not go with the PA and then, should there be trouble at one of these levels, decide to get out or Reverse?
 
Quote from game:

Is not the PA offering Supply/Demand information much earlier than by waiting for the testing of these levels? Why not go with the PA and then, should there be trouble at one of these levels, decide to get out or Reverse?
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You are watching the PA at a highly visible level to see the Supply/Demand message conveyed by higher timeframe participants at that level. Same concept as watching the PA at 60m or Daily Pivots. And if you have another higher timeframe level below there that can infer the Scenario sooner then an entry at that lower level would be logical.
 
Sometime in June I set a goal to begin live trading by Nov.

Since then, I have practiced on a method that is consistently profitable. More importantly, I have come to trust it. The problem is that my execution errors have reduced this profitable plan to BE.

So with only 1 month to go till the live trading deadline, the focus will be on greatly minimizing these errors. A few months back my greatest error was getting in too early on Reversals without waiting for S/R confirmation and generally disregarding the strength that got price up in the first place. I have managed to significantly reduce this error. This gives me confidence that the remaining errors can be reduced as well.

The 3 major errors and today's performance with respect to them:

1. Managing trade based on entry price rather than by monitoring overall pressure.

The Rev short at 0845 was exited impulsively. Managing based on 50% would have kept me in.

The long at 0930 was managed based on 50% instead of DS line break. This let me ride the trend instead of exiting too soon.


2. Pushing for movement and thereby over-trading.

Short at 0853 and long at 0855 is a great example of this. The continuation short was late in the wave and the Rev long was too early. Both were taken in the hope for movement. There was no compelling reason to take these.

3. Hesitating on continuations.

The context and prep work pointed towards strength. The rise from PM Support further confirmed this. The continuation at 0831 should have been taken.

Other errors today:

1. Was not focused this morning. Did not even realize the session had started. Looked to see that price had risen off the open after testing S at 3214. This entry is in the method and should have been taken.

http://www.sierrachart.com/image.php?l=1380645675563.png
 
Take care that you don't sink into CWS, which can be a particularly tempting trap at this stage of the process. Remember regarding 1 in particular that the market doesn't know where you enter and wouldn't care if it did. Forget about your entry if you can (which is one reason why I encourage traders not to obsess over stops). Your entry is not a reference point. The level at which you entered is. If that makes sense. In other words, how traders react to the level at which you entered (retracements, tests, etc) is more important than the price you paid, which they aren't even aware of. This is something that one just must put behind him.

As for 2, it isn't so much hope as it is fear of missing a move. As much fun as the Snidelys make of the lines, they can help you sit on your hands until you have evidence and, if necessary, confirmation of a move. If you have to, make a rule for yourself that you won't budge until that line is broken. Eventually you'll be able to get rid of it entirely.

As for 3, I'm afraid that's just part of the process. You can accelerate it somewhat via replay, but as long as it continues to be an issue, you haven't played enough charts.

It may help to go back five months to see how far you've come.
 
Quote from dbphoenix:

Take care that you don't sink into CWS, which can be a particularly tempting trap at this stage of the process. Remember regarding 1 in particular that the market doesn't know where you enter and wouldn't care if it did. Forget about your entry if you can (which is one reason why I encourage traders not to obsess over stops). Your entry is not a reference point. The level at which you entered is. If that makes sense. In other words, how traders react to the level at which you entered (retracements, tests, etc) is more important than the price you paid, which they aren't even aware of. This is something that one just must put behind him.
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Yes I clearly see how I often use the entry price and the P/L screen to exit a trade that is not moving right away, instead of basing the exit on whether the level around entry is holding or not. The long at 0924 would be a good example of this tendency.


Regarding the 50% guideline:

I find this to be a solid way to keep on the side of the larger trend and ride the winners.

That being said, there are certain cases when the exit should be made a lot quicker than waiting for price to retrace and cross the 50% level. Such as:

1. When S/R is being confirmed by DT,LH, etc, especially when at a major anticipated S/R level. In this case, it would be better to exit up high and then either add to the position when price retraces back to 50% or re-enter upon BO of S/R.

In the chart below, I have shown my entry and exit based on the 50% guideline.

Given that price had recently fallen from early R at 3228, do you think it was reasonable to not exit this trade once it lost momentum, and to give it room till the 50% level?

Was there anything in the context that would have called for a different approach?

http://www.sierrachart.com/image.php?l=1380650521846.png
 
Actually, the 50% level is not particularly relevant. What is much more important is the fact that price made a lower high. This is reason enough. But then it shoved you back into the opening range, which is another reason to exit. Given all of that, the most prudent course is to do nothing until the market shows its hand, which it does a few bars later by making another higher low and setting up a hinge. Once that is ready to go, you can enter the breakout of it, if you're that aggessive, or wait for the first retracement (I went into all this in the "Son" thread).

The market, in other words, will tell you what to do if you understand its language and if you'll just listen. Most traders, however, have so much going on in their heads that they can't hear, much less listen. Sometimes it's saying "I ain't goin' nowhere; chill".
 
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