Matcha's Dow E-mini Journal

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Quote from NoDoji:




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http://www.elitetrader.com/vb/showthread.php?s=&postid=2910334#post2910334

So after (like you) watching an amazing move transpire without me, I placed a buy stop in CL at the high of the day after price had already moved up nearly 2.00 from the opening pivot low (seems unthinkable), and also placed a sell stop 1 tick below the consolidation range low (just in case there was a reversal instead of continuation). By doing this, I proved that I no longer had any bias. Instead I had made the decision to allow price itself to go wherever it wanted to go and to TAKE ME ALONG WITH IT IN THE RIGHT DIRECTION.
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l like the coin toss analogy.

Having a bias just like trying to fight the market. When things don't go with my bias, I just keep fighting it untill I completely realize it's wrong...

I like to be "prepared" "anticipate" the next move, prepare for different senario, then I feel like I am prepared to react when things happen. But I also developed a strong bias...
 
Quote from ~~~:

sweetie... i just wanted to tell you that you're..one very, very lucky girl.:D
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I am ! I must have done something really awesome in my previous life!
 
Quote from Bolimomo:

I do (or should say "used to"). But from my recent experiences, it is only a 50-50 game. When it goes against me, it goes really fast (thin volume) and hard. A couple weeks ago I have decided not to pursue it. I don't like the odds. But I do watch pre-market activities intensely. They clue me in to how to trade the first 1-2 minutes.

Gaps are very hard to master. Because you may be right 80% of the time. But when you are wrong that 20% of the time, the market kills you. Fast.
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There is a self-proclaimed "The Gap Guy" Scott Andrews who had written a book on trading the gaps. I had bought and read his book. (Which I regret. :( ) His approach was taking statistics out of the X number of stocks that gapped up, how many of them had the gap filled. Over time. Z z z. "Trading by statistics". A bunch of non-sense. Let's say statistically 70% of the stocks that gap up will fill the gap. This morning there are 30 stocks gapping up. Are you going to short all 30 stocks with equal dollar amount and hope to collect some gains from 21 of those stocks that may, MAY, close the up-gap?

Anyway, ranted too far. I will rant some more in a new chapter of my new trading book "Trading The Gap". :)
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:D

Interesting study about the "Gap Guy". I have been practicing John Carter's gap play too. I gave up on doing it last week. It doesn't work for me... He manily focus on premarket volume on about 200 stocks corelated to ES Gap. He also mentioned, if gap didn't close for the day and you get hurt, it will eventually close in the next days, or months, you just got to remember the unclosed gap.

I wish gap and the first hour can be easy to me. Then I just need to simply trade the first hour and play the rest of the day!!
 
Quote from Bolimomo:

If you trade something like the S&P e-mini (ES), definitely. For ES there is no "overnight" or "premarket". The market is always open, for 24x5. You should look at the ES chart 24x5 as one continuous curve to do your analysis.

Hmmmm... for YM... doesn't it trade 24x5? I haven't traded that and don't have access to the chart. (Didn't pay). If so, yes.

If YM doesn't trade overnight, you then should look at the ES's price run overnight. Because it dictates so much how the US markets will open at 9:30 am EST. Dow e-mini, S&P, Nasdaq (NQ) and Russell (ER)... they all move together and giggle like teenage girls. :D Any given day they may differ in their movements by a few percentage points. But usually negligible.
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YM is same as ES 24X5... She is one of those moody teenage girls
 
Quote from PatientOperator:

Hi Matcha,

Well, unfortunately I was doing LIVE trading on Tuesday and Wednesday. Both were losing days and my only LIVE trading days in July!!! :( :( Sifu Boli and Sis ~~~ are right, the mind set in LIVE and SIM is quite different.

......


I still don't have confidence to trade the 1st half hour to an hour. I used to take the "Best Trade" advice from Al Brooks to trade his first hour failed breakout patterns (pg. 374 to pg. 379) I studied his failed breakout pattern charts on page 378 but could not master any of his methods in any great confidence. I have stopped trading those morning patterns for now. I think Boli is right that trading the morning gap is not easy, it should be reserved for advanced traders. On the other hand, Marcel Link has an opposite advice, on pg. 226, he said trading the opening of the market is LOW probability trading. On pg. 326, one of his rules is to trade light in the morning until he get a feel for the market's trend. He also has another rule - "don't trade the news".

Best of trading on Friday!

--po
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It's just my advice. We both need to stay in SIM for a little longer. No rush. At least you got the taste of Live. I havent even touched my live account yet...

My biggest draw down will be $200. So it toook a while to blow it all up. My daily target will be around $200 too to start off.

About the news, my intention wasn't trading on the news. I looked at the news and report to rank the sentiment of the market, bulish or bearish to gather one piece of the information to help make long or short trade. Somehow, it became a bias to either stopping me to take profitable trade or playing the wrong side of the market... See, Sim helped me again to discover the problem without costing a dime.

I think trading gap in stocks could be more chanllenging. ES and YM has overnight reaction to rely on. Nodoji and Boli reminded me of this. I am practicing it now. Market trending nicely at the opening most of the days. But you do need more experience to react it fast! I often missed the opportunities. It does take time.... lots of time and practice.

We are building up more skills everyday. I know I said I got confused last week. The more I learned the more I got confused. But then the last week I thought we will eventually get rid of the confusion. And I think we do need to "be confused" in order to "be clear" in the future. That's the way to find a suitable method. If you know what I mean...
 
Quote from Bolimomo:

You set up the safety net first before you pick up the quarters. :)

e.g. Let's say AAPL looks like it's in range ripping up and down $1.00. It's at the range low. $256.50. You want to long to scalp 20-30 cents. First set an order to short at $256.30 (20 cents below). Then put in another to long 256.50. (Or use some of the bracket order types, which I don't like... too cumbersome...). So once you are filled, you already are protected for 20 cents shall AAPL suddenly tank (hopefully the slippage is acceptable). Then you scale out at 256.70/80. Or bet to traverse the entire range.

It may be a 50/50 R:R from straightly a price ratio standpoint - 20 cents risk, 20 cents gain. But if you can win more than 60-70% of the time, you can still be ahead with a 1:1 RR ratio.


Again, the priorities should be:
#1) Follow the trend - try to get in early.
#2) Fade the trend - try NOT to get in too early.
#3) Trade range bound, tight market, or chaotic markets (e.g. Diamond but not a triangle), or the sudden spikes (e.g. May 6, 2010 - flash crash)... those don't come often enough.
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Wow, I might get a heartattack if I trade this way.... it require lots of experience, capital and risk tolerance. I am staying where I am , Level 1...
 
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