When a retrace is shallow and price comes back to test the previous S/R level consider playing it as a breakout trade. Otherwise you may get left in the dust waiting for that larger pullback that never comes. It feels strange buying a high or selling a low, but shallow retraces tell you who's seriously in control.
Matcha's Dow E-mini Journal
- Thread starter Matcha
- Start date
When a retrace is shallow and price comes back to test the previous S/R level consider playing it as a breakout trade. Otherwise you may get left in the dust waiting for that larger pullback that never comes. It feels strange buying a high or selling a low, but shallow retraces tell you who's seriously in control.
Matcha,
I'm not a PA trader per se, but if memory serves me NoDoji has made several posts where she describes trading decisions based on the 20 bar MA. I've noticed on several of your Dow charts prices seem to respect that 20ma line. ND's comment, "if you enter a trade in the doldrums, consider being more patient with it until the late-day volume comes back or a true reversal signal shows up." intrigues me. Maybe She'll stop by and give us a primer on her use (if any) of that 20ma.
PO suggested, consider a re-entry.... Me too, I know it's hard to buy the high late in the day but the fuse was lit on this rocket. After the fact, this would have been a great trade to put a buy stop on the HOD. I'm sure there were more than a few traders that were loading the boat with shorts eyeing that 50% / 618% retrace that helped fuel the rocket. One comment on, "exit early to protect the profit". I believe this is one of those aspects of trading that discretionary traders have to make a personal commitment to, and then live comfortably with their decision. Now-a-days letting a (small) winner turn into a (small) loser can go horribly wrong in a flash. A sleepy market can wake up quick on a flurry of stop running. On the other hand if I'm willing to risk X amount of my capital on my analysis of every trade, I have to be absolutely comfortable with my decision or I'll find myself dumping trades during normal price rotations (consolidations) only to see in the next bar or two I was right all along. Now, that said, if I enter the market in a consolidation zone of 15pt bars @ 9am and then enter in another zone of 5pt bars @ 1:30pm I need to know where the market has to go to tell me my analysis is wrong. Take your last trade for instance, nobody said your analysis was wrong, in fact everyone agreed your analysis was correct (you're good at this PA thing) But, something didn't look, feel or smell right to you and you dumped the trade. I won't suggest a generic stop strategy but I will suggest you implement a stop strategy that you are 100% comfortable with and you can replicate trade after trade.
Sweetie... a retracement of only ~23% (or less) is extremely bullish. Besides looking at the retracement amount, you also should take "time" into considerations. Peak: 8:00 am PDT. A drop to about 10625/30... at 9:30 am. 1.5 hour. 90 minutes. A typical run: 30 min, or 60 min, and occasionally 90 min. A retracement: 60 min to 90 min. No good, real trend will retrace more than 90 minutes. If after 90 minutes it ain't going lower, it ain't gonna go lower. Make your bet, manage your risks.
Quote from Matcha:
Thank you FMR, PO, WentFishing, Boli, Nodoji, sis and everyone for nice and kind words! Thank you all for taking the time reading and giving me feedbacks.
This journals has not only been a trading diary to jog down memories but a motivation to continue learning trading and keeping bad habits out. I would recommend any new traders who has somewhat worked out a system, then started a thread here! It has been a great learning so far!
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Matcha ... many people are giving you feedbacks and advices etc ..it's because you're such a sweetie .. You reminded me when i first started trading as an intern .. many traders offered good advices and helps etc even now .. coz i look like 28-30 (we really have a Big advantages being female traders always get many male traders free helps/advices etc)
I believe you can be a successful trader because of who you're ... You just need to have more training and time...
There're many ways to reach "rome" and you need to find your way! .. like i told PO .. the holy grail of trading is buried inside of him... Matcha the holy grail is in You too!... You have to seach hard to dig out the HG in You! Be patience and good luck girl! If you and PO are in NYC now .. sis will sure to take u2 to nice dinner and some WS touring .. and it's beautiful autumn now with all the leaves changing color to red, yellow, golden brown .. we can go for a stroll in the central park to talk about trading & all the fun things in life LOL Matcha,
I've been thinking about your response to NoDoji's query about the influence of a first losing trade. I'm only speaking from experience when I say, "watch out for the Influences' ugly stepsister (or brother
)!" Before I learned to be comfortable with risk I had a habit of risking my first winning trade's profit on my next trades. I would justify widening my stop in a losing trade by the amount of my winnings and hope the market would turn my way. I held some dysfunctional belief that since it was market generated funds I wasn't really risking my money. Needless to say this type of sloppy thinking cost me dearly. I found salvation by charting all my account balances in percentages of my original capital. This may sound old hat with today's platforms that slice and dice account balances any way you wish, but back in those days it took a couple of days for my daily statement to arrive at my home by snail mail!I still find it most beneficial to think in percentages.
Did horrible today. Nothing works out for me. All losing trades.
Maximized my daily loss. I got to stop trading.
The first trade was a long. Look for price to test YTD high. Got stopped out when price made 2 failed breakout patterns. -8Pts
Second trade was a short. After 2 failed break out to the upside, I joined the shortside, target at the test of LOD. But I once again stopped out.-8Pts
3rd trade sets up a breakdown signal. I entered. But nothing really happened and price made a mini d/b instead of a red bar collapse. I took out my short, so the loss is small. -4Pts
The trades in the afternoon were messy.
I stayed away from all the crazy reaction at 11m. 12:00 price retraced and set up a buy set up. But market continued to go lower. -15 pts.
Entered a long again with 15Pts stop. Didnât workâ¦Then I looked at the 1 min volume profile chart, it was at VAH. I bought at VAH. Today is the situation I need to respect Volume Profile, but I didnâtâ¦
Everyone is taking profit at the closing. I tried to get in and buy. Hmmmmâ¦.
$-252, 5 trades, no winners, I am out of the game at 12:25.
Sifu must be enjoy trading today. He loves trading in Chaotic marketâ¦..
Maximized my daily loss. I got to stop trading.
The first trade was a long. Look for price to test YTD high. Got stopped out when price made 2 failed breakout patterns. -8Pts
Second trade was a short. After 2 failed break out to the upside, I joined the shortside, target at the test of LOD. But I once again stopped out.-8Pts
3rd trade sets up a breakdown signal. I entered. But nothing really happened and price made a mini d/b instead of a red bar collapse. I took out my short, so the loss is small. -4Pts
The trades in the afternoon were messy.
I stayed away from all the crazy reaction at 11
m. 12:00 price retraced and set up a buy set up. But market continued to go lower. -15 pts.Entered a long again with 15Pts stop. Didnât workâ¦Then I looked at the 1 min volume profile chart, it was at VAH. I bought at VAH. Today is the situation I need to respect Volume Profile, but I didnâtâ¦
Everyone is taking profit at the closing. I tried to get in and buy. Hmmmmâ¦.
$-252, 5 trades, no winners, I am out of the game at 12:25.
Sifu must be enjoy trading today. He loves trading in Chaotic marketâ¦..
Quote from ~~~:
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I believe you can be a successful trader because of who you're ... You just need to have more training and time...
I hope that day can come soon! I will do my best to become CP so we can all meet!
Matcha,
Just about to post in my journal for the day and I thought I would come by and see how you did today...hoping that it was much better that myself. I, too, had a terrible day where one trade influenced the next and yesterday even to an extent effected today. Im going to jump back in the saddle tomorrow and go back to basics, be more thorough, and make sure I do things right.
Its all in the recovery
Just about to post in my journal for the day and I thought I would come by and see how you did today...hoping that it was much better that myself. I, too, had a terrible day where one trade influenced the next and yesterday even to an extent effected today. Im going to jump back in the saddle tomorrow and go back to basics, be more thorough, and make sure I do things right.
Its all in the recovery