Niko: is it possible to distinguish your exit from entry? I thought you were long right after 9:40, the blue arrow, ....... Anyway my fault. i was not reading your chart carefully but my question still valid: whether you can do this consistently. If you can trade this consistently, you will catch a big trending day when it comes. So not strong market you loss small or make small profits; for strong market, you will make good money. Then with the consistency, increasing the size, you can still make good points consistently. Again what i wrote may be nonsense. Happy Trading tomorrow!
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NQ Price Action Journal
- Thread starter niko
- Start date
And how many points actually did you make Niko?
Kp, that is really irrelevant at this point, the whole point of this exercise is the following:
We currently have a chatroom, where there is really little interaction. My understanding is that most members dont really understand the SLA in its most basic form and therefore are "afraid" of participating. That is why I proposed the team work initiative, so that those who know too much, could help those who know too little, and the guys in between could collaborate and help as their abilities allow.
My take is that one of the initial problems a student faces when trying to get the SLA is how to trace a line, for example the line at trade 3. It was very steep, but it was still visible and a trader could trace it. If it is convenient or not is a subject we will deal with in a future occasion.
That is where the comments of the chat members will be constructive for the whole effort. But if there are no comments then there is no point in doing this. And I will just go back to back testing my plan.
You are probably right but I think the reason people don't understand is that there are too few charts as examples of correctly drawing the lines and excessively too many words are used when a simple chart with a few words would do a much better job.My understanding is that most members dont really understand the SLA in its most basic form and therefore are "afraid" of participating.
That is why I post charts and not write too much.
Gabe
Whether or not the long is closed has nothing to do with how one traces the line. If you're going to trade this mechanically, the long is closed when your DL is broken, 0939. The ret for the short is at 0941. The entry is at 0942.
Agree, currently given that price rose considerably above my entry I would have voted on holding until a break of LSL, that would have kept the trade alive in this instance. But given that I said I was gonna take EVERY line break + RET that is why this was closed and then shorted.
What I was trying to point out, probably irrelevant to the exercise as you pointed out, is that the long was good, but if one CHOOSES to plot a thigh line, probably out of fear one risks this kind of scenario.
The short is then stopped out immediately. At this point, one can wait for the SL to be broken and a new long entry to present itself at 5, or, if one is calm enough, he can note the rejection which caused the short to be stopped out in the first place, and go long on the next bar (since he's out) or even the next bar after that, figuring that he can scratch for a trivial loss if it doesn't go. Traders are clearly rejecting 76/75, so this can be a situation (which comes up fairly often) where one can forget about the lines and go with the PA unless one needs to be mechanical for some reason.
Agree, this is an attempt to try to be mechanical, as mechanical as possible, just to define the pros and cons of the pure mechanical approach. There are plenty of details, like you pointed out that could have kept the trader in the trade, but I chose to ignore them. Now, you point this out and that is great, but just this week, I would like those who signed up for team work to do the effort to try to point this stuff to see how everybody sees the market.
What prevents the trader from doing this? A fear of being wrong? A fear of failing? A fear of losing a point? That this is not a well-reasoned trade with a probability >50% of being correct? What exactly is the cost of taking it and having it not work out?
This is a very important thing to consider, I have received mails from some members regarding the issue that we are all different with different risk tolerance, but personally I think that if a member cant swallow a 1 or 2 point scratch in the NQ, then his risk tolerance is way too low to be a trader. So I think, scratching included this is the most risk adverse system one could find online.
Edit: I should also point out that the lines are intended to be aids, not indicators. If one starts focusing on the lines instead of on price, one may as well plot a bunch of moving averages. The lines are nothing more than a gauge of supply/demand imbalance. They do not provide support. They do not provide resistance. The behavior of price is always of primary importance. If the lines determine what you're doing, get rid of them.
Agree, as I said several times, thanks to you I stopped drawing the lines some weeks ago and it made a world of difference, but for those who don't even know where to start drawing a line and where to stop is that this exercise is done.
BTW, I will only do this for this week, tomorrow I have a PTA meeting so I wont be trading, so only Wed, Thu, and Fri are left. If there are no comments from those greener than me, how they expect to participate in chat. And if they plan on being eternal lurkers they will find themselves without a chat next week.
Niko: is it possible to distinguish your exit from entry? I thought you were long right after 9:40, the blue arrow, ....... Anyway my fault. i was not reading your chart carefully but my question still valid: whether you can do this consistently. If you can trade this consistently, you will catch a big trending day when it comes. So not strong market you loss small or make small profits; for strong market, you will make good money. Then with the consistency, increasing the size, you can still make good points consistently. Again what i wrote may be nonsense. Happy Trading tomorrow!
The blue triangles are longs, the pink ones are shorts. The ones pointing right are opens the ones pointing left are closes.
Even in just the last 2 days, I feel like I've seen the merit in NOT begin so mechanical. There's something to be said about having a rule, but when it feels like a vice, that's something different. Then I'm not sure if I'm in "no man's land" wondering if I'm doing something out in left field. I still have a lot to determine. As much as I thought the strictly mechanical might be for me, I think it's just step 1 in feeling comfortable with the approach in general.What I was trying to point out, probably irrelevant to the exercise as you pointed out, is that the long was good, but if one CHOOSES to plot a tight line, probably out of fear one risks this kind of scenario.
Drawing lines is a guide, but at times for me, it feels more like excuse to exit rather than hold. However, I do think that I'm not drawing my lines correctly all the time and this might add to my confusion.Agree, this is an attempt to try to be mechanical, as mechanical as possible, just to define the pros and cons of the pure mechanical approach. There are plenty of details that could have kept the trader in the trade, but I chose to ignore them.
As I said several times, I stopped drawing the lines some weeks ago and it made a world of difference, but for those who don't even know where to start drawing a line and where to stop is that this exercise is done.
I certainly appreciate all the work you do, Niko. This week isn't optimal for my participation in the chat. I hope I don't miss the boat.BTW, I will only do this for this week, tomorrow I have a PTA meeting so I wont be trading, so only Wed, Thu, and Fri are left. If there are no comments from those greener than me, how they expect to participate in chat. And if they plan on being eternal lurkers they will find themselves without a chat next week.
Here is my take on the lines.
Gabe
Have you backtested those ideas you suggest on your chart?
Have you backtested those ideas you suggest on your chart?
I have been looking at charts for years.
I haven't formulated exact rules if that is your question but I hope that over time I will assimilate the proper entry setups.
I have some rules in bullet form derived from observation of the above charts.
I still struggle with the proper placing of the lines.
It seems to me that this SIMPLE method of SLA is not so simple after all and the many nuances will take time to incorporate and formulate.
I wish anyone who will try and trade strictly based on some simple 2 liner rules , good luck.
Gabe