NQ - Supply & Demand

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eminiman414

Started doing replays of the NQ and figured I would start my own journal as to not clutter the straight line series of threads. Right now following what is being spoke of in the bride thread.

Today I lost 4 of 4 trades and if I would have kept trading the fifth would have kept me positive for the day. I also missed the long trade after the first failed sell trade. I did not take that long bc price rejected the previous swing high which I guess is not part of the "bride theory" of break/retracement. Had I take that trade it would have been a winner and had I kept trading and took that fifth trade there is no doubt today would have been a positive day. So far I have done the replays since 12/13 and even with about 5 points worth of losses today i am still up 21.75 points since 12/13. I also take out the cost of commissions with my wins and losses. The previous days I stopped trading at 10:30 (due to focus) so other opportunities were missed as well. All in all I think I am starting to get the hang out this. I have just been following the lines with no regards for anything else (for now).
 

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Trading chop is challenging, and what is more important than the losses is scratching immediately as soon as the trade isn't going right. You can trade chop knowing that eventually price will exit and you will begin having winning trades, but it can be awfully wearying. Just saying the hell with it and waiting for all of it to clear is perfectly okay. If it hasn't cleared in an hour, just close up shop and go do something else.

Incidentally, I count 8 trades. Am I counting wrong?
 
Since you began this on TL, here's some unsolicited advice:

Take care not to get too caught up in lines. The lines are there to serve you, not to control you. They are there as a clue to possible changes in the balance between demand and supply, or, for the trolls, buying pressure and selling pressure. They will be of most use if you have problems with focus, or if you hesitate too long to scratch trades. Otherwise, they may cause you to second-guess your better judgement. Remember, it's not about lines; it's about the balance between demand and supply.

With that in mind, think about the annotations on this chart:
 

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Thanks for the help. Essentially the first chart you posted for me isn't too far off from what I did. The last long on the chart you posted I had stopped trading so I missed that one. The first long I waited for the break of the swing high before taking the retracement which I suppose was not following the bride thread. I did "see" the retracement and opportunity for that long trade was just hesitant. Thanks again. Excited for tomorrow.
 
Quote from eminiman414:

Thanks for the help. Essentially the first chart you posted for me isn't too far off from what I did. The last long on the chart you posted I had stopped trading so I missed that one. The first long I waited for the break of the swing high before taking the retracement which I suppose was not following the bride thread. I did "see" the retracement and opportunity for that long trade was just hesitant. Thanks again. Excited for tomorrow.
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Don't be concerned about "following" the Bride thread. It's not a course. Concern yourself with following buyers and sellers.

For example, if you need to follow the rules strictly and rigidly for some reason, then a short off the opening high -- after a break of the demand line and a retracement -- is in order. But if you can get past that and focus on trader behavior instead, you'll see that price reaches only halfway back of the opening upmove (91+/-). This signals strength. Therefore, whether you take the short or not, you should watch to see what price does, i.e., what traders do, and be prepared to exit the short and go long on strength. If you're not quick enough to SAR, take the next opportunity. In this case, it's handed to you after the second test of that 50% level, the bar on which the short is taken, and a retracement, the trough in which I placed the long entry.

This is the sort of thing that can be done in real time. Whether or not a retracement has taken place on the downside before the 50% level is reached, watch for it. If you've already taken a short, be prepared to SAR. If you haven't, wait to see what happens at that level. If price rebounds, forget the short and look to go long, as here. The second chart shows this. This is a simple yet extremely important and effective addition to the drill.

Otherwise, avoid looking for excuses to exit. Price is going to come back on you. This doesn't mean you're on the wrong side, again, or made the wrong entry, again, or that the trade is a loser, again, or that you're going to rack up yet another failure, again. It means that buyers are being given opportunities to climb on board and propel you forward. As long as they do so, find every excuse to stay in. These people are trying to help you. Let them do so. When they're no longer interested in buying, much less unloading what they have, and new buyers aren't stepping up to the plate, they'll let you know as here with a break of a demand line and a lower high (the latter being more informative than the former). And if it looks like you were too early and there's a last gasp of buying interest, you have a second opportunity to short, as here as shown on both charts: you hit 50% again (94+/-) and then make a higher low. This is enough to take the long unless fear remains an overriding issue.

The Bride thread is analogous to learning how to play the piano by numbering the keys and is chiefly for the seriously FU. You should move on to the "next level" as soon as you can.
 
I suppose this is where that well developed trading plan comes in. I recognized both 50% levels that you mentioned I just 1. Was "following" the bride thread and 2. At this point just wasn't sure what to do with those levels, more so the 50% level around 91. Thanks for the insights. Today I will focus more on buyers vs sellers and not let my focus rely just on the lines.
 
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