Potential NQ Targets
- Thread starter dbphoenix
- Start date
Blotto... I think you make an excellent point! We were lucky in that prior to the open, we had that new high to use to draw the 5 min trend line, so if we are waiting for the open, this would have never happened. But as you drew it, it looks pretty valid to to me if I wanted to take the trade before the open. So yes, there might be a long where you indicate "breakout". Now ND's rules are quite specific in that price needs to close above the trendline, so for the first long, it doesn't, but in the re-test, it for sure does. This might very well be a losing trade then. Its interesting how on the first long, with this bar being so small, the loss is not even 2 points.. heck, an exit could even be made for a profit. There was some good buying also when you consider the fairly strong two bull bars! Where you mark retest, this is also a tiny bar, so the stop loss is once again just over a point.
But, the next trade, the short, it sets up, and if you aren't emotionally damaged from the loss (which I as a new trader might be), but if you aren't, you can take the short, and more than make up for your loss. Then when the long presents itself at about 9:43 and 9:47 roughly, then this too propels you way into profit, more than covering your losses.
The secret is to think about this not on a trade by trade basis, but in terms of a series of trades. If you do this for 20 trades, I have no doubt that the winning points far exceed the losing points!
But I love that you point this out, because honestly, how you draw the trendlines really matters, and a place where I stumbled. More important is also knowing what to do when it doesn't work out and how you manage that. But if all of this is accounted for in a trading plan, the entry, the exit for a loss and exit for a profit, then none of this is loss, its just one trade that didn't work, one step before the winning trade.
But, the next trade, the short, it sets up, and if you aren't emotionally damaged from the loss (which I as a new trader might be), but if you aren't, you can take the short, and more than make up for your loss. Then when the long presents itself at about 9:43 and 9:47 roughly, then this too propels you way into profit, more than covering your losses.
The secret is to think about this not on a trade by trade basis, but in terms of a series of trades. If you do this for 20 trades, I have no doubt that the winning points far exceed the losing points!
But I love that you point this out, because honestly, how you draw the trendlines really matters, and a place where I stumbled. More important is also knowing what to do when it doesn't work out and how you manage that. But if all of this is accounted for in a trading plan, the entry, the exit for a loss and exit for a profit, then none of this is loss, its just one trade that didn't work, one step before the winning trade.
Good post k p.
Don't distract yourself with anything else until you have completed this process, and report back on ET either in a separate thread or on this journal.
Looking forward to seeing the results!
(perhaps as a group exercise each of the "apprentices" could choose a "price action" setup, post the rules for identifying it, and the results of a sequence of 20 trades. This would be an efficient way to share the work of testing and at the end of the process you could all compare results on which trade types, if any, are most effective?)
Your immediate priority is then to prove this. Why not test it in a simulation account, and make one post per trade with a screenshot of how the chart looked at the time of entry and at the time of exit. Also post your total profit, max drawdown, and number of contracts traded to achieve the profit.
Don't distract yourself with anything else until you have completed this process, and report back on ET either in a separate thread or on this journal.
Looking forward to seeing the results!
(perhaps as a group exercise each of the "apprentices" could choose a "price action" setup, post the rules for identifying it, and the results of a sequence of 20 trades. This would be an efficient way to share the work of testing and at the end of the process you could all compare results on which trade types, if any, are most effective?)
LOL.. I do understand the irony of what I said in reference to a hindsight chart. But to be fair to ND, she will say what she did is she when she was testing was that she would cover up the whole chart, and just move forward one bar at a time so that she didn't know what happened. This is how she developed her plan.
She of course isn't going to be drawing these charts in real time for the students as she is too busy trading herself, so of course she will use hindsight charts. But you know, when I posted this chart to my journal, I had the same idea, marked where the trades would be, I just didn't take them. But my charts on my journal are very much real time and based on what I'm seeing.
And I am looking forward to producing them! I am almost ready to go live to tell you the truth. In this past week, I have seen how using this 5/1 approach has turned out to work exceptionally well. I'm eager for this coming week to see what I in fact do as I am certainly more prepared than I have ever been.
You haven't been paying attention at all, Casper. The upper trend line you drew was connected across a 1-min swing high. The method I've been illustrating utilizes the 5-min chart for signals and the 1-min chart for entries. My upper trend line was drawn across the 5-min swing high at 9:15-9:20 ET. Your 1-min trend line was drawn prior to a 5-min swing move down. You're trading noise when treating that as a "breakout".
As for apprentices investing their time to determine whether this method has positive expectancy or not, I certainly hope they do that prior to investing their money.
My student would not draw his trend lines like you did unless he skipped the first part of the instructions for this setup (a 5-min trend line has to break).
Below is the 5-min chart prior to the open with the upper and lower trend lines drawn that appeared on my 1-min illustration charts.
And so we reversed at 4040 exactly. Now let's see if we return to the mean, which is now at about 3950 (+/-).
As for the purpose of the thread, it was to offer potential NQ targets based on the daily chart and its trend channel and mean. This may not have been made clear.
There is much discussion of trees but virtually none of forest. AFAIK, no one mentioned the fact that we reversed at 4040 this morning, and that should at least have been noted. To skim the market action without ever considering why it's doing what it's doing is a serious error.
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I was fully aware of this Db and wrote this in my journal:
In the back of my head this whole day was Db pointing out that we are close to the SL on the daily chart. I had this marked as well on my hourly, and although we poked slightly above, hitting the level of 4040 (The SL now is of course lower since it slopes diagonally down), there really was no long setup other than the one I tried.
I noted how possibly only one long set up for me shortly after the open, and that was it, but I just couldn't cleanly find the short until possibly 4031, but this wasn't set up perfectly and I'm trying to hard follow my rules (waiting for a 5 min trendline to show me the change in trend). Of course, when you take all the trend lines away and just focus on what traders are doing, it is quite apparent that they couldn't could get past this level. What is also amazing is how that support level of 3998 also came into play.
So your message wasn't in any way lost for me at least, I just couldn't find a "clean" way to take advantage of it.