Price Action - NQ III

[dbphoenix]

I suspect that he's looking at the right tick rather than the "bar" itself. And I don't know what hypotheses he's testing, which is why I've avoided comment (everybody has his own process).

I will point out, however, that trading the SLA would put him in much higher, no later than 3660. "Failures" are not part of the SLA as the SLA is for beginners and damaged traders, and trading failures -- or climaxes -- takes the sort of confidence which both categories of traders lack. Here, though, there's a break of the line at 62.5, so a short inside that retracement is justified by the rules.

Of course, one must be up by 0850 to take advantage of it. But, even if one is not, it is important to locate the trade that should have been taken whether one was there to take it or not and avoid taking second-best or, worse, third-best. If one isn't there to take the best, just wait for the next opportunity. That's why the winrate and P:L ratio for this approach is relatively high: take only the best trades, cut your losses short, and let your winners run.

 

[lajax]

Lajax,
I notice you take trend trades inside the range of lowest low/highest high bar of swing, I avoid those as too often for me they are losers.

I don’t understand this point clearly, maybe if you could make a further explanation, appreciate it …. But in any case this was my though process and the reason why I take the second trade.

Lajax,
Often times big bars are indicating end of trends and will often have Secondary bars that fail to continue trend to go other way. Many that only do Price Action don't study enough Price Action of individual bars in relationship of overall trend and swing.

Regarding to this I try to see the continuity of the price; in any case, for me at the moment the price went down, show the willingness of the sellers to push the prices lower, therefore IMO the movement could be of exhaustion (because the price was on a downtrend since 0850) or continuation, in any case the second trade was discarded one minute after

Lajax,

The short you made around 9:14, for one, if retracement bar not deep enough, often times not enough profit as price is trying to get to lowest low and couple ticks, plus difference between pivot lows is showing it is about to reverse, continue of trend should rip on down through the lows. Those lows are making like triple lows. Triple top at 9:10 to short. Triple bottom 9:50.

Regarding to the last trade the probabilities where low because at this point the downtrend looks like a TC, moreover despite the fact the price was doing lower lows there was shortening of the down thrust, maybe this PA could be classified as a DTDB; however in front of this information the Stop should have been located above the previous High at 49 reducing my risk

Lajax,


Wow, you look at all those charts? I like using 60 minutes, but to me sometimes too much is too much.

Yes, I look at the charts in order to have an idea of the context in order to know where I am located in the market; However during the trading session my attention focus primarily on the 1m chart but I have in mind the levels


BTW: Thank you for your opinion

 

[lajax]

I will point out, however, that trading the SLA would put him in much higher, no later than 3660… Here, though, there's a break of the line at 62.5, so a short inside that retracement is justified by the rules.

Regarding to this, I did not take the trade (black dot) because for me at this point the price was on a TR …. Here is my scribble explanation

if you have a comment is welcome.

"Failures" are not part of the SLA … and trading failures -- or climaxes -- takes the sort of confidence which both categories of traders lack.

That is one of the reasons why I am testing one strategy first, in order to gain confidence to move forward

Of course, one must be up by 0850 to take advantage of it. But, even if one is not, it is important to locate the trade that should have been taken whether one was there to take it or not and avoid taking second-best or, worse, third-best. If one isn't there to take the best, just wait for the next opportunity. That's why the winrate and P:L ratio for this approach is relatively high: take only the best trades, cut your losses short, and let your winners run.

Totally agree. I will have it in mind.


Thank you for your feedback

 

[dbphoenix]

Regarding to this, I did not take the trade (black dot) because for me at this point the price was on a TR …. Here is my scribble explanation

If by TR you mean trading range, it doesn't matter. Once price leaves the range and begins trending, any retracement after the reversal of trend still counts as a retracement. The same principle applies to a "failed" breakout. Take the first ret after the break of the DL. Otherwise, there's no point in drawing it.

 

[lajax]

If by TR you mean trading range, it doesn't matter. Once price leaves the range and begins trending, any retracement after the reversal of trend still counts as a retracement. The same principle applies to a "failed" breakout. Take the first ret after the break of the DL. Otherwise, there's no point in drawing it.

Ok but in this case I did not take the long after break of the DL because the price was at the middle of the levels that were marked before the open (Solid and dashed lines), therefore the PA that I was expecting (RET) was not located at the places (blue zones) where I had planned the trades; hence if the trade had been taken I would not respect the "filter" that provides the S&R.

But regarding to this at the first 30 minutes after the open do you give more importance to the SLA or the AMT?


Note: Sorry I understood the Supply Line

 

[dbphoenix]

Well, first let me ask if the forwardtesting is going as you expected. Or are you suffering from information overload? How much longer had you planned to devote to forwardtesting?

 

[lajax]

Yes, although the results are not identical as in the Backtesting , they are still good; so far the big diference, is the winning percentage (42% in 63 trades - in the backtesting was around the 50%) but the big difference is that I am no having "winners" of 1 or 2 ticks instead of it are losers of 3 to 4 ticks (almost the 25% of all the losers are scratches). But anyway, some days It has been difficult to face some consecutive losers days, although are relative low in comparison with the winners is something that affects. For example the last four days the net P/L has been +3,5 pts


Rearding to the time doing the Fwdtesting I want to finish the 100 trades, in order to have a point of reference in order to compare whit the backtesting results more objectively

 

[dbphoenix]

Do you think you're looking at too much? That it's making it too difficult to make a decision in "real time"?

 

[lajax]

Do you think you're looking at too much? That it's making it too difficult to make a decision in "real time"?

When you say "looking at too much" do you refer when I try to trade taking into account the SLA and the AMT? ... If its that I think that sometimes Its difficult in certain occasions for example when there is a TC day, the PA is not as clear as a trending day, because for example some days the uptrend is going on and when I try to go in the direction of the market I get caught in a hinge or a deep RET that stops me out and is difficult, however there are other days when the action is clear and the trades go in the right direction almost immediately.

 

[dbphoenix]

No, I mean all those charts and all those lines.

You'll recall that in the pdf, I look at the weekly, the daily, and the hourly. And that's it. When I trade intraday, I look at the daily (there's no need to consult the weekly unless we're near an extreme on it), the hourly, and the 5m. I may add an intermediating chart such as the 15m if I'm trying to explain something to somebody and the jump from the hourly to the 5m is too much, but, otherwise, I only look at what I need to look at to find the extremes.

When I look at the daily, all I want to know is whether it's up, down, or sideways. If it happens to form a channel, like the current one, fine. But otherwise, it doesn't matter. The channel isn't important.

The first thing this tells me is that we're very close to that trend line, and though we might break through it, there's a lot more room to the downside than the upside.

Then I go to the hourly:

And this provides the range. And that's all I need to know: upper limit and lower limit.

Then I look at the 5m or 1m, depending on which gives me the better view of what price is doing within these limits. With a range this narrow, the 5 isn't likely to do much good; price can get from one side to the other in a bar or two.

,

In this case, I might take the BO or I might not, but you're not looking at BOs so it's not relevant. But there are no other trades until the RET where I've placed the green dot. This is exited at a slight loss. Then the RET for the short, the red dot (note that price does not go all the way to the daily trendline at 85, but you have to trade what's in front of you, not what you think there should be). Then there's nothing more until that SL is broken and the next RET is offered, where I have the next green dot. In this case, though price might have made another attempt to reach that daily line later, it didn't, and hoping that it might would foul up the entire strategy for the session.

Those who are new to PA think that the more lines they have and the more levels they have, the more guidance they'll have to make a trading decision. But the exact opposite is true. Plot as little as you can. Plot only what you absolutely must have. Otherwise, you're looking at lines and levels instead of price, and if you're not looking at price, you won't be able to make any sound decisions regarding price action.