Spydertrader's Jack Hershey Futures Trading Journal

[ivob]

Quote from ticktrade:

When I started this journey I was using a 300 tick chart and market delta(buy-sell vol) for trade decisions. Upon Spyders encouragement I removed everything from my charts except volume and have adhered to the journals methods. After reading some posts, especially those from DKM, I quit simming and trading with real money and just monitored. I was a liitle slow to figure this out and those that mentioned doing this were right on. I started seeing things even better. After several weeks of this I started taking trades with real money on setups that had extreme clarity to me. While I am a long way from putting this all together in SCT form, the trades I have been taking have been the correct decision almost everytime and showed profit very shortly after entry.
I look for a retrace of a retrace on every L-R traverse and find spotting the ftt's that have a sizeable move much easier. I find them after flaws and ve's but mainly the ones I trade follow a vol divergence with price, or decreasing gaussian peaks if you will. These almost always follow some form of a flaw on some fractal.
The past couple weeks I have put the buy-sell vol indicator back on and look at it only on bars that I think are stalls. It made it obvious what was going on on those high volume bars that in the past would have had me taking a counter trend trade. Only to get instantly burned. I no longer need the indicator as I can see those bars for what they are now, continuation.
This is how I have been slowly incorporating trading realtime into monitoring.
For me monitoring without any simming or trading provided a huge breakthrough. My job has been so busy lately I don't get to watch the market constantly so I have been doing a couple things different. One was using the buy-sell indicator on stalls, the other was adding a 1 min ym close only line chart to filter the intrabar noise. I use the p-v channels on it just like the bar charts. I know this is not part of the method but has helped in my situation. Now I am able to look at the screen after being away for extended periods, see where things are, and find a correct entry in a matter of minutes.
As successful as things have been lately I still feel like I am way behind as I find it difficult to use any of the other tools available to lower the resolution.
I see flaws on the 1 min ym chart that don't show up on the other fractals so I guess this is how I am seeing a finer resolution.
I plan to continue to mainly monitor and slowly incorporate trading as this has proved to create the greatest improvement in my understanding of these methods.
I welcome any comments/suggestions.

Nice posting Ticktrade.
So you look for a retrace of the retrace and then enter with the (main) trend. I also notice quickly when something shows up that shouldn't be there. (retrace of the retrace turns then into reversal).

What about exits?

I know what you mean about finding a profitable entry quickly but I wonder when you exit. Just when you decide you have a decent profit? At a certain trendline?

regards,
Ivo

 

[guavaman]

Ivob,

I agree that the exits are the real issue. Pulling the trigger gets all the press, but getting out with a profit is the real tough part.

Take the 9:40 bar. I have that as an FTT of a down channel. Whether I entered as soon as I determined it to bean FTT or when the 9:45 bar formed the Pt3; it was a decent little run. That is until the 10:05 bar. Yes this is a freakish bar, but freakish bars do happen . Even if you put all the little pieces of the puzzle together and just knew the Price action was going south, where would one exit?

This is just an example, which is repeated throughout the day, every day. It is one thing to identify an FTT and enter in the opposite direction; but it is another to exit with a profit. Not such a big deal on long runs, but with the shorter ones, not having a coherent exit plan is tough. Yeah the RTL is the fail safe, but having to employ that tactic won't even cover my Starbucks expenses .

Just some tortured thoughts by a frustrated JHM newbie.

 

[ticktrade]

Quote from ivob:

Nice posting Ticktrade.
So you look for a retrace of the retrace and then enter with the (main) trend. I also notice quickly when something shows up that shouldn't be there. (retrace of the retrace turns then into reversal).

What about exits?

I know what you mean about finding a profitable entry quickly but I wonder when you exit. Just when you decide you have a decent profit? At a certain trendline?

regards,
Ivo

Like finding the main ftt's on dom. traverses, waiting for lower gaussian peaks, I do the same on non dom traverses. At lower fractals they show up as retraces of retraces leading to an ftt and break of a tape channel. On the lower fractals they are usually 123 patterns which I don't see on the 5 min fractal because I still can't watch the whole bar and see what is going on like Spyder does. It is difficult to stay out of the "rabbit hole" using shorter fractals so I have to keep reminding myself of this.
Since I started waiting for lower peaks to find ftt's it has made it easier to stay in a trade through flaws if the last gaus peak was => previous peak.

As for exits I use the TL's or a slowing of pace. Not the proper thing but I often have to exit and manage employess so I am concerned with monitoring primarily and occaisionally making a real trade.
I do a lot of replay using Ensign and when doing that I try to go from ftt to ftt. (This may be why I can't use the finer tools yet, they arent there on these replays). Doing the reply with a shorter fractal chart running has taught me to see the way the market moves in dom and non-dom traverses. In reality if you can see the entries, they become your exits. At that point you will be in SCT land
Correctly matching the gaussians are crucial. The Gaussians and there peaks are the key to everything IMO. Often I see an ftt(probably tradeable to Spyder) after a gaussian peak but if it is not a lower peak chances are you have a flaw and continuation will follow, but may quickly turn into an ftt again, this is the one I will enter on and look for what must come next.
I have a long way to go and will keep looking for the lightning bolt.
Many posting to this thread have contributed to a better understanding. Thanks to DKM and Tums among others. This method does work but takes effort to learn.

 

[nkhoi]

Quote from ivob:

...decent profit?
Ivo

Quote from guavaman:

.. profit. ..

 

[Tums]

Forget about exits !

As soon as you are in, you can forget about the position. You should start to look for the next signal, which is either Continuation, or Change.

If you encounter a Change signal, enter with twice the contracts.

Do this until EOD, in which you press the "Close All" button.

QED.

 

[guavaman]

Quote from nkhoi:

Nkhoi,

I believe I know what you are referring to. Someday I hope I have the best looking charts and the prettiest executions this side of the Mississippi.

At the present time however, I am singularly focused on turning a chronically losing enterprise into a "profitable" one. If I am fortunate enough to accomplish this I will be able to keep the lights on and the computers humming as well as pacify a wife who increasing thinks I am chasing the proverbial oasis in the desert.

Years of futile efforts will produce a focus referenced above. In the meantime I will continue to monitor the charts and post questions and comments in an effort to understand this method.

Thanks for highlighting the correct JHM trading paradigm.

 

[Ezzy]

Quote from Tums:

Forget about exits ! snip. . .

Exactly. Jack put it another way at one time. Paraphrased: You look for a new entry in the opposite direction.

Regards - EZ

 

[cnms2]

I think "looking for a new entry in the opposite direction" works only for SCT (or EHR, then RHR), and for EHE when your trade is profitable. For EHE, in order to preserve capital, you should also take wash trades. These are the first two drills Jack suggested.

Not looking to your P/L works only for SCT, when your concern is to always be on the right side of the market (or left of the RTL ... whatever ).

SCT = seamless-continuous-trading
EHR = entry-hold-reverse
RHR = reverse-hold-reverse
EHE = entry-hold-exit
RTL = right-trend-line
P/L = profit/loss

Quote from Ezzy:

Exactly. Jack put it another way at one time. Paraphrased: You look for a new entry in the opposite direction.

Regards - EZ

 

[nkhoi]

Quote from cnms2:

I..Not looking to your P/L works only for SCT, ..

it has nothing to do with SCT or forest or tree, if your mind is preoccupy with the ebb and flow of your p/l then you will surely miss some signals that it is continuously broadcasting.

 

[PointOne]

Quote from cnms2:

For EHE, in order to preserve capital, you should also take wash trades. These are the first two drills Jack suggested.

Since the journal is in a summer-break type mood, would you mind reminiscing a bit more on your experiences with learning these methods and any important breakthroughs you had along the way?

I have a question about wash trades. I've read most of Jack's posts on this subject (e.g. Columbus / not falling off the edge of the earth analogies). IF price gets away from you, do you HOPE for its return within a reasonable time-frame? This goes totally against Spyder's advice and I have difficulty reconciling the wash trade mentality with Spyder's approach (exit or reverse).

cheers

P1