Hi Volpri, I was actually taking about the second long at 10:24. The market was approaching intraday high, isn't it too dangerous to go long just below this intraday high resistance? Is there anything you see there that make you hold for new high?
Techniques for Day Trading the ES, NQ, YM, MES, MNQ, and MYM
- Thread starter volpri
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I'm of course eager to see what Volpri has to say, but I bet it will be something like the TR isn't established well enough because there aren't multiple attempts to BO from the top or bottom. He always has an excuse....
.... So maybe it made sense to squeeze out a few points expecting it to probe above this level.But I also think that when you're prepared to scale into a trade, its almost just as likely that you can make money going long or short. If we consider days that are a rally from open to close with barely a pullback, those days are incredibly rare, and even on those days, Volpri says he is prepared to exit the trade for a loss, and double the position in the new direction.
I did explain those two 2 point trades in that posts. The opening gap down. Then the reversal. This was a V bottom reversal. I was not trading it as a TR. I was trading it as a strong reversal approaching resistance. The momentum and price action were indicating to me i could scalp 2 points at least as I reasoned this could break the high of the day.
The reversal started bar 9:00. By the time it got to my first long entry it was still below the HOD. By the time it got to my second long entry it had close to HOD and showing no real weakness yet. Let’s look at this PA.
From bar 9:00 to bar to bar second long entry on bar 10:20. We got:
1) 17 bars. 5 are bear and 12 are bull bars. Buying pressure.
2) Biggest bar in the whole series is bar 9:35. Big bull bar. A lot of bears gave up on this bar and exited their shorts. Give up bar. Buying pressure.
3) Every single attempt by the bears to make the reversal fail….well every one of those attempts by the bears failed.
4) Gaps all the way up. Close of one bar higher than previous bars high. Low of one bar higher than high of the bar 2 bars back. All this shows buying pressure. And URGENCY.
5) The momentum. It just kept going up and at the point of both long entries the PA in my opinion was still strong.
6) it had broke above moving average on bar 10:00 and never looked back.
7) More than one series of successive bull bars before my entries. Equals bullish.
Remember, I didn’t even turn the computer on until after 10:00 so I was just reading PA up to that point. It was reversal trade on strong momentum and had nothing to do with a TR technique.
S, I reasoned that scalping a 2 point trade was certainly reasonable and a high probability I could get 2 points before it would hit my initial SL. So I took that first long entry on bar 10:10 grabbed my 2 points on next bar. After my exit the momentum continued up so I jumped right back in long thinking this move is going to give me another 2 point scalp as it begins to close the opening gap down. It did. I had 3 contracts long on each of these trades.
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Finding Hope in Your PA Trading Post
Hi Volpri,
I wanted to express my sincere gratitude for your recent post. As a beginner on my trading journey, I've been struggling to find my footing and have bounced between different methods.
Initially, I was drawn to the fast-paced nature of scalping and HFT, which seemed to align with my personality. However, this led to confusion and a lack of direction in my trading approach. I attempted to force myself into longer timeframes (4h, 1D) based on advice from a trading guru, believing it to be the path to long-term success. This resulted in further losses as the strategies applicable to longer timeframes didn't translate well to shorter ones.
Through this experience, I realized that scalping and shorter timeframes resonate more with my natural tendencies. However, after encountering A.L. Brooks' work on price action (PA) methods, I felt a strong connection and believed it could be the missing piece. Unfortunately, my non-native English background makes it challenging to fully grasp his books and courses, leading to self-doubt and questioning my choice and understanding of PA.
It was then that I stumbled upon your post. It served as a beacon of hope in a moment of uncertainty, reaffirming my belief in the potential of PA trading.
While I'm still a beginner in PA, I'm actively learning (not just studying, as I'm still grasping the concepts and have reread the book several times). I'm confident that with dedication and continued learning, I can successfully adapt PA methods and achieve trading success, similar to your journey.
Hi Volpri,
I wanted to express my sincere gratitude for your recent post. As a beginner on my trading journey, I've been struggling to find my footing and have bounced between different methods.
Initially, I was drawn to the fast-paced nature of scalping and HFT, which seemed to align with my personality. However, this led to confusion and a lack of direction in my trading approach. I attempted to force myself into longer timeframes (4h, 1D) based on advice from a trading guru, believing it to be the path to long-term success. This resulted in further losses as the strategies applicable to longer timeframes didn't translate well to shorter ones.
Through this experience, I realized that scalping and shorter timeframes resonate more with my natural tendencies. However, after encountering A.L. Brooks' work on price action (PA) methods, I felt a strong connection and believed it could be the missing piece. Unfortunately, my non-native English background makes it challenging to fully grasp his books and courses, leading to self-doubt and questioning my choice and understanding of PA.
It was then that I stumbled upon your post. It served as a beacon of hope in a moment of uncertainty, reaffirming my belief in the potential of PA trading.
While I'm still a beginner in PA, I'm actively learning (not just studying, as I'm still grasping the concepts and have reread the book several times). I'm confident that with dedication and continued learning, I can successfully adapt PA methods and achieve trading success, similar to your journey.
Aloha Volpri!
I’m finally all caught up on your journal and must say, wow; it’s been a terrific and thorough writeup, leaving me with very few questions. What luck for us all to see you have returned to posting here.
Referencing your ES chart from 2/16/24, post #1794, I’m hoping you could help me clarify when you declare a range.
1. At bar #34 (12:30 in the attached image), you have 20 bars of a pullback from a swing high. Is this the point you declare a range, and then you ‘back-date’ it by another 15 bars to the bar labeled #1 (9:45), where the swing low of the range (bar #30) is approximately equal of the low of the bar labeled #1?
2. Would the drawn-in red box be considered a range, as it has 20 bars in a sideways move?
Thank you very much for making this journal and sharing your trading method.
-Mark
Volpri,
I have two additional questions. The first is about trading breakouts and the second about exiting your position.
1. When you’re trading a strong breaking (has follow though), are you entering at market anytime mid bar, or are you waiting for the current bar to have s small pullback (mid-bar) before entering with a limit order?
2. As price approaches your target exit price (limit-order), are you following it up with a stop-market exit? For example, if you’re targeting 4 points and price is trading one tick below your exit price (limit order), do you have a stop exit (for a profit) closely behind the current price? Grab those profits, or wait? Would it be different if you’re doubled/tripled up to recover from a loss?
Thank you again for your journal,
-Mark
I have two additional questions. The first is about trading breakouts and the second about exiting your position.
1. When you’re trading a strong breaking (has follow though), are you entering at market anytime mid bar, or are you waiting for the current bar to have s small pullback (mid-bar) before entering with a limit order?
2. As price approaches your target exit price (limit-order), are you following it up with a stop-market exit? For example, if you’re targeting 4 points and price is trading one tick below your exit price (limit order), do you have a stop exit (for a profit) closely behind the current price? Grab those profits, or wait? Would it be different if you’re doubled/tripled up to recover from a loss?
Thank you again for your journal,
-Mark
@HawaiianIceberg
I have been super busy. Will try to find time to answer your question above about TRs. But in the meantime I often use this technique. Will trade one min TF TR as I am waiting on 5 min TR to get 20 bars. All the same trading concepts. One min just requires quicker decision making.
Here is an example in two charts from ES this morning as to how that would work. Both charts cover the same time period.
First is a 1m chart which is already in and established 20 bar TR so it is no longer a PB but in a TR. Therefore, I would trade as a TR until there is a successful BO.
The second chart is a 5 min covering same basic time period but still in the PB stage as it doesn't have 20 bars sideways to down.
I have been super busy. Will try to find time to answer your question above about TRs. But in the meantime I often use this technique. Will trade one min TF TR as I am waiting on 5 min TR to get 20 bars. All the same trading concepts. One min just requires quicker decision making.
Here is an example in two charts from ES this morning as to how that would work. Both charts cover the same time period.
First is a 1m chart which is already in and established 20 bar TR so it is no longer a PB but in a TR. Therefore, I would trade as a TR until there is a successful BO.
The second chart is a 5 min covering same basic time period but still in the PB stage as it doesn't have 20 bars sideways to down.
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Here is how I handle adversity after taking a chance on PA that I should not have taken. The 1m chart was over 70 bars sideways movement. However, I decide to enter long at the bottom of the TR anyway. Taking an unwarranted chance. I paid for it! Mistake! So how do I fix this?
First let's look at my entries and exits.
My first trade of the day netted me $75.00. As mentioned earlier of it being a 1.5 pt winning trade.
So, I start this second trade with $75.00 in the pot.
First chart is 1min. I went long 1 contract at bottom of TR bar 9:43. I added 1 more contract to that position size at bar 9:54. So, I am in 2 contracts long. IT went against me. I exited all positions at bar 10:02 with a loss. On bar 10:03 I doubled up (on the size of my total contracts in the losing trade) and went short 4 contracts and did so at the same price as my exit of the losing trade. I then exited that entire doubled up position on next bar 10:04. So, in less that 2 minutes I get my entire loss back plus back in the money. I now am up $250.00 in the pot.
Look at these trades on the 5m chart below. Notice the three horizontal gray lines. I am taking (before my second contract entry and my losing exit) an aprox measure of the opening move up and watching the BO of the bottom of the range on this 5m chart. That middle gray line is 50% When BO/PB is barely over 50% of the total opening move up I entered my second long (averaged down). But when it dropped down on bar 10:00 (on 5 min chart) I knew the game was over. I had to exit bar 10:00 my longs and enter doubled up short. Why? It had reversed the opening move by around 70%. That means it could continue down more at least enough for a scalp and maybe even more.
My interest at this point was to get back my $75.00 in the pot I had began with plus the other that I lost on that averaged down 2 contract trade. Along with hopefully, getting back in the green. The point is I didn't want to spend the rest of the session clawing back from losing my $75.00 and my total loss from that averaged down trade. So I reversed my premise and went with market inertia and in less than 2 minutes I have all my $75.00 back plus an addition $175.00. When I make a mistake and am wrong, I have to do whatever I have to do to correct that mistake. Psychologically traders find this hard to do. But the market is the market and we have to have strategies and techniques to go with the flow.
Now I could have gotton scared and quit trading or spent the rest of the session crying over spilt milk and paralyzed from taking any further action. But what good with that have done me?
Now if these kind of mistakes happen to me 3 times in a row I quit for the day because my brain is simply not in sync with the flow of the market. But it can happen to anyone 1 time or 2 times during the session. I do have days my brain is not working well. Could be because I am 69 next month LOL
Finally, as a point of discussion can anyone tell me what my mistake was taking that 2 contract averaged down trade on the 1 min chart and was there a way to correct that mistake sooner?
What about looking at the 5m chart? Mistakes? Corrections?
First let's look at my entries and exits.
My first trade of the day netted me $75.00. As mentioned earlier of it being a 1.5 pt winning trade.
So, I start this second trade with $75.00 in the pot.
First chart is 1min. I went long 1 contract at bottom of TR bar 9:43. I added 1 more contract to that position size at bar 9:54. So, I am in 2 contracts long. IT went against me. I exited all positions at bar 10:02 with a loss. On bar 10:03 I doubled up (on the size of my total contracts in the losing trade) and went short 4 contracts and did so at the same price as my exit of the losing trade. I then exited that entire doubled up position on next bar 10:04. So, in less that 2 minutes I get my entire loss back plus back in the money. I now am up $250.00 in the pot.
Look at these trades on the 5m chart below. Notice the three horizontal gray lines. I am taking (before my second contract entry and my losing exit) an aprox measure of the opening move up and watching the BO of the bottom of the range on this 5m chart. That middle gray line is 50% When BO/PB is barely over 50% of the total opening move up I entered my second long (averaged down). But when it dropped down on bar 10:00 (on 5 min chart) I knew the game was over. I had to exit bar 10:00 my longs and enter doubled up short. Why? It had reversed the opening move by around 70%. That means it could continue down more at least enough for a scalp and maybe even more.
My interest at this point was to get back my $75.00 in the pot I had began with plus the other that I lost on that averaged down 2 contract trade. Along with hopefully, getting back in the green. The point is I didn't want to spend the rest of the session clawing back from losing my $75.00 and my total loss from that averaged down trade. So I reversed my premise and went with market inertia and in less than 2 minutes I have all my $75.00 back plus an addition $175.00. When I make a mistake and am wrong, I have to do whatever I have to do to correct that mistake. Psychologically traders find this hard to do. But the market is the market and we have to have strategies and techniques to go with the flow.
Now I could have gotton scared and quit trading or spent the rest of the session crying over spilt milk and paralyzed from taking any further action. But what good with that have done me?
Now if these kind of mistakes happen to me 3 times in a row I quit for the day because my brain is simply not in sync with the flow of the market. But it can happen to anyone 1 time or 2 times during the session. I do have days my brain is not working well. Could be because I am 69 next month LOL
Finally, as a point of discussion can anyone tell me what my mistake was taking that 2 contract averaged down trade on the 1 min chart and was there a way to correct that mistake sooner?
What about looking at the 5m chart? Mistakes? Corrections?