The Price Action Journal

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Quote from SusanaDT:

I do not move stops to break even, stop movements should be based on future PA development not something that makes you feel good because you can't lose.

Look at my charts I annotated stop movement when I did.

I don't usually scale out, unless I see potential reason for doing so.

This week I did it once because eventhough PA hinted at retracement, ES had created a very nice reversal formation @ confluential support before that, so took one off and waited for the breakout, which I eventually got.

Susana
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Appreciate the ongoing dialogue, Susana.

What, to your way of thinking, is a large stop? Since you have positive R:R, and stops are based on setups, have you had some winners (more than a tick or 2) turn into losers because you didn't move the stop up due to PA?
 
Quote from rolextrader:

Appreciate the ongoing dialogue, Susana.

What, to your way of thinking, is a large stop? Since you have positive R:R, and stops are based on setups, have you had some winners (more than a tick or 2) turn into losers because you didn't move the stop up due to PA?
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A large stop for me is anything beyond 1% of my account, something I very rarely allow.

Yes of course, I've had hundreds of trades give me a few ticks of paper profit before stopping me out but I don't look for a few ticks in trading, what's the point, I'm not a scalper.

I've also seen hundreds of trades that would have not hit my big potential targets had I moved my initial stop to BE.

Let me put it this, I'm not afraid of small losses, I'm afraid of negative risk reward expectancy.

Susana
 
I think you misunderstood me. It is late and I'm going to pack it in after this. I was asking if you had winners that were MORE than a few ticks--say a minimum of 1 point--turn into losers? By the way, what is your R:R?

Take care.
 
Quote from rolextrader:

I think you misunderstood me. It is late and I'm going to pack it in after this. I was asking if you had winners that were MORE than a few ticks--say a minimum of 1 point--turn into losers? By the way, what is your R:R?

Take care.
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Yes, I've had many of those. 1 point to me is nothing, considering my stops are approximately 2 points.

My R:R varies since I let the market tell me when to get out.

Risk varies from 1.5 to 2.5

Reward varies 0.25-2.0(PA told me to exit) up to 15,20 points but in theory I do not limit the exit, it can be anything.

Susana
 
Quote from SusanaDT:


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price is continuously going from trending states to consolidated ones.
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This my friends, is the simple and concise one sentence explanation of price action and is the basis for the profession of trading. It applies to every instrument, internationally, that can be plotted with regularity based on price. From this simplification comes the aphorism "trading is simple, but not easy."

With only a generalized understanding and minimal deployment, no matter what tools are used (yes, that means indicators, flashing red and green lights, or whatever), your trading can be taken to the next level, whatever that is for you.

When you OWN the concept with habitual deployment, you trade well because trading well is what you do.

Osorico
 
Hi Susana, great thread... it's refreshing to see such an honest, pure approach.

I don't currently trade ES but I do trade stocks with PA and thought I'd pass on a few things I've found to be useful in hopes that someone else can use them.

1) I watch BOTH 1 minute and 1 second bars and have found that, over time, the 1 sec bars have given me HUGE insight into the 1 minute bars.

2) I've found that the more "well behaved" the 1 sec bars are, the easier it is to make money... to the point that I use 1 sec bar behavior as a screen.

Two quick examples. This first one shows the last ten minutes of BAC today with the 1 min bars inset at the top. Look at the 1 minute bars and then inside them with the 1 sec bars. These 1 sec bars are fairly well behaved and about the minimum I'd want to see for short term trading but I've seen much tighter... for example, the other day in AAPL when the 1 sec bars were so tight that the trading was incredible. I'll do a screen capture of this kind of price action the next time I see it if you like.
 

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This next one shows the last ten minutes of IBM today, again with the 1 min bars inset at the top. Notice how chaotic the 1 sec bars are... this is not always the case with IBM but a clear sign to stay away for now.
 

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Quote from amitman:

Hi susana,
I'll read your post again (I've already read it a few times) but I'll really love if you could post a chart to help me understand your point. Beacuse i thought PA is about LL/LH/HH/HL and S/R but from your post it seems they are different things and in this case I don't know what do you mean by PA.
Also even according to your post I can't seem to understand why you did the short on 10:06 and why you didn't make a short at approx. 13:20.
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Amit,
Here is a chart to try and explain an answer to your question, by what "i" think Susana means by her post. I thought it was a great post and hit the nail on the head.

Susana please clarify this if you think my answer is way off.

Rolex , no squiggly lines :-)

Max
 

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I forgot to clarify one thing. The PA at a s/r area that will tell you to take action will be a 3BR, or Matching High/Low formation.

Max
 
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