Trading NQ via Price Action
- Thread starter k p
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Hey NoDoji.. lovely to have you reading! Yes, the higher highs you mention I see now but this told me nothing. (If anything, by just drawing a trend line connecting the lows at E/F and H, and then seeing the break of this line could get me in my short much sooner and hence an exit for even a profit. Gosh, this really is a terrible place to short, or at least one that would requite a much larger stop, which therefore makes it a terrible place to short anyway.
So in essence, the bar where I exit for a loss forms the higher low, and hence shorting below this bar? I indicate this by the red dot. This essentially makes me short again at exactly where I tried the first time, but this of course means nothing to the trade since the market doesn't know where I got in or out, its only hard in my head!
Yes that's the bar I was referring to. Because a break of that bar's low could take price back through that fakeout low from a lower high, the odds of a lower low by at least as many ticks as the difference between the high at H and the high at your blue arrow 5 bars later is above average. So you subtract the high of H (~ 80) from the high at your blue arrow (~76) and then subtract that 4 points from the low where you got trapped short earlier and you get a profit target zone of 67.
Jesus.. and 67 is roughly where it turned around. I think you have the market rigged to do what you want! 
To be honest, your explanation is lost on me with regards to the profit targets, and although I could for sure piece it together, this is not anything I could do in real time, so I am just trying to focus on seeing where weakness is and getting in, then hopefully staying in until I see the buyers take over. I have read where you wrote before that Al Brooks was something like the calculus of trading, well Ms. NoDoji, this reply seems like you're writing the book!
I have this printed in my journal, the chart you annotated so well for me (I changed the colors so it could be printed) and it really shows me the power of trendline breaks. I usually look for horizontal support breaks, which is usually shorting much too late, so you have really given me something to think about here.
To be honest, your explanation is lost on me with regards to the profit targets, and although I could for sure piece it together, this is not anything I could do in real time, so I am just trying to focus on seeing where weakness is and getting in, then hopefully staying in until I see the buyers take over. I have read where you wrote before that Al Brooks was something like the calculus of trading, well Ms. NoDoji, this reply seems like you're writing the book!
I have this printed in my journal, the chart you annotated so well for me (I changed the colors so it could be printed) and it really shows me the power of trendline breaks. I usually look for horizontal support breaks, which is usually shorting much too late, so you have really given me something to think about here.
Attachments
Well... then it sounds like ego is involved somewhere, which of course is not a good thing. I guess if it works better for you then clearly this is the way to go, but I guess what's nice about the journal is that you're left accountable. You almost force yourself to have to admit where your faults are which might be more difficult to do if nobody is watching.
Jesus.. and 67 is roughly where it turned around. I think you have the market rigged to do what you want!
To be honest, your explanation is lost on me with regards to the profit targets, and although I could for sure piece it together, this is not anything I could do in real time, so I am just trying to focus on seeing where weakness is and getting in, then hopefully staying in until I see the buyers take over. I have read where you wrote before that Al Brooks was something like the calculus of trading, well Ms. NoDoji, this reply seems like you're writing the book!
I have this printed in my journal, the chart you annotated so well for me (I changed the colors so it could be printed) and it really shows me the power of trendline breaks. I usually look for horizontal support breaks, which is usually shorting much too late, so you have really given me something to think about here.
I chose a really convoluted way of explaining the measured move target to you; sorry about that! I was suffering from Friday Brain after scalping both CL and NQ at the same time, LOL! The attached chart shows the traditional way of doing it. Once you practice a while it gets easier to do in real time. I think it's worthwhile learning to calculate these target zones quickly because I need to know the likely minimum target zone in order to calculate the R:R on the trade. If the R:R doesn't fit my criteria, I generally skip the trade.
Ah.. the picture works beautifully... thank-you!
Its interesting that you say you were scalping both the NQ and CL. I'm a bit torn right now after my most recent discussion with Db here about looking at the big picture.
http://www.elitetrader.com/et/index...-out-all-time-high.285963/page-3#post-4023040
On the one hand, it seems like within a day there are plenty of 10 or 20 points moves that can be captured (certainly not by me yet of course), and then of course when you look at the macro, as Db is now suggesting, it seems easier. Of course his huge point about having to choose if you want to trade or make money isn't lost on me. Why bother with all of this back and forth (which is causing me to lose money), when I can just trade a much higher time frame chart and sit back to relax a bit. A 100 point move up on 5 contracts in the past month is worth $10,000 now, plenty of income! I was a bit surprised to read Db write that for the past 7 days there has been no reason to trade since he is still in his long from a month ago and price has now just been in this trading range.
At any rate, this is leading to a question. You have been at this for many years now and have I'm sure analyzed the crap out of all the markets you are trading. So do you mind if I ask why you are scalping? I think I do see that CL is certainly a scalping market because it generally just goes back and forth (mind you, I just looked up CL and notice that since June, its essentially going down with just slight corrections).
So is it that are you enjoying the steady stream of daily profits? I certainly like the idea of knowing that when I turn the computer on I have the skills to make $500 or $1000 that day. But do you sometime think that all this back and forth that allows us to capture this is just too much work, especially since most probably cannot do it well enough, and if the focus was more on the macro view, getting caught up in the daily grind could be eliminated and you can still have profits to show for it at the end of the month?
You're welcome!
Yes, scalping is a lot of work because of the focus involved. However, I like being flat at the end of the session, nothing to worry about, no hedging necessary. If I can generate 20 points of NQ profit or 40 ticks of CL profit a day trading one or two lots ($400/day) with no overnight risk, that's $2K a week. I might have to hold a swing trade for several days or even more than a week to realize that sort of gain while being at risk of a serious gap against me over a weekend.
I do swing trade options in my investment accounts because the risk is fixed. That's worked out very well. I use the same traditional price action analysis on the longer time frame that I use for my day trading.