Re-read this quote about a 100 times.. Don't give up but work smart.. Study one set up like nodoji said but you will still need to understand market behavior.. Study how the market behaves.
Peace
Last edited:
Trading NQ via Price Action
- Thread starter k p
- Start date
Re-read this quote about a 100 times.. Don't give up but work smart.. Study one set up like nodoji said but you will still need to understand market behavior.. Study how the market behaves.
Peace
Hey k p, you might already have these charts, but I took this info from your journal yesterday and put ND's comments in. These two charts are about the retraces that she was talking about.
Sorry to see you're having a bit of a rough week, I hear you, mine hasn't been all that great so far either!
There's not much I can offer so I'll just say that what ND said sounds good to me. I'd try to focus one particular setup and build some trading rules around it. But I'm nobody to talk as I'm in pretty much the same boat as you are. Hope your week gets better from here!
Sorry to see you're having a bit of a rough week, I hear you, mine hasn't been all that great so far either!
There's not much I can offer so I'll just say that what ND said sounds good to me. I'd try to focus one particular setup and build some trading rules around it. But I'm nobody to talk as I'm in pretty much the same boat as you are. Hope your week gets better from here!
A - So here we have the 5 min SL.
B - Here is the 5 min DL.
C - Break above, waiting for the RET. I mark in a long, wouldn't trigger.
D - This long here isn't a BOPB, since there was no break, but its something else I see, a bounce off the 5 min trendline. Here if price comes up to trigger the entry, I think its a high probability trade to keep rising, which it does in this case.
Of course the trouble is here that we already rejected going above the SL, but if this ends up forming a channel, it is sufficiently wide enough to trade to at least test the highs at C. (This means our SL isn't going to be a problem anymore for price breaking above again)
This is obviously forming a channel now that I think could almost be played..... by someone with a trading plan for channels!
E - Break out the bottom. I mark 3 shorts, tracking them up. The trouble is that they go back above the DL, and even close above. The third one would fill and provide a nice move down though.
After this, we have a nice trading range form.
F - Bit of a FBO here.
G - An even tinier one. As long as my entry was below the low of the bar I indicate, it wouldn't trigger until price came back down from the FBO. Does an FBO even strengthen the chance to ride to the bottom of the range again since we ran out of buyers, or shall we be cautious and think that traders are ready to break out the top???
The trouble with this trade, just for my mental jitters, is that it comes up again, twice, before ultimately hitting the bottom of the range again. As long as my new stop was above that FBO, I'd be ok, but this is an entry of about 21 and a stop of 26. I guess the target is down around 13, so this works if my success rate is over 50%, but I'd have to walk away for 20 mins as bh_prop suggested!
H - Using this swing high that comes off a 5 min chart for a SL.
I - We appear to break out the bottom again, but I am now more inclined to use the lows at F for the new range bottom.
J - Bottom is here, and this is also a little FBO from the micro range.
K - Another range here with a FBO. Now this is consolidation above the bottom at J, so we might start looking for a long confirmation.
L - FBO from the range.
M - Exit of range and break of SL.
N - I see the test back down to the SL break (it over shoots it though), and also overshoots a test of the range BO. But if price comes all the way back up above this bar, it would be a series rejection of the low of that bar.
This is exactly what happens. Trouble is that the low of the bar is 14, and with an entry around 20, that is 6 points. The swing high at P is only at 24, so if I go long at 20, I need this to really break out and for this to be a serious up trend. I guess I can always get out in time if we make it to 24 and turn back down, but a stop of 6 points is still quite a bit.
I'm still confused about where stops should be. Sometimes its the low of a previous bar, perhaps a tick lower. Sometimes the stop is a test of where the break of the trendline happened, sometimes I think it could even be a test of the trendline itself which might be even lower than the break if the trendline was a SL and hence slopping down, and sometimes the stop is the low of a range of a previous swing low. No wonder I'm confused... I've got too many setups in my head and I just keep borrowing different ideas from different trades without have a precise set of rules for each! I'm not playing Mr. Potato head here and hence cannot be sticking on random body parts at my leisure!
Q - It is a good rally up from here.
SUMMARY
Shit, if only I could trade as well as I post-analyze. Many of my plotted potential trades are in real time, not just hindsight, so I do have enough in my brain to make this work. Its just far easier with no money being on the line to do the right thing and not care about when it doesn't work out. (My brain bias might also have me remember when it works and not when it doesn't... hence why careful backtesting where each trade setup is taken and the result plotted, regardless of outcome, is essential.)
B - Here is the 5 min DL.
C - Break above, waiting for the RET. I mark in a long, wouldn't trigger.
D - This long here isn't a BOPB, since there was no break, but its something else I see, a bounce off the 5 min trendline. Here if price comes up to trigger the entry, I think its a high probability trade to keep rising, which it does in this case.
Of course the trouble is here that we already rejected going above the SL, but if this ends up forming a channel, it is sufficiently wide enough to trade to at least test the highs at C. (This means our SL isn't going to be a problem anymore for price breaking above again)
This is obviously forming a channel now that I think could almost be played..... by someone with a trading plan for channels!
E - Break out the bottom. I mark 3 shorts, tracking them up. The trouble is that they go back above the DL, and even close above. The third one would fill and provide a nice move down though.
After this, we have a nice trading range form.
F - Bit of a FBO here.
G - An even tinier one. As long as my entry was below the low of the bar I indicate, it wouldn't trigger until price came back down from the FBO. Does an FBO even strengthen the chance to ride to the bottom of the range again since we ran out of buyers, or shall we be cautious and think that traders are ready to break out the top???
The trouble with this trade, just for my mental jitters, is that it comes up again, twice, before ultimately hitting the bottom of the range again. As long as my new stop was above that FBO, I'd be ok, but this is an entry of about 21 and a stop of 26. I guess the target is down around 13, so this works if my success rate is over 50%, but I'd have to walk away for 20 mins as bh_prop suggested!
H - Using this swing high that comes off a 5 min chart for a SL.
I - We appear to break out the bottom again, but I am now more inclined to use the lows at F for the new range bottom.
J - Bottom is here, and this is also a little FBO from the micro range.
K - Another range here with a FBO. Now this is consolidation above the bottom at J, so we might start looking for a long confirmation.
L - FBO from the range.
M - Exit of range and break of SL.
N - I see the test back down to the SL break (it over shoots it though), and also overshoots a test of the range BO. But if price comes all the way back up above this bar, it would be a series rejection of the low of that bar.
This is exactly what happens. Trouble is that the low of the bar is 14, and with an entry around 20, that is 6 points. The swing high at P is only at 24, so if I go long at 20, I need this to really break out and for this to be a serious up trend. I guess I can always get out in time if we make it to 24 and turn back down, but a stop of 6 points is still quite a bit.
I'm still confused about where stops should be. Sometimes its the low of a previous bar, perhaps a tick lower. Sometimes the stop is a test of where the break of the trendline happened, sometimes I think it could even be a test of the trendline itself which might be even lower than the break if the trendline was a SL and hence slopping down, and sometimes the stop is the low of a range of a previous swing low. No wonder I'm confused... I've got too many setups in my head and I just keep borrowing different ideas from different trades without have a precise set of rules for each! I'm not playing Mr. Potato head here and hence cannot be sticking on random body parts at my leisure!
Q - It is a good rally up from here.
SUMMARY
Shit, if only I could trade as well as I post-analyze. Many of my plotted potential trades are in real time, not just hindsight, so I do have enough in my brain to make this work. Its just far easier with no money being on the line to do the right thing and not care about when it doesn't work out. (My brain bias might also have me remember when it works and not when it doesn't... hence why careful backtesting where each trade setup is taken and the result plotted, regardless of outcome, is essential.)
Attachments
Sure thing.. just a quick list for you right now.
SL - supply line, tracks selling pressure so it slopes down along the highs
DL - demand line, tracks buying pressure, so it slopes up along the lows
RET - retracement
REJ - rejection of a low or high
FBO - fake break out (got this from NoDoji) where price penetrates either a range top or trendline, but then falls back down.
BO - breakout
BOPB - breakout pull back.... the NoDoji setup of using the 5 min to track trend and 1 minute to find entry on the pullback
ND - NoDoji.... teee heeee
Db - DbPhoenix
kp - hopelessly lost trader who fortunately has more determination than brains at the moment!
SL - supply line, tracks selling pressure so it slopes down along the highs
DL - demand line, tracks buying pressure, so it slopes up along the lows
RET - retracement
REJ - rejection of a low or high
FBO - fake break out (got this from NoDoji) where price penetrates either a range top or trendline, but then falls back down.
BO - breakout
BOPB - breakout pull back.... the NoDoji setup of using the 5 min to track trend and 1 minute to find entry on the pullback
ND - NoDoji.... teee heeee
Db - DbPhoenix
kp - hopelessly lost trader who fortunately has more determination than brains at the moment!
@k p I'm a little constrained for time today, so I won't be able to indulge as much as I would like to. However, I think @NoDoji will give you her daily analysis, which may be similar to what I would probably have said anyway (TL, S/R, range etc), so here is something slightly different (yet very simple) to allow you to view the chart from a slightly different angle.
Look at A, B, C, D and E. Can you figure out who is in charge at those moments? Can you figure out the intensity of their determination of intention? When in charge of each particular shaded region, how hard is the opposite side willing to hold their ground? How many regions belong to who? Is there a point (region) where you notice that one side has excepted "complete" defeat?
All the above questions help you gauge where you should be positioned, how firmly and with what type of size.
Besides that, just understand that it is okay to have only 2-4 trades the whole day at this stage. Make those trades your very high probability ones and enter with size (as one would assume that you are entering with confidence). It is okay if you have to wait for an hour or even two for these setups to take shape. What that will do for you is make your trading very relaxed and hopefully remove the jitters. Most importantly, it will establish some consistency and a healthy PnL.
The below chart has 2-4 "easy" setups. If you had to pick any, which ones would they be?
NOTE: You entered into some trades where the region is shaded red. There's a lot of overlap and if you observe it in a little detail, you will see that there are two sides trying to establish control in their favor. It's probably not the best place to trade. Let them do what they have to do and once one side prevails, hop on with them.
Alpha.
Look at A, B, C, D and E. Can you figure out who is in charge at those moments? Can you figure out the intensity of their determination of intention? When in charge of each particular shaded region, how hard is the opposite side willing to hold their ground? How many regions belong to who? Is there a point (region) where you notice that one side has excepted "complete" defeat?
All the above questions help you gauge where you should be positioned, how firmly and with what type of size.
Besides that, just understand that it is okay to have only 2-4 trades the whole day at this stage. Make those trades your very high probability ones and enter with size (as one would assume that you are entering with confidence). It is okay if you have to wait for an hour or even two for these setups to take shape. What that will do for you is make your trading very relaxed and hopefully remove the jitters. Most importantly, it will establish some consistency and a healthy PnL.
The below chart has 2-4 "easy" setups. If you had to pick any, which ones would they be?
NOTE: You entered into some trades where the region is shaded red. There's a lot of overlap and if you observe it in a little detail, you will see that there are two sides trying to establish control in their favor. It's probably not the best place to trade. Let them do what they have to do and once one side prevails, hop on with them.
Alpha.
Attachments
kp - hopelessly lost trader who fortunately has more determination than brains at the moment!
Most people that make it in this business actually tend to have, more determination than brains. I guess you're on the right boat then
I read an article a while back that followed some "traders-to-be". They collected a lot of different data to see if they could find commonalities in the ones that passed or failed. One of the findings was that it was harder for persons with "credible" degrees (doctors, lawyers, pharmacists, PhDs etc) to succeed. Among other factors, the main traits that led to their demise was their "ego" (I'm smarted than the average population) and their failure to "dumb down" their thinking process. That is, it was hard for them to adapt the "less is more" concept.
Maybe brains aren't all that after all. :eek:
