Trading Pattern Failures

Quote from Albert:

...I am surprised that there are no double or triple bottoms or tops in your patterns, as I look for those all day long.

Good Luck,
Albert
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Actually, based on his initial message posts...some of those patterns can occur within a double or triple bottoms or tops.

My point...its not uncommon to have a multiple pattern signals in the same direction or in opposite directions (Long and Short signals occurring at the same time).

If the above occurs...signal conflict...you really need to know your setups to determine which signal has priority...

If not...a trader should be on the sidelines.

NihabaAshi
 
Quote from peterfigliozzi:

Very good stuff. Your biggest challenge will be sticking to these rules, when you know they'll take you out for a small loss, or take you out with a small profit when you think there is more to come. Honestly I think right here is the difference between success and failure in any trading method. It's painful to close a trade and then see it run, or take a small loss and see it run... but it's equally hard to see the eventual profits gained by making each loss a half point less than it could have been. You have a great set of trade management rules & I think if you adhere to them like the law you'll do very well.
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hello peter

we will see how my money management rules pan out. My main goal for now is consistency. I just got a night job as a valet and will be able to cover all of my bills with the proceeds. This means that I don't have to make any money trading ( less stress ). My problem up until now has been an unwillingness to create rules. I have had vague guidelines but thats about it. For some reason I felt I could jump right to the subjective\discretionary stage of trading without first following a structured trading plan. Over the next 20 trades I hope to accomplish 3 things:

1. Find out wether I actually have an edge (Some would argue this should be done before hand but part of my edge is pattern recognition and I feel the best way to test this is in real time).

2. Get to the point to where I can execute my system flawlessly.

3. Determine the "best" way to exit trades (winners and losers)

thanks
fan27

thanks
dan
 
Trade 1 : 04/26
30 min failed Breakout

Sold 1138.00
Covered 1133.50

Result + 4.5

It was very hard to stick with my rules once in the trade, but I prevailed. The sample set of 20 trades is off to a good start. It was also hard waiting for more than a week for a signal.
 

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Quote from porgie:

an 8 pt. target ES is not going to make u happy...3 or 4 is more realistic.
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You are right porgie (Especially intraday). That is why I am not using large profit targets but rather a trailing stop technique.

thanks
fan27
 
Trade 2 : 04/29
5 min : failed Breakout

Bought 1144.25
Sold 1155.00

Result + .75

My Initial stop was 3.75 pts. My 2 bar trailing stop kicked in as described by my rules. If I were to be using profit targets the area to exit was as plain as day.

After this sample set of 20 I am most likely going to have to tweak my plan. The concept makes sense but I am not sure the stop placement and profit taking rules are optimal. Time will tell.

So far I have stuck to my plan which is my main goal of this exercise.

fan27
 

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Trade 3 : 05/10
15 min : failed Triangle Breakout

Bought 1084.50

Took long enough to get a signal. I am holding overnight to let this trade play out. The question is:

Do I leave a GTC 3 pt stop order or do I re-enter another stop order at the beginning of the regular trading session tomorrow? unfortunately I didn't account for this scenario in my trading plan.

fan27
 

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Trade 3 : 05/10
15 min : failed Triangle Breakout

Bought 1084.50
Sold 1083.50

Result -1.00

Exited at Market at 16:55 (05\10). It did not make sense to hold this position overnight because my stop was so close. In order to let this trade play out according to my rules, it would have to be monitored. This scenario will have to be added to my plan.

ie.. If trade is winner going into close and stop distance is greater than ATR of after hours session then stay in trade, else exit at market.

any input on rules people use to determine wether to hold overnight would be appreciated.

fan27
 
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