Trading the NQ: Take 2

[wrbtrader]

...To be honest, I have no idea why I continue this, why I waste my time...

I don't think you really understand. You keep rehashing the exact same things again and again and again. Therefore, it has become too personal to you and your trade journal will become a waste of time for you. That type of attitude will be a mental block and it will prevent you from moving on to achieve whatever goals you want to do.

I say the above because you make these consistent jabs at folks and then you make requests about them but can't understand why they don't play that game with you. Seriously, get over it and be productive towards your goals unless you prefer to hang out at ET rehashing the same old stuff about NoDoji, Dbphoenix and whomever else that has spent time sharing their trade method with you.

As a reminder (see my prior analogy), there's other resources for those methods and there's transparency. There really is no need to be stuck in the mud here at ET (not a good place to be) as a struggling trader unless this place is just entertainment for you to let off some steam. I think there's way too much negativity here and it will swallow you up unless you can view this forum as entertainment only. Seriously, if you're still rehashing this stuff next year at this time...find another career because trading is not for you.

P.S. You can still have a journal about what you're learning about the markets every day without taking a single trade because my opinion is that you shouldn't be trading right now when you should be just learning about the markets and yourself...the latter the most important. A trade method is just one chapter in the book called "successful trading". Those other chapters are your responsibility and they have nothing to do with a trade method.

 

[k p]

I don't think you really understand. You keep rehashing the exact same things again and again and again. Therefore, it has become too personal to you and your trade journal will become a waste of time for you.

LOL... Oh boy... we are going in circles here because I still have to defend my position.

I think its important to separate a few things out. Yes, my journal didn't go nearly as well as I wanted. What I guess I really wanted was for someone to help me with my method, which I guess is silly because nobody really knew what I was doing. All they could say was that I was wasting my time trading fast charts. They showed me some of the stuff they do, but since its not what I look at, it wasn't nearly as useful. So my expectations were inappropriate.

I'm a little mad that after one not so great day, a few comments made me feel like I didn't understand what I was doing and prevented me from taking the trades I wanted to on the following few days which I see would have worked out, but this clearly is still my downfall for letting those comment affect me. I simply started with a journal again too soon after a bit of success.

Now saying all this, all the posts I've made about Db and such I put in a different category. I'm having these discussions for intellectual reasons, to see what can come of it, etc, but I fully realize that none of this is helping my trading. Heck, the minute I opened up my journal I already saw how destructive this was. So I've really shut out most of what I read now in terms of specific trading. I might still be trading real money, or I might not. I might still be using 5 sec charts, or I might not be. None of this matters at the moment because I'm not sharing this with the world anymore until I'm ready.

So any discussion I have going forward, and I do want to have them if I find a topic interesting enough to discuss, will strictly be for educational/informative purposes but I am making sure to keep is separate in my brain so as not to influence my own trading. I just found that most comments fell into the category of "I shouldn't be doing this" or "this won't work", and that I could already see based on my own P/L so it wasn't really all that helpful.

 

[ubo]

Two things wrbtrader had said that struck a chord. One is that you can learn how to trade in many different places and that there are a lot of different ways to trade. if you head over to topsteptrader YouTube channel and listen to the newly funded traders interview, you can get a glimpse of the diversity that wrbtrader is talking about. just my two cents.

P.S. when I say newly funded, it turns out in many cases, they are not new traders. In fact quite a number have been trading between 5 to 10 years.

 

[k p]

Two things wrbtrader had said that struck a chord. One is that you can learn how to trade in many different places and that there are a lot of different ways to trade. if you head over to topsteptrader YouTube channel and listen to the newly funded traders interview, you can get a glimpse of the diversity that wrbtrader is talking about. just my two cents.

At this point, diversity isn't really what I'm after. I realize there are a million ways to trade, and none of that will help me. I kind of like the stuff I'm looking at, I just wanted help with how to interpret or act on some of it... perhaps along the lines of figuring out why I think what I think about price at a certain point and that sort of stuff. To hear what other people are doing would essentially be starting at the beginning and its not where I think I need to go.

All I simply was after is more transparency. I don't see what is so wrong with that. I'm saying I want more proof. I might not be getting it, but if the only reply to me saying that I want more proof about a method is that to come look over here at this other stuff, then this once again isn't all that helpful.

Walk into a car dealership and ask to test drive a truck. Since they don't have a truck, they offer for you to test drive a minivan. But I don't want a minivan, I want a truck. Hence, I'm not looking for another method, I'm looking to see if anyone has anything useful as proof or illustration that this method in question is working. wrbtrader might be right in his initial assumption that my fascination was detrimental to me, to my plan and my trading, but I'm past that. I'm not looking for it for my trading, I'm looking for the answers for my curiosity.

 

[wrbtrader]

...All I simply was after is more transparency. I don't see what is so wrong with that. I'm saying I want more proof. I might not be getting it, but if the only reply to me saying that I want more proof about a method is that to come look over here at this other stuff, then this once again isn't all that helpful.

Walk into a car dealership and ask to test drive a truck. Since they don't have a truck, they offer for you to test drive a minivan. But I don't want a minivan, I want a truck. Hence, I'm not looking for another method, I'm looking to see if anyone has anything useful as proof or illustration that this method in question is working. wrbtrader might be right in his initial assumption that my fascination was detrimental to me, to my plan and my trading, but I'm past that. I'm not looking for it for my trading, I'm looking for the answers for my curiosity.

My point is this. You say you're looking for transparency from anyone here at ET and I've seen you congratulate a few traders here at ET for making live calls. Further, there's several journals here at ET (present and past) involving members making live calls. Yet, you're not using their methods nor do you show any interest in their methods. I only say that because I don't see you mentioning their methods in your journals and they are not posting any information here in your journals about their trade methods and I don't see you posting (asking questions) in their journals.

In contrast, you seem to want live calls from those not interested in working with you.

Now you say you're not looking for another method to imply that you have a method you're happy with but its not disclosed. Then if I got this right, you're looking for anything useful as proof or illustration that this undisclosed method has proof that it works.

I'm curious now, what's the name of this method you're using ? I'm not asking for details...just the name and I will be in shock if its a method that has no transparency considering the transparency thing is a big issue for you.

However, you did state (I quoted it earlier) that you really didn't have a trading plan. Maybe that's why you're confused about things. You say you don't have a trading plan and then you say you're not looking for another method as if to imply you have one.

The above is what I call "stuck in the mud".

 

[justrading]

k p,

I've seen some wonderful advice given here, I almost wish I had that when I was learning to trade, but as I'm too private a person to be as open as you are, it's unrealistic to expect that. So, I don't want to add to trading advice, but I'd like to tell a story or two just for the purpose of you thinking about you and the markets.

I'm getting on a bit. In America I'd be part of the x years is the new y crowd, but I just think of myself as old. If I really really turn on the charm, I might be able to develop a relationship with a forty year old woman. Now Thailand has more beautiful women than any man could wish for, so there is no shortage of drop dead gorgeous twenty somethings and thirty somethings to look at. Many years ago now, I was having lunch with a Spanish colleague when he announced that he had already fallen in love three times that day. Thinking it was in the client's office, I asked him which departments. He said just riding the elevator down to lunch.

I could focus on them, ie the 20+ and 30+, but realistically without at the very least my own yacht, none of them would have any motivation to look at me. I could spend all my time looking and hoping, or I could focus on the 40+ and successfully charm the skirts off them.

When I was young, the how often mattered even more than the what (I'm a perfectionist who is mellowing), and I would sacrifice a good outcome if it was not achieved in the way I wanted.

Ed Seykota famously said everybody gets what they want out of the market. Forget all the detailed stuff I've seen here. What do you want from the market?

I don't know you so the possibilities I might not think of could be many, but a couple come readily to mind based on all I've read. Do you want to persevere until you succeed in exactly the way you want? The way you want matters most? Or do you want to succeed in the best way possible, and are seeking the way how to?

If it is the former, then linear thinking is OK, indeed I've used it much in my path of learning. If it is the latter, then you need to adopt non-linear thinking if you want to have a ghost of a chance of achieving your objective.

Long story short, do you want to succeed only with a five second chart in the way you've discussed, or do you want to succeed and want to find the way to do so?

Why didn't I just say that? Several have suggested it and you have dismissed the suggestions out of hand, so certain that the five second chart is the best way. Rather like if I would say it must be a 20 something, or a 30 something, or else I don't want the relationship. Reality is the best hope of a relationship with a younger woman lies with the 40 somethings.

If after this long story I have failed to convince you to examine what exactly it is you want, and share that with all who are giving you excellent advice believing that what you are saying is what you really want, then I hope I have at least managed to entertain you.

 

[k p]

My point is this. You say you're looking for transparency from anyone here at ET and I've seen you congratulate a few traders here at ET for making live calls. Further, there's several journals here at ET (present and past) involving members making live calls. Yet, you're not using their methods nor do you show any interest in their methods. I only say that because I don't see you mentioning their methods in your journals and they are not posting any information here in your journals about their trade methods and I don't see you posting (asking questions) in their journals.

In contrast, you seem to want live calls from those not interested in working with you.

Now you say you're not looking for another method to imply that you have a method you're happy with but its not disclosed. Then if I got this right, you're looking for anything useful as proof or illustration that this undisclosed method has proof that it works.

I'm curious now, what's the name of this method you're using ? I'm not asking for details...just the name and I will be in shock if its a method that has no transparency considering the transparency thing is a big issue for you.

However, you did state (I quoted it earlier) that you really didn't have a trading plan. Maybe that's why you're confused about things. You say you don't have a trading plan and then you say you're not looking for another method as if to imply you have one.

The above is what I call "stuck in the mud".

It comes down to this. I want to trade S & R, be these levels arrived at from the overnight action, previous day highs or lows, or even the levels that become obvious after the market has opened and it becomes apparent what traders are willing to pay and what they aren't on this given day.

Now how to get into a trade? I can wait for my 1 min chart to show me some up bars, or some down bars, and I can wait to see what happens with the next 1 minute bar, but often, these entries are very late. If rejection happens at a level, it shouldn't take a whole minute to find out, hence the use of a faster chart.

See, most people on here say that chart is too fast, which is fine, but I don't agree. Hence, I can't find anyone on here to help me analyze my entries and exits based on what I'm looking it. Asking to see people's entries was simply a matter of trying to keep away all the hindsight traders who would ask why I'm buying or selling here or there when its obvious it won't work, etc... so I just wanted to see that if things are so obvious to someone, lets see their trades.

Listen, I'm kind of getting pissed here having to write all this up. I just don't understand what you want from me... what are you trying to get me to see.. to admit? I want to do this my way, simple as that. Can anyone help me do things my way? No. Then everyone please move on. When I asked for help, I wasn't looking to be told that I'm doing it wrong and that I shouldn't be trading without a solid plan. I say this again, as I said in my last journal. All you experts actually prevent people from posting journals. If there is a plan and its profitable, then there would be nothing in a journal of value, it would simply be a list of checkmarks to say if each trade was put on according to plan or not. My plan is to brush my teeth every morning... should I start up a journal to track my progress about that?

I know you have good intentions, but I honestly think you aren't listening to me at all in any of my answers. I don't give a fuck how other people are trading. Its nice if they show their entries, and I'd love to ask them why they did what they did and where they did it. But this doesn't mean I'm going to adopt their plan. You'll notice that I don't think I asked anywhere if someone can share their trading plan with me. This journal was about documenting what I... I repeat, what I am doing, and it got off track very quickly. You guys in here are like the parent of a kid who is doing a project for work, and instead of helping them do it their way, you take it all over to do it your way so that its good. Now its no longer the kid's project.

ND made great suggestions because she pointed out that if I want to trade S & R, I could simply be sitting there waiting with limit orders. She showed that if I wanted to use 2 point stops, then this dictated where my entry had to go because my stop had to be very close to a level at which the trade could be said to have failed. Both of these worked within my framework, although of course they didn't involve 5 sec charts, but they still allowed me to stick to my plan, the loose plan that it is.

Anyway.. I'm sorry for getting mad but I hope you can see where my frustration is. My last journal fell apart for this every same reason. I was of course even less prepared, but all anyone could point out was my faults, how I don't have a trading plan, etc. Getting involved in trading has the benefit of not having to be responsible to anyone else. And yet, I feel the exact opposite has happened because I feel like I'm having to explain everything I'm doing to everyone else. Having someone tell me that I shouldn't be trading with real money until I'm profitable is next to useless. Don't you think since I'm the one who posts how much money I've lost every day that I'm fully aware that I'm losing real money?

Anyway... I'm not mad at your wrbtrader, I'm just mad that what I'm saying isn't getting across. And if you're very sure that I'm delusional and not understanding you, then please leave me in my delusional state.

 

[k p]

Now Thailand has more beautiful women than any man could wish for, so there is no shortage of drop dead gorgeous twenty somethings and thirty somethings to look at.

I'm sorry but I got lost after this line.

What I want is to make money. My use of 5 second chart may not work for some, but heck, 1 min charts seems to not work for most seeing as most people lose money anyway... correct? If 1 min charts was the answer, wouldn't most people be profitable?

If anything, after talking to a few people in private, and based on what I can gather, its not even about the charts. Its about having the intuition, the years of experience. Sure they may have a firm rule about entry, but this entry wouldn't be taken if they didn't believe that market is going in their direction from the many other factors that are working in the back of their head based on context and all these other things.

If you simply show them the entry criteria they need on their, but take away everything else, they are lost. So what I mean to say about this is that it isn't about a 5 sec chart, or a 1 min chart. Putting that trade on has already been decided by many other factors, its just a matter of how to get in now. Could I use a 1 min chart? For sure. I mean if price is breaking out, you see it on a 1 min or 5 sec chart. But I wanna see what happens after the initial breakout. Its one less thing for my brain to do is I can spot how that BO happens. Expert traders already have these patterns memorized in their heads... they know what a solid BO looks like. I still don't yet, I need to see it print.

Anyway... can we get back to talking about pretty women in my journal? I'm just sick of having to defend everything I'm saying, doing, thinking, breathing, etc.

 

[NoDoji]

To me, your method and your thinking look like this:

You see a key level of support or resistance (a “line in the sand”, so to speak).

You’ve observed that if this key level holds, price frequently makes a run of sufficient strength in the direction opposite the S/R level that you can extract 10 NQ points of profit before price hits your 2 point max stop loss.

Your max stop loss is 2 points because you’ve observed that if price runs 2 points through the key level it’s more likely to continue significantly further before reaching your 10 point profit target, thereby skewing the risk:reward ratio badly enough that consistent profitability over each consecutive series of N trades is highly unlikely.

My opinion of the core concepts behind this idea/method is that it’s an inherently powerful one. The risk:reward ratio is awesome; the core idea of price reaction to “lines in the sand” holding, or being breached with a certain amount of conviction, is the foundation of every consistently profitable price action trading method I’ve ever seen, tested, and traded.

Now, to help prevent your confusion and fear, you need to define “key level” in specific terms and then log the price reaction (MFE/MAE) to determine the overall result of each consecutive series of N appearances of the qualifying setup during your trading time window each day.

If you're doing this step or have already completed it, then you're on the RIGHT PATH.

If your analysis proves that this idea has sufficient positive expectancy to cover your costs of doing business (commissions, exchange fees, internet, average slippage for stop losses etc.) and produces profits that are acceptable to you, then you practice excellent execution of your trading plan until you’re able to produce daily trade logs that are extremely close to the logs produced during the analysis phase, and once that’s done, you take it live.

If you're doing this step or have already completed it, then you're on the RIGHT PATH.

Fast charts are irrelevant. If you need a 5-sec chart to see a key level, then by all means use the 5-sec chart. However, a level can’t be very “key” if it can only be identified on a 5-sec chart, so it makes no sense to me why it would useful to you, unless...

...you’re using a 5-sec chart to identify certain patterns that you believe will prevent losses so you have the confidence to trade your system without fear and to enter trades with no heat whatsoever so you’re not lured into moving your stop to break even as soon as price makes a move in your favor, which is what it appears you’re trying to do by drilling down to such a fast chart.

If this is indeed what you're doing, then you're on the WRONG PATH.

So, k p, please tell us, which path are you on?

 

[k p]

However, a level can’t be very “key” if it can only be identified on a 5-sec chart, so it makes no sense to me why it would useful, unless...

...you’re using a 5-sec chart to identify certain patterns that you believe will prevent losses so you have the confidence to trade your system without fear and to enter trades with no heat whatsoever so you’re not lured into moving your stop to break even as soon as price makes a move in your favor, which is what it appears you’re trying to do by drilling down to such a fast chart.

I fully agree that a "key" level cannot be taken from a 5 sec chart. But, it also becomes obvious sometimes where traders are unwilling to go. I just did a quick scan of some of my charts to show you.

First chart, from Mar 27. Now I realize that there are too many lines on here where I am almost using levels from a 5 sec chart, but I often do see that in a strong trend, swing points, such as higher lows are never penetrated on the way up. So on this chart, we open, and its a series of higher lows until we hit R, my pink line. We drop down below, but I see a previous swing low, cyan line around 0933 that holds, and I go long above. If this swing point didn't hold, I would be out for 2 points but I got my +10.

Apr 20 now. I tried my first long, got stopped out. Then I start tracking that one swing low at roughly 4365. I see price bounce off here at 0931, again at 0934, and two more times around 0940. I didn't go long, but I note that I wanted to. Now could this have been seen on a 1 min chart? For sure... but there is just more "resolution" here. Its like a nice crisp picture, versus a fuzzy picture.

Now in terms of what you outline as the wrong path, hmmm.. I do see elements of this in what I'm doing. I'm just looking for a "clean" entry around a level I'm watching. I see it as no different than buying above a 1 min bar if the 1 min bar tells me that a level broke and we can start looking for longs or shorts, etc.

The trouble I have is that I haven't nearly backtested enough the things I'm looking for, and how often they work. Doing stats is where I'm not exactly working too hard. I'm kind of falling back onto the idea that as long as I take trades that I see "often" work well, and as long as I keep my stop at 2 points and target at 10, then getting just 1 out of 4 to work should control my losses, maybe squeek out a gain, or at least a small loss.

On the one day where things fell apart a bit, I kept taking shorts, 4 of them, and far too many at the same level when it clearly wasn't working. But at the same time, because this day stopped me from trading the next day, and not trading other days I've wanted to, I haven't been able to realize a few days where I would have gotten my +10.

I still remember how geez would have four $200 losers in a row and be down $800 for the day. But sometimes he also had four winners in a day that made of for it. We simply don't know the distribution of the wins and losses... (impressive I know this eh! )

Now my problem of course is that I don't know if my entry does at least give me a 25% win rate so as to offset the losses on 3 or 4 trades with at least 1 win. But you know... I just wanted to practice holding for 10 points. I learned to take small losses, which I thought was great. I learned to take some 10 points winners, which was also great and such a huge step forward from my previous journal... but I started a journal far too soon again and was met with too much criticism, so things fell apart before I could even really move anywhere. Perhaps they would have fallen apart anyway as I still might not have an edge, but I would have much preferred to be wrong and having the market tell me, rather than to be discouraged from taking trades by listening to people on ET.