Why trading is sometimes difficult for me

[heavenskrow]

Both 777 and Traider have given you some really good advice, above.

Different people typically see very different things, when they look at the same chart: from your chart posted above, the immediately striking things I see, myself, are two big, fairly clear 1-2-3 formations, one at the top and one at the bottom, around the areas where you've drawn arrows, both easily and profitably tradable (but with larger stops and perhaps smaller position-sizes, as wisely mentioned by Traider). This kind of observation is easily offered with the benefit of hindsight, I know ... my point is mainly that what we see when looking at charts can say as much about what we're looking for as it does about what's there. And with charts, as with many other things, sometimes the further back you stand, the more you can see.

Interesting, I never heard about the 1-2-3 formation but it seems like a good price action to add to my tools of arsenal, thanks!

I was quite profitable on the trade despite getting stopped out on the "wicks". My system is geared to have tight stop loss, and if my original theory is right, to just get back in the original direction which I ended up doing and covered at the low of the day(yellow arrow)

The main thing that I am annoyed with is that, even when I do get in at the "smart money" levels, the market balances/chops before taking off or reacting strongly. I guess my expectation that the market should just respect it and blast off is probably my weakness

 

[heavenskrow]

Scale out, trade off longer term charts. Try the 15 minute hourly etc. Scale your size down a bit, and make your stops wider.

Algos are trying to jack your money, stop you out... your helping them keep the lights on.
Brokers are rooting for that to happen
Don't be fooled! Don't be the Vig! Wall street is just raking the pot.

The very short term stuff is frustrating to me, just my opinion.

i think you are right on the money. I do need to make my stops wider and "accept the risk" that I have set for myself. getting sucked out due to noise is something i need to improve on, thank you

 

[heavenskrow]

What are your stop and profit target? If you are getting stopped out alot, then, you are using tight stops. If tight stops, then, your profit targets should be smaller as well or large enough to offset the losses when you are right. I am not sure what strategy you are using to give good feedback.

i have very tight stops, and my profit targets are based on "when the market" tells me to sell.
but they tend to be large for most of the time.
for example on this chart example i did post, I was stopped out on the initial wick, but then got back in short after I realized the initial trade was in fact right, and added on the line as it confirmed. Eventually ended up covering at the lows of the day so was able to make quite a bit..

but I guess I'm more annoyed at the noise of the market because in my head i have this assumption that, the market should respect a certain level, and when it does wick past it and then close below, it messes with my head.

 

[777]

I only trade 2-3 times a day as of late, and tend to catch most key levels so commission is really no factor.

I do still look at candles-do you have any other thing you recommend? I am always open to learning how to look at certain methods differently

There are no "red lines" or any lines, only "levels" which I have marked that should be where I anticipate market to reverse.

I didn't learn trading from watching youtube videos. I initially read lots of books, made mistakes, read lots of books, made more mistakes, and after an infinite loop of that, started backtesting and forwardtesting....and found my edge. Now just trying to master the "art" behind trading.

The Mentor Method Is Often Best:

Try developing a personal relationships
with winning traders who you think currently have an edge and see if they will help you.

Paid gurus-for-hire rarely work out as they are mostly hustlers who may have once had an edge but often never did.

"Be sound people whose behaviors are better than yours and you’ll drift in that direction," Warren Buffett.

Buy Traders of the New Era as it is a comparatively recent book which is a collection of interviews with mostly professional traders. The book has an rxtra-good focus on order execution as well as the need to find out what currently works, as good edges often end.

Also, the author posts on this site so you can target him with questions AFTER having read his book.

* often it is hard to find people who are winning traders and develop personal relationships with them.

** most people have more things to iron put than they initially thought and a mentor who currently wins can really help. Warren Buffett had several.

*** the shorter term you trade, the more you are facing winning algorithms which makes this game tougher than it once was.

In close spots algos snatch good fills (sub penny orders in stocks) in front of you and in others they step aside and let you have a poor entry, some scan the news and act in less than an eye blink, etc, etc, etc

**** on a positive note, it is fabulous you ask questions on ET!

 

[777]

Why do I have an edge-- aka positive expectation?

Why should tweeking my current ideas allow me to overcome the bid/ask, trading costs, those ahead of me on the information flow, the algos and professionals?

What am I doing that is do special?

Is there really so much soft money out there?

How many savvy people sitting at home with a retail account are winning pros, but more importantly:

Who wins at this and what are they really doing?

Key questions to think about.

 

[SimpleMeLike]

I sold NQ today at the red arrow... as you can see market closed there on the 5min bar, then on the next 5 min bar, it opens at same level but then makes a large wick above the open/close level very briefly before closing lower.

Then you can see on the next white line arrow, near the same level I sold, we make another wick higher before closing lower again.

Then later around 9am PT, we can see market making a HL and I buy at the bottom as well noted by the yellow arrow. However market chops/balances for almost a hour before deciding to rally higher.

So the science behind the trading I understand to see where big money usually comes in. My only problem is the stop hunting/poker playing/and starting to get wishywashy when the market takes it's time deciding what to do, whereas for the most part I feel like I already know where the market is gonna go next, I dont understand why it must take 1 hour+ to finally move. I dont understand the fact that it knows for example 7182 is the level, but yet makes large wicks past the level to hunt out stops.

My question is how do you other traders manage the "art" behind trading?

Hello heavenskrow,

I also intra day trade on the 3 min timeframe, so I completely understand what you saying as far the whipsaw and the patiently waiting game.

When you intra day trading, you have to play the what-if and where game.

For example,

1. What if I enter, and price goes in my favor, then comes back to my entry?
2. What if I get stopped out, and price goes in my favor?
3. Where should my profit target be?
4. Where should my stop loss be?
5. Where will price most likely stop after I enter before I get to my profit target?

I think you had good entries and trading well, just give it some time and practice. I experience the same thing and I hate the fake stop outs. I have a max stop out amount per trade. And i know my profit targets. Some times my profit targets don't get hit and I have to make decisions to break even or just hold for small loss.

 

[SimpleMeLike]

Why do I have an edge-- aka positive expectation?

Why should tweeking my current ideas allow me to overcome the bid/ask, trading costs, those ahead of me on the information flow, the algos and professionals?

What am I doing that is do special?

Is there really so much soft money out there?

How many savvy people sitting at home with a retail account are winning pros, but more importantly:

Who wins at this and what are they really doing?

Key questions to think about.

777,

These are terrific questions, I ask myself often.

 

[SimpleMeLike]

as good edges often end.

777,

Good comments.

Why do good edges often end? If that's the case how do traders make money year after year if the edge ends so often?

 

[qxr1011]

Why do I have an edge-- aka positive expectation?

Why should tweeking my current ideas allow me to overcome the bid/ask, trading costs, those ahead of me on the information flow, the algos and professionals?

What am I doing that is do special?

Is there really so much soft money out there?

How many savvy people sitting at home with a retail account are winning pros, but more importantly:

Who wins at this and what are they really doing?

Key questions to think about.

I think the most important question a man thinking about trading should answer is "Why do I have a dick?!"

 

[oraclewizard77]

Where you drew the white circle, we see very strong support. In Ninja Trader ver 7 at least, you can create price alerts. If you look around Tue, you can also see that was the bottom so if I was trading NQ which I don't, I trade ES, I would have set a price alert there which would also have underlined the support you found with the white circle.

As price was not able to break the support not even as you say to stop hunt, having 1 or more contracts around that level with targets set higher would be a profitable trade.

As for stop hunting, it may be stop hunting or in real life resistance and support levels are not walls, instead they are visual aides to suggest where we expect price to bounce off of.

So in setting stops, if in back testing, you see a wider stop is better when you are looking for trend to take you to a further target, then you got to do that.

Let's say in the white circle, you had a stop lower and it was taken out. At that point, if price were to then reverse from a failed breakdown and go back above the support, you can just get back in to a long trade.

Or instead of trying to see if price is going to hold at support, you let it bounce off of the support level and get in a little higher.

Even if support and resistance levels by themselves were to only have a 50% win ratio, we can improve the win percent by using these strategies and we can improve the reward vs risk by taking more profit off of major resistance and support levels like the ones with the white circle.