October 30 2009 Overlay, Trades, and Commentary

Break even for me today.

I was off screen mid-day so was not able to properly engage.

I need to get more aggressive. There is not enough speculation going on here.

Lots of opportunity in this market right now.

Commentary will resume next week.

October 30 2009 ES Prep Posted

Good morning. See comments.

October 29 Overlay, Trades, and Commentary

I said in yesterday's commentary that I expected a final move up prior to a significant move to the downside. I did not expect a powerful grinding trend up for the whole day though.

I suppose it is good that I did not get burned trying to fade the move all day but at the level I am reading things I should be executing.

I just could not get on the long side today. By the time I switched bias, I felt it was too late in sequence to engage.

I took a small 1.75 point loss attempting to short my potential blind resistance zone at 1052.00.

Right in the midst of the short, a good inside support zone formed. I did not change bias and stood aside the rest of the day.

October 29 2009 ES Prep Posted

Good morning. See comments on prep.

I was down 1 unit today.

Had scenario #2 on the prep as a sell off from the 1058.00 area. There was no clear entry for me to get short.

I was not just going to sell the area. I do not like selling support zone extensions.

If I were to take that short, that would mean I should short all support zone extensions and I am generally looking to get long when I see a shallow extension.

After the market started moving down, it was stretched and offered little opportunity for me get short.

I am trying to sequence more but not at the cost of taking late sequence questionable entries. It would have worked today but I do not want to try to make a career out of it.

The long stop out late in the day was a decent trade. I gave it some room but the market continued to grind down.

There is not much else to review.

I think we will see a final move up to washout the shorts and than a continuation down on a more macro view.

I think we have seen the high for 2009. We will have to see.

October 28 2009 ES Prep Posted

Good morning. See comments. Complex open today.

October 27 Overlay, Trades, and Commentary

Check out the scalp video in the previous post below.

Action was a little tight today. There was some movement but limited opportunities.

This was to be expected and premised correctly in the prep.

I had a minor profit today on an early scalp. There was not much else to sequence. It is good to not get chewed up in a day like today.

The best trades were just buying the 1058.00 support zone.

I am currently in a mode where I am not aggressively buying minor or regular support zones without some sort of micro confirmation. I will however buy an inside zone with no confirmation.

I feel like I am leaning on the micro breakout entries too much but they work. When they are not present, my trades have not been performing well.

Like I said in the earlier post, it is an internal battle right now in exactly how to best utilize my ability to feel and read the market. I think I am working through it well and will come to a good conclusion soon.

The goal for this week is to continue to win and work on sequence. I must master the art of sequencing without forcing myself into entries that I so not like.

This is the toughest part because on one hand I need to avoid randomness but in the other hand, there are plenty of entries that are technically correct but need to be left alone.

I have to program myself separate legitimate hesitation from hesitation due to lack of confidence or some other cause. They often both feel the same.

October 27 Trade 1 Quick Scalp Video

CLICK HERE FOR OCTOBER 27 TRADE 1 QUICK SCALP VIDEO

I did not get the entry I was looking for at 1058.00 but took a good breakout entry after the first congestion pullback.

I am battling with myself over simply buying and selling zones and waiting for good confirmed entries. Even with the smaller size.

It is a decision that needs to be made between consistent engagement and accuracy (winning %).

I want a higher winning % for now even if it costs ratios.

I am having difficulty seeing an extreme edge in just buying and selling zones because trades get stopped out low/high tick or come in shallow and miss.

When you combine these factors with an exit mechanism, It seems that even the best method and analysis can produce a lackluster outcome.

There is a better way to do this and I am working on it.

I good confirmed entry combined with my premise seems to work almost all the time but there are gaps in between setups that leaves the door open to randomness.

I need to work this out. Right now I am going for points on the board. Profit in dollars and ratios are taking a back seat. This is more advanced trading in my opinion.

October 27 2009 ES Prep Posted

Good morning. Comments on prep.


CLICK HERE FOR OCTOBER 26 TRADE 1 UNEDITED VIDEO

October 26 2009 Overlay, Trades, and Commentary

Lots of traffic today. Thanks for sticking around for a later (or earlier) post depending on where you are at.

There have been a number of new readers from Australia this week. I welcome you.

Read was good and execution was respectable today.

I am trading only 1 contract temporarily while working on sequence. My goal is to force myself in and out of trades and gauging PNL on the overall sequence instead of hanging my hat on individual trades as I have been.

The smaller size make it much easier for me to enter setups that I otherwise would not take. It does not mean I am taking worse setups, just some that I previously would have treated differently.

I need these on order to accomplish my goals. I need to constantly put points in the board and produce outliers.

I think I am at a point in my trading where my gut knows what is going on and I need to do everything I can to just trade it.

This goes the same for passing on good technical setups that I have no conviction about as well. This is a slippery slope for me as I do not like skipping trades.

I started the day with good rhythm and had a decent sequence going. I built off that and even placed the order to catch the big sell off today.

I cancelled the order after sitting through 6-7 bars of micro congestion.

Why? It was clear to me that the market would likely sell off if 1083.00 did not hold. However, the sell stop short I was trying to take looked less and less attractive as the congestion continued.

The short side was just plain overextended of the initial lower high at 11:09 EST and I believed there would be a more significant pullback prior to the move down.

I though I would be exposing myself to 4-6 points heat if the market pulled back. Instead, it just sold from right there.

It was not too bad of a decision and the read was correct. I did the right thing. If anything, I should have had more gamble there, especially since I was up for the day.

I am not going to dwell on it.

I felt good about my trading and sequence today after a couple of slow weeks.

It is important that I listen to my gut. My intuition is as sharp as it has ever been.

October 26 2009 ES Prep Posted

Good morning. Comments on prep.

October 23 Overlay, Trades, and Commentary

Good read this morning on the line in the sand inside support. I liked the short side if that area broke as the prep indicated but had no premium entries this morning.

It was a slow trading week for me and I was only interested in trading the open today.

I have been working on my trade selection and trading plan for the past couple weeks and have simply failed to fully engage the market.

I will be re-focused and ready to go on Monday. I know exactly what I am going to do.

There will be no major changes other than in sequencing as I mentioned yesterday.

It is time to start executing my prep as was originally laid out in the blog trading plan.

There was not enough of a sample this week to do a weekly commentary.

I will only say that I did not engage and was out of sequence for the week. Trading is a streaky business and I think I have just gone though a slow period.

I feel that I am ready to go for next week. Sometimes you have to struggle before moving forward and that is what has been happening.

October 23 2009 ES Prep Posted

Good morning. See comments on prep.

October 22 Overlay, Trades, and Commentary

I had a good read on the complex open this morning.

I took a breakout short at the support zone this morning. This is not often part of my plan.

There trade needed to be taken because there was good structure to the down side and good risk/reward. Also, an excellent pattern entry for a support zone break.

I cut the trade with a 2 point loss and reversed long because I had a classic long setup after the washout.

I exited both long trades early. This was my plan today. I had an expectation of a test of at least 1082.00 and likely beyond but was in a different mode today.

Working On Being More Of A Hybrid Trader:

I am doing well catching the big moves 1 or 2 times a week but having obvious difficulty holding equity highs in between big trades.

There is something to be said for putting points on the board every day and there are definitely not premium setups every day.

I need to start addressing this because the past couple weeks have demonstrated that I can grind even worth near perfect reads on what I expect the market to do.

This is because there is a lot of noise when price travels from point A to point B and introducing risk management stops of 2-4 points makes it impossible to catch these moves the way I want to catch them.

It is causing my to "pick and choose" my trades too frequently. I want to be mostly discretionary but have had too much randomness in the past 2 week.

I need to work on my skill of generating smaller profits in between premium trades. I believe that this is now the most pressing issue in between me and accomplishing my goals.

My Struggle:

The main struggle for me right now is that I am generally clear on what the price action is doing and thus often holding positions when I know they will pull back and move against my open equity.

So I am often forcing myself to remain in positions that I know are going to correct.

This is OK but it spills over into my executions and I have found myself forcing entries lately.

I am always debating on whether to just lay down my bet on an area and ride it out or to take more of a sequencing approach, getting in and out of a move as it unfolds.

I can go on forever about this issue so will leave it at that for now.

I have to acknowledge that doing what I am doing now is leaving money on the table and will just get better with time.

Plan:

In attempt to increase my proficiency and willingness to consistently enter trades, I am actually going to start cutting most trades earlier that what I would like and forcing a re-entry.

I think this is the only way to get better at sequencing.

I will also be reducing size on most trades but give my self the option to trade larger size than I am now with ad-ins to sequences.

This is not going to be a dramatic overhaul. I do not think my method or ability is lacking here. The approach needs some tuning.

I need to be more agile. It was costly today because I got out of my long with a scalp and did not re-enter.

I am going to force more sequencing under the premise that I will adapt quickly.

This will naturally hurt my ratios and is contrary to much of what I believe about the "optimal" way for a trader to execute.

It is very possible that conventional wisdom as well as my personal beliefs about how trading should be tackled does not suite my trading personality as well as it could.

It the only way for me to explain the divergence between my analysis and execution.

This is my hypothesis and we are going to test it.

October 22 2009 ES Prep Posted

Good morning. Complex prep today. See comments.

October 21 Overlay, Trades, and Commentary

I had no trades today. The zones were good but I had a premise for a retest of 1082.00 and possibly 1077.25 just after the open. Instead, the market took off and I was not going to chase it.

Overall, I though we would see a test of 1077.25 and we did but not before a big move up and a sneaky late day selloff in the last 45 minutes.

The ES has been tough lately. I do not mind standing aside in this type of action.

Observations:

There have really only been one or two good opportunities to trade each day on the ES lately.

This does not apply to those who scalp a few ticks at a time.

I have noticed that many of the clear setups I often see have been getting retested and pushed through and then go on to perform as premised.

This makes it tough to hit the key areas.

If you go in early like would have been required to hit the opening long this morning, you are risking getting retested and pushed beyond a reasonable risk tolerance.

This happened to me twice last week. I had the direction and premise but got clipped out on my initial entry.

Usually I would just re-enter but the grinding nature of the action makes the market contract and thus most setups are not worth risking 2 full stop outs.

The problem is that if you wait for a good washout or firm confirmation, you can miss trades like today which can put you on a path to randomness.

Today, I wanted to see the price push back down to 1082.00 at least before entry and I missed the move.

I am going to deal with this by being patient and waiting for my key setups.

Pushing myself into questionable trades has never worked out well.

It is not enough to have a good read and premise. I must focus on hitting the areas where the market is really going to have to work to stop me out.

I believe I have deviated from this concept a bit lately.

October 21 2009 ES Prep Posted

Good morning. Detailed comments on prep.

October 20 2009 Overlay, Trades. and Commentary

I was going to be brief tonight but ended up talking myself through this post. There is a lot here.

Tough grind today. Small loss in ugly action. Initial read and first visualization has been powerful. Almost have to consider speculating on this unconditionally.

I have noticed in the past week and a half or so that the premium trade of the morning has happened closer to 11:00 AM.

This is a major change in action from what we have been seeing for the past 6 months.

As I have said before, time of day has little relevance in my overall analysis but I can not ignore the fact that prior to the past couple weeks, the most premium trades have occurred prior to 10:00 AM EST USA.

Like poker, Trading To Me Is All About Position:

I have commented about this before. It is my opinion that my first read and premise should be executed. Even with minimal confirmation.

This is because if the trade is skipped and my premise turns out to be correct (it usually is), that any subsequent entries attempting to capture the initial premise will be at a worse relative price, with higher risk, later in sequence, and have a lower probability of a positive outcome.

Thus, it is a better bet to get your money in when you have position and the maximum expectancy of your premise.

When you skip a trade or miss due to hesitation, you are put into a reactionary mode which can often effect execution.

Late Morning Moves:

Things have changed recently and an adjustment needs to be made.

The market has tended to washout once, began the expected move, and then have a secondary washout prior to the actual move.

This makes me feel like I am out of position and my stats for the past 2 weeks are showing it.

I have either stood aside or been stopped out of the initial move and not properly engaged the secondary which has turned out to the the natural move.

I will not model my trading based on time of day.

However, I need to be aware of this recent behavior and ready to adapt.

Adjustments:

This may not be understood by most reading but what I am going to do is require significant washout and confirmation on inside zones when prior pivots are used to clearly establish the zone.

I will hit a "blind" zone with minimal or no confirmation.

Also, I need to start fading certain highs just after the open with no confirmation. I do not like fading in an uptrend but that was really the only trade for today and I think we will see a big downside move soon.

I will do this with appropriate structure as long as I can get the stop well above the high. This may require smaller position size and ad in upon a breakout.

The market tempo and behavior has changed. It may be temporary but minor adjustments need to be made.

My Performance:

The past 2 weeks have not been good.

There have been a couple rare mistakes, a couple over aggressive trades, and a lack of an adequate sample to get off tilt.

Mistakes happen and are the cost of doing business.

The lack of trades is an issue. I can not really even root out the problem with my PNL for the past 2 weeks because there are not enough trades.

My trading has slipped into random territory and this is worse than a couple bad decisions because you can not control the outcome of a random sample.

You never get lucky in random trading either. The market is efficient at punishing randomness.

I can not just increase trades for the sake of increasing either. This situation needs to be handled with care.

The solution is to focus and take the entries as they come. This tends to lead to a couple more losers prior to a reversal.

It is important to keep executing when things get tough.

In trading, randomness almost always leads to losses and losses can lead to more randomness.

I Am Not Broken:

I have thought about this a lot today.

My trading recently has not come close to the level that I know it can be at.

I am not holding and pushing through equity highs. I have learned that if your account does not go up consistently, it will go down.

I immediately start to question my capability when I do not get the intended result. This is an amateur habit that remains.

Im not going to win everyday or every week and need to stay focused.

My analysis continues to be accurate. It seems to almost always work out but I am not executing it efficiently enough. It may not always take the path I project but the end result hits constantly.

It is confidence and persistence that is lacking. The skill is there. I know it is without a doubt.

I would not have taken this path as far as I have if I thought or felt otherwise.

I have to acknowledge to myself that I can do this at the highest levels and that I can not let the noise in the market or the Goldman Sachs bullies make me think otherwise when I am contemplating a hand.

A trader's month is often made in 3 or 4 days. We have 8 trading days left this month.

I can not be certain everything will work out in my favor in that short period of time even if I do everything right.

I am certain that if just trust my reads and execute what I feel based on my preparation, I will accomplish my goals.

October 20 2009 ES Prep Pposted

Goals for today:

1. Execute.

2. Let the market prove you wrong.
Good morning. See comments on prep.

October 16 2009 Overlay and Weekly Commentary

I am not marking up my execution chart today.

I was stopped out of an AM trade that I forced myself to take in order to not miss a potential opening run up.

The trade was too soon after the open and against my prep premise of the market trading down closer to 1077.25 visualized on the prep.

I had a second micro breakout entry at 1:00 PM today but could not execute due to technical problems. You can not really speculate on what would have happened because the trade did not happen. Likely break even at worst.

I continue to have poor performance on Fridays. I need to correct this part of my trading.

Weekly Review:

There were not enough executions this week to declare a winning or losing performance.

I had two trades that did not work. One was clearly a mistake which was addressed earlier in the week.

You can not look at a couple trades over the span of a week and expect to gain any insight.

What I can say is that this week lacked intensity in execution. The market was very slow and grinding.

I made a conscience decision to mostly stand aside.

However, my preps and premises were correct all week. This could have been traded.

This is turning into a broken record but I must note that I am not consistently executing my prep.

I can justify reasons for this but the bottom line is that my analysis is almost always correct and I think I have steered a bit off the path that got me to where I am now.

The initial intention of the blog is to trade that prep. After making an excellent run in September I have made some adjustments that have cause a grind in equity.

I will focus on the basics next week. Trade the prep. It is simple and it works well.

I am also going to require more textbook breakout entries.

I need to see tight and clear congestion off significant zones to execute these with the win % I want.

I attempted a few in the past couple weeks that were acceptable entries but they were forced and did not work out.

I know when there is a good trade and when there is not. I am always trying to test this. 90% of the time when I lose it is because I am forcing trades. Trying to make something happen.

I justify this under my "it is better to lose than to miss policy." This is correct but there is a line that gets crossed where I justify an entry I do not like under this policy.

I need to remember that my gut is almost always right and stick with that.

Pure Drive and Ambition:

The effort one has to put into making a trading career work is indescribable.

I have tried to write about it before but can not find the words.

Most will never understand what this is.

I have been having trouble dealing with myself off screen.

Expectations are beyond what many consider possible as I start to see what I am becoming capable of.

There are no breaks. I am living this 24 hours a day.

There are just two modes: relentless sense of urgency fueled by oppressive drive and ambition or constant fear of short term failure and financial ruin. Nothing else.

October 16 2009 ES Prep Posted

Good morning. See comments on prep.

October 15 Overlay, Trades, and Commentary

No trades again today.

My read was spot on. I am now very familiar with the contraction setup we have seen for the past week.

I felt different about my prep starting 1.5 weeks ago and did not know what to make of it initially. I went with my instinct and it turned out to be correct.

Now I understand what I was feeling. It was the sense of short term indecision in the price action. The market was going up but it was being constantly faded and washed out which causes a contraction.

I literally "feel" the direction and premise of the market when I do the prep. I believe this is the result of my training and preparation.

Literally spending endless hours observing and noting how price and volatility acts in specific situations. It has become second nature to me.

The challenge now is trusting my instinct enough to place consistent large bets on my premise with limited confirmation on demand.

I have made great strides in this in the past couple months but stalled out a bit in the past week. I do not think it is a big deal. I am doing the right thing by standing aside.

I could adapt to this type of price action but I am not going to make a career out of trading a grind like this.

Let's see what tomorrow looks like. Many probably think people will be taking profits. I would normally agree with this but it is options expiration so a positive close is likely.

I will be ready for whatever happens.

October 15 2009 ES Prep Posted

Good morning. See comments on prep.

Goals for today:

1. Premium setups.

2. Take what you feel is right.

October 14 2009 Overlay, Trades, and Commentary

I had no trades today.

The read was good. I had an upward bias and was looking for opportunities to get long up until about 11:00 AM today.

I made the decision in the late morning that I was not going to aggressively engage the market today. The action was extremely slow and grinding.

Most of the prime moves have been happening in the European session. If this continues, I can make adjustments to entry requirements. I do not think it will be necessary.

The only thing to do today was to blindly bid into the 1080.00-1078.00 area or take a shallow micro breakout around 1081.00.

It is frustrating to see my visualization and prep work well and not trade it. It is difficult to find balance between good repeatable confirmation and simply biding and offering key areas.

I have taken a few questionable setups in the past week and it has not worked out well. It is worth noting that these were also short side trades which were fading an obvious powerful move up.

Today I wanted good confirmed setups and the market did not cooperate.

I will be ready for tomorrow.

October 14 2009 ES Prep Posted

Good morning. See comments.

Goals for today:

1. Wait for official premium setups.

2. There have been no premium setups, do not invent setups.

3. Take what you feel is right.

4. Do not force trades.

5. Maintain good position. You control the day.

6. Do not hesitate when it is time to execute.

October 13 2009 Overlay, Trades, and Commentary

I usually do not make undisciplined trades.

Today's trade was the exact polar opposite of what I normally do given the same setup.

I attempted to short the pullback after a relatively shallow breakout. I am almost always anticipating a washout and move back into the range in these situations.

This was a 100% unforced error and very sloppy trading.

I had the correct long trade order set at 1067.50 initially.

When it did not get filled and the market pulled back, I basically decided to fade myself to the short side. Most of my losses are due to me fading my own premise.

This is particularly bad.

Shorting a pullback after a support zone can be a good trade but it is not one I usually take. This is the type of trade where I usually say "here is where all the retail traders are getting short".

Today it was me and there is no excuse other than it being a stupid mistake.

It may not seem like a big deal but it is to me because the trade had no chance according to my plan and I talked myself into it which meant I had to force the execution as well.

Action In The Past Week:

I think the trade was primarily a result of the fact that there have been ZERO premium setups since last Tuesday.

I have not seen a spell like this in months. Instead of standing aside I allowing pressure to succeed and move forward in equity get to me.

Both losing days since last Tuesday have been on setups that were marginal at best. They really were not even setups, just concepts. Concepts will not cut it.

If you look back, the market has not traveled more than 4-6 points in any one direction intra-day since last Tuesday.

All of the movement has been in the Globex session. Including today. Spiked 1068.00 - 1081.00 new high just after the close.

This is horrible action with limited edge.

It is a fine line between pushing yourself to execute and inventing setups or scenarios for the sake of engaging and it has put me on short term tilt now.

Basically, making the last week a scratch. That type of performance with what I know is crap and completely a result of mental distraction or fatigue.

Whatever caused it needs to be corrected. These issues will always exist in trading.

11:00 AM Trades:

I hate having to incorporate TIME into my trading plan because time has absolutely nothing to do with structure.

However, every single trade I have taken at or just after 11:00 AM that I can recall in recent history has failed.

SO I AM DONE WITH 11:00 AM TRADES FOR NOW.

This actually makes sense and is more in line with my universal view and strategy.

If I am not already in a position at 11:00 AM, anything I am going to get into is going to be reactive to missing an initial move and also OUT OF POSITION AT A WORSE PRICE.

This theory continues to prove itself day in and day out and has some significant ramifications to intra-day trading which I want to address at a later date.

Not all 11:00 AM trades are 11:00 AM trades. I know the difference and will point it out when I see it.

Why Not Trade The Pullback After The Price Broke Back Into The Range?

It seems like good trade.

Same reason as I stated above about missing a trade. OUT OF POSITION AT A WORSE PRICE WITH AN LATER IN SEQUENCE KICKER.

I believe position is everything in trading just like poker.

When there is a moderate extension outside a range and a move back in, there are several points that it could pull back to.

You can try to catch this but your reward is smaller than getting it right the first time and your risk is more with lower probability of success.

Is it worth 2 stop outs to hit a progressively worsening trade? No.

Why take the bet?

Get it right the first time. That's it.

I am rapidly evolving into a position on intra-day trading that says there are a couple times a day where the price is a bargain and will run in your direction that can be projected and hit consistently.

Everything else is manipulation and noise caused by Goldman Sachs bullies, scalpers, and arbitragers.

Some say you can not predict the price action.

I disagree. I do it almost every day with extreme accuracy.

It is not a prediction but rather a projection. The difference is that a projection requires real time course correction based on certain structural scenarios.

It works but you can not capitalize on it until you completely stick to it under pressure.

How many times will I have to prove my process correct before I trade it exactly as it is meant to be traded?

October 13 2009 ES Prep Posted

Good morning. See comments.

Goals for today:

1. Trade with confidence.

2. Be aggressive on premium setups.

3. Create outliers.

4. Let the market prove you wrong.

5. No defense or cutting.

October 12 2009 Overlay, Trades, and Commentary

There was no action today.

I attempted a micro breakout long off the 1072.00 inside support mentioned in the comments on the prep but quickly scratched when it was clear the market was going to contract.

I do not like to scratch but the breakout entry in the tight range put me right in the middle of the potential daily range. I correctly considered this out of position and decided it was not worth the risk to hold.

There should be some good trading over the next few days. The market is sitting on yearly highs should provide some good opportunities whether it extends or corrects to the downside.

I do not have much else to discuss tonight.

There is a good posting below of a commencement speech that Paul Tudor Jones did for a group of ninth graders this summer.

It i s a good read.

Speech By Paul Tudor Jones On Failure

Here is a speech that Paul Tudor Jones gave to a group of ninth graders.

He speaks candidly about failure.

I have said often in this blog that a big part of becoming a trader is constant failure.

Prior to trading, I had not experienced much failure. Now I see it as a requirement to reach the elite level of anything you do.

Paul Tudor Jones - Failure Speech June 2009

October 12 2009 ES Prep Posted

Good morning. Prep posted.

Goals for today:

1. Premium trades.

2. Take trades that feel right.

3. Be confident.

4. No defense.

5. Create outliers this week.

October 9 2009 Overlay, Trades, Commentary, and Weekly Review

I had a couple breakout long orders at 1062.50 and 1063.25 this morning just after the open. Price came within a couple ticks of filling then pulled back.

After the second pullback I saw a familiar sign of a contracted day and decided to not engage. My day was pretty much over after that.

My read was correct and the initial premise of the trades was accurate and would have worked. This is very common.

However, the max earning potential today was 8 points if I held all day and this just does not interest me because I would have had to bet 6.

I did the right thing.

Weekly Review:

I had a small profit this week on only 6 trades. Two wins, two losses, and two break evens.

I did not make any mistakes and had fantastic reads and preps all week.

Just failed to properly capitalize on my reads. The only exploitable day was Tuesday and I caught 15.75 points but feel in hindsight that I only got 1/2 the available volatility.

This after catching 99% of the AM move up.

Need to note that it is crucial to maximize the days that are going to give up good trades.

The losses on Thursday were acceptable. The trades were a little aggressive but that is just the cost of doing business.

The profits were low this week due to failure to exploit Tuesday only, not losses on Thursday.

I sat Monday and Friday out.

I turns out that everything looked bizarre to me Monday because the CME changed the algorithms for producing tick data.

I was not aware Monday morning but knew my tick charts looked different.

There is no magic time frame but I have a symmetry I like to see in my plotted data.

I have adjusted my 1750 tick prep chart to 2450 ticks and my 610 tick trading chart to 810 ticks. I may end up changing that to 910 ticks.

Personal Review:

I had an angry post yesterday because the week was not going how I wanted it to. It is important to remember the number that matters is the one at the end of the month and year.

It is common for just a few outlier days a month to make or break a trader.

My trading overall has been precise and disciplined and I have made few mistakes. There has been great progress reducing the number of missed opportunities.

There is much room for improvement. There will always be.

The focus in the upcoming weeks need to be on creating multiple OUTLIERS. This means pressing when I am up and exploiting my reads on days the market is cooperating.

This is the #1 goal.

It must be done in conjunction with everything else I have been doing.

I believe accomplishing this over the next couple weeks will help me advance to the next level of trading and be a major milestone in my career.

I think I am ready for the move.

October 9 2009 ES Prep Posted

Good morning. See comments on prep.

Goals for today:

1. Take all trades that feel right.

2. Require good pattern entry confirmation.

3. Need to perform end of week.

4. Ne defense.

5. No break evens or cutting.

6. Let the market prove you wrong.

October 8 2009 Overlay, Trades, and Commentary

Positive thinking gets you nowhere in trading. Tearing down and rebuilding mentally (not strategy) helps.

You need to have a low before you can make a new high. You need to hit a new low in life before you can be the trader you want to be.

I was not too irritated after today's 2 unit loss until I reflected on today's trades and realized that I have put myself in the same Thursday position as I was in last week.

It is late in the week and I have not performed at the level that I know I can.

I did not do anything wrong today. The trades were OK. They were mediocre setups on slightly stretched legs down but had to be executed in case this market sold off today.

What is irritating is after this morning's stop out and break even after a 3.5 point excursion, I felt the good trading was up. But executed anyway this afternoon.

Partially because I was thinking at lunch that I can not just hit a morning setup and sit out the rest of the day. This is flawed. I know when the action is not it my favor. Why make bets in ugly action for the sake of being active?

Also, this crap action in the afternoon is exactly what I feared there would be if I attempted to start shorting on Tuesday when I had a 15 point run earlier that day. The trade would have performed on Tuesday and created an outlier day.

Afternoon Trade:

This was a decent area to short after a failed extension of 1064.00. They only thing that could make this trade fail was a higher low (afternoon inside support) in the middle of nowhere. That's what we got.

There was an obvious inverted pump fake warning of this inside support holding around 1060.50 that formed. What am I supposed to do? Bail on the trade after taking all the heat.

The nature of the entry left no way to reasonably exit the trade. ANY exit could have resulted in the trade working and a premature exit which is worse that a stop out.

No excuses:

This may be an over reaction to a day where the chips just did not fall in my favor. I do not care.

This type of performance is ABSOLUTELY UNACCEPTABLE and needs to stop right now.

I have been sitting on a new equity high and range bound for about 2 weeks now. This is weak. I need to produce outliers and advance forward in order to hit my goals (in order to survive for that matter).

For someone who spends every waking moment focusing on trading the .75 unit that I am up this week is PATHETIC.

I read the market too well to accept this.

I need to step up and find it within myself to push myself to the next level. Whatever it takes I need to find it and it needs to get done NOW.

October 8 2009 ES Prep Posted

Good morning. Comments on prep.

Goals for today:

1. Take all trades that feel right.

2. Do not over manage positions.

3. No defense.

4. No break evens or cutting.

5. Let the trades work.

6. Be aggressive.

7. Let the market prove you wrong.

October 7 2009 Overlay, Trades, and Commentary + VIDEO

Check out the VIDEO below. Commentary and live trade.

I spent some extra time on the prep this morning. The read is usually quick but today required some deep visualization.

The extra time paid off. The prep was extremely accurate down to the fact that 1048.00 would extend but likely hold and premise of sideways action.

I took the long this morning which was similar to yesterday's long. The management was completely different though.


Yesterday, I was premising for an extension and not much else. Today, I was premising for a sideways and contracted market with a potential extension. Big difference.

Same trade, two management styles. It is crucial to understand that trading is not about setups and signals. You must understand how to adjust to changing market structure and volatility.

I was a little defensive today. This is generally a losing strategy. It causes a trader to miss the winners and hit all the losers.

I handled it OK today. I did the right thing. I will not make a habit of it. It would have been OK to lose today.

I have been reading and seeing the action well and was confident in everything I did. Especially not really engaging.

There is opportunity to work a tight sideways market, especially when you know when to look for it.

I simply did not WANT to today and that is OK. I did not miss much.

I have found that it works best in trading and in life to just trust my judgment whether it is good or bad. Then at least I am consistent.

CLICK HERE FOR TRADE MANAGEMENT IN A WHIPSAW VIDEO

Update

Nasty contraction this morning. Do not get whipsawed in this mess. We will see a breakout but this is ugly.

October 7 2009 ES Prep Posted

Good morning. Detailed comments on prep. Good trading.

Goals for today:

1. Trade what you feel is right.

2. Do not over manage trades.

3. Your targets get hit.

4. No defense.

5. No cutting or break evens.

6. Let the market prove you wrong.

Wednesday McEnroe for Intensity:

October 6 2009 Overlay, Trades, and Commentary + VIDEO

Check out the VIDEO with commentary below.

Yesterday:

There were no postings yesterday because I elected to stay off screen. I could not sleep Sunday night and was up most of the night watching the price action.

When it was time to do the prep I was not seeing the market as clearly I usually do. This is the best time to stand aside.

Today:

Trading was decent today. I had potential inside support at 1041.50 pre-market. There turned out to be extension support at 1042.50 (close).

I caught the long with a text book failed blind extension micro breakout entry. We have seen this long setup dozens of times in the past few months.

It has become standard procedure to hit it.

My overall target was 1059.50. I sat through the grind believing in my target. I covered 1/2 with 6 points after a significant correction down then drive up.

It is worth noting that the structure of that congestion I exited in was pointing overwhelmingly up. However, it was a natural area to cover 1/2 so I did.

I have to balance what I think and what makes good sense with probabilities. What I think in feel is more important by the way.

I covered the other 1/2 a couple ticks off the high of the day. It was a purely discretionary exit near my target that worked out well.

It is important to remember to exit decisively. Do not wait for exit confirmation because then you have given back too much.

I did not participate in the move down. There were a couple good short setups but I was not prepared for the move and do not just trade setups. I expected a reaction to the downside if 1059.50 failed but did not act with aggression.

One weak spot in my trading is afternoon trading after catching a big run in the AM. I suppose I should press at these times but often I feel the market does not have another ultra-premium trade left.

I need to work on this.

The #1 issue on my trading agenda right now is to have consistent outlier days. This is crucial if I want to reach my goals.

Not much else today. I will let the video speak for the rest of the post. There is some good commentary along with the trade video.


CLICK HERE FOR OCTOBER 6 TRADE AND COMMENTARY VIDEO