August 26 2010 Trade Review

There was an interesting role reversal for me today between the TF and ES.

I found myself focusing on the ES this morning as the TF looked nasty for execution. I was not something I thought about. I just happened after glancing at both charts just after the open.

My primary strategy is to lead with TF entries and initiate trades that allow me to scalp off edge. Then follow with an ES position after direction is clear.

This makes for only one or two ES entries a day but they are mostly winners and create much more an edge then constant back and forth ES engagement.

I had a structural premise on the ES that was clear to me since yesterday. I knew exactly what I would look for and was talking about what I thought would happen today yesterday morning.

This led to a conflict in my trading strategy. Lately, I have been looking for wholesale entries to exploit. Short term inefficiencies as other get caught in traps.

My ES trades this morning were based on a structural premise which is something I have been working on avoiding. I need to know and understand direction but want to execute traps and fakes (on the winning side).

I believe the price does the opposite of what it looks like most of the time and am willing to lose when I fade the obvious trades that work as they look.

However, I initially entered the ES only after I saw what looked like inside support start to develop and squeeze a bit. I said to myself...."this move up is BS".

I did not have an entry at all. Then I said it again and recognized my gut felt a trade. Then I had to enter. I scalped 2 points and exited just before the price squeezed again. A little more violent this time.

Amazingly, I felt the move up was crap again and faded it on an uptick. I was very confident and had conviction because this used to be the type of long I would hold that would obtain a decent excursion only to peter out.

So I shorted it confidently. Then hit the area a third time. The trades were just rolling off my fingers which is rare for the ES.

I was not able to continue hitting the move down as I lost some feel and also got into an ugly sequence on the TF.

Once I saw the ES working, I was confident the TF would follow. I ended up hesitating a bit on the TF and entered way late on my first entry. It was too ridiculous to hold and I quickly knew I was out of position even though I thought my premise would work.

I covered for an initial 9 tick loss then proceeded to trade an irritated crappy sequence on the way down that consisted of entering with almost immediate positive excursions followed by weak exiting or quick scalping.

I did not like the late entries at mid range. Risk was too much. I do not mind taking heat but not if there is a good chance I could be right and still squeezed out of the position.

Performance on the TF was just plain lame and I left quite a bit of opportunity on the table. I left some on the table on the ES as well considering that I had been all over the move in premise well in advance.

I am accepting this as my style. It has been producing wins virtually everyday. I will take extreme consistency and moderate daily profits over the constant outliers for and against me that many experience.

The question is can I continue this daily winning and sharp execution? I am slowly making it a habit to win and it is a little hard to believe after how tough this has been over the past few years.

It is a psychological balancing act keeping all the variables in check that are required to maintain what I have been doing. It requires always thinking about it but not exclusively thinking about it.

More of a passive obsession with maintaining focus on and off screen. The passiveness is required in order to be able to sense the true feel that I have developed over the past few years.

It is the feel that separates a winner from a loser.