Follow the White Rabbit

Basic Trading & Sim & Indicators & Divergence Trading

2012-02-16T13:04:00.000+08:00

My thought for today:

**1st basic trading rules to know market direction....:

A) Range - use fading technique
B) Trending - use trending method

**Range chart for scalping and 3 indicators _ ADX and MCD and Stochastic
1000 tick charts for MACD divergence trading

** for sims.... from now I will use 2 contracts when SIMming...What I need to lose ?

For real trades , I will stick to 1 lot

Silent Night (in Malaysia)

2012-02-16T10:06:00.002+08:00

Enviro : range - trend fading
erratic price action so fall back to indicators trap :)

Erratic market sim 40+

2012-02-14T22:14:00.001+08:00

but i have more confidence

Old charts with new mindset

2012-02-11T13:01:00.000+08:00

Friday : i let the market tell me where he want to go after SUPPORT and the result :+sim 460

sim +100

2012-02-09T22:28:00.001+08:00

After these years only 2 rules keeps going on with 1 sad fact

2012-02-09T12:47:00.002+08:00

The rules of macd zero and the triangle pattern
and the 1 sad fact that I have a tough time putting that rules to work in my favour

Sim 160+

2012-02-02T09:54:00.001+08:00

Keep shooting at the training field
code: mcd 0

CL hardknocks -What they dont teach you in trading books

2012-02-01T22:11:00.003+08:00

CAUTION: Take these lessons only with pounds of experiences.

1. Volume - Decreased volume during higher price indicate that price may reverse.

2. Mcd - cross zero may indicates anticipation of strong movement

3. Mcd divergence signal valid only in big frame chart. Taking divergence signal in small frame is a sign of sure death and a rookie baby trader.

4. When assesing current situation, relate to the left of the chart. Check the space of least resistance

5. Elliot wave pattern when coincides with MA & Mcd > the risk is minimum

6. Doji and hammer are good 'landmarks' and 'landmines'

7. Fast trend shall be followed by whipsaws and vice versa.

8. CL has a habit of finding the base as the launching pad, normally at the Pivots and SR. Find that launching site.

9. Look for the candle pattern - the trigger - 2 types - the price pattern esp triangle , the candle esp hammer (pin bar), bigger candle and doji (spinning top)

10. As I don't like to deal with losses I will let my Stop Manager to deal with the losses, I will concentrate only on opportunity of profits. Sounded funny but hey, I'm a human :)

11. Stop order can be used to enter market and market behaviour at that stops could be better seen than a market order.... when emotion and overconfidence easily take over. However I will not be messing with Exit stop order.

12. Others often mentioned that SR line is the line of opportunities but remember that SR line could be the line of death. Strong movement could happen at that line. Act AFTER the line is touched and watch the volume for traps. Use market order at the starting position of NEXT candle and use tight stops. What is not killing me at this SR line, will make me stronger.Experience and judgment is crucial here. Thats why some trader prefer the pullbacks than breakouts. But I prefer use the term 'breakback' to replace the term pullbacks - touch and break the SR line then move back to the original direction. What made most of my losses were I expected price to made new turn trend but market later rebounced back to the original direction.

Next position of candle

2012-01-11T23:49:00.001+08:00

After a complete candle..the starting point of next candle together with EMA is a good Holy Grail :)

sim + 70 but missed the 1250 move

2011-12-15T07:38:00.001+08:00

correct direction, correct entry but wrong ext

EMAs and VST charts

2011-12-07T09:14:00.001+08:00

Even though previous Simmings were good but am not comfortable with it as my account IS small and these charts had big frames

...So I put 3 type of charts which have very short time frame....

tested ..it feel good

Sim + 350

2011-12-01T10:38:00.001+08:00

Tough market...putting back 3 ema ---see from there + macd with the sam esetinng of ema.....simple order for the mind in tough market

SIm + 380 - enter on pullbacck

2011-11-24T15:24:00.001+08:00

Nice figure...

Since I take supplement, my brain improved a bit and I took a more " wide" approach to trading..Like a Elliot Wave...I conclude that market has 3 phases - trend, flat breakout, and swinging from point to point. The best gain . of ocurse is trend phases..but to take position in trend required a"pullback" straetgy to avoid whiplash.

Pullbacks

2011-11-23T00:02:00.001+08:00

Below is an article from one excellent trading website ....

http://www.swing-trade-stocks.com/pullbacks.html

How to Trade Pullbacks

Buying weakness and selling strength is the art of buying pullbacks. Stocks that are in up trends will pull back offering a low risk buying opportunity and stocks that are in down trends will rally offering a low risk shorting opportunity.
As a swing trader, you have to WAIT for these opportunities to happen because...
Doesn't it make more sense to buy a stock after a wave of selling has occurred rather than getting caught in a sell-off?
Doesn't it make more sense to short a stock after a wave of buying has occurred rather than getting caught in a rally?
Absolutely! If you are buying a stock then you want as many sellers out of the stock before you get in. On the other hand, if you are shorting a stock, then you want as many buyers in the stock before you get in. This gives you a low risk entry that you can manage effectively.

Buying Pullbacks And Shorting Rallies

Where do you buy a pullback and where do you short a rally? You buy them and short them in the Traders Action Zone (TAZ). Here is and example on the long side:
See how you are buying stocks in strong up trends after a wave of selling has occurred? Ok, now here is an example on the short side:
Now you can see how you are shorting stocks after a wave of buying has occurred.
When going long, wait for the decline into the TAZ and when going short, wait for the rally into the TAZ.
Are all of them created equal? Nope. You have just a standard pullback like in the example above and then you have...

The First Pullback

These are exactly what the name implies. It is the first one after a change in trend. How do you identify a change in trend - when the 10 SMA crosses the 30 EMA. After that happens, you look for an entry when the stock gets into the TAZ. Here is an example:
This is the most reliable type of entry into a stock and this is the likely area where institutional money is going to come into the stock. If you only trade one pattern, this should be it! You can get into a stock at the beginning of a trend, at a point of low risk, and you can take partial profits and ride the trend to completion! What more could you ask for?
Oh yeah, speaking of getting in on the beginning of a trend. This next setup fits neatly into an Elliott Wave Pattern...

First Pullback After A Breakout

There is one other type of pullback worth mentioning and that is the first pullback after a breakout.
If you are looking at a stock that is trading sideways or forming a basing pattern, and it suddenly breaks out of the pattern, you can look to buy the first pullback after the breakout. This also gives you a low risk entry into a stock that will likely continue the current trend.
Here is an example:
Most traders are going to buy break outs. The word break outs sounds so exciting doesn't it? The problem with buying break outs is that it is hardly every low risk. Think about it. If you are buying stocks when everybody else is, then who is left to buy the stock after you get in?
Forget buying break outs. Step away from the crowd. Wait for the breakout buyers to get scared and sell. This sets up the pullback that you can get into with low risk, high odds, and a profitable reward.

Source:

http://www.swing-trade-stocks.com/pullbacks.html

Sim +160 sideways

2011-11-18T22:15:00.001+08:00

for less risk, take position after cross or near cross of EMA with indys rule intact

Sim +80 late session

2011-11-17T23:50:00.001+08:00

hammer and ema had some roles for a holistic picture + indiys

Sim +140 premarket

2011-11-16T22:45:00.001+08:00

after that the market went to the moon

Sim -160 pre- market sideways

2011-11-15T23:44:00.001+08:00

Side by side trading with Infinity Trading Challenge ---boredom before pit session open cause me to enter sim recklessly...found that my original setup making money if stricly adhered to :*(

however my losses was lesser than 1st Infinty trading Challenge..but they trade real money..and they are pros

Sim +170 in sideway mkt

2011-11-14T21:45:00.001+08:00

Confirmed method but not staying in trade

Sim late session -70 erratic

2011-11-11T23:51:00.001+08:00

sim +140 250t

2011-11-10T23:15:00.001+08:00

simple is more

Sim test & Brain supplement

2011-11-09T10:38:00.001+08:00

Okay...I need a warming up.
Decided that I put back 4 indicators there to take out stress out of my mind...
Feel good about this...seriously :)

And yes, my brain & health supplements arrived yesterday !.
Feel the difference already.. heheh

MF Global - riskier than CL

2011-11-03T10:36:00.001+08:00

Trading Challenge

2011-10-27T10:31:00.002+08:00

If u guys want to see some real actions from the guru then klik this

http://www.livetradingchallenge.com/

and now I open for comments in this blog

Need mental focus

2011-10-11T12:22:00.001+08:00

The technique is okay ...but the problem is my mental focus...

May be I need a brain supplement :)

Simple mind

2011-10-08T07:12:00.002+08:00

I look at the candles and it seems I can predict the next move like a trader ..for 2 consecutive days
Add in 1 indicator, then I begin to think more like a philosoper

And yet I have at least 2 indicators all this while.
May be my learning phase is over, and now its time to do it as a naked man ;)

p.s..ok I will SIM run naked for 1 more week.

Hammering my brain

2011-10-06T23:20:00.002+08:00

Candlestick hammer is gooodddd :)

Stochastic

2011-10-06T09:56:00.002+08:00

Price action is weak now so.... no action is required...

Back to indicators..sigh

I found that Stochastic work when it work.
With some weird behaviour, of course.
Yesterday I changed its MA to EMA..a sort of Dinapoli Stoch.
> Better.

MACD...yes...the old guy MACD.
I put the same parameter like D Stoch.
> No lag.
I lied...some lag

Will put some 'acid' to it. :)

OK

2011-10-05T09:07:00.001+08:00

I picked a soft spot in CL - sim green again.
but I have to do it in 30 sec

Entry & Exit

2011-10-04T10:22:00.001+08:00

Up to yesterday my system will signal me to enter and to exit.
Conflicting signals were abundant. 50: 50 , more so in current CL market
So it made me wonder, entry and exit surely have different dynamic behaviour

So I devised system A to enter and system B to exit so both will achieve at least 80:20
It is a logical move, right ?
We wanna the market move from A to B in our direction to make profit, right ?
As usual SIM test is good.
I will let it simmer in my trading mind

Butt

2011-10-01T11:01:00.002+08:00

Scalping pay peanuts, I will loss focusing energy...
it is the big move will make the day
U know a tool called Andrew Pitchfork ?
Fibonacci retracement ?
Elliot Wave ?

To keep tradition alive I will call my tool....the (B)MW
I knew it long time before but not mentioned it in the blog, so i forgot...silly me
Add it the standard old EMAs that we all have and we ( me actually) will see

Have a nice weekend

New scalping technique

2011-09-30T14:32:00.000+08:00

well not really new , but I coincidently stumbled upon it after long dark hours...it is suitable for scalping.
for a more meaningful move I will learn more about Elliot wave

New technique in chart

2011-09-29T09:10:00.003+08:00

I put an overlay study using a bigger chart into a smaller chart: Then I synchornize these 2 charts
Whoa...quite a view...no need to stretch my neck

Rusty move

2011-09-26T21:57:00.003+08:00

Divergence not suits to MIn charts

2011-09-24T12:32:00.000+08:00

I revisited the donkey divergence lesson :

I found conclusive evidence that divergence is NOT suitable for MIN charts.

Thats all I have to say

Smurf vs Frakenstein

2011-09-22T10:21:00.000+08:00

Due to EIA report, I decided just to watch.
My small account dont allow me to take risk, even though basically I'm right on technical. The market went long.
On day like this - news driven - no clear pattern found prior and after the news.
So I add ema synchronicity in my two charts for post-news period. Sim test green.

Started live session

2011-09-21T10:44:00.001+08:00

but missed the move .
The visualization " patient & profitable" trader is good ...
Emotion : calm
Missed entry : Double bottom (to long)(read websites..duh)
Result : Nil

''Emotional'' journal

2011-09-20T12:25:00.000+08:00

As trading involving emotional control. it is a wise move to record the emotional side of trading and compare it with the result.

Trading 1 > Emotion 1 > Result 1 (red -ve , green +ve , yellow) ( not in term of USD)

A trader's job is to trade or holding the trade

Overtrade is the biggest Sin

2011-09-19T16:24:00.001+08:00

Copy from:

http://www.elitetrader.com/vb/showthread.php?s=&threadid=125197

Given the limited number of traders who ultimately experience profitability, few other fields have more published rules and guidelines than trading. After all there's no book titled Idiots Guide To Trial Defense. We've been inundated for decades with the old saws about cutting losses quickly and letting winners run. Still we see little improvement in the trading performance of most participants. Futures trading is truly a zero sum game. Each night the Clearing House pays out the same amount of money it collects. Toss in commissions, charts, research and the endeavor quickly reaches negative expectancy. Since I began trading on the CBOT floor in 1982 much has changed. Electronic access, FIFO and lower commissions have vastly leveled the playing field between professionals and the rest of us. While technological advancements have made trading short term more appealing than a generation ago, in my view retail traders should consider trading less. In fact rather than enhancing returns and cutting risk most short term strategies only accentuate the losses associated with futures trading. Allow me to share with you some cautionary aspects and a bit of advice that could help you clear some preliminary hurdles.

Commissions: One of the least talked about advantages of being an Exchange member is ultra low commissions. I'll let you in on a dirty secret. The most legendary floor traders would have been net losers if they'd been paying the same commission schedule as you. In the larger financial products it was very typical for a floor trader to trade 1000 contracts a day in hopes of making just $1000 a day in profits. Superstar traders like Tom Baldwin would trade 20,000 lots on a busy day. I'd wager that many of you who've suffered grave drawdowns in your futures account are gross positive! Think about the paradox. Profitable trading yet net losses.

If your trading style is of a scalping nature I have a couple of suggestions. If you're trading more than several hundred contracts a day then lease an exchange membership. I won't go into the details here but for larger traders a seat will reduce your commissions and exchange fees dramatically. If you choose to remain at the retail level then try trading on an exchange or product with lower fees. Eurex charges far less than it's American counterparts. If you must scalp in America then look at lower fee markets like Treasuries. Or if you want to scalp a non-fixed income product choose a market with a larger minimum tick size. Paying $4-5 a r/t to scalp markets with a $5 tick is nonsensical. Cutting transaction costs is one of your most viable edges.

Short Term Technical Trading: I'm going to be both emphatic and controversial. There's is no system based on short term indicators generating anything other than real time random performance. It's utterly naive to believe the next few ticks can be handicapped by a stale set of variable equations. Now I know some of you are thinking I'm out of touch. That's because you've just successfully back tested some esoteric system with divergences, crossovers and filters. You're sure this new optimized system is gold. Think again. First the obvious. The Goldman's, Morgan's and big bucks CTA's with their vast computing power and impeccable tick data have already tested every conceivable indicator under the sun. Even if you're onto something remotely consistent you'll be subject to all the problems of high frequency short term trading such as commission costs, unable price orders and slippage. Now here's the good news. There's many signals derived from longer term strategies that will produce quality short term trades. Which signal has a more reliable chance of generating quick follow through? A new 5 minute high or a new monthly high? As a technician doesn't it make better sense to monitor a wider array of markets and spot higher percentage opportunities then to “specialize” in a single market and take a series of weak signals derived from noise?

Trade The News: One of the pretexts of technical analysis is the theory that news is already reflected in price. Nonsense. Markets are organic. Market moving institutional participants are constantly reevaluating their positions based on evolving perceptions of fundamental information. Think of the market as a basketball game. We're watching a half court offense methodically passing the ball around the perimeter in search of a high percentage shot. Suddenly an athletic defender intercepts the pass and runs down the court uncontested for a slam dunk. That defender's name is News and he can spoil even the most conservative game plan. News often comes unannounced. News can be as unreported as a dry weekend in July when perceptive traders figure out there's a potential drought developing and then push futures to a limit up open. No matter how mechanical and detached your approach you'll be frequently confronted by decidingly anti-technical factors.

Position Sizing: It only matters how much you bet. We've all made historic market calls only to take a small profit much too soon and then watch the market explode for weeks on end in the direction we anticipated Then the next time we try to milk a winning trade for just a bit more and see our open profit evaporate into loss. It seems that picking the markets direction is seemingly easier than extracting consistent profits. I preach two approaches. For folks who're reasonably well off and seeking stable returns I suggest you vastly under trade. Practice with scaling out of winners along with hard protective stops. Larger accounts should risk no more than 1-2% of their equity on each trade.
For smaller accounts I advocate a more wide open strategy. You're probably not going to double your account 12 consecutive times trading for 1 tick at a time. None of us are that good. What you can do however is hit an occasional home run. I'm not saying just let it rip without an uncle point but you must intelligently look for opportunities that'll give you a quantum leap in return. Unless you're still a teenager, compounding $5000 by 20% a year isn't going to be a life changing experience.

Learn About Options: Like futures themselves, options are increasingly traded electronically and have enjoyed tremendous surges in volume and liquidity. For small traders the ability to over leverage with a defined stop loss on equity is a boon to your big play potential. I'll give you a pertinent example. This past December I had strong resistance on the March e-mini S&P at 1511. I decided I wanted to risk $10,000 on a short position. Index futures margins would have allowed me to short just 2 contracts. A 100pt down move would in turn have resulted in a $10,000 profit ($50 per point x 2 contracts). Instead I bought $10,000 worth of put spreads with an expected 8-1 payoff if futures closed below 1400 at January expiration. Fortunately the trade worked and my 10k turned into a minor windfall of $80,000.
Another advantage to long premium options trades is the ability to trade futures positions contrary to your options. If you're long calls you can then be a natural seller of futures. Often if you're in a rhythm you'll quickly pay the cost of your options with the proceeds from your delta hedging.

Accept Your Psychological Shortcomings:We're all flawed in one way or another. Discretionary traders in particular are subject to the pitfalls of poor trade selection, over trading, undefined risk and revenge trading. A movie actor can vacillate between bi-polar feelings of arrogance and guilt but what makes his foibles different than a traders is the simple fact that he gets paid no matter what self destructive urges overtake him. Trading is akin to playing 18 at Augusta each day. We will never trade perfectly but must attempt to at least minimize our innately ruinous impulses. Keep a journal of your trades. Don't just mimic the information contained in your brokerage statement. Instead keep a log of how and what you felt emotionally about each trade. Like me you'll find there's commonalities with many of your losses. For instance if I fail to take a signal that would've resulted in a big winner I'll invariably take a sub-optimal trade next. Often I'll over trade it to boot. Doing nothing more than eliminating your “trouble spots” will save you money that can be dedicated to the next good setup you perceive.

Hopefully I'll have an opportunity to expand on these points in subsequent articles. Till then, best of trading and good health to all.

Closer and closer

2011-09-15T12:47:00.002+08:00

Sim Trading - made paper money even though market ranging yeyy!...

Closer to the light but I have no active trading right now. My son sitting an important exam :)

How to protect your trading mind

2011-09-07T10:01:00.002+08:00

Once trade is entered, I would say wait for stop loss to be taken out OR IF YOU FEEL IT NOT GOOD, GO FLAT ASAP. I said this because trading is naturally risky and a losing business....If the trade proved to be good, then the trade now should be breakeven. Once the trade is profitable, bring the stop loss closer to make sure the profit is protected. Not only that, my TRADING MIND is protected from emotional worry. I can see and think clearly.

The Fibbemas and the gang

2011-08-26T10:46:00.003+08:00

To repeat - What I need to trade succesfully:

Experience - such as yesterday - back to base is again showed in CL.

The lucky Fibbemas :he he :
5 , 9, 20, 50, 100 - Why I didnt follow the oldman's sequence you asked...Well, he didn't trade CL

Candle Pattern : Hammers, doji, engulfing, inside candle, wedge, covering

Lots of 3 point lines

Long Range Lines

Volume

Y - High,Y- Low, Y-Close

Trading Styles: Breakout in 4mins, Pullback and Continue 1 min, Bothways Triangle, 50% retracement, Observing Candle patterns.

Donchian Channels to be considered

Target 200 daily

2011-08-25T13:17:00.004+08:00

After reviewing my trading in this holy month, I have a conclusive tool and edge now.

So I can moved to the next level of trading. I need to determine my min profit traget as I found that keep longer trading hour is bad for me.

So here my trade management plan:

No. of trades per day : remained 2 times per day

Profit target: USD 200 per day. If I got more from first trade, it will be a bonus. If I got less 200 from 1st trade, I will try the second trade.

Risk per trade : -USD 100 per trade, exit as wish - not waiting for Mr Stoploss once I found that the trade is bad. So at most it shall be breakeven.

The long road to Succesful Trading

2011-08-25T10:28:00.000+08:00

For a long time I have this Idea A that yet to be implemented due to lack of tool.

The I upgraded my Sierra Chart to the latest version.

Now I can put in the tool that I really want to use and discarded the usual ones.

Then yesterday I read this thread

http://www.sierrachart.com/supportboard/showthread.php?t=28537&highlight=support+resistance

Looked like that I have the same idea with Kiwi, a VERY senior trader and respected Indicators programmer.

Be like Water - continue

2011-08-24T09:31:00.003+08:00

Revised some tools in my chart to suit the market, especially the MA as it is quite tricky.

I also separated the MA from main chart in order to have a clear mind :-)

Add up a timer, as I acted to soon before the candle close.

I have a good feeling about my current chart layout

Trading is truly is a mind game

2011-08-23T09:22:00.000+08:00

I determined that there are at least 4 phases of CL, not as simple as 2 as I previously thought.

1) Straight trend - Breakout style

2) Waving trend - EMA style

3) Pulsing Trend - Price/Candle Pattern style

4) Ranging - Indicator style

The problem with my mind is that I need to clear my mind before I could see the phases. My mind want confirmation but the market is full of Uncertainty. Trading is truly is a mind game. To beat the market, I need to adapt to the market uncertainties, I need to be like Water

http://youtu.be/-DDGMSDfh_w

Still on sabbatical leave

2011-08-19T10:18:00.004+08:00

Halfway through Ramadhan and I'm still on sabbatical leave.

This give me opportunity to re think strategies.

What I have now that I can predict only about 10% of CL behaviour.

The other 90% drive me nuts - the ranging period.

How you can plot your trading plan if the price is random ?

Traders said it's hard to predict the highest and the lowest.

I will focus how to determine that - the level of high and low and play pull back at SR

Again, CL went to the starting base before jumping down

2011-08-18T09:30:00.001+08:00

The market scaled higher and higher to the peak
Then I looked at 1chart, I saw the hammer and doji
the 3chart showed normal candle but with MACD divergence
My 50chart show contraction of bolingger.

I put SIM short . Walla - Quick SIM win 490.

Learning a new trick

2011-08-16T11:06:00.001+08:00

I learned fibonacci this week. It is simple in it application and whats more ..combined it with what I already know the it make some sense in my trading brain.
A definite good thing of fibs is that it helped me draw horizontal lines at one clik !

Volatile Markets but Gurus seemed missings

2011-08-11T11:34:00.002+08:00

:-)

Faster, and Stocks are tanking

2011-08-08T11:30:00.004+08:00

In US and malaysia the stocks are tanking.
And I'm grateful that I can trade CL future as a better alternative.

Again, I re looked my old charts and I decided to change the slow stochastic to faster stochastic.
No body told me that except my fast brain.

p/s....Coincidently, Richard advice is relevant
http://richardwesleytodd.blogspot.com/2011/08/hahahahaha.html

Master and slave charts

2011-08-05T10:04:00.002+08:00

SIM -Previous weeks I'm simming mindlessly... I got -ve result, but yesterday i got positive results. Good improvement for my self and I felt comfortable.

This is the last set up that I will not changed any more as I have tested it mindlessly like a zombie. For the record I had nearly 900 setups within 3 years trading part-time. I named it the NakedHammer ..He he he.

However I will try add up a range chart to have a micro look for the trend...but this micro chart is not a decision maker master chart, it is more like a slave chart

Traders Proverbs :)

2011-08-04T06:04:00.000+08:00

Triangle and doji is like a compressed spring

So easy on SIMMING

2011-08-03T10:10:00.004+08:00

For about a year I watch CL in 2 min frame.
They said don't changed your set up. Yeap I followed that advice. 1 year.
Yesterday I watch CL in 1 min frame.Totally focused. Interesting.
(5min and 15min charts as the GPS)
.
Now I understand why 2 min frame is different compared to 1 min frame.

It's the time, Elliot Wade..

he he.

Again CL went to the base.

SIM trade - usd 650...more than 1 plays, of course. It is so easy when I'm SIMMING.
May be I need to train my mind that my live is Sim and my Sim is Live

Way To Go

2011-08-02T09:48:00.013+08:00

SIM - This session the CL repeating its die-hard behaviour . It confirmed my CL theory.

Go to the base and jump : Jump up or jump down.

So my WTG

1) identify the base first - starting line, normally at the Pivots and SR
2) check the space of least resistance - direction
3) look for the pattern - the trigger - 2 types - the price pattern esp triangle , the candle esp hammer (pin bar), bigger candle and doji (spinning top)
4) My Stop Manager will deal with my losses , so I will concentrate only on the profits.
5) I may use stop order and market order where necessary
6) Special obs: Turnaround : After a long trend or long candle, usually followed by a hammer, a candle (various types) then price cross the line of dojis. Enter at the correct side of dojis lines.

Disclaimer : Foooollow at your own risk. You may have the knowledge but you dont have the xperience to deal with my set up.

A month of Hiatus

2011-08-01T10:02:00.001+08:00

Ramadhan is a fasting month for muslim...at night Muslim have tarawikh prayers, which clashes with my trading hour. So my live trading will be limited.

However, this will give me opportunity to review my scalping technic, which during the last SIM session I got USD900.

Great Lesson Today

2011-07-27T09:29:00.010+08:00

Started with a comment from a veteran trader in Elite Trader forum regarding 27th July 2011. An independent view of an expert witness (names withheld here)

========

Wow! Unbelievable except this is CL so you never know. This morning it was under constant selling pressure. Someone was dumping it. And now someone is gobbling it up.

Trying Short @100.47. Not seeing any falloff.

========
Registered: Sep 2002
Posts: 3056

07-27-11 02:41 AM
I should be posting my breaks like you do ( ) Was just talking to a lady friend of mine and totally missed that huge move. Missed them all today on breaks. I was telling my friend this. Oh, well. Keep your losses small and you'll do well. And days you miss some action are no problem. There's always the next one.
=========
P.S. I'd call today's action very unusual. Rallies and sell offs seemingly on their own.

ADD: FWIW when I don't feel like I have a good sense of what's up I just step to the side. No problem.

7-27-11 02:48 AM

============

Great! WTG. Should have been more patient with my 100.47 short.

Maybe this will retest the LOD the way it's going.

****************

What happened to ME during this session

As the 15m chart is flat for 4 days , the i deleted the all emas as I thought as it was no used.

And I felt a litlte bit rusty of inactivity for 3 days...

I then looked at the 2min MACD K, and my eyes immediately saw a beautiful divergence of the moment. Once I saw the divergence I draw a line at the MACD and the line at the price . I concluded that was a Resistance line. So I put a stop order to SHORT. Yes, I thought the price will stop and reverse at that line. I forgot that a line is just a fence and the price could jump over the fence. So, this is the 4th time in this journal that I took a wrong position at the fence, on the exact line. So this is a risk faced by a pure SR line traders. It could make and could break. When I put the ema back, it clearly show that the trend at my short entry is up but it have no predictive power for the next action, it's only react . But probably the ema will keep me thinking on the validity of SR lines. I t could save me, but depend on what I want to see at that exact moment.

1 minute later my short triggered- that's a surprised to me because I expect a wiggling entry. The price move up, and my point of entry to short actually should be a second point of entry to long after a wedge pattern (1st point of long entry - not taken). My stoploss when its momentaryly gone up got me out at -90. The K line now was no more a divergence but gone to the oversold line.I failed to see that actually the the price actually reverse up to the base at the top peak before taking a dive.

Then CL dive down to the abyss......leaving me speechless as I take a breather.

Tactical Lesson A) When I see small frame during dead market.... dont forget to see the bigger chart. The big time frame is important to warn me for the potential of a big move out this dead market. To see this potential, I need the space. And this space only can be provided by big time frame.

Tactical Lesson B) The ema is a lagging indicator for the price. Maybe it is useful. The keyword is MAYBE

Tactical Lesson C) SR is good for staging an ambush but it didn't show the direction. It could be BACKFIRED as happened to me 3 times, recorded in this blog. It's helpful to think SR lines as the fences. The price could jump over it. I need a 2nd opinion indicator to check the potential direction. Once I know the direction, yeah, the potential is limitless :)..hey isn't trading is always about the direction...not the crappy price action ?

Tactical Lesson D) Divergence trading only for at extreme positions - Top and bottom and not in between. Use the big time frame eg 15 min for that. If I use a small time frame eg 2min. 5 min...that's not divergence trading, that's donkey trading. Like SR lines, I have been stung by DonkeyDivergence trading many times before...The sad part is not about the losers as it will be taken care by my trading partner Mr StopLoss, but the pains of losing opportunities of BIGBUCKS like today

Tactical Lesson E) Wedge pattern is valid. Yet, I always underestimate this because the price tend to be dormant before it goes wild and I dunno which direction the price will go after the wedge. DIRECTION again. May be a special order OCO entry useful here.

STRATEGY Lesson F) In big time frame chart, when you see a clear space (no clutters of SR lines) and market goes to the extreme point of top or bottom, prepare your mind that if you capture that move, you'll be richer than yesterday.

Report at this time : Consumer Confidence Report at 10.00 am

Hopefully I will read this post 1000times to make me remember this great day and benefits the lucky souls who also happened to be read this.

P.S. Imagine If I not distracted by that donkey divergence surely I will take the short at the beginning of the dive...hehehe...I know I know....Its useless to ponder it now...or If my account is bigger I will stay with that short and history is made. heee

VIDEO , Price & Divergence

2011-07-21T15:49:00.002+08:00

I will try to put a video of my trading in here ..hmmm how to do that is another matter

No trade yesterday But I would like to put some notes to remember.

A) Price pattern consist of : doji, hammer, pivot, SR line, wedge (NO INDICATOR and can be used in small Time frame and big TF)

B) Divergence of Price and indicator only can be used in big TF : --- 5 minutes and beyond.

another +30

2011-07-19T22:45:00.002+08:00

I short at the break, but market slow reaction made me decided out. market then rebound up. My 2.5hr completed and close pc for the day

+30 not stay the course

2011-07-18T21:10:00.003+08:00

Now my direction is correct with the trend , but I jumped the train too soon and lost 500 opportunity.

But I know how to rectify my mistake by adjusting the time frame.

Hammer and wedge can kill the Dracula

2011-07-15T21:29:00.011+08:00

Again , I'm exactly at the other side of the fence on the dotted line...
may be I need to write a post-it note...

Are you Sure Up ? Do you use stop order?

When using limit order, my emotion controlling my mind

I short the market even though there many signals to long : the ema, the line , the indicator, the hammer, the pivot. My emotion win - my brain lose.Stop loss -90 save me nearly 500 .

I dont need ABC pattern at the moment.

But I need 2 BIG RED PILLS

Trading schedule, pattern, usual mumbling

2011-07-15T10:22:00.006+08:00

I will revised my trading schedule as follows:

Mon, Tue, and Friday : 8-10.30
Wednesday & Thursday : 8-11.00 . I missed the previous 2 days while the market long (wed) and short (thurs) at 10.30 ...when EIA news and gas report were released

Old things...Patterns are valid : SR line, triangle, hammer ( 50% position entry), pivot, next candle after doji ( need to repeat this to remind myself), line structure....

To learn new things: so called ABC pattern...

I have 3 charts and yesterday I failed to see all 3. I focused to only 1 chart, therefore I mised the SCREAMING signal to short in 2 other charts. My mistake focusing to 1 chart only coz I'm tired.

I will maintain 1 momentum indicator only to show the MOMENTUM, not the price as I will look at the price for PRICE itself. If truly intrepreted and used MOMENTUM indicator is a Leading indicator

My mind : I have problem focusing my mind this week due to distractions. Sigh.

Smaller time frame

2011-07-13T10:56:00.004+08:00

These 2 days market choppy and forced me to look at smaller time frame.

I will adjust my dektop layout:

from left standard,DOM, 1 min, range

hammer candle& doji & SR line & pivot line, Higher Hi Lower Lo, Triangle

No trade

2011-07-11T22:25:00.002+08:00

Difficult market environment - no trade..only SR line valid but too late to enter

+110

2011-07-08T22:37:00.005+08:00

Long market after a downtrend...purely on support line and range break. Quite a gamble on calculated risk, 1 trade only as I'm tired

June Statement -81.23

2011-07-02T12:56:00.000+08:00

Opinion 1: I have no more 'Afraid to Trade' syndrom. Compare trade log with last 2 months, literally I broke the ice.

Opinion 2 : I found that my scalping style was more successful than my last 'positionin' trade that made me nett negative this month.

Fact : Detail check with the chart revealed that actually my 'context view of the market was really bad'. I'm surprised that I took short trades in a clearly long trend and vice versa. No wonder I felt that way during live trading. I follow SMALL rules but ignore BIGGER rules. What save me from disaster this time was my trade management - cut loss short - that result as if I'm scalping.

Action: I will sim trade 1 session, with this revised mentality

-110

2011-06-30T23:59:00.004+08:00

End of month with 1 loss trade. Evidently I'm not prepared yet for longer time frame...Longer time will bring bigger opportunity as well as bigger RISK ..hehe.

Back to scalping mode. After 4th of July, I'm ready to be an independent scalping trader, if by chance I got a 1000 usd home run, it is not because I'm a fantastic trader but it is a bonus from market..Ok I will modified my profile as a part-time scalper trader.. I will take care of my ass so my body will take care by itself (new proverb from me) .

selfNote : R - extreme & continuation , 5min SR

+40

2011-06-29T23:05:00.003+08:00

Scalping 40..market doldrum before EIA report...I have a tendency to go against trend when scalping. 1 trade only like yesterday.

I need to look at 1 min time frame to look more opportunity there, by using a very simple line.

+20

2011-06-29T09:10:00.004+08:00

Tuesday - Put a short, then market reverse -90 just 1 tick before stopped out then went down out at mini profit 20, immediately market made another wave down 220 at my intended direction...Not exactly follow my rules and trade based on UNproven chart.

Tick chart was LOOKED nice but I need a bigger account to trade it. I tried to built a small 'hill' at the moment.

No trade

2011-06-28T14:49:00.002+08:00

Monday - No clear middle picture, no clear signs till the extended time....and I have no time to wait as my CL trading time only 3 hours.

A tough market as only extreme SR lines could be useful and I can use this only if my account is bigger than USD 10k..... Will check with tick chart ....

Scorpion's Tail

2011-06-25T11:09:00.001+08:00

The market had moved early and when I came to trade, choppy abound as the market at it's scorpion tail. So no trade as no signals picked up

+50 Ping Pong Day

2011-06-23T22:39:00.000+08:00

My brain has been programmed for shortchart so much that I refused to take signal from trendchart.
The market so full of energy - like a ping pong game - that make me tired watching so I adjust one of my chart to be 'silentchart' between 'trendchart' and 'shortchart'.

Without energy and suitable tool, I'm easily lose focus. Just 1 trade today +50

+80

2011-06-22T23:32:00.002+08:00

Interesting market today - like playing chess.... however, due to lack of sleep I cant really focus.

Post edit : It was FOMC day ---hmm

+30

2011-06-21T22:35:00.008+08:00

Missed the sweet spot due to distractions from my sons who need guidance for their home(school) work
But I have no regret as I enjoy their company while I can.
Scalping +30 for a cup of cappuchino and mini sandwich today.

No more blank trades

P.s. My trading hour starts at 7.45pm Malaysia time (the other side of the globe from Chicago). This is is my family active hour - dinner, tv , washing cloths, parenting...Its tough but I need to persevere...

Same mistake

2011-06-20T22:25:00.006+08:00

Trade A 40+ and another same blunder Trade B, clicked zero contract, this time a blank long.

I didn't believe it myself.

To prevent thing like these, I reset the properties value to go default 1 contract and enable 1 click feature.

(Edit : too many pics...: ) I cant see it in my browser hehe..

+40

2011-06-17T23:15:00.003+08:00

1st trade +40, 2nd trade 0 .

On 2nd trade, I clicked the button to short but a window pop-up. I forgot to click "1 to replace 0" contract as it is a safety precaution on my part to prevent 'accidental click'.. So it was a blank bullet and market went down without me on board.

Good thing is I followed my rules.

-80

2011-06-17T09:54:00.003+08:00

3 trades (yeah more than 1 and max 2) :

1) -10 . fast cut a loser trade . Good.
2) -120 . Late entry and not according to my rules. Chasing market .High Risk and paid it. Bad.

3) +50 . Follow my rule, but market is out of strength already. Quite OK.

Past 2 days CL had spike trade but I not wish to comment about the market, I wanna to comment about myself.

Evidently I was not "afraid to trade" anymore....now I will focus to follow my entry rules and maintained trade management : the fast cut....

Other then that I found that I need to keep in mind that each day I have 2 trades, not one. If I just keep targeting 1 trade, it will put pressure to my emotion and it is definitely worse than trading 1 contract . Trade A will act as breaking the ice of the day, and Trade B is the real trade of the day. Both will enter early as soon the signals are valid.

Done:
Low stress trading.

To be done:
To enter early when signal comes.

SIM and overtrading burnout

2011-06-16T10:12:00.001+08:00

As my connection was not reliable, I sim trade

Result : Positive green, however as it was only a SIM, I kept continue trading, my sim profit then.... vanished.

Observation: I will burnout if I overtrade...as I made mistakes as the focus slowly gone. Also I clicked the wrong buttons twice !!

Overtrading has 2 types : a) # no. of contracts per trade and b) # no. of trade.

As I only trade 1 contract per trade, I need to limit my no. of trades as well to max 2 trades per day.

Now not Afraid to trade but

2011-06-14T15:02:00.000+08:00

I had connection/internet problem.....
even the best traders on earth could do nothing when their connections were lost.

time for a song

-140

2011-06-10T21:49:00.005+08:00

Emo is ok, exactly on the line, but at the wrong side. Next time

1) need to look at the alpha timeframe
2) need to look at the ema colors and context of these lines. I'll put only 2 ema as 3 ema were too busy for me
3) I waited the stop loss to kick me out, but actually I realized i was wrong much earlier..so dont wait for the auto stop loss.

+80

2011-06-09T22:08:00.001+08:00

market choppy but when a moment came when I looked to the several charts I thought i have to do something.
about 2 mins in trading, i felt a bit stress. Got +80 then I close my pc.

More bigger time frame

2011-06-09T10:23:00.000+08:00

I'll put more time frame: 15 min and 30 min.
Bigger is better

Trade like Zombies

2011-06-07T21:57:00.000+08:00

I found out today,, once rules were established I need to trade like Zombies - no thinking allowed, just enter stop entry order.

If further thinking is allowed then I will find excuse NOT to enter trade and I will lost good opportunity

May 2011 Monthly Statement

2011-06-07T09:55:00.002+08:00

Just 1 trade

+30

2011-06-01T09:33:00.002+08:00

scalping profit after a long break. market choppy that later turned out was a bull.
higher low is the clue.
Big traders took vacation @ Memorial day

Low and lower stress

2011-05-27T10:26:00.000+08:00

As I focused to lower my trading stress...my chart is nearly naked (price & volumes only)

YIKES..Am I mad ? but I admitted my stress level is lower than ever....

However, my 2 EMAs still there but the setting was 26 & 12....( the normal setting of MACD...he he he)

Time Frame Tested

2011-05-25T08:59:00.000+08:00

I tested the new time frame - yeassss, I knew many time I test time frames...but this is NOT my normal time 2min frames...its 5 minutes and 10 min times frames...

What I feared that will slowly react actuallly is good for me :- my STRESS level is lower.

My focal point is STRESS LEVEL.

I got good feedback.

BTW, I have to check my adsl line , I'm not confident to trade live yet via my line.

Time Frame adjusted

2011-05-21T06:49:00.002+08:00

To nail the CL I have to adjust the time frame to make my stress level is low.
I will see the result next week

Today Cl moves more than 1000 usd... nobody capture that ?

Stop "dis"order.

2011-05-20T10:59:00.002+08:00

I have a set of rules. Really simple rules.
But I found that I slow to react to the rules as I tend to order at market.
The execution of rules is poor due to type of order I chosed.

I have to use STOP Order to enter the market.
In fact a more sophisticated order is 'OCO bracket order As I dont know which way the market will go after it pushed into a corner.

I'm clueless exactly when market will make a big move, as the market tend to sleep before it's roar.

My stop order is crucial to my plan.

Tryin times

2011-05-19T10:14:00.001+08:00

My PC had 3 components replaced due to the lightning - power, motherboard and network card. As the old AM2 motherboard has sold out due to AM3 now entering PC market, I have to asked several shops and thank God, one shop had a stock.

I also placed a lightning isolator in place. This is tropical Malaysia, thunderstorm is normal here.

After 2 warming up sessions I'm eager to trade. However, it was raining heavily and suddenly my adsl and telephone line suddenly went out.

Now I suspect that the technician probably did not secure the contact lines under the roof, the lines may be shortcircuited by rainwater. and it will be confirmed if my lines are okay after raining stop.

This early morning I open the internet, it was okay and the phone line was fine too.

Damned, it's now confirmed.

I have to go up to the roof again, to put the exposed lines under the roof.

God help me. Clicking trades is easier than all this.

Apr 2011 Monthly Statement

2011-05-04T15:33:00.002+08:00

My super mini account...Need a lots lots of efforts to have a bigger size ..yeah

Lightning Bolt

2011-04-26T10:50:00.001+08:00

My plan to trade live my modified set up this week to be shelved as my computer and adsl line down due to lightning bolt. It may take one week to rectify all that.

Life is like that

CL stripteasing

2011-04-22T10:23:00.001+08:00

As I planned, I have no plan to trade with modified set up today but few windows of opportunity came.
No trades but opportunity lost....

Life is like that and I want to reverse 'that'.

Optimising set up

2011-04-21T10:51:00.000+08:00

Test run modified set-up on EIA day - turned out to be fine..60R:40W
From now I need to fire several lives trade to solidify it further in my mind.
Starting from next week I suppose for live trades

Put an audio alert

2011-04-20T10:57:00.001+08:00

Adjust the setup and put an audio alert so not put unnecessary strain into my eyes.
However, this does not meant that my mind fully adjusted to this setup yet.
Good Friday coming and I expect market to be choppy...

Change set up to avoid the same mistake.

2011-04-15T18:04:00.000+08:00

I noticed that my mind keep repeated the same mistake due to the same set up of my chart.

As these mistakes were well documented here with LIVE trade, so my reason to change my setup is valid.

Revised set up.

2 chart side by side - min and ticks
1 macd - yes I have indicatoritis. Volume is out as it is not vital for CL trading.
EMA added another 1 to gauge long term trend.

Current mental outlook:

" I look for easy set up...No need to look for complicated set up that is not there"

-150

2011-04-14T22:48:00.004+08:00

I knew Sto is a weak set up but yet I used it. Stubborn mind cost me - I need to erase that failed set up from my mind

Turn a round

2011-04-14T09:06:00.000+08:00

I noticed that my Sto setup is not the best setup...as I'm against the trend.

How to turn it around ?
I will use EMA to guide the entry

+40

2011-04-13T23:26:00.005+08:00

Mini Short

After the EIA report...Wedge / Triangle is near risk free, all I need is initial direction

Ok, still here :)

2011-04-13T13:14:00.003+08:00

due to technical difficulties, this blog remain here.