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You may want to look at how markets work from the inside and it may give you a better perspective of the markets if you have a better understanding of their structure...this will lead you to understand who you are trading with on any given day, that's important to know...for instance, if longer term/time frame traders enter the market they don't wait for support or resistance levels to try and get an advantage, they just get in at the most advantageous place for their longer time frame trade and when they enter the market, those are 90% of the time trending days, they make markets trend, not the short term/time frame traders...they, short term traders, are just looking for a fair value area in which to have two way trading and find value in those areas...most days you will find that we trade with shorter time frame traders and you can tell within the first hour or so of trading who's in the market and they, short time frame traders, will almost always trade off reference points/prices, such as S/R areas example; if price trades to a support and finds support there and then move up off of it your trading with small time frame traders and you can better formulate a strategy once you have identified the players your in the markets with...kinda like knowing the prey your hunting...markets are not as random as one might think or be told, there is a structure to them and although it may seem like most times your adrift at sea as you say, all you need is a sexton to navigate by the stars...and just might be that you need a tool like that to help you get your bearings...i find that indicator trading and most all other brass ring BS systems that are out there just don't work, at least for most all traders that buy into them, i look at them like this, if its such a good system then why are you selling it...traders are a greedy bunch and we are always looking for an edge to take your money...also 90% of this business is the sell side and the other 10% is the buy side and that's us retail traders and hedge fund managers that are the buy side...remember that we are traders and are paid to take risks, its part of the job..with all this said and i'm leaving out a whole lot of other stuff too numerous to post here but wanted you to know i feel what your going through, i would say all in here will agree..we're traders and we have all gone through difficulties some similar to yours, its all part of the journey...if i may suggest, so i don't just sound like an unemployed therapist, that perhaps its time for a complete rebuild of your trading...i'm not saying to throw all of the skills you've acquired out the window, but maybe a look at something other than what your doing now...i can only tell you that i tore down my trading 2 years ago and rebuilt my plan off of something called Market profile along with order flow, (price ladders), if you google these two tools and see how they work it may be something that would give you a different look at the markets, i know it will at least explain, perhaps, what/why markets behave the way they do on certain day as opposed to others...also, one must understand that volatility has returned to the markets and in a big way...when we had free money being printed and thrown around for almost a decade now and volatility at all time lows with a 10 yr bull market, that most traders today have never seen the likes of volatility at these levels and believe me i'm sure it blown up more accounts than you could imagine...just hang tight and remember that you don't have to trade every day if the market is not going to help you with your edge...its just life, that happens...if you swim in the ocean you'll know that sometimes its too rough..you could still swim out into it, but the risk of drowning just increased, no?and something else to think about is this, price action is nice to understand but today's markets trade differently than they did when price action was important, not saying its still not, but there are a lot more machines in here with us now so i would suggest you look to find value and build a trade around that and less around price perhaps...price is really more of advertising than value...sounds vague, but research it and you'll find the key of my point, again a rabbit hole too deep to get into in this post..you get the point...so good luck and may your future be brighter than your past...
The markets are too chaotic, news driven and fast reversing for hackneyed, simplistic methods like this to be as profitable as they used to be.
If you use the same methods as 99 percent of traders you will get the same results they do. Including the losers who give you advice here.. they are here because they are losers.
You are trading in a vacuum without any indication of what other instruments, including bonds, FANGS, TICK etc are doing. Your indicators are based only on the price action of the instrument you are trading so contribute nothing. You don't even have anything to show the important levels such as VWAP, the previous and current session OHLC, pivots, etc.....
Even though it's pretty arbitrary I think it's best to use some kind of moving average as a stop line after entering a trade.. just stay on the right side of it. I like to use a moving average from a much higher time frame on a relatively fast chart.
Even the guy who invented Market Profile says it doesn't work anymore.. talk about rabbit holes. That's more like a tunnel to the center of the earth.
Feel free to PM me.
"If we don't loosen up some money, this sucker is going down." -GW Bush, 2008
“Lack of proof that something is true does not prove that it is not true - when you want to believe.” -Humpty Dumpty, 2014
“The greatest shortcoming of the human race is our inability to understand the exponential function.” Prof. Albert Bartlett
If I read this thread correctly it seems you have appx a year of trading experience....and your thinking of giving up? You need to stop trading real money and get your method in order...or find a new one all together.
Why do I say this ?
1) You say you identify trends using price action but a couple paragraphs later you say you never seem to know when a trend ends. You don't have a handle on price action.
2) Your attempting to trade with 7500 volume bars on the ES but then using a 1.5 point stop. Simply unworkable based on the avg bar size.
3) You are unsure of whether it is better to enter on a limit or stop ? You say there are pro's and cons to each but what is best for YOUR method ?
4) By your own admission your trading in consolidation and range bound markets constantly getting chopped to shreds.
One year of experience is just scratching the surface.....step back and work on your method and/or find someone who is profitable that can show you their method...which obviously no easy task...but it is far easier than trying to piece it together on your own. Sorry to be brash but this business will simply chew up and spit out those that are not FULLY prepared.
Nice thread! Your post seems to relate to a lot of people and you've received a lot of good and solid advice sofar.
I'd like to chim in with a couple of my thoughts too.
I think you need to change your expectations about when you're going to be profitable. Many people here are actively and fulltime trading futures for several years and are still not profitable. I don't recall anyone who's profitable trading futures in one year or after 400 trades. My advice is to accept that it will take many years of hard and daily work before you're profitable. If you're not willing to invest this time & effort or if you do not see any signs of improvement, you'd better quit. The path is to go from large losses due to undisciplined trading to smaller losses, consistent small losses, consistent breakeven, consistent slightly profitable andsoforth. With all due respect, with only 400 trades under your belt you're only at the beginning of the journey. You're in learning mode and not in banking mode yet.
Start a journal here on this forum. Not only do you receive feedback from others, but it forces you to take accountability. My journal got slightly out of control due to the daily posting, but it's very valuable to me. Not only the feedback but mainly the fact that I have to post what and why I did stupid stuff. If I did not have a journal I would not make the daily evaluations, the analysis I sometimes do, evaluate the month stats and more important: act upon stupid behaviour. Without a journal I would not act as swiftly as I do now: "I don't want to look like a fool on this forum, so I'd better not make the same mistake again and fix it"
In addition:
- Start using context (my assumption based on your chart postings that you don't do that yet) instead of trading of 1 chart.
- Ditch the indicators and start reading price, volume and market internals. Plot the floor trader pivots, OR, yesterday's HLC, VWAP, etc. That's all that matters
- Keep and evaluate stats: what's the distribution of your expectancy on various times per day, what's the expectancy per setup, etc.
- Do what-if tests on your stats & charts: what would have happened if you doubled your risk, what would have happened if you changed your scaling method, etc.
- Read other journals and follow those that appeal to you most
- Trade sim until you're profitable. Yes, sim trading for the next couple of years
- Ensure that your family doesn't get irritated by your trading. Either have their full support or trade (what I do) when everyone is asleep or not at home
I strongly suggest going to Jigsaw.com and taking yourself through their free webinars and then trying their product (which you can do in a free trail). They are strong proponents of Order Flow, from which you can see what is really happening in the market, and from which all other indicators derive. Their methods are simple, although take some time to get the hang of. You don't need indicators, all you need is the DOM and a few correlating market charts or DOMs, such as YM, NQ, RHY. Pete Davies, founder of Jigsaw also has a lob of webinars on tube (see Jigsaw) worth your time.
If you are not trading using Order Flow and Volume Profile Analysis tools, then I think you will continue to be lost. I started using these tools and have not looked back since. The market is an auction and knowing where the volume lies, using volume profile analysis and order flow, is the key to deciphering where the market will likely go in the short term. NinjaTrader now has some great tools built-in and I also use OFA (Order Flow Analytics) for trade entry and management. It will take time to learn, but once you see how to use these tools, you will (in my opinion) never use anything else. Most of the indicators out there are just based on price - well that is a very narrow view of the auction process - and will fail to show you what is really happening. Price action is really an indicator of what may happen - kind of like a teaser - but volume analysis is what is actually taking place.
For example, look at the screenshot below. The area where I placed the green line represents an area of "thinner volume." Price will move between areas of thick and thin volume. So, in this case, price moved up and then back down to the thinner volume, where it proceeded to rocket up. I would have placed a long there based on that and look what happened! Straight up. This is just one example, but it shows what I am talking about. Knowing that ahead of time allows me to prepare trades.
Use renko......heiken ashi is a hybrid representation of price.......I had similar issues until I switched to renko.......Renko on one chart and Japanese candles on the other.....it helps to view the markets using 2 candle types in this particular situation.....
Trading: nq, es, Hype cool runner Ipo's months out short into lockup expirations. UVXY, TSLA options
Posts: 24 since Feb 2016
Thanks Given: 3
Thanks Received: 60
Chin up. There is nothing easy about trading. In the markets take a long time to learn. They say it takes 10,000 hours to master something. Think of a pro golfer. How many swings does a golfer put in before turning pro. How many practice swings do they put in ever after a pro. How many trades did you do before going live? In the markets you are up against pro's. Your paying to compete against them. Would you pay to compete against a pro golfer or poker player of Chess grand master. One really has to put in the time to learn and then practice practice practice on a great real time sim program w live data that keeps track of all your stats. Practice till you are consistently profitable and you have tweaked it until you cant get a better % profitable and win rate. Get your order execution to the instant intuitive point. Then ease into real time live $ trading. You are up against a.i.'s, algo's, elite pro gamer types, Chess Grand Master types that have 20,000 games in memory etc they are 14 moves ahead of you..(trades). People jump into trading live way to early and do not really understand what they are up against. Chess grand masters will admit they see the board, the pieces differently over time and differently that everyone else. Same with great traders. Your story is really the story of most traders unfortunately. It does take time and commitment ability etc. fascination and obsession. Think of it as getting a PHd, or becoming a golf pro. It does not come easy by any means. The best you can have is an edge and the win losses are randomly distributed with in the probabilities of the "edge". You could get all the losses up front even with the best strategy. One has to come to grips and really get that down to your core. Machines have no problem with it. That should lead one to if x occurs do x1, if y occurs do y1. As Bruce Kovner master trader put it.."imagine different scenarios, take the one that confirms."..if one gets that on a deep level you can begin to get around the 100 or so cognitive bias's we have that conspire to keep us from trading effectively. Sorry for rambling ..maybe there is something in there for you. Good luck.
Part of the reason is that you most likely are undercapitalized. You may also not have a great income to supplement
your current income.
Most people know where I came from.
My unit had almost a billion dollars behind us. Our traders made great money so they did not have to trade every 5 minutes.
If a day did not look good we went home and did nothing.
The poor guy/gal with a $5,000 account wants to match wits against the big boys.
That is sad.
I can give perhaps one piece of advice:
Find a great trader. He or she had better have made millions of dollars trading. Don't pick someone who
comes up with intelligent sounding stuff but does not have a pot to &^^% in.
See if you can spend two weeks with this person.
Perhaps see if you can take a job with a small hedge fund.
I would recommend one or two excellent trader coaches online but there has to be a thousand idiots out there so don't go online to find a guru. Your odds of success are about 4 in a thousand.
TB
I would teach you but then I would become a guru who gets laughed at every day. Don't need the hassle. LOL