20120822
After attending TopStepTrading webinar yesterday and reviewing previous webinar from March decided to amp
up my discipline a notch, including journal keeping.
Initiated short open ended trade at 1.24542 @1.2
contracts at 9:07 AM
1. because bot TDSuperTrendQuantity was in a short paper trade
2. the setup correlated more or less with TD's approach
3. before I'd studied
market sentiment but after glancing at
volume profile
4. Before calculating what TDSuperTrend's initial stop meant for
money management
Management commentary:
1. Stop at 1.2470 = 15.8
pips -> loss of $189.6 minus commissions, or 189.6/54720 = 0.35%
Since we're forward testing with cash assume a daily loss of 0.2%. Moved to .002*54720 + 1.24542 = 1.2463
(or 0.2%). If this trade fails that's it for the day.
2. By 9:39 TDSTQ had moved stop to 1.24674 in response to rising EUR/USD (hit MM 6/8 @ 1.24590). Since
this is still above my 0.2% daily loss target left my stop where is. Feeling of depression setting it at ~
-4 pips unrealized loss, then equanimity knowing the stop would take care of things if they get out of
hand.
3. Shortly after the last comment at 9:39 EUR/USD plunged (to +12 pips profit by 9:45) with every sign of
going lower. Depression turns to calm elation, then to worry. Moved stop to protection at +1.5 pips
(1.24515), when it looked like price was setting up a new lower
value area median 1.2441, TD method
indicated downtrend.
4. Retrace peaked for the time being at @MM 3/8 at 9:52--thinking about moving stop to just above this, but
since TDSTQ stop is on the move will go with that if it gets between my entry and my stop.
5. By 10:06 price has retraced back to within 5.5 pips, 200
tick chart indicating a miniuptrend, 600
pip
chart stil indicating weak downtrend, 1800 tick chart indicating downtrend, and notice on othe brain's
back burner the part of the Lord's Prayer that begins "Lo, though I walk through the valley of the shadow
of death...." is repeating.
6: By 10:10 I noticed my entry and protective stop are sitting smack dab on the median of the mode of
today's value area--a sitting duck even if price is still polishing its shotgun (appears to have given up
on the retrace in the downtrend, heading away from me for the time being). Ordinarily I'd move the stop to
just above the last retrace high at 1.2448 but seems that would be penny wise pound foolish--why increase
the chance of getting stopped out unnecessarily, risking pennies against what could amount to significant
profit? Instead we'll wait and hope for price to break downward through previous low at 1.2431 just above
the
floor pivot (another location where price could set up housekeeping--just has to lose interest in the
last value area and the scent of my stop sitting there).
7: 7 minutes before US open price appears to be consolidating between 1.2448 and 1.2435, US futures
negative meaning we can likely expect the Dow to try to recover the initial
gap down in the first 30-60
minutes after open, probably correlated with upward pressure on the EUR/USD
8: At the open one eye on the Dow 1 minute chart and one eye on the EUR/USD, which is sitting at the top of
range mentioned previously, Dow as suspected aggressively trying to
close the gap, EUR/USD rising but not
so rapidly.
9: Dow now collapsing at T+ 90 seconds, EUR/USD inching upward toward my stop. Hard not to move the stop
back to day's loss where TDSTQ stop now sits
10: A little relief at t+5 minutes after EUR/USD (attached to Dow by rubber band) came within 1.5 pips of
the stop but has now pulled back a little. 200 Tick chart indicators flatlining, 600 & 1800 Tick charts
suggesting beginning to resume downward trend, but still buoyant and too soon to say. Dow still showing
remarkable signs of life. Too bad. Hopefully we survive until a (downward) trend sets up. If not we'll
get stopped out and sit on our hands until the market initiators tip their hand one way or the other.
Should walk away & let market takes its course--get breakfast rather than sit here watching & working on an
ulcer.
11. at 10:43 Steeling myself to get stopped out, and stopped out for a profit after commission of $7. Gag
me with a spoon. Uptrend started on 200 tick chart, mixed signals on 600, signs of wicked retrace in a
downtrend on 1800 tick chart. EUR/USD and Dow have merrily climbed to premarket value area, entirely
closing the
gap & more. So much for that new minivan.
12. 10:47 Price hits TDSTQ stop, and the bot goes long at significant
S/R with all indicators pinned in
overbought area--silly bot. Still, all signs point to beginning of uptrend, so we sit at wait for a
retrace, potentialy to go long, avoiding the powerful urge to jump on the lemming train at this point.
FOMO is strong in this one. Smartass bot is up 11 pips, but it's early days. "First ones now will later
be last" is repeating in the back of my brain.
13: 10:55 watching price as Dow retreats from yesterday's close, having gorged now fat & happy. Looking
for signs it may retest the close,
breakout probably necessary for EUR/USD to establish an uptrend.
14. 10:57 entry at 1.2474, just below magic number of 75, stop at 69 (5 pips) when 200 shows retrace over
and 600 confirms. Should NOT be taking setups from 200 tick chart
Stop moved to +1.5 pips at
first opportunity since we're facing considerable uphill climb in front of likely S/R. Not exactly a high
prob entry. Dow plunging on 1 minute chart.
15: 11:01 stopped out for another $7 profit after commissions. Who'd have thought? Time for breakfast.
Bot still up 6.5 pips. Instead placed another long
limit order at 1.2377, 4 pips above price and 4 pips
below MM 6/8 (I can hear @
Fat Tails every time I mention MM
) --make the market work a little if it's
going to take my money.
16. 11:06 Price weaking, no
momentum, no nothing except FOMO. Cancelled order. Bot still up 9.5 pips--
stupid bot.
17. 11:07 long limit order filled at 1.24835--absolutely my most hated entry (breakout). Initial stop
placed just above day's loss limit including previous gains at 1.24685. No real justification for the
entry, the exuse is "I'm going to quit for the day if that trade goes south."
18. 11:15 stop hit and that's it for me for today, down $158 after the smoke clears. Now where did I put that stick I beat myself with.
Notes:
Market Sentiment post first order entry:
Possible explanation of drop just before 9:AM
EST from ForexLive by Adam Button || August 22, 2012 at
12:50 GMT
Euro Hits Stops Below 1.2440
Risk aversion spikes and the US dollar makes broad gains.
EUR/USD bids at 1.2420/30 with more stops below.
No fundamental drivers for the latest moves, which were led by breakdowns in Bund and Treasury yields.
Market Sentiment pre trade:
Orderboard from ForexLive:
EUR/USD: Bids 1.2420/30, sell stops below. Tech supp 1.2390/00 (55 day MA- 1.2390). Offers start
1.2480/00 ahead of a barrier at 1.2500 (part of a 1.20/25 DNT), also talk of SNB related offers from
supranational. Buy stops through 1.2510 ahead of offers 1.2535/50 (July 5 high 1.2538) and ahead of the
1.2550 barrier
Futures from CNBC @ 9:30 AM:
DOW (Mini)
1month
FUTURES FUTURES FAIR VALUE (-22.42)
13203.58 13177.0 -22.00 13176.58 13177.0 0.42
Last Updated: 08:24:23 AM
S&P 500 (Mini)
1month
FUTURES FUTURES FAIR VALUE (-1.63)
1413.17 1409.3 -3.20 1410.87 1409.3 -1.57
Last Updated: 08:23:47 AM
NASDAQ (Mini)
1month
FUTURES FUTURES FAIR VALUE (-3.25)
2772.2 2769.25 -4.75 2770.75 2769.25 -1.50
Last Updated: 08:24:59 AM
OIL 96.68 -0.16 -0.17%
GAS 3.0655 0.0003 +0.01%
NAT GAS 2.826 0.051 +1.84%
GOLD 1642.00 1.30 +0.08%
SILVER 29.40 -0.028 -0.1%
Events from BabyPips
Session Time Currency Event Impact Actual Forecast Prev.
London New York 10:00 USD Existing home sales med 4.51 mn
4.37 mn
New York 14:00 USD Minutes from prior (31 Jul-1 Aug)
FOMC Meeting
released high
Sydney Tokyo 23:30 USD
Fed's Evans discusses current economic conditions and
monetary policy in press briefing low
ForexStreet news bullish for euro but also for dollar:
Forex Flash: EUR/USD targets 1.2700 – BBH
Wed, Aug 22 2012, 12:26 GMT | FXstreet.com
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Forex Flash: EUR/USD targets 1.2700 – BBH
Forex Flash: EUR a bright spot as of late – BNZ
EURUSD’s bull and bear fight….
FXstreet.com (Córdoba) - Greece outlook has gotten more constructive as the meetings start, according to
the BBH team. Juncker will be in Athens today while Greek PM Samaras will be in Berlin and Paris on Friday
and Saturday. Hollande and Merkel will also meet tomorrow in Berlin. "Despite the flurry of meetings, the
Greek saga will continue to play out over the coming weeks until the Troika decision and German court
ruling in September", they say.
"The technical picture seems to favor further euro gains near-term", BBH says. "The euro broke above the
$1.2445 area Tuesday that had capped the euro in August, which also coincided with a retracement level from
the June-August drop in EUR/USD", analysts comment. "That break targets the June 28 high near $1.2700, but
further gains could be a slow slog as markets await further developments regarding Draghi's proposed bond-
buying plan".
Forex Flash: Dollar is bullish against the majors – UBS
Wed, Aug 22 2012, 12:15 GMT | FXstreet.com
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Related News
Forex Flash: EUR/USD targets 1.2700 – BBH
EURUSD’s bull and bear fight….
Forex Flash: Dollar is bullish against the majors – UBS
FXstreet.com (Barcelona) - FX markets consolidated the majority of yesterday’s gains, with the DXY trading
flat in the European session. Most major equity markets were trading slightly in the red at the time of
writing, though news flow was relatively light ahead of the FOMC minutes due later in the US session.
According to FX Strategist Chris Walker at UBS, “Our core views remain bullish for the dollar against the
euro, pound, yen and Swiss franc, while exercising a degree of caution with commodity currencies at current
levels against the greenback.”
The Eurozone debt crisis remains a focal point, with EUR/USD around 10 big figures lower, and Spanish 10y
bond yields 65 percentage
points higher, than was the case in May. Lastly, “we remain confident that the
SNB will maintain the 1.2000 floor in EUR/CHF for the foreseeable future.” Walker
adds.