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Big NFP surprise...98K actual versus 175K consensus. That's as ugly as it gets. It will be interesting to see how this is digested today. On the one hand, a normal view would be to believe that there's just no way the ES will be able to climb today given this news so you'd go all in on a down day versus the open. Thinking a bit more however, how will this news be balanced against the very hawkish Fed minutes; will the ugly payroll number bring some relief in that the Fed may cool it a little on the rate hikes. So what may seem clear cut to me isn't quite so. Markets really are very interesting animals...
I've got some time to review this morning prior to the open. My aim is to get my mindset right and build a little confidence in what I'm seeing and hopefully doing going into the morning. I'd like to get off to a good start today and see if I can sustain it. The NPF could cause big volatility off the open; I don't mind that so much but the price action off the open yesterday is not at all something I can feel comfortable with. So I will watch carefully given the potential for some wild stuff this morning and trade appropriately. If I feel uneasy about the price action I'll stand aside. While I want to be in the market more often, I don't want to go into boating in the North Atlantic with my little fishing boat just yet.
11:00
Looks like a day to fade the extremes at least until 14:00 roll around. I have 2 trades on the day, 1 hit and 1 stop. The stop is no big deal and not exciting, just entered the order and took heat until I got stopped out - not exciting at all. The hit was a bit more entertaining. I shorted 56.0 off the opening push up. Good enough. I hesitated just a bit, maybe 5 seconds or so and then I just entered. Now, that 5 seconds really could have cost me, especially considering the volatility at that time (this was around 9:40). But I got lucky and caught a little bounce and I got in. The ES was starting to move back down and then bounced a little. At this point I was looking at a potential exit and reversal to a long position at 55.0, however I needed a little more information first. I moved my stop down to BE to cover a bounce - so that was good management. I then anticipated the reversal coming so exited my short. I did not go so far as to completely reverse my position yet as I needed a little more confirmation, but I figured I'd get a head start and at least exit my short. BIG MISTAKE. I made a written reminder after this...do not anticipate, just wait and act once you have all information for your decision.
So, my 1 point win went on to hit my target of +4.50 points and I left 3.50 points on the table. I didn't get mad or anything, I just sort of shook my head and took a little walk around to step away briefly. I'm actually glad this happened because I should not be trying to predict what will happen, I should only be reacting to what DOES happen. I failed to do this properly on this first trade and I was punished for it. Had I not been punished I would not be learning the lesson but rather receiving positive reinforcement. I'm glad I got punished, that will help the lesson sink in. I violated my trading plan and when I do this I should be feeling a sting.
So I'm pretty close to hitting 100% execution so far today, just that 1 mistake. I'll work to execute flawlessly for the next 4.5 hours and not worry about the results, just executing my plan.
12:35
Prior to entering the market, I feel calm and in control. I have some fear and anxiety at times but for the most part it is manageable at this point. Once the trade is finished, I've been feeling nothing too much - win or lose. I just enter the result and go back to watching.
The most difficult time for me mentally is during a trade when that trade has moved in my favor, but not be enough or to a point where I could say that I'd reverse the direction if it turned against me. Maybe it's not moved far enough to hit an area of price rejection (either from today or prior days) so I would be able to get out and reverse at that point, or maybe it's just getting going. My stop is still in it's initial location and I have a somewhat profitable trade, maybe even over my 1R mark.
It's at this stage where I have anguish. Do I leave my stop alone and accept that the trade may turn against me and give me a loss? Do I move my stop to my entry point and turn this into a "free" trade? What if the market reverses a little and retests to my entry point and I'm taken out by a tick or two before moving back up?
This is the time where I get the most anxious. I'm "right" in that price has moved in my favor, but I'm an area of uncertainty about how to manage the risk I have left on the table. Full risk or risk free given the context of the trade in it's current location? There will never be THE right answer. Actually, there is THE right answer and it's pick one or the other and don't swap between the two.
Anyway, I'm in this situation as I'm writing this, long from 53.0 since 11:48 and in this zone where I've got 6-10 ticks of profit but price has not moved high enough for me to reverse into a short if that's what I get from the price action. I've moved my stop up to my entry point so I have 0 risk left on the table for this trade. And I'm wondering if I'm just taking the easy way out when the easy or comfortable way is usually the least profitable way.
13:25
Still riding this trade. It's at a point now where I can work my trading plan so it's better - I have certainty in terms of how I should be reacting. I held through a good deal of chop there and I was tempted at one point to exit for a 6 tick profit. I did not because there was no short at that spot to reverse the trade into. My charts were such that it was unclear what I should be doing based on my trading plan. At times there is clarity, like the trade off the open while other times, especially when there's that low volume, lunch time chop, things are unclear and I don't know how I should react. In the end holding the trade ended up likely being the more profitable decision.
13:30
Not sure what that was all about but price just jumped all of a sudden and I got filled for +5.50 on that trade. I'm +4.50 today and a small error away from being +8.0. That move was odd...the only thing I could think were the rig counts but that's at 13:00.
13:45/EOD
I am finished with my trading today though I'm following any trades that meet my plan at the moment. Price is very choppy around the 56-59 zone and I'm getting several reversals. I don't mind not actually trading them but following what I would do in real time is helpful. I'm happy with my profit and trading to this point today. I executed as close to perfect without being perfect as possible, just the one small mistake that cost me. To be profitable despite this is good, but I understand it will not always be this way. I need to continue to work hard to eliminate execution mistakes as there's a fine line between happy and sad.
I was more detached from results today then I can remember being in the past. I'm not all the way there of course but there is progress. I am continually reminding and telling myself, "process, process, process" because that's really what will drive everything. This is common knowledge I know, but knowing and doing are of course different things.
I end the day with +4.50 points of profit which is 3 profitable days on the trot. I took that little break for vacation but looking at my last 2 consecutive trading weeks I have 2 straight weeks of nice profits, +6.25 points for this week and +5.50 points for the last week I traded. If I remove my errors from Monday I'm at +9.0 points for this week. Those are positive things indeed.
I am continuing to see where my path to consistency lies. I am committed to continuing my development to get there. I don't read any trader psychology stuff anymore but I recall reading some stuff at a point last year about visualization techniques. Basically, you visualize a situation where you had a perfect trade and focus on the feeling of that, etc. For the longest time I had to make up an imaginary perfect trade because I could just not pull one off. Then I had one. Then there was this baron patch and then finally another. Now those events are coming much more frequently. And now that they are I don't really need the visualization stuff. And that's because a lot more often I really don't care what ends up happening as long as I execute to plan.
I really think I'm making some excellent and speedy progress. For a long time, and even recently, I wondered if I could actually ever get there. Now I see that it's possible for me to do this. I'm altering the way I think; I know this is true because I can feel it. This is very motivating. Once I get a little bit of that feeling of relaxation or the feeling that I know that I won't give into the temptation to cut a trade short when I'm supposed to stay in it I want more...A LOT MORE! I'm feel like a lion who's not made a kill for weeks and finally has a fresh wildebeest in front of him. I'm getting the energy to go hunt even more because I'm still hungry.
Next week I'm going to apply some additional pressure to myself. I will make next week my last week on simulated trading if I can apply my process consistently throughout the week. I will allow for a mistake here or there of the technical variety but I cannot make emotional mistakes that impact my execution. I've been wanting to get back to real money trading for a very long time but have refrained because I was just making too many errors and was not consistent. I have arrived at the point where I know what I want to be doing and how I should be doing it. For the aspect of reading price, entry and exit I'm where I need to be. I still have to work on consistent execution and not acting upon fear and emotion but I've been making fast progress in this area. I only need to look at the short I took this morning off the open. That's a trade that caused me pause, yes - but only a few seconds. Just a few months ago I would have pissed myself before I took that trade. It's not that I've become brave or anything it's that I've started to detach myself from results. I now need to attach myself to my process while continuing to lose whatever attachment to results I have left. I will be studying and reviewing a lot over the weekend; I am eager to make as much progress as possible over the next 48 hours. I want to come back on Monday with a different mindset and mentality, I want to continue the learning. I want to be Neo when he first gets plugged into those training programs; I don't want to stop.
I put in a lot of work in over the weekend, reviewing every chance I got even if it was just for 5 minutes. I also had time to relax and enjoy time with my wife and children and enjoy outside so it was a good and balanced weekend.
I have decided to just move on to live, real money trading today. It's a short week so I'll commit to doing this for this week only then evaluate over the long weekend. I can and will hop back into simulated trading if things turn negative but I want to give it a try.
I'm also going to change things up just a bit. In an effort to focus on process, process, process and be detached as much as possible from individual outcomes, I am only going to record parts of each trade as they finish. Normally I log everything including whether the trade hit, stopped out or broke even as well as the P/L for that individual trade...most of it's just a copy/paste function in Excel. Today I will record entry/exit price and time as well as calculate in advance my stop loss, target, RR, etc. but I will not log the outcome or the P/L. Of course I will know if I stopped out on the trade or the trade hit my profit target but by not logging these outcomes and P/L I won't be able to track from trade to trade how I'm doing for the day. I will do my best to not calculate these things either mentally or on the side. My aim is to just focus on this moment and this trade and the process for capturing the trade - that's it.
I'm going to do some pre-market review to get warmed up a little and then get to it. I feel good but I do feel somewhat anxious. It's not fear but it's something that is basically new since it's been a long time since I traded real money. I know that if I can just follow my process plan that things will work out fine. There's no reason I cannot do this.
Something I'm going to pay attention to as well today is my mental energy. I might burn out part way through the day and not really be in the right mindset to trade the entire session today. I'm going to check on myself periodically and if I feel I've reached my mental limit I'll cut my trading off and just paper trade the rest of the day.
Overnight there's not a great deal of directional bias. The Asian session was mostly up and the European session was mostly down, though it's been recovering over the last 3 hours. I'm afraid there aren't any clues from the overnight session that I can take into the US session today, which is fine.
11:25
Slow day thus far, zero trades. I had a short setting up around 10:10 but it was in a tight area and although I got a reversal I considered it invalid based on the location. Sometimes these things are tricky to read and need some discretion. I'm glad I held off as price moved higher.
We did get a price reversal up off of 63.25 but this isn't an area of interest for me so I did not enter short off of this. Those have been the only 2 locations for entry for me today and while the 1st had some validity the 2nd had none based on my plan.
This is perhaps the worst possible scenario to start back live trading. Normally by this time there have been at least a couple of entries for me but not today. It would be better for me to have more action but it's nothing I can control. I'll just stay patient and focused.
11:33
Of course as I was typing that nothing was happening something started to happen. I maybe should try that more often
I got a signal and shorted 59.0. Took very little heat before the trade started working. Stop at break even and holding for my target.
11:52
Just exited that short trade. Not quite to target but there's a reversal occurring at a potential turning point so my process calls for me to take profits.
I'm pleased with myself in that I'm now trading real money. Today started off very slowly in terms of possible action for me. I stuck with the market, I maintained my focus. When I saw a potential turn I did not hesitate and I did not anticipate. I was very prepared but I waited for the confirmation that I look for. I was not jumpy about moving my stop to break even and I was not nervous about the trade working out for me. Generally I get really anxious when I get into profit territory but not on this one. I was calm and relaxed. I just keep saying to myself out loud, "follow the process, follow the process, follow the process". I didn't want to allow myself to slip into a state of anxiety or get myself attached to the outcome.
It's only 1 trade. But it's my first live money trade of the year, and I could not have handled it any better than I did. Yes, it's a winner and yes I know how much but I'm trying not to think about it. On to the next one. Using a baseball analogy, I got a base hit on that at bat; I'd say it's a double. But that's in the past and I've got to prepare for my next at bat. I might strike out, ground out or I might get another double or even hit a homer. All of that is uncertain and out of my control. But I do have to take the at bat. I can't be happy with my double and just go home.
13:00/End of Day
My first error today, and one that looking back looks bad. As price was moving down I actually typed in my trading log the conditions I would need to see before I took a long. I got those conditions but decided to skip the trade (I did record the trade in my log since it was valid according to my plan). I even typed, that I got what I was looking for, "but...". LOL. If I'm typing "but" then I need to snap out of it and realize that's just excuse making. In my mind, I was looking for something more extreme and what I got was subtle, but it was there - there is no mistaking that. 100% there and 100% legitimate.
The trade did hit the target.
I'm not going to say that I'm fragile but with that mistake I believe I need to conclude the live money trading portion of the day. I am up +5.75 points today, so I won't be complaining even though I've missed profits and could be up more. Just taking all entries would have netted me more points so far today, even including the bad one I skipped. I made a mistake so I need to step aside and sim trade the day out and come back fresh and strong tomorrow. I don't want to do something to damage my mentality; this is after all just day 1.
I used good discretion to avoid a reversal that would have stopped out. I guess I got too full of myself and thought I knew better. I don't. While I can apply some discretion I also need to take the trades that are not obviously bad ideas. I need to learn when to override my plan and when to stick with it. I realize that I will never be perfect in this area and there will forever be room to second guess myself. But I definitely need to take the trades where I write down what I need to see in order to enter the market then get what I'm looking for. Skipping that is a 100% error all day. I lost focus there and got away from my "process, process, process" mantra that I've been saying aloud all day.
I will review this evening and do some work to understand where I am and how I'm going to get to where I want to be. I want to be operating at 100% efficiency. I will get there, this much I know. It will just take more hard work. I'm in a fight with my mind and my mind isn't going to give up that easily.
EOD Follow Up
As I mentioned I was going to sim trade the rest of the day. After I typed that bit above I stepped out and ran an errand. I got back to there was a good trade that I saw - I tried to short it but I didn't get filled as price ran away too quickly for me; it did come back to my exact entry price but I was in the back of the queue and I did not get a fill (I don't get insta fills on sim, they're usually crap).
I'm watching and I see this short opportunity developing. I start stalking and I'm liking the way it's setting up and I get the price action I'm looking for so I put my order in at 58.50 and get a quick fill. Price stayed around my entry for around 10 minutes then moved lower. There was a hard reversal at an area of an earlier double bottom, so I knew there was a chance of a bounce or even a reversal in this area. By this time I'd cast my lot and I was short and that was it...no reversal here, the only action I could take would be to exit my trade in this location. I didn't feel that was the proper course of action based on what I saw so I just put my stop at break even and did some other things. I eventually got my fill for a +5.25 winner.
I paid close attention to my feelings entering this trade and during it. I really could not have cared less what happened; it was a real whatever kind of thing. I was not anxious, nervous or anything. This is likely due to the fact that it actually does not matter, it's not even real money. But that's not how I've been rolling of course...I've had problems executing strictly even on sim - because while it's not actual money it matters if I'm "right". There's absolutely an ego beyond the money aspect of trading for me, this need to be "right" which is another way of saying the need to have winning trades and avoid losing ones. Winners are "right" and losers are "wrong". Of course I know better than that, in an academic sense at least. But my mind is still not convinced - that's the fight I'm undertaking now. I'm trying to detach my mind from winners = right and losers = wrong to following my plan = right and not following my plan = wrong.
So even though I could say it's no big deal to not give a damn about a sim trade; I do give a damn - my mind gives a damn. That my mind let go and gave me no physiological negativity in the form of fear or anxiety is a good thing the way I see it. It's an example for myself that I can become detached from the results and attached to the process.
Another day and more progress - amazing progress. I am so different than I was 2-3 weeks ago. Tonight I will do a lot of thinking and some review and will resume live money trading in the morning. I will look back at this particular trade and remember how relaxed and calm I was. I will try to emulate that tomorrow when I'm trading for real.
Nothing of note overnight and only the JOLTS report at 10:00 which isn't normally a market mover. I'm back on trading for real this morning; had a good review session last night and did some statistical analysis...I feel good this morning. I've got some time for review and study before the market opens and I'll do just that.
Looking forward to facing my challenges today and making some progress.
11:20
Holy cow, so hard today - price is absolutely all over the place and it's extremely confusing and I love it! I've skipped a few trades today using discretion and those have been good calls. So far I am operating at 100% efficiency to plan and I'm pleased with this.
12:10
Price is in a really tight range here and is narrowing. I suppose there's a good chance it could move fast out of here and not come back for a potential entry on a pull back - such has been the day from my lens. If this scenario plays out it might well be impossible for me to be in the market when this move happens as things are just too choppy and too tight at this time. I don't mind chop as long as it's wide range chop or a lower volatility chop but with the order book being so thin price is flying around like crazy and this ~ 6 point range feels a lot more like about 3. I can't do it...I won't do it, and that's okay by me.
I'd love a move out of this area that turns into a head fake, I'd be all over that if I see it and can catch it. I'd also love a move out of the area and a pullback where trapped traders start bailing for break even and others pile on for a second chance; I'd be in with the 2nd chance crowd if I could catch price before it moves away.
I can't think of any other scenario in which I'd play in this zone and at this time. I don't see those two above scenarios as being too likely just based on volatility so far today so most likely I'll just need to try to find something somewhere else a little later on. If I do see what I think is a head fake or a move out with a pullback I'll certainly try to trade it provided the entry ticks the requirement boxes for me but again, there's a good chance in my mind that price would run too far and too fast for me to catch a good entry - and I'm not chasing.
Up to this point though I've been operating at the highest level of efficiency possible on what I see is a difficult day to trade. Yesterday and really each day last week was much easier to trade by comparison than today - at least for me. So there's the positive for the day. I'm welcoming the difficulty because it's providing me with good opportunities to test my discipline and patience.
14:56
So price is running higher here. Based on the morning and opening range I just don't think we're going to get much past, if at all past the HOD at this point. I could absolutely be wrong and misreading the situation but I think it's very unlikely that we will get more than a few ticks past 51.75 if we even get to that spot. That's my prediction, though I won't be trading based on it
15:06
Got the move I was looking for there, and a nice TICK slam after the rejection at 50.25. I've really been grafting hard today; this has been one tough nut to crack for sure. This one may not play out the way I think/want and we may end up moving higher after all, but at this point the trade's risk free.
15:25/EOD
I'm out of that short at the buying here. If I were swinging multiple contracts I'd have scaled. As is I just exited because I have a reason to.
I am starting a new rating for myself, called efficiency. This is going to be my trades versus my signals minus good discretionary skips. So, if I get a long signal but I have a valid reason based on my read to skip the trade (and these are written in my plan) then I'm going to track the trade as a mechanical entry and record the P/L but I'll not count this as a possible entry. If the trade goes on to win, lose or break even I don't care; I'm just not going to count it as a potential trade since I had a good reason to skip it.
So my efficiency will be my entries based on potential entries I should take and my exits based on exits I should take. If I miss a a valid entry, that's 0-1 and not 0-2 (counting the exit) as I have no way of exiting the trade.
I went back and tabulated yesterday and I ran at an 80% efficiency level; just the 1 error. Yesterday was comparatively easy to today. As I mentioned above, I've been grafting hard all damn day and really focusing and concentrating. Today could have been a disaster for me but I did well. My efficiency for today is down from yesterday, 77%. However, considering this is day 2 of real money, and considering just how damned hard things were today I'm going to say the 77% is a lot better than the 80% from yesterday. Yesterday was Trading 101 and today was a graduate level course. I'm sure there are people who think the opposite, but for the way I trade and what I look for today was a tangled mess!
So I end the day profitable, and at a 77% efficiency rating. I made errors in the early afternoon, I just got mentally worn down...it was taxing. Unlike yesterday I did not quit and move to sim, I took a little walk to gather myself and came back and did some analysis of price action and the trades and potential trades up to that point for the day. I reaffirmed that I was making some good decisions, and I accepted my errors for what they were. After doing this I got back to doing what I know I NEED TO DO.
I proved a lot to myself today. I proved that I can be resilient and strong. I proved that I can make hard decisions and use discretion well. I proved that I can take trades without hesitation. And I proved that I can take an early loss and keep plugging away and chipping away and even when it's not working I can still keep going. And I proved that I can stick to my plan and trade without emotion. I had zero emotion today all day. Nothing mattered except me hitting my spots where I was supposed to. And finally I proved that I can make errors and bounce back from them and keep going. I can forgive myself and my imperfections and get back up and do the right thing(s).
Today was a big day for me in terms of growth and development and in terms of learning a little more about myself and what I am capable of.
I've got a large amount of post market review to complete this evening as there was a lot going on today that I need to take a 2nd, 3rd and 4th look at.
I appreciate the opportunity to follow your journey and your development as a trader through your journal. It's inspiring to see your progress and it gives me hope that I may also one day get where you are, if I work hard. I wish you all the best!
Could your briefly describe your post market review process?
During post market I really just start again from the beginning of the morning and walk forward through the day. I believe there are a number of platforms where you can actually do a market replay (Ninja Trader I think does this) but I don't have that available. So I just walk through very slowly bar by bar and re-evaluate price action, etc. I keep lots of notes during the day about spots in the market and what I'm seeing and what that means and I compare these notes with what I see during my market review. Was I reading things correctly initially and if not, could I have read things differently?
I also look for potential lost trade opportunities. If I see areas during my review where I could have entered a trade in real time I study the conditions, why would I enter there and how/why did I miss it initially?
When I get to spots where I did trade, I review the entire trade again. Here, I keep good notes on my trade log so I state the reasons why I took the trade at the time so I can compare that against my thoughts during my review session(s).
For the last session, I will do a review just after I stop trading for the day as I want to review while everything is still fresh in my mind. Often I also have time to re-review prior days, either the days preceding or maybe a day which would be similar to today. I'll use the same process in terms of just walking slowly through the day bar by bar.
I also do another review later in the evening, after I've been away from the screen for several hours. I believe that gives me a little different perspective as I've had some time to let things soak in. As time allows in the evenings I also re-review prior days or weeks. I will always start with the current week and then if I have time I'll just pick a random week and start reviewing it.
When I do my review I try to be very critical and second guess my decisions. At the same time, I also try to understand that in that moment I cannot see the future as I can during my review, so I try my best to just deal with the conditions at that moment in time and not use the benefit of hindsight.
I also mark up my charts a lot, there's stuff all over them - arrows, notes, thoughts, just all kinds of things. I take screenshots of these and compile them by the week and save this as a pdf file. So if I'm watching TV and some commercials come on I'll pull out my iPad and just start going through a chart. I'll just pick an area and start looking. Or if we're in the car and driving somewhere and no one is talking I'll do some review there. These types of reviews are definitely not as detailed as my others but occasionally I'll see something a different way or learn something. Otherwise, I'm basically just burning things into my head and memory. My goal is to get as much screen time as possible whenever possible.
I'd recommend you take a look at the My Trading Coach website by Lance Beggs. You can search various article topics on there; he has several on his post market review. Lance believes that the post market review sessions are even more important than your during market time. I'd say they are at least of equal value to me. I believe I started cutting off some of my learning curve when I began devoting a lot of time to market review.
Overnight, he Asian session was unremarkable and the European session rallied hard but has since slipped below where the rally began. This leads me to believe that the European session could weigh on the US session somewhat until the afternoon. If the US session moves down today then I'll be on the lookout for a post 14:00 rally.
The EIA report is at 10:30. Bloomberg has this as a top tier economic release, a "market moving indicator". I suppose it has some potential to move the market but rarely does. I'll be cautious around this time and if there's a potential entry just before then I'll skip it. Otherwise if I'm in a trade that crosses the 10:30 threshold I'll just roll with it.
I'm going to of course work on my efficiency today. I'm going to try to continue to focus only on process and try to become attached to that alone. I'll be doing some review before the open this morning to get me prepared.
13:15
Today has been slightly more straightforward than yesterday other than the little chop down between 38 and 42, but even that was not as bad as yesterday. I am at 100% efficiency for the day so far, so that's what I am aiming for. Unfortunately I have yet to have a positive trade P/L wise...lots of paper cuts. I am continuing to focus on my process and plan and just trying to read the price action as I normally have been doing and placing bets accordingly. Today they are just not working out so far. There have been a few occasions where the ES looked like it could reverse and move up so I've been taking long entries that have mostly stopped out. My shorts haven't worked out either.
While I'm not pleased about the P/L part I am doing what I need to be doing. I've paused for a bit to review the day as it's unfolded, something I do often. I cannot identify any mistakes that I have made and I would not change any of the decisions that I've made thus far.
I'm going to attempt to continue as I have been up to this point, just focusing on the process and plan and recording the outcomes but not worrying about them. So far so good, even though I'm down for the day.
I've been looking a lot at prior days I have looked at and these last 2 days have a really different feel and look to them, very much out of the norm. Perhaps that's because it's a short week and the DOM has been relatively thin this week. Monday was a very "normal' day as I see it but yesterday and so far today have been out of character from my view.
15:40/End of Day
Man, rough day for me. I don't know why but the last 2 days have just been extremely hard to get a handle on. Even when I was reviewing 4/11 last night, even with hindsight and all of that, it just looked so much more difficult than just about any other day - especially recently.
I ended the day with nearly 100% efficiency, just 1 error or missed opportunity. That was on the last trade of the day. I skipped it but the reason really was not valid. I sort of knew this at the time but I just didn't have it in me at that point. It was another very hard day to trade for me.
While I did scratch out a pretty good profit yesterday, today was a different story. My best trades were break even today, not one positive result P/L wise. The good thing is that it's just lots of scratches and no deep cuts and I'm still overall profitable for the week.
Even though I did skip the last trade I am pleased that I gave the level of effort that I did today. I did not let the losses get to me and while I can't say that I didn't think about P/L at all, I certainly didn't focus on it. As the day wore on it was on my mind though. But I was mostly able to still keep trading and I stuck to my plan.
I have reviewed parts of the day already at this point with the aim of looking for a path to profitability for today. I cannot find one. The one trade I did skip was a profitable one, so that kind of sucks as it would have gotten me really close to break even on the day. But seeing that this is day 3 and the ES was not to be tamed by me today it's fine. The trades that ended up being losses were not errors, they were good entries that just didn't work out. On another day they might have been profitable. At the same time I have gone back looking for potential profitable trades I may have missed. On my charts, the entries stand out so it does not take long to find them. I've looked enough for a profitable trade or two that I just missed and it's not there - aside from the one I skipped for an invalid reason. So I suppose it's just one of those no good days.
I'm not too sure what to do about tomorrow. I think that part of the issue over the last 2 days has to do with the Friday holiday. Volumes are lower and the book is thin and it certainly won't be getting any better tomorrow. I might sim trade tomorrow or I might just skip that too - or perhaps I'll do some live trading. At this point I really do not know what the best decision is but I'll give it some thought tonight. I want to trade but I realize that I don't have to trade.
I've got a lot of work to do tonight. I'd like to review these last two days and try to really understand what the heck is going on. Why is it that I can look at any other Tuesday/Wednesday I have marked up and reviewed and I can make sense of it in terms of where to trade but today and yesterday are a complete mess? I'd like to see if I can come with some answers to that question. Maybe I will see that things are not as confusing as I am making them out to be.
The other thing I need to think about is when and when to not use discretion in skipping trades. I have defined and am continuing to refine in writing my thoughts on this as I'd like to quantify this as much as possible. When I record trades based on strict entry and exit criteria I am recording everything and not using any discretion. I'd like to think that I could apply just a little bit of discretion and skip the trades that are obvious born losers. I have done this so far during the week, so that's good. But I know this is also causing me to skip trades that don't fit my vision of a born loser, they're just maybe ugly babies. But ugly babies can grow up into handsome adults - just like me
So while I want to use discretion in my trading and I think I need to, I am learning when and when not to. That part is harder than just taking all of the entries that I have defined to take. Often there is 1 really obvious spot each day where I could trade but would not. Maybe I need to give myself a veto count...like I will take all of the potential trades based on my criteria but will be allowed to veto 1 trade if it meets my veto criteria. If I can only let myself skip just 1 then maybe that would help keep me from messing about too much. Most of the time I'm not better than my plan.
Up and down overnight and the US session looks to open under a bearish tone. There's some economic news at 8:30 which could change the direction.
As this is the last day of the short week the DOM should be thin and price action should feel more like yesterday and Tuesday. This will present challenges for me. I did more review and homework last night than normal and I feel good about trading today so I'm going to live trade again. I believe the price action over the last 2 days has me speeding up too much in my mind. I need to just slow down and relax and pay closer attention to the things I should be in terms of price action and areas of interest. Of course, it always looks easier after the fact, but I need to recreate the feeling of ease during the trading day. That's more difficult when the market is so whippy.
I don't want to sit out today because I feel it's going to be a really good chance to trade in some difficult conditions and I feel that no matter what I'll grow a little. I'm really going to have more stamina today and use good discretion based on a few price action reads. I need to simplify and trade with clarity. Yesterday I could not achieve the level of clarity that I have recently. Today I will try to change that. Focus will be on process and not outcomes, something I did reasonably well yesterday.
Premarket Follow Up
I put a little more thought into this on my drive today, the kids were reading books and it was quiet on the way to dropping them off at school.
What's been happening over the last 2 trading days is most likely decision fatigue. I'm not used to making that many trading decisions per day. With price being much more whippy than normal I'm getting a lot more reversals, many in key areas so in essence many more "signals" to do something or at least make a decision.
After yesterday I believe this uncovered some deficiencies in my written plan in that it was not refined to the point where I defined exactly the price action I'm looking for to confirm/avoid trades in specific locations. Whereas in the weeks prior I could basically just take almost all of the signals and come out more than okay (Monday for example) as the book has thinned and price is jumpy this is no longer the case. I'm finding myself faced with many more yes/no decisions and they are coming much more quickly and frequently. This has reduced my ability to see and think clearly.
So I've refined, in writing, what I'm looking for at each moment. It's simple things and I've avoided putting too much detail in. I still seek simplicity and am avoiding adding more things and making this too complicated. The more stuff you add, the less you'll achieve - I really believe that...been there, done that, read the book.
So, with this I'll approach today with a plan that's a bit more refined that should provide additional clarity and reduce the mental capital required at each decision point. This should reduce the fatigue I've been experiencing over the last two days and allow me to trade longer today.
I also suppose it's a bit like lifting weights. You're not going to go out and squat 405 on your first day in the gym...you've got to build up to it. Perhaps as I get more exposure to this type of market environment I'll build up my mental strength to deal with it better and for longer periods.
13:00
I'm finished for the day. I made 1 trade that scratched for break even. I skipped several to plan signals that all would have stopped out. These were trades that 100% fit into my plan but they just didn't look right; they were out of sync with what I was expecting the market to do based on what it had already done.
I'm following and logging the trades that fit my plan but at this point I have zero confidence in these trades being profitable today. I suppose the issue is the volume in the market, it's extremely low at this point.
I'll do some study and review over the long weekend but not too much. I know what I want to be doing, it's just a matter of doing it. I am glad I held off trading today because had I taken my planned trades I would have good from a positive P/L week to a negative one.
15:55/End of Day
Wow, what a horror show today! The best thing I did was decide early on that I should not be trading today. There were many potential entries based on my plan. Those entries that have been working so well were not working today at all. The best trades today were scratches. Price is just too wild to get a handle on and the choppiness around key price areas is just insane.
I believe the lesson I've learned over the last few days is to figure out how to recognize these kinds of days and just sit them out. Memorial Day is the next CME holiday so I suppose the Friday before and maybe the Thursday before could be like this. I have made a note on my stats log about this environment and will be watching from the sidelines during the next pre-holiday trading.
I am a little frustrated because I was on what I felt was a really good roll and it feels like I just lost my mojo all of a sudden. I believe it's the liquidity but I might be tentative come Monday to get back into trades. If the DOM is thin starting out Monday I might just sit that day out until I feel like the ES is acting normal again.
Happy Monday. I did a ton of work over the weekend reviewing, back testing and looking at results. I was really focused on looking for a way to recognize chop time so I could perhaps alter my approach in these areas. Just about every day the ES will chop around once or twice per day. Sometimes this is near a key price for me and I'll try to trade it to catch a larger move but I can end up taking many small losses if I'm reversing a long position to a short or vice versa. I don't think I'll ever be able to detect every chop zone nor will I be able to tell how long it will last or how it will resolve but there are some things I could do minimize the trades within these zones when I recognize them. This doesn't really change what I'm doing but I am going to make a slight adjustment in this area as I believe it's the smart thing to do.
My confidence is a little low at the moment coming off of Wednesday and Thursday trading but I believe if I can just stick to hitting my trades and not skipping any out of fear then at the end of the week I'll be in good shape. If I start skipping trades and/or hesitating then that's when my results could easily suffer. Again, I just need to be 100% focused on applying my process and trading plan and let the rest just happen as it will.
10:00
Price is very whippy off the open and the DOM is once again extremely thin. I am very much considering sitting out the day as last week my results were worse as liquidity started to dry up. I'm going to continue to monitor over the next 30 minutes or so and then make a decision but so far I am not liking what I am seeing.
11:35
I tried fading the initial move/rejection at 37.75 and scratched at break even. I did have a chance to reverse this into a long trade but I'm just not feeling it today. The volumes seem a little low and I'd rather watch today, see what happens and try again tomorrow. It kind of sucks that I can't just trade today but I just have no confidence in what I'm seeing/doing today.
No European bank holiday today and no upcoming US holiday so my hope is that the volume in the ES is more back to normal. Housing starts at 8:30 were basically at consensus and there's industrial production at 9:15 which could provide some market movement before the open.
I am really going to try to focus on implementing my process and plan today. Last Thursday my confidence took a hit, not because it was a negative P/L day but because I missed some things that I could have caught and because I stopped trading part way through the day when there were other good (to plan) trades in the afternoon. These afternoon trades ended up being positive so that could have erased part of my draw down if I'd just stuck with my plan. Then Thursday was pretty haywire and even though I did a lot of work on Friday and over the weekend that should have restored some confidence it just was not there yesterday. I also started catching a cold on Friday and was sick all weekend and am still not feeling great so maybe that's part of it too.
At any rate, there is really no good reason for me to just not take the trades that are in my plan. As much as I have wanted to I have not been able to do this for even 1 full day yet. Last week was probably a bit of an odd week with the Friday holiday so maybe that wasn't the best week to start live trading. This week should be okay though, so I really need to just do what I need to do and stop with the worrying and fussing about things that are out of my control.
11:35
I've been stalking trades all morning and I've had a few spots that I liked but price is just running hard and fast from where I'm looking and I can't catch an entry without really chasing, which I don't want to do. My chart is marked up with "price ran" notations all over the place. It's a little frustrating but there's nothing I can do about it so I'm just trying to look past it and take an agnostic view of things and patiently wait for the next potential opportunity.
12:45
I don't know if I'm off or what but price action today has either been a) whippy and run at inopportune times for me or b) extremely difficult to read. I am having a hard time keeping the bigger picture in mind and have gotten far too tied up on minutia; I've recognized this and tried to adjust. I'm overly nervous and anxious very often today. My mind is a little bit all over the place, but I'm trying hard to stick to my plan and make good decisions that are based on my trading plan. In terms of trades today has been unusually quiet. I would not be saying that had I been able to catch a few of the moves where price ran before I could achieve entry but price did run. I really do feel out of sorts though.
End of Day
Man, pretty frustrating day to trade for me. I kept getting mixed signals around key areas that were really taxing my brain in terms of continually having to make these in the moment snap decisions. The way I was reading things for a lot of the day was that price would reverse, jump, stop, then reverse again. I was getting a bullish read followed by a bearish read and so on. So during those times I just stood aside, unsure if that was really the right thing to do, even though that's what I'm supposed to do based on my plan.
Then price would reverse off a key level and just pop then stop/reverse at another key level. So I'm wondering, wtf, is this bullish or bearish? I can't decide so I do nothing. There were a few times where I had clear bullish or bearish price action in an area where I thought it should occur but price just flew way past any potential entry point for me. I did not stall 1 second or hesitate in my entry at all, price was just reversing and moving away much too quickly for me to act.
So for me price is still acting in an odd fashion. I don't know what it is or why it is, if it's that the ES has a different feel the last couple of days or if it's me who is off. Either way, I'm clearly not in sync with the price action over the last couple of days. I'm trying very hard just to stay patient, not get frustrated and not do anything stupid. Today I didn't do anything stupid but it was very hard to not get frustrated a few times.
Tomorrow is quite busy for me from around 11:30 until 14:00 and I have a few other things I need to tend to that will take me away from focusing on my screen. I will try to arrange some of this until after 16:00 or prior to 9:00 but we will see.
I've reviewed today already many times during RTH. I reviewed again near the close and I don't see anything that I would do differently. I'm not going to to any review tonight, I'm just going to let today go by and just try to forget about it. Somewhere in my rational mind I know that the ES will line up with what I'm looking for it to do at some point. I also know that until then I will likely be able to avoid most or all of this chop and odd price action, so I won't get hurt too bad during this time when I'm not in sync with the ES. But there's an irrational part of me that also thinks the market has changed forever and I'll never get back in sync with it. That's the battle right now.
As eager and confident as I was last week, I'm basically at the opposite end of the spectrum this week. I'll really have to just brush this aside and try to place smart trades where I see them and let the chips fall where they may from there. We'll see if I can actually accomplish that or not.
My workday just keeps getting busier and busier. I likely will not have time to potentially trade until later this afternoon, after 14:00. Just one of those days...
Of course my goal like most/all people doing this is to eventually do this for a living. I try to arrange my workday so that I can watch/trade the ES as much as possible during RTH. Most days I am able to do this but there are at least a few times each month where I am away for periods. Unfortunately for today, it's going to be more time away than normal even for my busy days.
So in terms of my trading and development today's another day that will go by and another day further away from my goal.
End of Day
Super busy day at work, I had 0 opportunity to consider trading. I did catch up with what I missed during small breaks I had today and had the opportunity to follow some of the trades I could have/should have made had I been available. I did pass on a couple of opportunities to enter trades because I was only going to be at my desk for a short time so it didn't make sense to get into something that I could not finish.
Based on what I was seeing price action normalized a bit today; things were much less jumpy and whippy. This is encouraging because things have been off since around last Wednesday/Thursday and it's been extremely difficult to read and trade.
My Thursday looks normal, so slightly busy but nothing that will take me out of my office and Friday looks pretty light. I hope that I will have good time to watch and trade over the next few days and get back into the groove I was in early last week.
