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Reet’s 2 Trades a Day Keeps the Drawdown Away Journal – ES
These recent mood swings in the ES worked out well for me. I am wondering though if these sim results are really indicative of any real trading in the hopefully recent future. I doubt I will be this selfassured during extreme conditions like these if real money was on the line. Also, I wouldnt trade on my phone for real, like I am doing now. Anyway, nice to experience a change of pace.
I am 2 days behind on this journal. So first yesterdays results. 1 (big) loser, 1 (big) winner
Trade 1: First off, I anticipated the big sell of. In the morning I noticed a huge negative divergence on the MACD (yes, I tried an indicator again) on the 4H. Also, we seemed to be in an area of distribution. A lower high was made (on the 15M) during the night. So I decided to be bold and short the thing. I put out sell limit order at the top of the consolidation block @2916.75
Target: 2910,50 (slightly above daily open)
stoploss: 2918,50 (but i moved it up to 2020,25 - VERY WRONG!)
Long story short: Next time wait for an actual reversal, stupid! Price rallied up all morning until i got stopped out. I moved my stop because i was SURE price would fall. Thankfully I bailed before price went into some buying climax.
Profit: -200 USD
Trade 2: But then price did turn around. I wasn't at my laptop at the time, but I saw it on my Metatrader app (scanning price when I'm on the go - has this all become an addiction by the way?) It didn't hesitate and tried to enter through a limit order. Didn't work, price fell too fast. So i used a market order @2918,75
stoploss: no time to enter
Target: no time to enter
Price just kept on falling, I didn't feel the need to manually enter a stop and target. Price fell through both levels I drew in. I closed the trade @2909,00 during a popup that took too long for my taste.
Trade 1: Things are looking bearish still this morning on the ES. Price is consolidating after a popup. Nearing resistance. And also touching VWAP. So I short @2897,25
stoploss: @2898,50
Target: none, hoping for a big dive again.
Price falls almost immediately after I entered, and stalls @2894,50 where I exit
Profit: 137,50
Trade 2: I immediately re-enter, thinking price wil proceed to fall, momentum and all. But I get scared as it goes up, and I bail @2894,50 for a
As I was saying, I am trying to get more trades out of the Euro Stoxx Future instead of ES. Because its slower (ie less risky), cheaper and thus has lower margin (in europe), and trades best during euro hours here in Amsterdam. I feel it would be better to start live trading Euro stoxx whenever I'm ready. Today I had some succes with it.
All trades are visible under the chart.
The first one was just riding downward momentum on DSX. Profit: 56,26 (5 ticks)
The second trade did the same one the ES. Profit: 50 USD
The third I was buying DSX too soon, expecting a reversal based on a previous low. Wrong. Profit: -22,50 USD (2 ticks)
Trade 4 is the most interesting. I am reading a lot about some method called Kewltech (or something silly like that) and I am trying to apply it. Again I bought 1 contract Euro stoxx future, this time based on a first touch of 'support gained' from a previous high (first red box on the chart). When price did start to move up I bought (second box) via buy limit order @bid @3417
Stoploss: 2 ticks below support
Target: At first touch of (possible) resistance of previous high @3427
Target reached after 2,5 hours for Profit: 112,15 USD
Leaving the ES for now and focussing on FESX (the euro stoxx index future).
4 Trades yesterday, 2 win, 1 loss, 1 BE
Trade 1: Downtrend on M5 and M15, noticing resistance around 3430. Enter sell order @3430.
Stoploss: only 2 ticks. I like that about FESX: tight stoplosses.
Target: @3417
Moved target up when downward momentum wore of. Closed @3426. Profit: 4 ticks, 44,60 USD
Trade 2 and 3: Price made a new high and was retracing a bit (I thought). I was waiting with a limit buy order @3440 level, a 'support gained' level, thinking it would go up from there. But it really did not. First trade profit: -2 ticks, -22.30 USD. Second trade (I was quite sure of myself) I got out just in time. Profit: 0
Trade 4: So then I noticed a huge negative divergence on the MACD, see chart. So i shorted at the next logical moment, during a mini-popup @3437. Small stoploss. Target: big. I moved my stop up to @3428 when price halted a bit. Got stopped out for profit: 9 ticks, 100.35 USD.
No trades today, due to lots of work (This will become more of a problem in the coming weeks).
Reading Trading in the Zone by Mark Douglas now. It's about trade psychology. He supposedly teaches you to be confident and disciplined while trading. I cannot wait.
average win = (6+4+13+8+8+10+6+3+9+6+6+4+15+9+8+7+8+8+9+41+11+5+4+9+4+9)/26 = 8,846 ticks
average loss = (4+0+4+2+5+4+0+0+3+16+0+2+0+2)/14 = 3 ticks
win % = 26/40 = 65%
loss % = 14/40 = 35% Expectancy = (8,846 * 0,65) - (3,00 * 0,35) = 4,6999 ticks
I like the numbers. Ideally I would like a higher expectancy, even at the cost of my win percentage.
But there's room for improvement too. I didn't like all the different methods and edges I tried. There's some consistancy in my profit, but not in the way I trade. Also, too much mistakes, like leaving money on the table, entering too quick, throwing in indicators to justify a trade. Also, the filled-when-touched order filling sim in metatrader colors these results way too much.
I've read Trading in the Zone by Mark Douglas and a lot of what he says is really inspiring. His book ends with a trading exercice that I want to base my next cycle on. Goal of the exercice is to become a consistant and self trusting trader. More on that soon. Most inspiring was when Douglas compared his trading style with his attempts at becoming a runner. I started running too a couple of years ago, and I ran a marathon recently, and yes, there are indeed lots of interesting comparisons too make between the two. So this morning I registered for a half marathon this summer and started training again. I'll be running and trading now. Let's go.
In the meantime, while I am figuring out the rules and method of my new trading cycle that I will soon post in this journal, I won an elite membership to nexusfi.com in the 10 Year FIO thread (hurrah!) So I thought I'd post the trades I took on ES-mini today (sim still) based more or less on this method I am checking out by Damian Castilla on YouTube.
First two trades were losers. The first a buy, during a downtrend, silly. The second one was a sell, but I was chasing a breakout to the downside. I should have entered as soon as the consolidation (red rectangle) broke. Or, even beter, as I did with the third trade, enter on the retracement. That one made up for the losses and then some. Of course I should have hold even longer for more win. But 150 USD is fine as well.
Anyway, I am also in the proces of setting up a new trading account, that will let me trade the micro ES future. I cannot wait.
Still busy with work, so I have little time to trade and start a new cycle proper. Today I had the change to pick two trades on ES (sim) and they both worked. I am experimenting with trend following breakout trades again, trying to enter in area's of consolidation, and getting out after a harmonic target has been reached.
Trade 1: trend is down, I enter a sell limit order @2845,50, thinking a break out of that consolidation to the downside is most likely. I put my target (ambitiously) @2831,50, hoping the length of the previous leg down will be leading. Stoploss goes above the consolidation @2847,50 (8 ticks). We never reach the target. I lower my stop when half of the length is reached @2843,50. I get stopped out for a gain of 8 ticks or 100 USD.
Trade 2: Big fluctations after the open. Trend is up. I enter a buy limit order @2845,50, after a retracement, and get filled. Stoploss @2834,50, under the LL. Target: one harmonic leg above that LL. Price bounces of VWAP a couple of times, and I fear I am stuck. But I persevere, that is to say I walk away from the computer, and when I come back I see that price bounced of the trendline in the end and got to my target @2852,00 for 26 ticks or 325 USD. Which was nice.
On the chart, the right most trendline is actually a trendline. The other two lines are me trying to measure the leg of a swing, and then projecting that length forward to find a proper profit target, if this makes sense.
I did some more experiments with measured moves, as I now think they are called. See my crude attempts in the web-version of metatrader in which I use trendlines to measure the legs of previous swings, and then project them forward from the most recent higher low (uptrend) or lower high (downtrend).
My first trade in the euro bund future failed, because I got caught in a reversal. Loss: 7 ticks
Second trade. Back to the good ol' ES, which seemed to be trending up now. I drew in the measured moves in M5 actually, took the trade in M1. To my suprise it worked, price reached my target almost to the tick before retracing (a bit). profit: 27 ticks(!)
Third trade: back to the Euro Bund contract, still trending down. Same sort of move, with a tight stoploss (because of the small legs). this time it worked. Profit: 9 ticks
