One Good Trade

[CanOz]

After 9 months of trading on SIM, cycling through indicators and methods, attending webinars, endless hours watching the markets....I'm running out of time. My wife gave me 12 months and I've almost used that up (August 25th). The pressure is on.

I've made progress, I'm down to a simple method in determining the markets structure and I use the DOM for entry at those predetermined levels. I still have some big issues to over come. They are, but probably not limited to:

1.) Over-trading - As TH says I'm working for the broker'
2.) Taking the wrong trades
3.) Failure to plan the trades
4.) Exiting too early or too late, not following the plan

So to help me overcome this I've decided to finish up my SIM trading at the end of the month on ASF, a public forum. That gives me a couple of weeks to perfect my One Good Trade (book by Mike Bellefiore) before going Live on August 1st and finally end my misery and either *rap or get off the *rapper.

From tomorrow i will attempt to take one trade per day for each market i follow, K200, HSI, Dax and Crude.

Here are the rules:
1.) No more than one trade per market,
2.) If no planned trade setups apparent, don't trade.
3.) Max loss per trade is about 360 EUR on average but its specific to each market.
4.) Max daily loss is 500 EUR
5.) I must take a trade at a predetermined level anticipated in my my plan.
6.) I must use the trade management in auto to go to breakeven. I can move my final contracts target order only.

By doing this on ASF i feel i can make the trade a good one, put my best effort into it by being publicly accountable and learn to exercise discipline.

Tomorrow i will structure the markets and post the plan for the morning sessions, and the trades that i will anticipate. I will try and post the Market structure before the markets open but time is tight in the morning so they may get posted after the open. To start here is the K200, and the HSI.

I'm open to criticism, but please keep it constructive...this is already difficult enough to do!

Cheers,


CanOz

 

[sammy84]

Best of luck. Will be following with interest.

 

[springhill]

Good luck mate, not my area of interest but wishing you the best all the same. Will watch with interest.

 

[tech/a]

Can

It's-all well and good having a "plan" but do you know it's
Longterm profitable.
IE fully back tested and then --- here forward test it.
If all your doing is forward testing in R/T your going
To be bitterly disappointed I think.

 

[kid hustlr]

GL Can.

Can you quickly explain the indicators on the charts?

 

[KurwaJegoMac]

Good luck Can.

Can I ask why the desire to limit yourself to only one trade per instrument per day?

I would have thought the number of trades you take would be limited by your maximum daily loss or whenever you're in the money and the market goes quiet.

 

[CanOz]

This is a fully descretionary trading method, to my knowledge it cannot be backtested. Volume profile is just used to identify strong support or resistance, anticipate directional bias, and the type of day it will be. The stop, and trade management is already programmed into the ATM on Ninja. By watching the order flow at these levels I'll try and align myself with one that wins the auction!

One trade makes me focus, apply patience and discipline in order to cut down on trades and improve the quality.

Cheers,



CanOz

 

[5oclock]

Gday CAN and goodluck."One Good Trade", did you take much away with you from Bellas book CAN, I am about half way through it and cannot put it down.

 

[tech/a]

Can

In all seriousness I have read the things your doing wrong in your opinion
Your rules
Your what you intend to do
I cant see anything that inspires confidence.

Just have a re read
I'm sure you'll see what I mean

 

[CanOz]

Can

In all seriousness I have read the things your doing wrong in your opinion
Your rules
Your what you intend to do
I cant see anything that inspires confidence.

Just have a re read
I'm sure you'll see what I mean

Thanks Tech, appreciate your effort. This isn't a trading system that I've outlined. Its a method to train me to only trade my plan, and not keep trying to enter and exit the market all day long. I've mentioned that the method is discretionary, entering trades at key levels.

CanOz

 

[tech/a]

Not having a go just devils advocate.

1.) Over-trading - As TH says I'm working for the broker'

Ties with 2) If your over trading your seeing setups that arent good setups or your method doesnt have a contingency for low --er win rates.

2.) Taking the wrong trades

If you took the trade then it was "right at the time" if not there is something seriously wrong with your entry technique and see 1)

3.) Failure to plan the trades

The biggest problem and in my view the crux of all problems. You dont know what to do when your in a trade. How to minimise loss and how to maximise gain--that is ALL there is!

4.) Exiting too early or too late, not following the plan

Hard to follow the plan when there isnt one??

I reckon your Guessing!--
You dont know what "The Rules" should be!
Seriously thats what it seems to me.

 

[CanOz]

Done for day, two losses in a row on the K200 and the HSI. Got caught trying to fade an opening drive like no other I've seen in the last few months! 400 point nearly...WTF?

 

[skc]

After 9 months of trading on SIM, cycling through indicators and methods, attending webinars, endless hours watching the markets....I'm running out of time. My wife gave me 12 months and I've almost used that up (August 25th). The pressure is on.

Can, I think doing a journal on here is the exact right thing to do. I've done it several times and it is very surprising how disclosing the rationale and management of your trades to a bunch of strangers on the internet can make you honest (unless you are a pathological lier).

I found that if I am too embarassed to share a certain entry, chances are I am trying to bend the rules and make my observations fit my expectations. The same with exits. Note obviosuly this doesn't solve the problem of the method being actually no good (not saying that's your problem), but I think it will significantly assist in the 4 issues you've identified above.

As to your wife's deadline... what's the alternative anyway? Start with real money and risk losing? Or let the last 12 months go to waste (assuming she's unfamiliar with the concepts of stop loss and sunk cost)? Clearly an extention shall be granted.

Good luck.

 

[skc]

Done for day, two losses in a row on the K200 and the HSI. Got caught trying to fade an opening drive like no other I've seen in the last few months! 400 point nearly...WTF?

If the markets are correlated (which K200 and HSI appears to be) and you are taking the same trade with the same plan etc... is that really 2 trades or is it just one trade. In another word, should only one trade be taken, or each trade be half the size/risk?

 

[CanOz]

If the markets are correlated (which K200 and HSI appears to be) and you are taking the same trade with the same plan etc... is that really 2 trades or is it just one trade. In another word, should only one trade be taken, or each trade be half the size/risk?

I treated them as separate trades because they were taken at different times. I can't enter a trade in both markets at the same time. After i took the K200 trade i waited for what i thought was a fade play on the HSI and took that, got pounded out.

Good question though SKC.

CanOz

 

[Gringotts Bank]

Done for day, two losses in a row on the K200 and the HSI. Got caught trying to fade an opening drive like no other I've seen in the last few months! 400 point nearly...WTF?

Get back on the horse mate. Actually it's a wild beast.

 

[Trembling Hand]

After i took the K200 trade i waited for what i thought was a fade play on the HSI and took that, got pounded out.

Keep at. Only thing that seperates the scared and lost from the ones that eventually succeed is lessons taken AND implemented

and not blowing up.

Here some inspiration, points not dollars!!

 

[sinner]

Why one trade per day? Unless you expect to be right >90% of the time, how is that going to work? Lose a day, no more trades for that day even though the next setup could pay back the first one plus profit? So how will you cope if every single day you go to play for the next month the first trade of the day is a loser?

To me it makes a lot more sense to simply alot your max loss (500EUR) for the day rather than concentrating on the number of trades.

IMHO, this:

'm running out of time. My wife gave me 12 months and I've almost used that up (August 25th). The pressure is on

says a lot. Look back over all your threads recently, and the "Developing a mechanical system from scratch" thread too. Ask yourself how sure you are that your new found DOM reading, key level watching technique is not just another thing you've hopped into without knowing what it is you're actually looking for. Because, let's be honest, if it is, then it will probably be about as successful as the other attempts at ORBs, genetic programming, etc.

 

[peter2]

Can: I think you should re-read "One Good Trade" in light of what you are trying to do.

I agree with Tech/a in that you don't have a plan rather a few general ideas. I was disappointed with the content of your plan after all the work you seem to have done.

Bellafiore writes that you need a detailed plan with many "what if" scenarios. Firstly you need to to find a stock "in play". You've done this by selecting two correlated markets. Might be better sticking to one in the Asian session and perhaps another in the UK session (DAX?).

Your plan to only have one trade doesn't allow you to have any "what if" scenarios. You have to allow yourself a few trades/session but limit your daily loss amount. Once this daily/session limit is hit then you stop and review.

This morning you picked a S/R level and tried a "fade" trade which failed. What happens after a "fade" trade fails, I suspect you have a BO trade opportunity. I submit this basic scenario as a better plan of attack for you. If this is your favourite setup then master it in the markets you trade. (What generally happens to your fade play in the first hour, last hour, when price is near the high/low of the previous day, high/low of current session. etc.... ) Your tape reading skills (confirmation for execution) should help you lower your ave loss and speed up your execution (before the candles are printed for the rest of us to see and act on).

Obviously you should add a few more scenarios to your play book as you recognise them (with experience). eg. BO failure, 1st pullback.

Bella has a large play book, with a few favourites and knows exactly what he wants to see before he sees it. A good trade is doing exactly what you planned to do.

Yes, of course you must continue studying your markets, but without a detailed plan (one scenario) going live might be too destructive for your capital and more importantly your mental/emotional capital.

 

[CanOz]

Excellent post Peter. Very much appreciated...

The IF/Then statements are a great idea. I will review this morning disaster and see how that would have helped me interpret the market a little differently, while planning for the DAX.

CanOz