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  #53253  
Old Jan 28, 2010 6:51pm
Grateful to Merlin, Jim and Fudd :)
 
Member Since Jun 2008
More than 10 Vouchers  688 Posts
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Quote:
Originally Posted by mbqb11 View Post
I have been staring at this chart. It really is intriguing me as a breakout + pullback combo. I don't know if I can get myself to pull the trigger on it , with friday coming tomm, I am reluctant to just stay out lol



Mike
Funny, I've been scratching my head over this one too. Well not funny, seeing as I learnt breakout and pullback trading from Mike...

I nearly pulled the trigger on this 1H BUOB earlier today which was a good pullback to the trendline. I didn't because of a recent tun of losses from overtrading, and also going down to the 1H to get a trigger on a daily trendline is often just one step too far for me. I also didn't see the momentum over the next couple of bars.

Now I am considering buying a break of the highs with a stop below the pin and trailing out on the 4H BAT or 4H 2 bar trail... but there is some sideways traffic. A breakout is a different animal though.
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  #53255  
Old Jan 28, 2010 6:55pm
Grateful to Merlin, Jim and Fudd :)
 
Member Since Jun 2008
More than 10 Vouchers  688 Posts
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Watching...
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  #53261  
Old Jan 28, 2010 7:35pm
Grateful to Merlin, Jim and Fudd :)
 
Member Since Jun 2008
More than 10 Vouchers  688 Posts
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Man it's good to see this thread swinging. I read every post. Have done for almost two years.

I do that because it's funny how you can read something again and again and again and it just doesn't click. I've read the James16 'This Is Critical' post so many times, we've even joked around about it on here, but something started to click with me this month.

I had a bad month due to a lack of discipline and over trading. No other way to slice it. I am going to review things and get some tighter rules on to cut down the discretion. Because discretionary trading is fine when you're feeling on top form but that can slip so easily. So I am going to the old 'so many bullets a month' plan. After those bullets are used, no more trading.

The reason I mention the 'this is critical' is because since Jarroo's been back I've been staring at a lot of his charts. I always used to think 'man his trouble areas are so close, how does he ever make profit'. Of course after a year of staring something began to click (I'm a slow study) and I realised that on the daily timeframe, any single bar high or low can stop my trade.

Any. Single. Bar. High.

I used to think support and resistance was those big visible areas that any kid could see. And those are great for getting into trades I've found. But once I am in, any daily bar high or low is a trouble area. It just slapped me in the face yesterday looking over Jim Jarroo's old charts. He marks out every bar high/low. And if there is one bar high and one bar low at any given level, well that's a pivot zone.

I know it probably sounds like I am saying the simplest stuff, and if I'd read my post last year I would have nodded and moved on. But sometimes this stuff sinks in on different levels. I've been employing a lot of hope in my targets and suffering as a result. But looking back on my losers, every trade turned around at a previous bar high or bar high/low PPZ. Not one of them 'failed'. That is amazing information, as anyone who has been to PF and watched James' 'where is price going' series will tell you.

As James would say, armed with this information 'what can stop you?'

I understand in my gut now what Jarroo means by hard breaks. I understood it in my head before, but it's a long ole journey from the head to the gut (it usual involves a stop off at the foetal position under the desk on the way). Jarroo knows where his first potential trouble area is, and it's usually close. He watches price at this level. It either blasts through or it turns around. If it turns around, he doesn't mess with it and closes out (unless it's a triple A setup in which case they get a little more room).

Why ever does it take so long to arrive at something so simple? I scratch my head sometimes on this one. Seems to be the nature of the learning curve. When a good clear setup is posted, I usually think 'man my grandmother could have traded that'. We all jump on those. They are easy. Trading isn't finding those. Trading is sitting on our hands when the nearly trades come along.

So first potential trouble area becomes critical to identify. Then watch price at that level. And you have a choice: take some profit, get stops to break even, take full profit. But if it turns around and kills you from there, don't scratch your head in surprise. The market should never surprise you, even though you never know what it's going to do.

Sounds familiar as an approach doesn't it? A little like this....

James16:

Quote:
THIS IS CRITICAL.

WE MUST LEARN TO:

Notice a strong s/r area just beyond our pa if it exists.
Know that if we trade into it we had better be prepared for a quick reversal that could give us a loss if we are not prepared.

if we know its there, we have several choices.

1. get out when it gets there for a small profit.
2. take a small partial profit and move the remainder to BE.
3. stay in with your total position hoping for a break and move your stop to BE.
4. Dont enter until the level has been broken.

Last edited by TiaForex, Jan 28, 2010 7:49pm
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  #53262  
Old Jan 28, 2010 7:42pm
Grateful to Merlin, Jim and Fudd :)
 
Member Since Jun 2008
More than 10 Vouchers  688 Posts
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Quote:
Originally Posted by jarroo View Post
Nice work on that Cad break out Aaron. My thinking is that a pullback PA on the trendline or wedge or triangle, etc. is a great base to support the setup. i.e your 1 hour BUOB.

What do you think of this on the Usd/Sgd to support that multi bar high. I think momentum is building.
I didn't actually take the 1H BUOB Jim, although I pondered over it for a while. I've been ill disciplined this month and paid the price so I was a little gunshy. And a small 1H bar can be meaningless against a big daily trendline. Could easily have been one of those 'two bars later the REAL bar appears' type trades.

But I wish I had now.... I am probably going to go in on the daily after we break the highs.

I hadn't spotted that BUOB/neutral bar with trendline pullback on the USDSGD. That's a good spot. It's rare to see daily bar highs line up exactly to the pip, especially when not at a round number. I certainly think momentum is building. So many potential ways to play this. A pure break of those highs with a tight stop, a wait for a close above the highs and then a pullback to retest, or waiting for bullish price action at the highs once broken (resistance turning to support). And of course a pure play of that BUOB you highlighted.

It'll be an interesting one to watch that's for sure.
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  #53269  
Old Jan 28, 2010 8:08pm
Grateful to Merlin, Jim and Fudd :)
 
Member Since Jun 2008
More than 10 Vouchers  688 Posts
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Quote:
Originally Posted by jarroo View Post
Wow. Nice post there Aaron.

The James16 "This is Critical" was the formula that I needed to push me to the next level. All the time and practise prior to that . . ....
Out of interest Jim, when they do go to the moon how much of our original position is left on? A half? A third?

My daily bar close is around my bedtime so I can't babysit them during the Asian session. I need to pick trades that are still fighting by London open, so those ones that are less than A+ and need tight management are no good for me. I could be dead and buried by the time I wake up. (And I don't trust those new fangled management EAs... I am still steam powered... )

But then, anything that keeps my trade selection to just A+ setups is no bad thing. Getting trigger happy and losing discipline is still my biggest problem.
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  #53314  
Old Jan 29, 2010 5:47am
Grateful to Merlin, Jim and Fudd :)
 
Member Since Jun 2008
More than 10 Vouchers  688 Posts
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Quote:
Originally Posted by Dan Gilbert View Post
The J16 manager EA is the reason I am profitable.... Without that thing, I would be dead in the water - many times.... it allows me to leave my monitor, even though I sometimes don't want to
I think it's great, I just notice sometimes my connection drops and sometimes my broker has outtages and if that's going on when price hits my BE level then the EA won't send the signal. It's a small thing but something I am not entirely comfortable with.

Now I like Jarroo's idea of the free trade because that can be done entirely through the order panel. (Order panel once placed will be honoured by the broker subject to slippage, EAs originate from your desktop and so the broker knows nothing about them till the signal is sent. I know you know that already Dan, I'm just explaining for clarity for others).

I'll have a fiddle in demo with it all.
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  #53323  
Old Jan 29, 2010 7:47am
Grateful to Merlin, Jim and Fudd :)
 
Member Since Jun 2008
More than 10 Vouchers  688 Posts
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Quote:
Originally Posted by SeekingLight View Post
I'm writing this because I suspect you've been psychologically lashed out at by your recent experience and are now accordingly showing a counter-reaction. And that in turn carries risk of shooting past the target of being aware to being over-aware, which may just cause you more problems from the other end of the spectrum again with the above mentioned risks("enemies of the state, errr, trade, everywhere!").
I think your analysis of my motives is spot on and very astute. It definitely gave me pause. So easy to fly from one side to another after a bad run.

And I agree that there is potential trading constipation if every bar low looks like trouble.

But it seem that Jim stresses both here and on PF, the importance of that first trouble area. It seems to be his main focus. In fact I'd say it's over 50% of what he says. The email sent out to PF members last night was another re-iteration. He talks of months without a loss, killing trades if they go into drawdown, partial profit at first target and then holding onto the rest forever. I guess once you perfect that system then your stop need never be at the other end of the bar so there's more profit potential that way. And with his "Where is Price Going?" series in PF he also seemed to be pushing people to identify the first area which is usually close.

Now I fully understand what you're saying, which is that being picky allows you to give your trades a little more room. Mike does this, I know you do, and it seems less stressful too. And no amount of tight trade management is an excuse to take a sub-par bar (thinking, oh well I am moving my stop so quickly that I can take a chance on this...been there, done that, got the scars to prove it). And of course price often bounces from first area to retest the entry so you could end up strangling one of those once-in-a-blue-moon A+++++ setups by going to BE after 20 pips and miss the runner.

Jim always says that with a big account, he only needs a couple of slam dunk 50 pip moves a month to make a very good living. So his focus becomes "don't lose money". Then he leaves half the position on to see if he can get some action on a runner. It's a nice compromise between cutting out losses and seeing the potential of long running trades.

I guess it's all just about finding what works for your personality and making all the pieces (selection, management, exits, frequency of opportunity) work for you. I know your focus is on identifying swing points, inter-market analysis, and so it becomes slightly different to just looking for big bars at big round numbers.

Mike's often said this is the hardest stage. You absolutely nailed where I am in your post in my PF journal. I think it's experimenting with a few styles to see what works. And not swinging too far from one side to the other because of some bad experiences. This is where it is hard because I am working out what fits me, rather than just coping the various styles available (James16, Jarroo, Mike, Rac, you etc). This is where the road must be walked alone, because all anyone can offer is how they see and trade the market.

Both approaches are valid I think. Whether you're Jarroo and you watch for a hard break and don't mess with the bar if it doesn't give you that, cutting out early. Or if you're Mike and are super picky thus allowing you to move your stops up slower than Jim does. And all approaches require pickiness to get them to work. I like the idea of Jarroo's free trade/DIBS style approach, but we'll see.

I'm enjoying the conversation and your thoughts, as always, Patrick. I took most of January off from posting (except in my PF journal) to give me focus, and I do want to post a little less in general. But these are stimulating conversations that get me thinking and I really appreciate your perspective.
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