(binned per thread starter's request) Market bottom rotation trad

On first page, check supply takeout PDF files.

Why you load heavy on some plays remains a mystery for me bro. Even high probability is just probability in my book.

Alright the thing you pointed out is correct if you take one big factor in: limited or completely random amount of executions. IF that factor is stabilized into consistent repetitions the probability starts to play huge role in how you can or cant scale positions.

Quick example would be:
A guy is tosing coin on the street, lets say that coin has 60-40% win loss edge on head, meaning if you bet head over long while with the same exact position size, you are playing game with positive edge, mathematical fact.
Now lets take two scenarios in, one which accounts what you noted and one which goes beyond that and takes the execution amount in equation.

1st example you decide to play that game 3 times. Or perhaps you also decide to play it 2 or 3 times more at some random times months later on. In this scenario you simply cannot risk big because the game of probabilities has no strong consistency over 5 or 10 repetition, but once you start going 50, 100 or above 100 the consistency starts to stack up a lot more towards curve of normalization (depends totaly to how the game is structured, but for sake of coin example above, thats exactly what would happen, and the same goes for binary plays in markets).
That means with so few examples you would be right, even knowing that you are playing game with edge, you should not go deep position size, because you could easily stack few losers in a row over limited number of repeations.

2nd example, you decide to play this game every day, over and over again, 100s of consistent executions. Thats where IF you actually had high edged game (60% would not allow to do that, would require 80% or higher to size bigger), then you can size up. Obviously you can still get significant loss due to few stacked losing plays in a row but over long run should even out.


The points above are the core structure of what pushed me towards trading road that i have been going since 5 years ago, basically intentionally pushing with all that in mind, by no means could i be trader using method 1, thus only option 2 was acceptable, and for that meant M1 is a must to ensure frequency, multiple plays to figure them out, higher edged plays into mix....all that basically is derivate of the point you touched and i laid out in above 2 examples.


Its very thin line between what you noted and where i am going with, because with game of lesser edge your point starts to become stronger and much more relevant, (lets say edge 50-70%) and once you start passing 70% the other side of equation kicks in which are repetitions. A good example for that would be poker, you sit behind new table, get good hand with decent edge rate, but that edge rate is still far bellow 70% which means no matter how many of those games you play there will be very few situations where you could bet big on first go and make sense out of it, its due to edge % that dictates it.

Sory for complicating the answer so much, but it is very thin line between what you said being a holy grail and the little bit more of % edge increase that tils to factor of executions that changes the behaviour approach for trader. But to keep it real, the key factor for trader is to fully understand that by doing shitloads of research and data gathering on pattern you trade, so that data actually 100% backs that, otherwise its just dangerous assumption trader is making by sizing big on "A grade play".

The core principle of this is really at the bottom line just experiance in that niche thing that you do, over and over again. Goes same for any proffessions when you ask someone with tons of experiance in specific niche thing, how can he do that even if to outside observer seems quite risky, and he ll tell you back he has done it 1000 times, he gets aprox average fail rate (in reality he - she will tell you goes by gut, but the gut in real sense just means shitloads of executions).
So the same would go to above setup. If you do gather the data on the plays in depth, if you trade them in depth over time youll start to see certain few key variables clearly that bake certain plays deeper size worthy. I have been asking same thing equity trader in EURO equites about 6 years or so back, got the same answer from him, didnt get it then, but it became very clear not that far later.

but what happens when you hit a losing streak? you keep increasing position size? I believe you that it is working for you, you are demonstrating it day in day out, but you definitely have to be in full control of your emotions playing it like this. I dont think that would be suitable for me but I might see it differently in the future though, who knows. Thanks a lot for your clarification!

For sure, emotions have to be fully in check. Honestly i did not have a streak of 3 or more losing flagship (higher grade A grade plays) ever that i can remember, that is one of the key reasons why it doesnt impact emotions much. Doesnt mean it cant happen, its just very unlikely, thankfuly because losing streaks on high quality plays (even if only 2 in row) are the most damaging to moral, performance as you start to question everything about what you trade, one of toughest things to deal with and it takes year by year to weed out really all variables in details before you actually lay out "A grade play" into real A grade play that is only slighttly different in structure, yet in performance much better. That is why i lay out all the details about each play as much as i can, because they matter a lot.
Its all about experiance of exection, if youll trade those plays enough youll get there sooner or later.

Have set alert in Coinigy platform for BTC, if it bakes HH on momentum move ill consider taking this pulback leg, liking the way its flattening here, as long as demand holds and HH is on ill long. Possibly for 3-4 R trade. Lighting network has been sucessfuly implemented on BTC, this could open now floodgates to transactiosn and possibly start slowly another accumulation on BTC. From tech side defenetly the best thing that has been done on BTC since 2017.

I have been thinking about this post of yours. Do you trade supply takeout failures? A grade failures so to speak. Bigger picture is downtrending, lower TF downtrend with a series of lower highs/ lower lows, asymmetrical structure with a clear supply level and overhead supply nearby. Bull legs in structure have more candles than bear legs. No bull momentum, no clearout with quick rejection. Entry would probably be at overhead supply and target new structural low. R:R should be at least 1:5 or so.
Basically an advanced rising wedge trend following pattern, but with about equal supply level and sloppy price action in it.

USDJPY for start of the week, didnt take the play.

Good question, the answer is yes. Basically all the variables you explained (however they dont need to align that much) but i would only take a play with confirmation of tape, using futures and soaking / absorption as the guide, the tape has to confirm that buyers have been using a lot of fuel without making any significant advance on the price, compared to previous moves of bears, confirming that there has been limit order soaking by offloading sellers. The basic structure fits to what you said, but tape has to be there otherwise i would not take the setup, too weak edge, too easy to see the ghosts.
I like this play especially in assets with strong catalyst like equitiy with shock bear news or FX asset with strong surprising central bank news and then you can trade those plays in multiple rows, usually because structure will be much cleaner even without the tape, and the catalyst direction gives you increased edge on lenght of TP size.
Ill try to point out some examples this week if i find anything or if i dont forget.

Did you skip this one for a reason(if yes, please explain) or just missed the setup?

usdcnh setting up, i like the structure so far, lets see if it bounces once more
Keeping an eye on chfjpy, dow and gbpjpy too

Hey, no i wasnt around the comp when the setup was in process. No reason for skipping it.

entered usdcnh on the break of last significant high and scaled in some when spotted the micro shelf
got out of both with some profits, emotions kicked in
micro shelf holding strong as im writing this

Yep took same play, but i got late entry only took 1 third of size, was waiting for dip back towards initial high to add normal size, didnt get. But as you said micro shelf and overall demand is holding well 7986 for now.

NZDJPY long X.416. Its being pushed by USDJPY clearing into new HHs so chances are it might bake that pullback leg on upside.

NZDJPY took some.

USDTRY market making activity present, watching here and there if anything sets up possibly on the long side.

Gold long. 1307.2 supply takeout.

Big soak on the bid side on GBP, possible accumulation and upward move on GBPJPY, looking for long.

GBPJPY sold for 1 R gain. Solid push on demand imbalance.