A Dissapointing Week

Well there is no other way to say it other than to say it - this week was really poor. Yea we made money but we made a number of mistakes that simply can't be allowed in the future. You know that rule change I made yesterday? I was looking at my actual rules about the Double Bottom setups today and I realized I had already written a rule into my standard setups that would automatically disallow any reversal. I couldn't believe it. I had been mistrading my own trade plan. Disgraceful. So lets talk about the profit our mistakes cost.

• Missed trade Tuesday due to emotions: -150.00
• Reversal out of Standard setup on Thursday: -250.00
• Total Cost of Mistakes: -400.00

As you can see these things can make or break a trader. They were the difference between hitting my next equity objective and falling short. And that is why I take each mistake so seriously. Because it is a very real and very serious impact on my bottom line. Each mistake is like losing a client, a customer, a referral. Good business owners don't let that happen. It is no different for a trader.

And as far as our new setup. Traded this week correctly it had a 88% win rate (I caught the only loser yesterday! lol!) and +450.00 in profits net. I don't consider that lost profit however because that wasn't in my trade plan until yesterday. But that one setup alone has been good for about 80% win rates and over +1700.00 in profits over the past three weeks by itself. Its going to be a great addition to my arsenal.

So lets talk about where we go from here. Obviously next week we are going to aim at achieving that perfect execution week. Employing all of our setups, taking the correct ones, and most importantly - managing them correctly. I have one last week before the first month of trading is over and my goal of making $2,000.00 in profits is a pipe dream at the moment. Traded correctly? That goal would not only have been met right now, but exceeded. I conservatively estimate that i've left over $2,500.00 on the table this month so far from mismanaged trades, not taking +1 ticks to cover commissions, incorrect signals being taken, and my two new trade setups I added this month. But what we have to realize is that the past is the past and you can't do anything about it in the present. So we are moving forward. But if you think for one moment I don't believe that goal of $2,000.00 by February 6th is still possible from my actions next week you would be dead wrong. We are going to get there or do our damnedest failing to do so.

My weekend project is simple - find out if trading prior to 9AM trading only my support and resistance setups in the market would be worth it. Today for example there was an easy +5 points available. On the 22nd there was an easy +4.5. All textbook DB/DT or You're Screwed setups that I pass on due to the time. I still contend some of my other setups should not be traded in those time periods but the support and resistance setups seem to be very consistent there. So i'm going to do some extensive backtesting and see what the probabilities are for allowing those two setups to trade during that time period.



And despite all of this. We made money this week. We're doing something right, even if we are still doing some things wrong.

Trade Results:

No Trades Taken.

Rule Revisions and a New Setup

Today was a rough day. I traded perfectly. Lots of trades, not a lot of success in terms of profits. It was just one of those days... one trade missed its target by 1 tick and resulted in my only getting +.25 rather than +2.5, another trade got me short, reversed me on a double bottom pattern, and then stopped me out only to seek out my original target. And that was the final straw. Three times in the past two weeks I have been in positions that faked me out on double bottoms only to go onto my initial targets. And i'm sick of it! So I rewrote my trade plan today that any standard, or triple threat setup I take is held until par or stop out. Reversals are not allowed. Its the difference between -125.00 and +125.00 and i've seen this happen to me time and time again. Now if i'm able to get to par on the setups, then a valid signal occurs, so be it - i'll take it.


Rewriting the rules isn't something I take lightly. Its an important part of my trading and I don't make changes without significant evidence that there is valid logic behind the change. This one change (albeit a small rule) would've resulted in three more winning trades and around 650.00 in additional profits left in my account over the past three weeks alone. Its a small change but I have no doubt a positive one for my account.


The other thing I wanted to mention was the addition of my fifth (and final) trade setup in my arsenal; codename - Untouchable. It's called "Untouchable" *DUN DUN DUUUUUUN* *Cue suspenseful music* because it gets profits that have been previously untouchable - original right? ;). The Untouchable is a trending setup meant to get me into swings I have (until now) been unable to participate in. It hits high win rates, and has low risk setups that yield 1 risk, 2 reward outcomes. It works on all timeframes, all markets, and is very consistent. But like all my setups they might not occur every day of the week because they are so selective and filtered. I decided to start trading it live today and yup - you guessed it. The first trade was a loser! Yay! It always seems to go that way but the point is the idea is solid, the data supports this and i'm going to continue with the setups.

Here's a valid setup from earlier this week:


And another to show its potential swing trade ability:


The last thing that happened today was as I got another Untouchable setup (that would've gone to par for +1 tick) my internet dropped out literally as the order was being sent. I mean, the info bar in TS said "Order Sending" so literally to the millisecond. Now i'm not sure if it was a god send that the order didn't go through (I would've been unable to manage the position) but the setup was valid either way and did what it was supposed to do. It was a hell of a stressful five minutes though on the phone with TS Support, rebooting routers, modems and computers...

So overall, this is my largest losing day (even though I should be tied if I would've got my last trade in) and it should be +75.00 instead with my rule revisions. Either way, we learned a lot today and our methodology is more profitable and stronger than it ever has been because of it! But maybe I won't be getting my Buffalo Wild Wings this week after all! Sad!

Trade Results:

-200.00

Guess what I did today?!?!?!

Nothing. If you want the perfect explanation of why we don't trade FOMC days go pull up a chart. Utter crap through and through. I decided to sleep in a bit, take a nice long lunch, get my workout done early in the afternoon and chillax for the rest of the day. We hit it hard tomorrow morning!

Trade Results:

- No Trades Taken.

Profitable Yes - Successful No

I started off the day great, a par, a winner, and one loser that got me to -.25 net. No biggie. I took every trade that came along and managed them correctly. Then I got ready to catch a wedge break on my tick charts this afternoon. I got my signal to short at 41.50, and I had seen price bottom out at the swing low, trade through by a tick and was heading upwards. I HESITATED. Fear set in - I thought this could double bottom, and then I'll lose. I passed. The signal went on for +3 without me right to its target. I caught a double bottom a little bit later that was very profitable but the point was I screwed up. I don't have a double bottom UNTIL I HAVE A DOUBLE BOTTOM. I needed to execute and I missed a winning trade due to fear. Very disappointed in my performance today. I traded like a worthless pansy ass newbie today and that's just not good enough.



So yea... we ended up with a new equity high again but it should've been over the 1k mark and it wasn't due to ME, not my method.

Taking tomorrow off (i'll be simming it of course) due to FOMC and then we'll be back to kick some tail into the weekend. Remember, after the first hour tomorrow things will get very light and choppy. Best to stay out until one hour AFTER the release. FOMC days tend to headfake two directions before running. Typically it takes forty-five minutes to a hour of useless death swirl before it picks a direction. So just be careful in the volatility!

Trade Results:

+175.00

Day 1 is Successful

Today was a pretty hard day to trade. It was a lot of quick short spurts back and forth and one hell of a consolidation chop fest from around 10AM till noon. It was the type of price action that could absolutely ruin your day and rob you of your money. We kept our heads about us and did exactly what we had planned on doing - we executed perfectly. The end results were a par trade and a winner. One other thing of note was that we once again had another "You're Screwed" setup (remember I got burned by putting on the wrong position on Friday on one of these) and this one too invalidated on entry. Guess what? She didn't fool me and I was ready for it. I let it pass on by and it quickly reversed into what my stop would've been. That's progress folks. Trading is about making mistakes - and making sure you don't repeat them.


The only other thing of note is that we closed out today with a new equity high at the end of trading. +725.00 Gross... The last time we got this high we hit +737.50 intraday and then proceeded to hit a drawdown and finish at +400 on our equity curve that day. We got a long ways to go and we need to step it up a notch. The first two weeks we weren't trading all the setups and we missed a lot of opportunity. Last week we only got to trade two days out of five - this week we are going to give it our all and see if I can get to my next goal - 1,000.00 at the end of the week so I can get me some Buffalo Wild Wings!

One last side note. I will not be trading Wednesday due to FOMC so it will yet again be a short week for me. Regardless, it should be an active week in the indicies with all of the econ news being released. Hold on to your hats!

Trade Results:

+ 150.00

A No Growth Week

Well Friday morning I did screw the pooch on a setup. The new "You're Screwed" setups I started trading actually gave me a signal - or so I thought. It was a valid setup, however in my rule set there is a condition that invalidates the entry trigger if that condition is met. This only occurs in less than 10% of the setups and so I jumped into the position, only to realize about two seconds later than this setup had invalidated. I got kicked in the teeth quickly for my mistake and lost a quick -1.75. I was disappointed I made this mistake but they will happen, it was my first live signal with this setup and I was lucky it was such a small loss to learn my lesson. I know I won't make this mistake twice.

Thankfully I caught the next valid signal and got +2 out of it to get me +.25 net on the day. I quit trading at this point because I was leaving to go to the Auto Show with my father as planned. The rest of the day whamm'ed and bamm'ed about without me as Friday's tend to. It would've been profitable had it been traded throughout but i'm glad I took it off regardless. This week ended net +0.00 overall. I only traded two days essentially so I can't beat myself up too badly. The only problem with a week like this was that I had a very real decay of my account due to commissions. Yes, I grossed 0.00 but when you figure in commissions spinning my wheels this week cost me 64.00. Ouch. Anyway, had I traded correctly Friday that cost would've been covered.


Next week I plan to just try and trade solid throughout. I've got some real account growth to get going on. We need to post up some impressive numbers worthy of recognition and i'm going to be in hot pursuit of that "perfect week" where I don't make any mistakes and trade my plan perfectly. Hopefully next week can be the first of many that I succeed on that goal.

Quick shot of the typical post 1PM shift in the markets on Friday. Crap? Yup.


Trade Results:

+12.50

P/L Outcomes ≠ Good Trading

Today I wanted to talk about one major thing before we dive into how the day unfolded. Most new traders (and some seasoned) seem to assume that the profit or loss at the end of the day is somehow related to THEIR performance that day. The reality of the matter is nothing could be further from the truth. Profits are NOT related to if you traded "good" or "bad" on any given day.

As traders we need to understand that our methods have a probability of outcome and to achieve that probability we as traders need to execute our plans correctly throughout the day. If we do that the method succeeds. If we don't, the method fails. As long as you took the signals and followed your rules you traded perfectly regardless if that nets you a losing day or losing week. Systems have drawdowns, trades stop out. The point is successful traders separate the outcomes of profit from the outcomes of their performance.

As for today. I traded my nuts off. The most trades i've ever taken in one day is 4. I had taken 8 by 12:30 in the afternoon. Too many to go through individually but lets just say the trading gods didn't favor me in the am. I start trading at 9AM CST - by 9:04 I was down -225.00 on two back to back losers and by 9:22 up +25.00 net on one winner. This back and forth P/L whipsaw continued throughout the day. All I know is that I traded like a champ. I missed one signal that went for big gains but that's just going to happen. I was bidding for it but I got greedy by a tick and missed my fill on a trade that went the better part of 6 points. DON'T GET GREEDY. As I type this I hit exactly 50% "winners" today, two of which were par, one of which I got slipped on the exit for a tick and i'm still net profitable. Another trade that was a loser literally tagged me out on the tick low before going immediately to my profit target - but it happens! GOOD TRADING IS TAKING THE SIGNAL.

Now I did do something a bit unorthodox for myself today, and that was to quit early. I stopped trading at 1:30 rather than 2:30. Now this *IS* against my rules but I did this for two reasons. Today I took 2x's the trades I normally take on a day and frankly, i'm emotionally and psychologically drained. My focus is lacking as I write this post and I have no want to sit at the screens anymore. Secondly, the market has just gone ape shit in the last hour and shot up 20 points in a straight line. While there could be opportunity here, this puts price action into an "outlier" category which diminished my edge somewhat. So maybe i'll miss out on nice profits, but i'm willing to accept that outcome right now. I'm just not in the mindset to put on more trades anymore today.

Because I am so tired I will merely give you my two charts I traded and the arrows that indicated the trades... A lot of the trades are Double Tops or Double Bottoms so take a look and see what I did.




*Update 6:32 PM* Turns out there was one more valid signal that worst case would've been par (+1 tick) but it came up to my target level exactly but I can't guarantee that I would've gotten filled (or that I would've gave up a tick to get out) so we'll call it even. Worst case I missed one trade.

Trade Results:

+112.50