MickDs Common Sense journal.
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Thread: MickDs Common Sense journal.

  1. #1
    My name is Mick and this is my hopefully - 'common sense' trading journal. I'll be trading on paper for a while untill I sort out and firm up my egy and start generating some decent profits in demo mode.

    I began it for a few reasons the main one being to keep me honest, it's just too easy to change your mind on exactly what your egy is half way through a trade . Another is I was beginning to take up band width on capilist88's journal . Have a look over there as he's some fascinating reading at his journal and web site.

    A little bit of background -
    I'm 38 and have been studying stocks for a few years using daily charts, then I stumbled upon cfd's and forex, there is a couple reasons for this pattern, the first is I do not have a lot of money so finding a viable trading instrument in which fees are less likely to encroach on profits having a small account proved to be a major consideration. Another is that in Australia, it has only been lately that cfd's have come onto the market as well as some other derivatives into the masses. I've observed forex before but was a bit overwhelmed with the quick day trading/high risk picture it depicted but today I know that it's no different to any other market, it's just structured differently with a different behavior - one which I like!

    Why do I Wish to trade?
    Clearly there is trading for money, that's probably the driving force behind many traders, myself included, but there is also the challenge.
    For instance, I do a little bit of programming. I began with vba and eventually got to assembler because I just had to understand how it worked! It was just one big mystery and the markets to me personally are much the same in that there is always something to research, learn and execute.
    I do not program in assembler but I understand how it works and it has helped my programming hugely. Learning about the markets is precisely the exact same thing, while you might not use methods that bankers do it still helps to understand how it ticks.
    Though I think I could play demo's forever really, it's good fun, should I start to turn out regular'high scores' I will then start playing for real.

    Why Common Sense?
    While I don't have any real transactions under my belt I've been around long enough to realise that a few things about trading the markets:

    - Price action is king, while historic patterns and support/resistance are no guarantee of a move in your favor, the price action before and'at' these points is very important. After all, how many different people see the very same patterns and act on these if right or wrong?
    I also like to see things in higher time frames and drill down to reduce time frames to'see' exactly what has/is occurring to provide me a better look at which way I will play with it.

    - Money management is paramount, not just risk (capital preservation) but money maximisation egies too. IOW, reduce losses small and maximise profits. I honestly think this is where to make money and will be my main focus over what else, the market holds no guarantees concerning direction but when I'm prepared with a fantastic money egy I will be set for if it moves in my favour (IOW, once the market comes to me).

    - Indiors are'old news' (i.e. lagging) but are convenient to perhaps confirm a transfer or maybe to use only as a different way of looking at price action and'aid' determine entrance and exits. I use the stoch for OB/OS amounts as a price direction indior and CCI stations for entries and exits. I've only started with CCI's but they look promising as a filter for greater transactions.
    Have a look at bobblongs thread for more info, it's a great thread.


    Anyway, I will write some of my egy down with some other standards for my trading decisions shortly, feel free to jump in if you have any queries or advice along the way, both are extremely welcome.
    What I would ask though is this is my journal, not a egy and will be subject to change as I see fit so please do not ask me to carve it in stone for you, besides I believe you need to create your own, there is no use after whatever you do not fully and whole heartedly know and think in. It will not function as system and it will not work, just pick up bits and pieces from here and other threads and piece something together that works for you - and stick to it.

    Cheers,
    Mick.

  2. #2
    Well, that did not work out how I had expected results below.

    I need to work with one time period and stick to it I believe, I am using the 4h to choose which way I'll play it but viewing the 15m all day only to see it go against mepersonally.
    I also believe I am pulling the trigger too early, there are a couple of reasons for this, encounter and lack thereof for you however I am starting to believe that the time of day I pick my trading setups isn't helping either. If I can not be awake for the actions I am going to need to play it long duration, that's simply stick into the 4h, put my orders and let the market come for me personally.
    The best trades I've had have come out of placing a trailing stop (quite broad ) and leaving it overnight. I've picked up several hundreds of pips this way and it was only by knowing'it's only a demo account' I would have left a commerce open like that - but it definitely works!

    Another factor to consider is how many pips do I want? Clearly I intend to shoot heaps and it is possible, plogically though it's quite hard once you see the charts all day, it's a hard call to see you gain 50 pips very quickly only to see it go back 200 then grow another 300 or so if all goes well.

    Anyhow, I've abandoned my buy orders in from the former trade, I'll place my first stop loss at 2xATR in the 1h chart using the trailing stop at 1xATR in the 1h and see how that goes tonight.


  3. #3
    Still awaiting the breakout with my long order on the 4h, however I did get tired (itchy trigger finger) yesterday and only started watching price action ofter the gap available over the 5 15m charts. The price started to go north but failed, I waited patiently for the price to go back below lowest/low for the afternoon and went brief to grab about 50 pips.

    I marketed after I saw the activity changing by going apartment, waited for some confirmation of this change and entered long @ 227.45, I give it some room for the sl and set a trailing stop of 75 and left it immediately to join the other orders should they come great.

    So far I am up about 75 pips and the commerce still looks ok at this stage for the longer term even though the price is discovering some fantastic resistance at 228.20-40, I will nurse this one this morning and that I will take some profits only in case.

    Lt;editgt; only closed for 68 pips, the price was heading south on the tick chart and the range was twisting up very tight, somethings going to happen, either good or bad for my long term commerce but I needed to maintain this profit, we'll see.

  4. #4

  5. #5
    Ahh, I see where you've gone off to! Good stuff; I'll add your journal to my subscription list.

  6. #6
    Quote Originally Posted by ;
    Ahh, now I see where you've gone to! Good stuff; I'll add your journal to my subscription list.
    Great, and you are welcome to chime in whenever you like, every little helps .

    Trading upgrade:
    Well, while waiting for the major move that I have put to bed for now I've been playing the 5m with fairly good success now. I went brief after the close of my long position above and picked up yet another 30 pips. I've just re-entered long, I was a little early but we will seethe price has been telling me I was beginning to go the wrong way though and it was time for a shift or maybe to take stock of my place

  7. #7
    Todays trades:
    Yep, I am only trading small as I am concentrating on price action only and I am just counting pips for and against, the profit is at us$ but I think that it works out to approximately 150 pips for the day which is pretty good watching it's off hours and 7 pip spread needed to come from the six trades as well!

    Lt;editgt; the vacant boxes were buy/sell stops I pinpointed.

  8. #8
    After yesterdays more or less success I will be rethinking the egy a bit, I shall still use exactly the same MM egy however my trade selection and management will be based purely on'current' price action.
    After studying's eduional Tecnical Analysis Fallacy thread, that was basically how I traded yesterday and I think I picked my own entrances and exits quite well. I had been working the 5m charts since they were going fast enough for me to'see' the price action but slow enough for me to have a look and examine exactly what was happening - quite slow actually but fun none the less.

    I will be dring forth and back between the 5 and also 15m charts today to get better adjusted to the longer time frames hopefully working my way up into the hourly or perhaps 4h where you will find more pips per move with more of a chance for scaling in using greater positions - there is less work on the peepers

    I am also reading The Art of War at the second (google it, there are various free versions on line/for download) and I am postponing any critical trading attempts until I get my mind round my egies to take care of different price action situations as they happen. If there is a common theory amongst traders/commentators it is that no one can predict the market and enjoy warfare, no matter how much you prepare your army based on historical or perhaps breaking information, there is not any guarantee that you are able to win the battle. You must be well prepared to deal with adverse situations as they arise and make the best of them - good or bad - when ever possible, do not rely on old or hope analysis and do not be indecisive on your actions, the market takes no prisoners!

  9. #9
    Been a bit quiet with trading of late as I've been busy and read TAOW and seeking to relate the significance of the chapters into trading, the way I see it .
    I've also starting using the Oanda demonion so I've been playing around more than anything else to see how it all ticks and I am growing very fond of it really.
    Last night I put to a commerce using the A/J and this morning I had been up over 120 od pips (I had two units in, 1 in 80 od pips the other at approximately 40 so far) I place another on this particular morning too so we will see how it goes.

    I've really just been seeing price action and getting a sense of the current market, once in I then nurse the trade from the lower TF's up to state the 15/30m and monitor it there looking back on occasion to search for early signals of weakness/strength for further buy-ins/closing of trades. In addition, I look at the larger time frames too, all of the time seeking to relate what is going on from 1 TF to the others.

    I will begin posting some severe trades again soon, I am also keen to go live as It will'create' me take it a little more seriously and pay more attention, with play money I will always just'set my cease and TP' and leave it open to bigger losing trades over anything else. I really do believe in SL's however I like to have them for emergencies only (ie. From price action) to provide space for the actions but when the market is telling me to run I really do

  10. #10
    Here is a couple shots that provides an idea how I would play price action to conserve capital. I actually posted them at the TA fallacy thread too but put them to remind me of what my egies are about - ie. Small declines, big winners and adhering to the market, not fighting it.
    I am quite happy to jump on the bus going the other way as soon as I see it turn, I would just do this typically after I've been in that specific market for some time, else I would just stick to transactions at the 4h/daily path for hopefully a few added safety.

    A lot of traders aspire to the SL/position sizing method of MM, I agree in principal but that I don't agree it's a set and forget egy, IOW, cut the loss short if PA is telling you your on the wrong bus! I do utilize PS'ing because of my initial entry and use the stop because my'astrophe' stop just, I think it can become obvious pretty quickly if you right or wrong, a sample below shows this.

    I am actually short again since the PA @97.79 is indiing some weakness,'' If I will nurse it through the 5m charts I'll start to anti up and stay in for as long as possible.



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