Bought 1 ZB 106 26. Only have 1 ZB now. My rationale is I've more than made my profit target today, doubled in fact, so like the age old question, what do you do when someone hands you a million dollars? Do you hold out for more, or are you thankful that a million is twice what you had in mind? I like to be thankful.
1002 CST Prices have hit 105 21. I'm still holding 1 ZB short since 105 29. I would say that closing out all remaining contracts between here and 105 12 would be a good decision. If I were to continue to trade today, and I probably won't, I would short any attempts at 105 25 or 105 26.
Order to buy 1 at 106 20. Raised it to 106 22. Out of everything. Done I believe unless something comes up.
luckyhonda, I didn't mean I would just close everything without thinking. It is simply that I've found that my sweet spot is 1 - 2 hours of the morning. If prices still hadn't done anything at the 3 hour mark I'd probably create a limit order with a conditional cancel at a target that profits me less than my anticipated target. Then I'd go to bed. My time zone is completely different as I live overseas. I'll concede that on this second trade where I shorted at 105 29 and closed at 105 26 on most, I would have been better off to hold a few more minutes for 106 23 etc. The problem was that I got in at a bad price, 105 29, and the trade lasted much longer than I originally thought, i.e. I sold while prices were pushing into the low. With that in mind plus 2 things I'll mention in the next paragraph, I got out at 105 26. Another couple of items that led me to close out are the fact that today, I just completed 10 of 10 consecutive profitable days in a row. I know I shouldn't think about it, and for the most part I don't as technically I shouldn't have taken the second trade of the day if it were really that much of a concern. Even so, it still is there at the back of my mind, hence the quick sell at 105 26. Finally, a second item is that I have a daily profit target. Today I exceeded that profit target by 2 times. This led me to be comfortable with exiting.
1043 CST If anyone is still following, we may get another short here at 105 23 or better. Cycle high looks to have hit. Projected time was 1040 CST.
johnpinochet, Thanks for your posts & your answers. They are great. I understand your methodology in controlling the trade during the day. It makes a lot of senses to me. I am trying to follow a very similar strategy. I have more questions if you don't mind answering when you have time. 1. My biggest problem is coming up with the initial buy/sell bias going into the day. It is easier when the market is trending. However, on range bound days and also toward the end of a trend, it is often very difficult to determine which way the market goes. How do you deal with those situations? 2. You've mentioned market profile. How do you use MP? 3. How do you handle losing trades? I appreciate your sharing & replies. Wish your winning streak will continue. Regards, Luc
I use a MP clone, so it isn't 100% MP, but very similar. Bottom line, my clone gives me a bar chart graph (as in math, not trading). The x axis is time, and the y is price as is normal. Each tick up or down in price is represented by a single rectangle of the bar column for that time. If price is predominately selling then the color is red or a gradient thereof. If price is predominately buying, the color is green or a gradient thereof. In a matter of seconds I can scan every tick level in the ZB and see how many contracts were sold versus bought. I can see if a single column of 5 minute time was primarily used for selling or for buying. So, how do I use the above? First I keep in mind that it can and will fail me. Frequently. You can't blindly buy or sell based on the fact that all of a sudden you've got green or red all over the place. Second, I look at a normal trading bar chart and I look at my neural net indicator prior to looking at the MP clone. When I've decided on a buy or sell price and a direction, I then look at the MP clone and wait until price meets my target. I then watch very carefully the action that occurs. I call this price combat. I would imagine someone else has used the phrase before, but I would love to be able to claim it. ;-) Basically I see a score of sells vs buys at each tick level. As price approaches my price projection number I'm able to see if price volume and direction is sufficient to break through and continue or that it will stop. Then I take the trade. In conclusion, I use it for cofirmation only. It will keep me in a trade longer as it confirms the trend for me, at least on the 30 minute. For example, the 30 minute MP clone bar chart had the ZN's in the red all day for every bar on 23 June 2006
A buy or sell bias in my opinion is not necessary trading the way that I do. It certainly helps if you wish to hold over night. Then you probably need a bias over a period of days, and should be looking at a daily, weekly and monthly chart. Now having said that, a bias is certainly helpful, especially if you intend to only trade one side all day, i.e. only sell or only buy. So, in my daily pre-market commentary, when I make a call on my bias, how do I do it? I look at three things: The 50 MA on the 5 minute. The 50 MA on the 60 minute. Where is price right this moment based on the most recently established daily high or low. Personally, for me, I place emphasis on the 60 minute, prior to the open, and then rely on the 5 minute during my trading. How to use MP, see my reply above. How do I handle losing trades? A losing trade comes with the territory. Don't look at the next trade as making up for the loss. Take the next trade without hesitation. Never let a single daily loss exceed the average high end of your best profitable day. Since my best performance is with the first three trades of the day, I will never trade after more than three losing trades in a single day. Statistically based on my performance, the odds are not in my favor.
Monday 26 June 2006 Today we have New Home Sales at 0900 CST. Not sure how much effect this report will have on the market, but it really is the only significant report today. Price projection numbers: 106 15 106 03 105 24 105 12 105 03 No bias today. Too soon to tell.