Monday, 29 November 2010
20101129
1st real trading day after Thanksgiving. Believe everyone is still in party mood leading towards Xmas. Looking at little trading activity and tight range. People don't want to rock the boat and want a nice year end closure.
Tuesday, 23 November 2010
20101123
North and South Korea exchanged shells today. Asia/Europe market were all affected and lost points following this news. Let see how price move.
Whats happening in the world do affect market sentiment.
Whats happening in the world do affect market sentiment.
Monday, 22 November 2010
20101122
Price moved up to 2150 in after market trades before moving back to where price was on Friday close. It's back to the zone line, 2 possible play depends where price falls on when market opens.
Saturday, 20 November 2010
Making an Entry
Making an entry is not easy, at least for me. Many people out there suffer problem of too many trades (ie. trigger happy), I'm the opposite, I suffer the problem of not entering.
Here are some analysis of ways to enter the market.
0. Moving Average Crossover - in its simplest form, price direction changes when 2 MA crossover. This has the problem of being late in entry as we'll need to enter on the next bar after confirmed cross-over. Price would have already moved a distance making our stop loss wide.
1. Oscillator - I would say this is by far the most common way of making an entry. Oscillator could be MACD, Stochastics, CCI, RSI, ergodic, ..... Similar to MA Crossover, all oscillators are lagging in someway.
2. Oscillator Divergence - an added "reason" to catch the price and enter. when Price differs with the swing made by oscillator.
3. Price Breakout - Queue at last support/resistance, wait for price to breakout. Price may break and move rapidly in our favor, it may also break slightly and turn right back against us. Price Breakout entry offer the worst stop position.
To me, all indicators or oscillator has another common challenge - the bar count. They can look quite different, and could be deploy for totally different purpose.
**I'll try to paste some picture later.
Here are some analysis of ways to enter the market.
0. Moving Average Crossover - in its simplest form, price direction changes when 2 MA crossover. This has the problem of being late in entry as we'll need to enter on the next bar after confirmed cross-over. Price would have already moved a distance making our stop loss wide.
1. Oscillator - I would say this is by far the most common way of making an entry. Oscillator could be MACD, Stochastics, CCI, RSI, ergodic, ..... Similar to MA Crossover, all oscillators are lagging in someway.
2. Oscillator Divergence - an added "reason" to catch the price and enter. when Price differs with the swing made by oscillator.
3. Price Breakout - Queue at last support/resistance, wait for price to breakout. Price may break and move rapidly in our favor, it may also break slightly and turn right back against us. Price Breakout entry offer the worst stop position.
To me, all indicators or oscillator has another common challenge - the bar count. They can look quite different, and could be deploy for totally different purpose.
**I'll try to paste some picture later.
Friday, 19 November 2010
20101119
Price moved towards 2120 and bounced right back towards target.
Looking at the bigger picture, price is bouncing off zone created in end Oct - early Nov. This is the power of price shown by DbPhoenix in his articles, - price moves from zone to zone and will respect the zone boundaries.
Thursday, 18 November 2010
Wednesday, 17 November 2010
20101117
Price has fallen through important support at 2016. Next line of defense is 2053 dated back in Apr 2010 and 2023.
Going for short play.
As planned
Going for short play.
As planned
Tuesday, 16 November 2010
20101116
Anticipating price to to down to 2106 level, a resistance back in Oct
Looking at 4pts stop and 12-16pts target.
Price moved below 2106 and have no sign of reversing. No Trade
Looking at 4pts stop and 12-16pts target.
Price moved below 2106 and have no sign of reversing. No Trade
Friday, 12 November 2010
NQ Trading Plan
Had some interesting observation looking at charts over last few days.
"noise" or consolidation range is around 5pts and typical move is around 10-20pts.
I was trading 2 pts stop and 4 pts target previously!!! no wonder taken out easily, noise took me out.
Taking expectancy into consideration. Reasonable target is ~10-15 points. Consider I can get good entry and prepared for 4 points stop and 12 points target (3 times RR).
I'll have a good trading plan if I can find some trading style giving me 30-40% accuracy as shown in following charts
"noise" or consolidation range is around 5pts and typical move is around 10-20pts.
I was trading 2 pts stop and 4 pts target previously!!! no wonder taken out easily, noise took me out.
Taking expectancy into consideration. Reasonable target is ~10-15 points. Consider I can get good entry and prepared for 4 points stop and 12 points target (3 times RR).
I'll have a good trading plan if I can find some trading style giving me 30-40% accuracy as shown in following charts
20101112
Looking at Stop of 4 pts and target 12 & 16. RR of 3&4 each
Nice move according to plan. Key is in entry, there were couple of time price move to area of interest. If enter on touch, we'll have 2 failure before the 3rd and successful move. Need to study how Trader-X or DbPhoenix enter their trade.
Below is BIG picture showing various points of interest in planning out the trade.
Nice move according to plan. Key is in entry, there were couple of time price move to area of interest. If enter on touch, we'll have 2 failure before the 3rd and successful move. Need to study how Trader-X or DbPhoenix enter their trade.
Below is BIG picture showing various points of interest in planning out the trade.
Thursday, 11 November 2010
Expectancy Revisit
Had a chat with fellow trader today and prompt me to take a look back at my earlier blog on EXPECTANCY.
Expectancy = (Probability of Win * Average Win) - (Probability of Loss * Average Loss)
We can look at it in another way, as a ratio between accuracy and risk reward.
Expectancy = Accuracy * Risk Reward
Lets say we've an accuracy of 40%, i.e we're correct 4 out of 10 trades; and we've a risk reward of 3, i.e target is 3 times that of stop loss. We'll get this.
Expectancy = 4/10 * 3 = 1.2 (positive)
To break even, i.e. Expectancy of 1. Risk Reward has to be greater then 1/Accuracy
Risk Reward > 1/Accuracy
Accuracy - Risk Reward
10% - 10.000
20% - 05.000
30% - 03.333
40% - 02.500
50% - 02.000
60% - 01.666
70% - 01.428
80% - 01.250
90% - 01.111
Expectancy = (Probability of Win * Average Win) - (Probability of Loss * Average Loss)
We can look at it in another way, as a ratio between accuracy and risk reward.
Expectancy = Accuracy * Risk Reward
Lets say we've an accuracy of 40%, i.e we're correct 4 out of 10 trades; and we've a risk reward of 3, i.e target is 3 times that of stop loss. We'll get this.
Expectancy = 4/10 * 3 = 1.2 (positive)
To break even, i.e. Expectancy of 1. Risk Reward has to be greater then 1/Accuracy
Risk Reward > 1/Accuracy
For above example, for accuracy of 40%, RR need to be greater then 1/(40%) or 10/4 or 2.5
Minimum Risk Reward needed for various Accuracy is as followAccuracy - Risk Reward
10% - 10.000
20% - 05.000
30% - 03.333
40% - 02.500
50% - 02.000
60% - 01.666
70% - 01.428
80% - 01.250
90% - 01.111
20101111
DbPhoenix mentioned trading on the right side of chart.
It is to plan out the trade before market open.
Here is my analysis for today.
Price drop down below support in pre-market. What I'd like to see if price climb back up, bounces off support area. With a 5pt stop and 15+20pt target, I'll have a nice 3.5 Risk Reward ratio.
Price move according to plan but didn't move as high as anticipated. Top at bottom of range formed earlier of the week. Partly because it has already gain 30 points from LOD in earlier session.
It is to plan out the trade before market open.
Here is my analysis for today.
Price drop down below support in pre-market. What I'd like to see if price climb back up, bounces off support area. With a 5pt stop and 15+20pt target, I'll have a nice 3.5 Risk Reward ratio.
Price move according to plan but didn't move as high as anticipated. Top at bottom of range formed earlier of the week. Partly because it has already gain 30 points from LOD in earlier session.
Wednesday, 10 November 2010
20101110
Post market analysis, price drop pass area of interest.
Another good area is as shown.
With 5 points stop and 10pt+15pt target. RR of 2.5 (entry on breakout)
With 3 points stop and 10pt+15pt target. RR of 4.16 (entry on bounce off support)
Monday, 8 November 2010
20101108
Price is moving in 10 points range. Looks like it'll bounce between 2177 and 2187.
Looking at longer term chart. I'm still LONG bias.
Looking at longer term chart. I'm still LONG bias.
Trader-X is back
Trader-X is one Trader that I respect alot and followed.
I like his idea of simplicity.
He is back with some nice new post. Check this out.
Back from the dead?
I like his idea of simplicity.
He is back with some nice new post. Check this out.
Back from the dead?
Friday, 5 November 2010
Wyckoff Forum by DbPhoenix
Has been reading DbPhoenix Wyckoff Forums over in Traders Laboratory for a while now. It's style of trading with very similar to what Anek advocate in his AHG - Trading without indicator.
Trading without indicator "forces" one to immerse one selves in PRICE. To feel the pulse of market.
It is also with this understanding of price that one can look for "area" of interest. To trade only when price reaches an area where we can look out for "signs" for advancement or reversal, and not middle of no where.
DbPhoenix is very generous, as Anek, shared freely his insight in trading and gave many examples and writeup in the forum. It is definitely an eye opener for me.
Trading without indicator "forces" one to immerse one selves in PRICE. To feel the pulse of market.
It is also with this understanding of price that one can look for "area" of interest. To trade only when price reaches an area where we can look out for "signs" for advancement or reversal, and not middle of no where.
DbPhoenix is very generous, as Anek, shared freely his insight in trading and gave many examples and writeup in the forum. It is definitely an eye opener for me.
Thursday, 4 November 2010
20101104
Pre market moved to high. Expecting it to drop back to ~2155. Not an easy play as there is no reference as to when it'll peak before reversing down - a full 30pts move from where it is now.
Wednesday, 3 November 2010
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