Putting things together

Taking the week off and perhaps another week coming up for real life stuff. Normally I would take a couple of picks here and there but in the spirit of staying consistent and trying to only make trades I won’t regret, I’ll be very picky if I take anything. Mobile charts sometimes “look” a little different than they do on the computer. That said my outlook would probably be short, at least for another low below 1.067 before breaking a high of 1.0716.

Feb I think is just not going to be a good month for me. Quite a bit of vacation and traveling.

Looking for longs currently (we’re at 1.061x as of this writing). The safe long is at 1.063x, and more supply is hanging out at 1.0600, so it’s possible to see a dip down followed by an up move. Holiday chop however so we’ll see how it develops.

Edit: price is now 1.0611, floating in holiday chop indeed. Not surprised to see either side develop, so I’d rather be flat than in atm

Looking for longs now. 1.057x is the first target, with the current low being the stop.

Finally back! Price is at 1.0600~, going shot fro 1.0585 with 1.0623 as the stop. Simple retrace trade.

Edit: Got stopped out, I’ll be looking for the next opportunity whenever it arrives

March is almost over and will mark the end of phase 1 for me. Overall I would say just okay. Not good, but not terrible either. I’m sitting at -2% for the year, which I hope to turn into +10% by the end of the year.

I need to do a better job of tracking my trades and evaluating my trading opportunities accordingly. It’s a bit difficult because as I think I’ve mentioned before, my trading is basically through market patterns. These take shape in all sorts of forms, and as a result, there are trades ranging all over the place in terms of risk to reward, with the probability being the key element, like below:
low probability, low risk, high reward
average probability, average risk, average reward
high probability, high risk, low reward

In such a structure, who’s to say which is correct? However, when I trade all of them, I find that it is easy to miscalculate exactly how much risk to put in on each trade. When I’m trading for quarters and dollars, little changes make noticeable differences (i think).

I want to to a better job at evaluating the trades I take, both during the trigger-pull and the post eval. I find that to do so, I must “let people in” so to speak, into how I actually trade. These boards are a little barer than they used to be, so after some consideration, I don’t mind doing so as much anymore :slight_smile: But before anyone gets too excited, there are no secrets to be revealed, only theories to build on.

[B]Important note:[/B]
I was, and am, very hesitant to put out this sort of content in the public space because well, it might just not work. And in the process, I don’t want to draw too much attention to a method that could just be plain terrible. This isn’t a system that one can just test for a little and conclude that it sucks and waste a little time. It is instead built on theories and ideas about how the market works - things that one can’t [I]simply[/I] test. As a result, if such a theory or idea is bad, then the resulting tester wastes a tremendous amount of time. And for that, I feel bad. And so, although obvious, take everything with a grain of salt, with a suspicious eye, with a skeptic’s POV to wait for not when it succeeds, but fails.
[B]End note[/B]

Here we go:

I haven’t put too much time into trading lately, but here are my “big ideas”, or chart structures that I think a lot about when it comes to trading these days, and have been working on since the start of my career (lol). :

  1. Daily direction (Price) - Momentum. Price that has moved in a specific direction has a tendency to continue in that direction. If price is up 20 pips, it is more likely to finish at +40 than it is 0 or -20. This is not “physics”, this is just a fact of markets and of many inanimate facets of life.

  2. Daily minimum move (Price) - Barring massive holidays, price moves. It is more likely to be at +40 or -40 than it is to be between -40 and +40. Nothing new, but combined with other knowledge it gives the trader a good place to put conservative TP/SL marks.

  3. Currently weekly structure (Price) - Price is not random. If one were to track a weeks high and low, they tend to occur over a period of 2-3 days. It does not take a week to develop, nor does it constantly make new weekly highs followed by weekly lows.

  4. Current wave (Price) - Traders pay attention to current highs and lows. Price will be tugged towards one end or the other.

  5. Likely wave pattern (Price) - The concept of a trend wouldn’t exist if it didn’t at least work some of the time. They do exist, and they do work.

  6. Current pattern in wave (Price) - Trends don’t last forever, and things that aren’t trends can’t stay that way either.

  7. Current time with respect to current wave (Time) - Similarly, price doesn’t trend forever, and things that aren’t trends can’t stay that way forever.

  8. Current time with respect to previous waves (Time) - Sometimes, certain hours of the day favor certain types of moves, specifically tops and bottoms. This isn’t extremely reliable, but boy does it look insane when it works.

Not going to give charts for all of these, but will likely be labeled in future posts.

Things that go into a trade decision:

I try to take as many things into consideration as possible. Everything is a probability/reward balance. Everything is a up probability vs down probability scenario. Simple things but TA is, well, TA. You should have a desire to find out as much as you can about everything that you can.

Things that I considered in this trade in accordance to the post above (in no particular order):

  1. Likely wave pattern
    Exploring and thinking about waves will get you to ask the important questions about trading: what does a chartist care about? How much movement “matters” within what time frame/ You don’t have to trap price in a box to analyze it. Analyze it’s surroundings as well, understand how much wiggle room there is. Does it make a difference how you draw them? What’s a good rule for establishing such a thing?


  2. Daily direction and minimum daily move


If you read closely, you can see that so many more of the elements, not just the three I mentioned, are being used in this analysis.

Instead of talking about why I trade, let’s take 1 post to talk about why I don’t trade.



I’ll say it just once, but I’ve found it very mind opening. Study how price moves throughout the week. This is what I call Current weekly structure. Where is the high/low in the week? It just so happens that as this week developed, Friday was looking like a very high probability “null zone”. This means that in the context of breaking either the current weekly high or low, price on Friday wasn’t going to make an impact. Thus, while you don’t particularly need the weekly direction to go in your favor, it certainly doesn’t help. The more “I’m not sure” factors there are, the less likely I am to take a trade, esp if I’m only looking to hold for 20-60 pips.

  1. Gaps have a good probability to get filled
  2. There’s a good probability that the first 24 hours of a week shapes the week’s highs and lows

Gap is filled and the week is underway



I don’t guess where I think the market will go next, I just play the probabilities.
It’s only Tuesday, but let’s think for a second. Monday made a high, Tuesday made a low. We’re at a ~110 pip weekly range so far. How big is an average weekly range? What’s more likely here, Monday top with a Tues/Weds/Thurs/Fri bottom or a Tuseday bottom with a Weds/Thurs/Fri top? What’s the probability that we’ve seen the weekly top and bottom already (meaning the rest of the week is just sideways)?

It’s okay if you don’t have the answers, as long as you have methods to obtain them. You NEED an edge to succeed.

Just like that, done for the week. No need to trade anymore when you get everything in 2 nights.
Trading is not easy, but it is simple. The two facts I mentioned in the opening were all I needed to guide my weekly trading. Anything in the blue box, which is really about 24 hours, was good enough of an antry point. It’s okay to take a couple of small losses looking to cherry pick as long as you don’t overdo it. No one is expecting to pick the topping bar as it’s forming - the point is to recognize that it might be the topping point in the hours that follow. No one point tells the whole story. The more parts that fit the narritive, the more likely that the narritive is true.

  1. big red bar - could be the top but not trading it
  2. breaking bar - big down swing for a bull move, could be correction or change. Don’t have to trade it either
  3. 24 hour period following - if the objective is to trade towards the gap under the analysis that the gap will fill, then now would be a nice time to trade it. The bullish momentum has not resumed, and anything in the blue box or higher gives a 1:1 reward ratio or better. Under the assumption that the gap fill % must be greater than 50% (otherwise we would not be using it in our analysis pack), this is a no brainer trade. In fact, it has always been a no brainer trade direction, but we were waiting for a balanced opportunity to do so.

From here a possible trade would be bullish to 1.078x with current swing low 1.0738 as the bottom. But my goal is to trade the main weekly swing, and I’ve done that to my content.

Missed out on an extra short day. Still trying to make sure I’m following my plan, and currently I don’t have one fully set for these kinds of scenarios, they’re a bit rare. Normally I wouldn’t trade today, but statisically it’s a long day. Should get up to 1.072x, but maybe not until next week. Either way, Looking for longs

Trading has been so-so. I think there are some great ideas in my thinking, but they are not quite strung together well enough to produce the results I want. I know not many people will want to read or follow someone who isn’t strongly profitable, but I make the assumption that if there are others who were like me when I started, they would have wanted to read this sort of thing. The important take aways are not the results, the strategy, the trades, or systems, but rather the ideas. The ideas themselves can produce all of the above in a fashion that cannot be ignored.

I’ll make this one short(ish) and just highlight some scenarios that I’ve looked at in the past couple weeks and hopefully be able to shine some light as to how I view the market.


I always trade into the gap. Point 1 just didn’t work out for me. In this sort of scenario, it doesn’t really make a difference where I enter, because my risk is always the same, a percentage. This of course affects the profit because in order to get, say, a 1:1 RR, I would need to hold on to it for more if I had entered further down. But in this case it is not important because there was never a chance to really get much profit. It came down then up, never getting close to closing the gap.

Point 2:I can’t remember if I took a trade in the area marked 2, but again, this is kind of irrelevant. The point is that I have knowledge that there are forces that say that price should not have bottomed out as shallow as the point that it did on the right side of the marked “w” (in other words, it should have looked more textbook 1-2-3 down trend than “w”) and I had reasonable suspicion that it could have bottomed out where it did (giving an entry opportunity about 25 pips from the bottom). The key is to both be aware that both scenarios exist, and to find ways to reconcile these differences. Don’t tunnel vision and blindly pick the double bottom because it “works” and don’t have “analysis paralysis”, but rather find ways to make a decision before it is time to do so.

Not making the money but the strategy is coming more into focus. I’m in no rush to do this, just to do it right. My timeline for completion on this project is about another 3-5 years, depending on how busy I am. I can afford to lose $5-10 bucks a week on trades for quite a long time, and at this rate my account is doing fine. One or two trades changes everything, and I know how to be patient. It’s all about playing the spots I know and building the proper infrastructure at this point.

Looking to short for the week with the stop at 1.1230. Happy trading and catch you guys later.

Market short at 1.1752 TP 1.1735 (1HR swing low) SL 1.1781 (1HR Swing high). basically 1:1 on this, I’m very interested to track this one til it hits.

Very clean, very little drawdown. I will definitely be looking into this more!

Same thing, looks like it happens about once a week so far but I’ll wait a couple of months to see this one play out.
The real questions will appear when the set up fails. So far this is quite a good set up though, primarily because the exits are fairly safe, and most importantly, there is plenty of time to get in. I work, have hobbies, and do love my sleep. Having a couple hours to get into a trade without heavily affecting R:R makes all the difference.I use to be a big fan of hyper low risk, hyper high reward, low probability, but each pip means too much and at an amatuer level it’s not worth pursuing.

Was looking for a calm week and kind of got it. I’m not expecting much to occur until next week, as 1.1635 and 1.1850 looks pretty locked up. The Tuesday launch was slightly unexpected. I got most of the move but it wasn’t as big as I’d like. Fortunately, I have some ideas on how to add. Overall I’m pretty satisfied because I’m not full time in this and got in and out when it was possible.


The up move was textbook breakout mode.

The short was simply because I thought that the high of the week was locked in, so my risk was protected. I got out because I realized that the bulk movement (period) was probably done and we could be floating in dead space for the rest of the week and a 50% retracement of the down move was about as likely as a 50% extension of the low. So while I could have had a small loss, I took the chance and got out at a small profit instead.

THEN I came back later and realized that another low at that time was extremely likely, but I didn’t want to muck around in it so I entered short again and took a conservative TP and bailed.
9/10 on execution, 4/4 on calls, and enough money for a burger and some nice fries.

Working smarter not harder is so true it hurts. When you get to the heart of TA, it’s really just as simple as it sounds. Find a pattern, test it, and respond accordingly. As I’ve developed in my journey, I’ve taken the approach to building a wave model to be my background. Then I look at the tops, bottoms, middles for signs of reversals or continuations. This use to be an extremely laborious task, and any changes in the base model would require me to start the process over again because the focal points (tops/bottoms/middles) can then be changed. Finding ways to effectively generate all of these focal points whenever a change is needed has saved me probably dozens or hundreds of hours, and in practical terms, weeks and months since I don’t spend 8 hours a day at a trading desk.

A bit quickly here:


Got pretty handled today, and these sorts of bottoms make retailers go mad and into tin foil hat mode. But looking back, I took two longs when I should have taken jut one. Or rather, I took two longs when I should have taken one short and one long. Think I may still have been down overall, but it looks and feels a lot better than taking two losses. The key for me has been not to go into panic mode, but to clear my head and think back, “Was this the right trade, given all the information I knew and could have known on hand?”

Just as you are taught to not make decisions when upset, you should not make strategy changes to alterations after a loss. The absolute key is to have a rock solid trading strategy, and to be able to pin point problems and study them and look for solutions. It is easy to look at this type of movement and say “next time i’ll only close if my stop loss is hit AND if the bar closes under the stop”. This would have been a killer series of trades, but I know not to do that. First, because I know I can’t be awake during these hours and make that call, and secondly, I don’t have the capability to program an EA to make that call. I also don’t know how much extra average loss I would be incurring on trades when I am clearly wrong. These questions are not trivial, but they also do have real tangible answers. Being able to understand this aspect of trading has been critical in my experience.

As an aside, this is a slightly dangerous short, but played correctly will net a small profit to recoup some losses

I thought I’d put in a little blurb here because… well, I can! I recently tried to get back into the trading game and after some coaching and therapy (not necessarily trading related), I’ve been keeping my mouth shut more because it keeps me out of trouble haha. I pick a lot of fights people.

I realized that I really want to keep people away from making the mistakes I did, but that it’s not always my place to force that ideal onto others. If people want to donate their money, so be it. Of course, I didn’t come up with all my ideas myself, it came with the help from reading what a lot of other really great (and articulate) people have written over the many many years. Here’s what I have to say.

From a philosophical (logic) standpoint, everyone must understand that the routes they choose as traders have pros and cons. Traders must understand that these should be FIXED. If I trade manually, I cannot complain that ‘I would make money, if only I had a robot’. If I trade with an EA, I cannot complain that ‘I wish sometimes there was an override button’. These are FIXED. Now, I can trade both with an EA, and I can turn off the EA and trade manually. However, EACH trade can fall under only ONE category. Such is the same with how we approach TA/FA.

IF you choose the TA route, you have 2 options, discretionary vs mechanical. These are FIXED. If you trade discretionary, you will NEVER know your true edge or profitability. You CANNOT. Yes, you have past p/l, win rate, charts, graphs, whatever, but the fact that there was no precise moment of trade means that no 2 traders of the same system will make the exact same trade at the exact same time.

If you follow, you’ll understand that when we demand a REAL EDGE from the market, or proof, the instant we do that, we are no longer trading discretionary systems. If you want your edge to be defined, you must do so with math.

I used to think many people were okay with being discretionary traders, that things would just ‘flow’ and they would ‘get it’ or not. But other time I’ve come to see that a lot of traders really just want success at any cost. They want a system that REALLY wins. This means they want mathematically based models. It MUST be. But so many traders are scared of math for some reason. It’s what I call trader hell - the desire to make money, without the desire to put in work into it. This is where almost all true failed traders fall. It is without question. How many traders quit saying ‘yea I tried it but I couldn’t get the hang of it’ or it wasn’t for me, or I realized I didn’t want it that badly, or something like that. How many traders say ‘it’s rigged, there’s no proof, it’s all bs, it’s 100% random’?

I know these traders do not really mean what they say. I know they are mad, but have not really cared about winning, as they wanted justification for their losing. What was that quote? Every man gets what they want from the market? It’s more true with time I believe. I know they do not really mean it because you’ll find that these traders know almost nothing about the market. Truly. There are so many FACTS about the market. Things that if you take the data, do something to it, and count it, are true. People say ‘oh but if something is 60% now, it might not be 60% later’ But just look. If you take 5 minute data from last month, and then you take 5 minute date for every other month this year, and they all fall within expected standard deviation, there is no arguing. It is simple math. I mean really. If you’ve tried your hand at the numbers, and couldn’t find anything, then great. You’ve given it your best shot, and you can at least say you know of things that statistically are random, or have no traceable edge, etc. but at least you have that.

To end, here are some things I think about. Traders:
-do not care enough about math
-do not question things enough to look for answers
-do not understand that any trader HAS to create a model of the market. They may not call it one, it may not be written down, but it must exist.
-do not question the model enough

To be concrete, here are some things I am thinking about:
What makes an MA good?
Should an MA minimize the number of bars that do not touch the line?
Should it have minimum variation in slope from bar to bar? (because MA = 1 is very accurate but useless)
Should it have a maximum number of bars before price touches the MA? (mean reversion strategy)
Should it minimize the time it takes between moving from a positive slope to negative slope? (MAs at trend reversals)
Is it possible to combine MAs without using multiple MAs?
Is there a way to know when price is moving towards the fast MA vs the slow MA?
Is it possible to have a “morphing” MA that slows down or speeds up based on price volatility?