Thanks Johnny and everyone else, Yes the pdf is coming along the problem is that I was posting this to both threads I was just pasting my text on to JPgs in paint then posting them as I thought this was better. On FF the Jpgs open fullsize when you click on them and download them. I did not know the diference when making pdf that there was a a size issue but there is …
One of the memembers is retyping all the text making the pdf small enough to post. Over 75 posts. So it is asking a bit to rush them … But it will come along.
I have always been a scalper and today I was determined to stay in until I saw something on the 1 or 4hr charts to tell me otherwise (after covering of course).
I wanted to re show this statement from Lucky Ladys post it is how this startegy can be and is being used by longe term traders . Getting the best entries as a scalper and holding like a position trader. also covering fast to lesson loses…
As I stated in the last post I have struggled far to long with my trading. I have had extrodinary results but nothing that stuck. I have gone through every issue I described. I also know that I am not alone there are too many people I know and have known that are still struggling.
The key to all the problems we have can be solved by what I posted before. Lower your risk become emotionally detached. It is amazing how fast a account can grow with a small precentage risked when your not spending half your time making back losses.
The Statement be a mechanical trader is not in reference to jump at every pin. We must use all our tools to succeed. It is in agreement with the above, trade emotionally free. Be able to manage your trades without regard to fear or greed.
So over the last year I have tried to grow small accounts by risking to much. the thought being if I can't margin out in 200 pips It will never happen.. Didn't work all the bad things kept showing up. I did have some exceptional gains.
But I have come to realize I could not stay emotionally netural at those levels. That was what was killing me. ME
I have increased my account over 100% in the last 2 weeks risking 2 % . And trading less than I ever have. I still am not taking all the trades I should . Disgarding the old is still taking place. But I now sit through the old and take the MA signals.
My goal to reduce stress is to pull out my cost of living every week once it is hit. During the time I am waiting for the broker to remove it switch to one of my other accounts to build them up slowlly. Then anything I make over that first withdrawl will grow the account I will refigure my risk on a weeklly basis to start . Might do it on a dailly I will not raise it when I hit my living exspenses. AS this will be removed.
This should keep me from being stressed about making money to live on and grow my account at the same time. Plus I will only risk 1 or 1.5 precent.
This is my plan any way.. Ken
Why is it so hard to trade well ? If you have been trading for anytime at all more than likelly you have times of good trading but may not been able to hold on to it. First a disclaimer I am not a DR.. Do not take any of this advise as such.. I am just another trader trying to find his way like everyone else. LOL
Have been studying and trying to learn to be successfull for longer than I would like to admit. Plus knowing that my biggest challenge was within myself. I feel maybe I have a little bit of knowledge in this area to share some insights. It is one of the areas of trading that is proably the hardest to come to grips with. Everything else entries , stops, exits , signals patterns are a real thing that you see time and again .
But what is going on in your head is first not something you can see before, during or after a trade. Second we have no problems in our minds. That is the hardest to get over. I don't have a problem. Like any mental illness or addiction the first step to a cure is to admit a problem exsist in the first place.
So lets go through the different places we can make mistakes and possiblly why we keep doing them.
ENTRIES ;
The first and most common is the wrong entry. In my rewriting of the strategy I recomended everyone read Trading In the Zone as it would give you some insights into why you do certain things. As far as entries go. The portion of the book which can explain that. Is the fact that until you teach your mind what to look for you have no chance of ever being successfull. You can not process information in your brain that you don't understand. It is no different than a builder handing you a set of blueprints and asking you to build a skyscraper. You could not do it.
So why is it that we think within a few Days , Weeks or even Months we can master trading. Then we read a good trading idea and we jump right in and fail. I had a exprience with this one time that I actually caught. I saw a entry it was a good one. I entered trade starts to go wrong look back and the entry was not even what I thought I had saw. It was totally different was I wrong or did my mind see something that wasn't there.
We have to train ourselves to see the correct entries when and where they are. The only way to do that is to constantlly scan your charts and review them at the end of the day when your not under stress. I would also advise against dwelling on your failed trades to much as if you study them just as hard, you may see them and mistake it for a good entry.
I personnaly look at my bad trades right when they happen. Take note in my mind of what I thought I saw and move on. I don't look at them later, only missed good entries.
Plus not all failed trades are bad entries sometimes your just early or late. But do not concentrate on the bad give more time and energy to the successfull ones and then look for that exact setup again and again. If you don’t review charts at the end of the day or really study the whole week on the weekend. That is a signal that you have no intention of trying to be successfull at this. It takes effort on your part.
I believe this is one reason that EA's are so popular as you are now giving your choice of trades to a machine. This keeps you from ever being wrong. It was the EA's fault.,
So what is the cure, First find a trading strategy that suits you. It is true that some people trade fast and furius and others are more into longterm calm and caution trading. I like both but haven't mastered the second but love scalping.
Then to study the strategy and really understand it. It comes out all the time in the threads that most people just skim through the information then start trading and then the questions start to flow. Then they get mad when you ask them to go back and read the strategy again as they have missed the very basic parts. Or my only pet pev is when you give someone a answer and they don't even read it correctlly.
I am not singling anyone out I have 3 threads running and they all have that issue.This strategy is in PDF which is great and is on the first page and we have had people ask where it is… I mean come on guys.
Anyway you study the trading strategy of choice. You then have to learn how to trade it. The best way is to lower your risk or demo ( demo never worked for me) to a amount that you have no problem opening and closing trades either positive or negative trades. That is key if you are getting a emotional response from yourself. Anxious scared to enter or worried once in . Your risking to much at the start.
You have to prove the strategy to yourself before you can ever hope to trade it well. Yes you have seen all the winners making fortunes and you know it works. But has it worked consistentlly for you? We all have doubts of what people post on the internet anyway. With my knowledge of this startegy I could post all the entries, exits ,add on areas and anything else you would want and make you believe 100% that I was the best trader alive.
But that isn't my goal If I help one person to start trading successfully I will be a very happy person. So we have to learn to trust ourselves that this works.
BREAKING OLD HABBITS
The second part to this is the hardest and I see it time and again. It also is the thing that is the most painfull to watch. To see people trade this startegy very well for a day or a week then to loss that trust and fall back. Sometimes they give up all together even after having been right their just a few steps a way from total nirvana. LOL
Most of the times it is the return to bad habbits that cause this. The new trader who has not been overwhelmed by the information available by the Internet. Is more than likelly the one to have the easist time of becoming successfull the quickest. Not having to break the hold of the old. It is funny to hear I went back to my old style. IF it worked why did you leave it ?
This particular startegy, EO's Covers anything you may want to trade. Scalping, Long term it is all there. The whole idea of the startegy though and seems the hardest for older traders to see is the fact that the use of the MA's and the S/R , and a few trendlines is all you need. I hate to see my friends trading extremmelly well I mean awesome good. Using the MA;s for entries and exits. Then the next moment . "oh I see this equities is doing this think I will do this. Oh that didn't work" Then they get stuck on that and it is one loss after another . Lucklly they are decent traders and they just stack up Break Evens mainlly.
But just a shift in their thinking back to trusting the strategy and boom they would be back on track and they do that the next day or next session. So why is it so hard to hold on too. Because they still don't trust it. That is the only excuse there could be . It works it works for them day after day yet they forgo it and revert back to things that are a hit and miss.
I wish that news services never exsisted the listening to a news service then trying to trade is madness. If you think your news is getting to you before it hits the biggest players you are wrong unless your spending thousand a month on it then your just equal. Very rarelly do you get news that will help you anymore than just trading your charts. You have been told from day one that your charts actually show the emotions of the traders. The news is already factored into what we are seeing. The biggest failure of you listening to news is the habbit of arriving a direction for the day. Then making one bad trade after another because the market isn't agreeing with your bias. But if you look back if you took the signals from the startegy darn they would have worked as they show the true response to YOUR news or analysis.
If everyone could get past the above issue we would see a lot of Eureka moments. It doesn't matter that it works sometimes trading the MA's works all the time. But until you have unshakeable faith in the Strategy of choice even if it isn't this one you will never see the results of those you are trying to mimick. And you are doing just that so do what they do believe in the strategy and quit looking for outside confirmation . All the confirmation we need is on our charts.
Another place we can go wrong is in the use of chat rooms we all like to have company trading but if you are swayed by others opipions and can't hold the course with their comments . It may be better to trade solo and meet up later to compare or find like minded traders. You can make bad choices just from the drop of a word or two. It is nice though if your trading alike 4 or more eyes are better than two.
STOPS
Stops are one of the uglyest mental issues around. If you can't let trades close at your set levels and let them run. It can be devasting to your confidence as well as to your account. There are two issues invlolved here one is you believe if you get stopped your wrong and your never wrong.
Second once you let it go to far you can’t close it that bad as you can’t afford too.
Lets look at the first one. First and foremost there is no right or wrong in trading. Stops are not a sign of good or bad , right or wrong. If anything you should see your stop being hit as a blessing allowing you two things one it saves your money, second it allows you to get a better or right entry.
A lot of times you will find yourself stopped out just to see price turn then go in your direction. The problem then is that you didn't reenter. You were 1. to soon with your entry or 2. price just tried a bit harder to push past a area but failed.
You have to learn to see this for what they are. This is a place that Price Action can come into great use. By watching the close of the candles and not the highs or wicks. If you get stopped look for a better entry if your PA is showing you it is ok.
The letting stops run is hard it is worst when your trying to turn price and you have lots of levels close together. In your mind your thinking maybe it will turn at this next level and I want to be in and get the best price to start making back my loss. But you will find all you end up doing is making a bigger loss.
Also your break even or point you actually start to make a profit moves further and further away then you may do the unthinkable add to a losing trade to move your BE closer. But if price continues away you just compounded your loss just as we know how to compound gains to build our accounts fast you are losing just as fast.
So take the loss it isn't right or wrong it is just saving you money and allowing you to be ready for the right trade. If your stuck in this trade going the wrong way you may not even see the correct trade going the opposite direction. As your hoping for a turn. It is funny but a bad trade takes all your attention and energy. After a really bad trade you can be a emotional wreck. I have seen people take days or weeks off after a really bad trade. For me I do better to stay in the game and take a few very safe trades to remind myself I do know what I am doing.
Again the best way to break the grip of this type of thinking is to be emotionally detached from your trading. So as we talked about above trade a small enough amount that you don't have any feelings regarding the trade.
Sometimes you may want out of trade but because the price is moving so fast your broker slips your order or requotes you. I have had a 30 pip loss end up over 60 because of this. So it is better to take the 20 first.. Then look for a new trade.
In the same leaque but different is Chasing or trying to turn price at those same areas we think price might reverse.
I hear time and again I want the best entry . But are you willing to lose 40 or 60 pips for that best entry? The trigger signals we use are mostlly 2 candle signals requiring a second confirming candlestick , But within our regular trading using MA’s and other things for confirmation we normally take the entry on the open of the next candle. When you see these giagantic moves don’t try and turn the price to soon it may be the one time you should wait for that second candle for confirmation. Maybe go back and reread the descriptions of all the signals.
There is not any explanation a person could give me for letting stops run. It is a futile process. Closing and entering when the price has turned will always get you a better entry.
At some point your skills may improve then you may start to see the few times that you can no for almost certain that price could turn here.
GREED
Taking profit and fighting greed. Greed rears it's head in two ways . One you hold a position to long for more profits only having it turn on you and possiblly losing all your gains. And second thinking your infallable. Either is just as destructive.
The first we have all the tools we need to take profit to not use them and assume is just nonsense. The same signals and triggers we use for entries can tell us it is time to take profits. A glance to your left on your trading chart can tell you how price has been flowing and weither a scalp or something longer is available. So take your profits move the stop and cover your trades then you can let them play out as they will. But never just assume your in for massive gains. Plus as you have seen with this particular strategy there are many places to add back on to your trade if it does continue. It is actually that practice that can seperate good from great traders. To have secured profits first then add risk would be the sign of a smart trader.
The second you may have to get burned a few times to learn that your human like the rest of us. But just remember we trade a strategy not emotions no signal no trade. sounds simple. LOL
I use a comment Trade Happy .. from time to time. I would like to say something towards that end. As I said earlier I have known for a long time my greatest enemy keeping me from success has been me. I think being in the right frame of mind while trading is critical to making good choices. If you feel out of sorts and can't focuse it may be a good day not to trade.
Everyone should find a way to shift their emotional state I would say meditate but first time i mentioned to my son I was he thought a group of fanatics had taken me.. Meditation is nothing more than using something to clear your mind and put it in a positive state. If at one point in your life you felt like the world was perfect. May have been when you were in your late teens before the real world kicked in.
Might have had your perfect car and perfect partner and everything looked great, and during that time there was a song they played over and over . So even today when you hear that you are taken back to those times and you feel the positive energy. Maybe have a song or two that effect you handy and if you find yourself making bad choices sit back close your eyes and return to that perfect time. Then run your strategy through your mind before you take your next trade.
Every REAL organization in the world uses such thought processes to achieve great results. You can't bully yourself into submission and your never wrong. So you must always feel lik the winner you are..
Well I hope some find this usefull or entertaining.. I sure some will get a chuckle but it is all good..
Trade Happy Ken
Hey Ken I love your honesty. To that end I will admit that I am my greatest enemy too and I wish my trading was consistantly profititable but its not. I have great runs followed by margin calls the things you describew in your posts explain perfectly what happens.
For me I had lost that big account so I ddecided I would go full time trading and my whole mentality was just wrong. I felt pressure with every trade and constant stress and the biggest mistake for me was chasing the market and trying to force trades that simply were not there. I remember being up all night babysitting a loser from sunday night asia right into london. I should have never been in that trade in the first place and in the end it cost me over $2000 before I pulled the plug.
Anyway long story short I had like $25 left in one of my badly blown up margin called accounts and decided to trade again. This time instead of throwing my money away I chose to just use that account. I am using Eo’s method almost exclusivly (personal tweaks aside) and not taking alot of trades but with all that said. In 2 weeks with proper mm I have already brought my account up to $140 I know its pennys really but the fact is I am earning great % return. I think the biggest factor for me is the fact that there is no pressure. If I don’t see a good setup I don’t trade simple as that. Also when I am in a trade I have to babysit it. It is who I am as a atrader and I accept that. I find after I enter a trade I set a t/p and then play mobsters 2 or surf the forums a little or read or whatever then I click back and forth and keep an eye on the trade that way and it has done a world of good for me. Im like you, I would rather take my 10-20 pips and move on but I have decided why not let it run I let my losers run no problem but why not stay in the trade if there is no indication to get out.
Anyway I wont let this post get any longer
[B]I encourage every new trader to read Ken’s posts even thought they are long. I gurantee you will gleam some perils of wisdom and grow as a trader[/B]
Great To hear John , I really believe your on the right track… Just don’t change a thing… I Hope your seeing some of the asia longer term trades I have been getting pretty good at covering those and letting them run. Good for you as well being in the US. After the USA session the price sometimes just continues in the same direction. Being a early evening entry. Because I saw your working again…
Anyway Great News and if I can help At all let me know Ken
Kenneth, Thanks for all the info in this thread. I am interested in this stategy/method. I am posting my charts for any feedback you might have on my understanding so far. I have not been able to read everything, my eyes are not as good as they once were, and look forward to your finished product. Here are the charts and what my thinking was. This was not a live trade as I do not think I fully understand yet.
Looking at the daily I see price approaching the 50 period ema, the 4h approaching the 50p ema, the 1h at the 200p sma also I have an S/R line at 149.25. As I watched the price hit this area and head back north…I entered 2 amounts long at 149.30. Watching the 15m my first profit target was @ the 200p sma (149.80) I closed out one amount for 50pips. I moved stop to Breakeven. Then I entered another amount when price moved down to the 5p ema (149.70) My second profit target was the 10p SMA on the 4 hr chart (149.95) I closed both amounts there for 40pips x 2 = 80pips.
Total trade 130pips in about an hour. Was I just lucky or am I understanding the method a little?
Thanks
Jack
jack : Yes that was a very good plan on your part also on your 15 Min PPA was in confluence. If you check the e/j it had almost the same trade. The Cable was a bit better there was a actual signal on the 35/50 line plus PPA from fridays close. A hammer…
But your trade was excelent. It would be considered Mostlly a trade taken off pure Price Action. the confirmation of the MA lines helps to support your analysis of the S/R line. It is this confirmation we are looking for to help lead us into those trades… The addition of a signal candlestick would be the icing on the cake…
eohater
"One for all, and all for one" Member Since May 2008
10,530 Posts
Quote:
Originally Posted by The Captain
Wonder if anyone can help explain a setup for me. Check out the 4h on the EJ. The two spinning tops looked like a for sure that she was heading back down. But as you can see the next candle is higher. Any thoughts?
I’m bearish on EJ myself. I have been all day. If we break down and look at our lower time frame charts though, we can see that she has consolidated all day during the US Session. She can go either way at this point. Once she makes a break, she will confirm it and continue in that direction. At this point, she’s just bouncing up and down waiting for a driver. [B][I][U]We’re not the drivers, just passengers, so don’t try and drive it[/U][/I][/B].
A great comment we should all remember… Had a group I was chatting with today kept trying to turn the gbp back up… Even though everything was looking short. So remember look for the bus stops and just get a seat…
Don’t jump in front of the bus , no signal no trade…
Yes it is being worked on now by another person , They are having to re type it as I saved the Text as jpgs and it is to big to post any where. I f push comes to shove I will re write the thing one more time. But that would take a good deal of time.
Ken, Would you be so kind as to share with us the exact colors of each ma you use for each TF? It would be very helpful to have the same color ma’s to compare to your charts. You also mentioned that you run a 50ema and a 200sma on all charts. Are those in addition to the ones you already state at pg.5 of the EOS pdf? Please forgive me but I am a little confused about the exact set up on all the ema’s on all the time frames:confused:
Hey Ken,
Here is a demo trade I just planned out and entered. Let me know what you think if I’m on the right track. Daily chart -
heading down to the 50period EMA and 149.00 round #.
4h chart price at the 50p EMA about 149.90.
If it bounces off this poss long, If it breaks down, short.
In the meantime see some potential on the 1h chart
looks clear down to 149.40 - 149.25 (about 50pips potential?)
15m chart enter short when price hits the 5 or 10p EMA’s.
On demo I entered short at 149.85 SL at 150.05 just over the yellow sma.
Profit target approx 30 - 50 pips (149.40 200 SMA on 1h chart) If it breaks though there then on down to 149.00 and then watch where it goes
from there
the things you describew in your posts explain perfectly what happens.
