Yes, stick to the rules. But if I had been paying closer attention to the SMT, I would have noticed that once again there was divergence at NY open that was signalling Cable was going higher. With this in mind, I think I would have felt more confidence stepping in front of the ADR.
Regardless of my latest losing streak, I do feel like I am making some breakthroughs in understanding. Did you touch the London Open? I guess this time market flow ‘smoked’ support!
Regards
That ended up being a valid set up on my platform as the ADR was hit with the low of the 8:30 EST candle. I missed it by 10 minutes.
Have you read Trading In The Zone by Mark Douglas?
I know it’s helped me a great deal with the psychological aspects of trading that are seldom talked about. Specifically, with the proper mindset when placing a trade, and how do deal with a draw down in the account.
I have that book downloaded on my computer, but it has been sat there for a few months without me ever opening the file. I will definitely take a look now. Thanks northern.
Unfortunately, I did take that trade, although analysis was favouring a long order, Cable fell, so I took a 30 pip loss. I will be posting that as soon as I can journalize it.
Regards,
Clark.
It ‘smoked’ support for Fiber which was negative on all TFs, but what about Cable? My analysis earlier in the day shows that H4 was UP, which is probably why you made the trade (along with the COT, Backwardation etc). Well, I will be interested to see your write up.
Regards
P.S. I am leaving my analysis for another hour or so because I want to be closer to the market open.
Trade #6
Date: May 11, 2011
Time (GMT): 6:39 AM GMT
Live
[B]Pre-Trade:[/B]
Currency Pair: GBP/USD
Market Bias (Long Term): Bullish
Market Flow (Daily, 4H, 1H): Bearish
Position Taken (Long/Short): Long
Trade Style (Swing, Scalp, etc): Swing
Risked Percentage (%): 0.5%
Lot Size: 0.04
Stop Loss (in pips): 30
Take Profit (in pips): 120
Entry Price: 1.63339
Notes & Comments:
Although market flow is bearish on all three time frames, there is a lot of support currently, as a result, S&R always trumps market flow, and we may be seeing a rise in the Cable and Fiber. Given the volatility of the pairs recently, the take profit will be a larger one. Once we are up 30 pips, I will be setting the SL to BE+1, and at 60 pips, I will set it to BE+30 and at 90 pips, I will set it to BE+60. Trade will not be executed past 2:00am GMT. The reason for trading the Cable versus the Fiber is because there were more signals of the Cable being bullish. There were some fundamentals indicating the Fiber may fall.
Entry Screenshot:
[B]Post Trade:[/B]
Exit Date: May 12, 2011
Exit Time: 7:07 AM GMT
Exit Price: 1.63039
Net Pips (in pips): -29.4
Net Income (% growth): -0.57%
Net Income ($ amount): -$1.17
Notes & Comments:
Trade was off; Cable and Fiber continued to fall today. Cable was not able to break through resistance. Actually thought this would have been a good trade, market sentiment and S&R was in my favour. But the not everything works my way, unfortunately. Lesson learned. Personally, I am starting to feel that when I am taking pending orders I am losing more than I do when trading during the session. I will try to find more time to carefully watch the kill zones instead of an hour beforehand.
Closing Screenshot:
Currency Pair: GBP/USD
Date: 13th May 2011
Time (GMT): 07:00
Pre-Trade Market Bias
USDX: At 75.37. Has pushed up to 75.80 but there is resistance in the 75.50 – 76.00 area. Also support at 75.40. Mixed.
US Bond Yields: All putting in lower lows and lower highs on a 3 month timescale, but short term all but the 2yr note have put in higher lows.
COT Data (Net position and direction): Commercials are net short, but a positive net change from previous report. BULLISH.
Backwardation: Yes. BULLISH.
Futures Market Open Interest (rising/falling) / Volume (rising/falling):
OI: 112,819, up from109,496 previous day.
News Releases Scheduled (Only High Impact)(GMT):
12:30 – (USD) CPI
13:55 – (USD) University of Michigan Sent.
Chart Technicals
Market Flow (Daily, 4H, 1H): Down, Down, Down.
SMT Signals: Divergence on 2H in favor of an up move in Cable.
Support/Resistance: Support at 1.6220 on D1.
Comments: If Cable makes it up to 1.6288 and the CPP, then this is OTE 62% from the NY afternoon swing down, and also 38% retracement from the previous day’s high. But there is support at the current level, and not confident as to whether support or market flow will win out in the tug-o-war this time.
Trade (Yes/No): Sidelined for the time being.
Ali and Clark thanks very much for your regular market analysis, it’s very helpful to many of us especially the C.O.T stuff that’s still bamboozling me, I hope you keep it up.
If I may, I think you may be weighting entries too heavily on fundamentals, I think they’re really useful for catching those once a week full fib extention trades (which I wish I could and hope to eventually) but for our 20-50 pip bread and butter scalps nailing the basics, in order, is working quite well for me.
In my case it’s Kill zone/news, then recheck S/R closely followed by MF. I wouldn’t trade against all three MFs regardless of s/r because s/r trumps Mf but at some point MF always over comes s/r and I’m experimenting with momentum tools (opps I’ve said too much) to try and get a handle on really strong MFs.
(Won’t let me posts longer cont.)
Then buy/sell zones and OTE, with these in place I’m happy to enter a trade. Depending on the session I’ll add significance to the Asian range and ADR, “making the numbers” and SMT, with an eye obvious candles and patterns.
I always flash between the usdx and my charts regularly but bonds, gilts, bunds, Williams %R and COT I’m more likely to use to keep me in a trade than get me in a trade.
I know this is not a competition but I wish I had yous guys analitical capacities which I’ll have to develop to take my trading to the next level but I just saying the basics are so good don’t lose the woods for the trees.
This is something of the blind leading the partially sighted as Michael is in short supply at the moment but please keep up the good work.
Hey Jaroon well done!!Like you I am in the keep it really simple camp as I can’t yet analyise like Ali and Clark.
Took first trade this week based on ITC’s methods using analysis of smart money tool,I perhaps use it a bit differently to you guys and look for the most subtle diffferences and have read it all the way back 3 years and have noticed its very consistent on the small stuff as well as the major trends!Have a look for yourselves and a BIG thanks to ITC for revealing it!
Trade 11th may(demo)entry 06:15(GMT)candle M15 chart long @6350 based on small divergance on SMT Trading below CPP,25 pip stop@6325 and take profit 6415 due to confluence @6430,previous days pivots,institutional figure,and previous support level.
Result+65 pips more or less(excluding spread)entry was manual as I still don’t have a really firm grip or explanation on the different types of orders(help anyone).
Not really seen anything else I could trade for certain(I’m only trading London open as its what i’m most familiar with).
Overall early days but very happy that this was an educated decision based on the previous 3+ months studying ITC’s methods and learning from you all.
Thakn you all and GLGT
Yes, you definitely make a worthy point. I was attracted to London Close because I think that there is less to think about at that time, and maybe I am complicating things because my perception is that London Open is for the big boys! Like you say, COT and everything else could be clouding my judgement when it should just be used as a way of adding weight to all that you mentioned. Who knows! This is one of many grey areas that exist.
I do know that if I hadn’t placed so much emphasis on it today then I would have set a pending order at 1.6288 with my SL at 1.6218 and my first TP at 1.6258. I wouldn’t have been stopped out, I would have reached first TP, and I would still be in the trade at BE+1. I hope this is what you guys did 
3 years!! It seems like you are being rewarded for all your hard work. What time frames were you looking at? I like the 2 hour and the 15minute/5 minute. I did a few months worth of back testing on the 2H, but I have yet to explore the number of opportunities on the 15M/5M. I do remember ICT said the SMT on short TFs was like ‘a candy store’, or something to that effect!
3 months,you’ve misread it Alishijo,I’m patient but not that much!!
I only use the 1hour chart and that spots it all for me,I concentrate on the smallest failures eg:one makes higher lows and the other doesn’t,if you review it on the hour chart real slow and look for every divergance however small and relate it to your trading chart you will see how it pans out,works for me along with all the other ICT techniques.
Missed off OTE for trade,was roughly between 62 & 79% off high of 9th 22:00 and low of 10th 17:00.
I’ve kept out of the chat room this week and that way I can concentrate on my analysis and what i’m seeing,I’m looking more at bigger timeframes to spot unfolding swings using the 50% rule.
Hope that helps and any feedback always appreciated
Jeff
Edit ignore the animation I don’t know where its come from but its not intentional!!
Here’s my NYO for Friday. The swing I used is a bit contrived but with the expressed Resistance, MF and sell zone I was happy to use it.
Not standard TP levels as I’m just not hitting the extentions that make 30% a great prospect, yet!
I think I’ve over cropped it. E/G.
Other good news is this is my 3rd trade of the week, and new low trading record. 1st netted 3.5%, 2nd lost 1.5% and I was going to stay flat with my 2% but there you go.
Well folks, I am officially having a torrid time of it! Took another loser tonight that puts me at break-even in percentage terms for the last rolling month, but minus on the account due to the fact that I upped the steaks to split trades. I didn’t change my analysis in any way from before, and I am taking the same trades that I always have. Check out the screenshot and let me know where I am going wrong (if you can see, because I sure can’t!)
Weekly update - Week 8
Trades taken: 2
Trades Won: 0
Trades Lost: 2
BE: 0
Percentage profit/loss: -2%
Last rolling month update
Trades taken: 10
Trades Won: 6
Trades Lost: 4
BE: 0
Percentage profit/loss: 0%
2 Month update
Trades taken: 25
Trades Won: 17
Trades Lost: 7
BE: 1
I am quickly losing all confidence in my London Close trades after 4 losers in a row. What is the probability chance of that happening after 3 losers in the first 21 trades? At what point do you decide to go back to demo and admit defeat?
Remind me of the 50% rule…are you talking about 50% between 62 and 79 OTE?
If it is working, stick with it. That is the only feedback I am able to give right now.
You dont admit defeat at all… You need to realize that what you have is an “edge” which allows you to have a winning trade more often then a losing trade. The only way to capitalize on this “edge” is to take the trade every time your set up occurs. 4 losers in a row is absolutely minimal and minor in the grand scheme of things. Think a year or longer.
As soon as you come to terms with the fact that every single trade you make is unique, and has no relation to any trade before it or after it, you will be able to place your trade, and let the nature of probabilities work in your favor.
Look at the stats you have right now. 17 winners and 7 losers. A 68% win rate which is exceptional. The only way to keep that win rate is to continue to trade your plan every time a trade becomes available. You could easily go on another run and recreate your win stats before the most recent 4 losers, which would be 17 wins and 3 losers. Meaning your total would actually be 34 winners and 10 losers, an amazing trading record.
I took that trade and lost as well. I also had a successful scalp on EUR/JPY earlier in the week. On top of that, I missed a profitable scalp on both the Fiber by 1 pip, and the Cable by 5 minutes. So there were winning opportunities this week.
By not taking trades because of a string of 4 losses, you are allowing yourself to lose that “winning edge” you have. Probabilities only work in your favour in the long run.
Instead of being apprehensive about a string of losers, you should be excited to take the next trade that meets your plan because you know the “edge” you have works, and with 4 losers behind you, long term probabilities say you are closer and closer to a winning trade.
I hope that makes sense, my apologies if it sounds like I’m rambling. That was not the intent.
Well, losing week for me :(. It’s been 1 full month that I’ve been trading on a live account and I’m up nearly 36% which is awesome and hopefully next month will be just as good, or even half as good.
Alishijo, don’t worry about losses, they’re gonna happen. I don’t think I’ve won a trade this week lol. Northerntouch101 makes a good point as well. Longterm ICT’s strat is a winner, shorterm losses are expected.
Well said guys. Without blowing smoke anywhere inappropriate Ali, you’ve got the tools down, no doubt, and have helped us by sharing your efforts thus far.
But this is where the true test of a successful trader only begins, not with the system but with dealing with the inevitable losing streaks and not going to pieces. Welcome the chance to deal with this stuff now, it’s probably more important to your long term goals than any system.
For my part I’ve had 6 out of 8 profitable weeks but my unprofitable weeks, of over trading, revenge trading and over leveraging without correct risk control, in 3 trades have blown my first account. I’m grateful because I’m NOT going to do it again so when I’m, eventually, working with significant amounts of equity I won’t have to learn the really hard way.
Thanks for everyone’s support. It is much appreciated.
[B]Northern [/B]- Your explanation makes perfect sense to me, and having only read the first 35 pages of ‘Trading in the Zone’, I can see where you are coming from in terms of ‘unique trades’ and ‘trusting the laws of probability’. I realize why it is so important that I get through that book, and internalize everything in it. Finding a winning system is only half the battle…the other half is learning to think in a completely new way.
[B]hellogoodbye[/B] - I know it’s a winner, and he did tell us at the start that you will encounter loses in all systems, including his. I guess I was expecting to build my account a little more before the losing streak started, and that is why I am hurting. You did reassure me by sharing your experience, and so thanks again.
[B]Jaroon[/B] - Thank-you for your kind words of support. I am sorry about your first account, but you seem to be on the right track with 6 winning weeks out of 8. Your last paragraph suggests that you would also get a lot out of the book ‘Trading in the Zone’ by Mark Douglas.
As a taster, here is a quote:
‘If you could choose one of the following two traders to manage your money, which one would you pick? The first trader uses a simple, possibly even mediocre trading technique, but possesses a mind-set that is not susceptible to subconsciously distorting market information, hesitating, rationalizing, hoping, or jumping the gun. The second trader is a phenomenal analyst, but is still operating out of the typical fears that make him susceptible to all the psychological maladies that the other trader is free of. The right choice should be obvious. The first trader is going to achieve far better results with your money.’
I know that ICT said we shouldn’t put limits on our learning, but I have come to the realization that if I make all the right moves, I should be able to go full time in 2 to 3 years. That would be the same as studying for an undergraduate degree and coming out with a job offer at the end of it. With the basics in place after 8 months, I now need to step up to the next level and deal with the psychological discipline needed to be a successful trader. I have had no problems sticking with the entry criteria and cutting my loses at a set SL, but I need to work on running my winners, and also on the fear I feel when encountering a losing streak. My heart, which still beats faster when I pull the trigger, is telling me that I am far from the ultimate goal of trading without all ‘psychological maladies’.
Well, thanks again. GLGT!
