Thunder dome

[MattfromNZ 55]

32 minutes ago, Michael Sanchez said:

That second entry looks good to me, just didn't get a big move out of it. Because you had such a nice range going, I would have considered putting my stoploss at the low of the previous candle. With you stoploss where it was you aren't getting a good risk/reward. I would want to bail from the trade as soon is it re-enters the range.

[MattfromNZ 55]

I had a break after the initial morning chaos and used the mountain pass strategy on AAL for some 2.5R gains. So far I really like this strategy.

[Adam Lewis 64]

Stock: CCL

Result: -1R loss

Strategy: ABCD

Long/Short: Long

Entry: 1Two attempts to find an entry at around 20.60.

S/L: Loss of VWAP

Why did you take the trade?: After a strong move up and breaking and appearing to hold VWAP this looked like a good ABCD entry. My first entry stopped out, the price then dipping back below EMA and returning up. I took a second attempt seeing this hold VWAP, but again stopped out and came off it.

What happened next?: I took a total loss of 1R on these 2 trades, as I kept my stop tight. The stock rolled over from here and didn't break VWAP, settled back down 40c lower.

How did you feel after taking the trade?: I felt ok. Not losing my shit anyway! You win some you lose some. I lost this but with a tight stop it was absorbable. 

What did you do well?:  Kept a very tight stop.

Questions?: So... Was this a good trade or not? Was I right to make an attempt, a second attempt? My rationale for going in was clear - the stock strong green on the day, after a strong run up, breaking VWAP and pulling back, appearing to consolidate right above VWAP. I had every right to anticipate a continued move up right? There will always be trade ideas that don't work out. Was this just one of them?

[MattfromNZ 55]

47 minutes ago, Adam Lewis said:

Stock: CCL

Result: -1R loss

Strategy: ABCD

Long/Short: Long

Entry: 1Two attempts to find an entry at around 20.60.

S/L: Loss of VWAP

Why did you take the trade?: After a strong move up and breaking and appearing to hold VWAP this looked like a good ABCD entry. My first entry stopped out, the price then dipping back below EMA and returning up. I took a second attempt seeing this hold VWAP, but again stopped out and came off it.

What happened next?: I took a total loss of 1R on these 2 trades, as I kept my stop tight. The stock rolled over from here and didn't break VWAP, settled back down 40c lower.

How did you feel after taking the trade?: I felt ok. Not losing my shit anyway! You win some you lose some. I lost this but with a tight stop it was absorbable. 

What did you do well?:  Kept a very tight stop.

Questions?: So... Was this a good trade or not? Was I right to make an attempt, a second attempt? My rationale for going in was clear - the stock strong green on the day, after a strong run up, breaking VWAP and pulling back, appearing to consolidate right above VWAP. I had every right to anticipate a continued move up right? There will always be trade ideas that don't work out. Was this just one of them?

Here is some things to think about (Just remember I'm relatively new at this too so take it or leave it, I've just been trading ABCD's a bit longer)

- You took the trade around VWAP. Things can get fucked up around VWAP, especially close to the open. I personally would have avoided this trade for this reason alone. ABCD pattern is a trend continuation pattern, as soon as the VWAP gets encountered, it has a ability to reset trends. What we see here is a VWAP reversal. This pattern is more suited to a VWAP focused trade than ABCD I think.

- Stoplosses for ABCD trades often shouldn't be too tight, especially if you are entering before any breakout where it is often placed below the range. It seems to me here like you would have been stopped out even if the price action did eventually go in your favor.

- Your first entry was made after very little pullback, and only one red candle. For me this wouldn't be enough to warrant entering for an ABCD.

- Once the price dipped down below the VWAP, I would classify this as a potential type C ABCD pattern - as in the pullback is now steep. Aiman says for these you should wait until a second bounce on the resistance (often 9ma) to see which direction it will go (because often it does exactly what you see here).

Hope some of this is useful.

[Michael Sanchez 53]

17 hours ago, MattfromNZ said:

I had a break after the initial morning chaos and used the mountain pass strategy on AAL for some 2.5R gains. So far I really like this strategy.

This was a great trade. Your first trade was perfect. I also liked how you managed your second trade well and got out at break even. No need to lose profit. Great trading Matt.

[Michael Sanchez 53]

 

10 hours ago, MattfromNZ said:

Here is some things to think about (Just remember I'm relatively new at this too so take it or leave it, I've just been trading ABCD's a bit longer)

- You took the trade around VWAP. Things can get fucked up around VWAP, especially close to the open. I personally would have avoided this trade for this reason alone. ABCD pattern is a trend continuation pattern, as soon as the VWAP gets encountered, it has a ability to reset trends. What we see here is a VWAP reversal. This pattern is more suited to a VWAP focused trade than ABCD I think.

- Stoplosses for ABCD trades often shouldn't be too tight, especially if you are entering before any breakout where it is often placed below the range. It seems to me here like you would have been stopped out even if the price action did eventually go in your favor.

- Your first entry was made after very little pullback, and only one red candle. For me this wouldn't be enough to warrant entering for an ABCD.

- Once the price dipped down below the VWAP, I would classify this as a potential type C ABCD pattern - as in the pullback is now steep. Aiman says for these you should wait until a second bounce on the resistance (often 9ma) to see which direction it will go (because often it does exactly what you see here).

Hope some of this is useful.

I agree, I do not take ABCD patterns if they cross the VWAP. Those trades are unreliable in my opinion. I want my patterns to respect moving averages as much as possible. 

[Michael Sanchez 53]

[MattfromNZ 55]

8 minutes ago, Michael Sanchez said:

Awesome trade man! This was  was also a 5min ORB.  I originally had this stock on my 5min ORB watchlist, but swapped it for another, because my strategy involves entering near VWAP, and this was was so far away. Looking back at AAL's chart today it remained super far away from VWAP for all of today and all of yesterday (during market hours at least). I don't understand that.

[Michael Sanchez 53]

Takeaways 

• I must stick to ABCD patterns because this is what I know best
• My worst week was when I was "scalping" and trading Double Tops and Bottoms
• My hotkeys are allowing me to make profit even when I have more losers than winners.
• I need to improve on my ABCD patterns
• My monthly goal was to have at least 1R (surpassed expectations) 

[Michael Sanchez 53]

7 minutes ago, MattfromNZ said:

Awesome trade man! This was  was also a 5min ORB.  I originally had this stock on my 5min ORB watchlist, but swapped it for another, because my strategy involves entering near VWAP, and this was was so far away. Looking back at AAL's chart today it remained super far away from VWAP for all of today and all of yesterday (during market hours at least). I don't understand that.

Thanks boss!! AAL's price action was very strange today it was gapping up 8% and completely sold off  to -2%.

[MattfromNZ 55]

MattfromNZ Trading Summary for January 2021

Journey

I started learning and watching daytrading in the last months of last year, but this is my first month of real daytrading where I am treating it as if it was real and trying to follow actual strategies. I started properly recording my trades in the second week of January after I set myself up with fixed risk hotkeys.

Goals

The main goals of this month was to learn as much as possible and try out different strategies to see what works for me.

Trades

Over all my trades, I managed to make a small profit of 0.19R per trade or 24.63R total. Over 14 trading days this is making an average of 1.76R per day. I am extremely happy with these results in the early stages of my trading career. The main strategies I focused on were ABCD and 5min ORB.

When I take into account whether I followed my strategy rules or not, we can tell where the problem lies. When I follow my rules my win rate for ABCD patterns increases from 40% to close to 60%, and my profit per trade increases from 0.5R to 1R per trade. 

Strategies

• ABCD: For this early stage in my trading career, this is my specialty. I managed to profit almost 0.5R per trade over all my trades, and I feel that I have learned and improved so much since the beginning of the month.
• 5min ORB: This strategy is very much a work in progress. I really want to be able to trade this, but it is revealing itself to be much more difficult than I expected.
• 15min ORB: Not something I gave a lot of attention to.
• Lightning Bolt: I did not see as many opportunities for this trade as I thought I would, and the ones I did get, did not seem to be very convincing for the strategy.
• Mountain Pass: I tried this strategy in the last week. I can see it becoming my new favorite, because I like it a lot. The rules are very clear for when and how you should enter, and when you should not. This is a HOD/LOD reversal strategy and I will need to get used to finding and watching stocks for this.
• Range Breakout: This isn’t really a strategy, because it has no rules. It’s just me watching a stock oscillating in a range and entering upon breakout. Not really working too well though.
• No Strategy: These are trades I make upon impulse or whatever, without following any rules or strategy. The times I try to chase a bull run for example. Interesting that I am slightly green on these trades!

 

Going Forward

• Focus on ABCD, 5min ORB and Mountain Pass Strategies, and develop my playbook for these so I have clearer rules for entering and exiting trades.
• Learn more about reversal strategies. Not necessarily to be able to trade them, but to help me identify them and (for example) see the difference between reversals and pullbacks on ABCD patterns.
• Not make “no strategy” trades as this is bad discipline
• Continue to watch and try and read L2 tape

Edited January 31, 2021 by MattfromNZ

[Adam Lewis 64]

On 1/30/2021 at 4:45 AM, Michael Sanchez said:

Superb trade! The 9EMA on the 1 minute chart is a great tool to help find entry points in the first 30 mins of trading.

[Adam Lewis 64]

8 hours ago, MattfromNZ said:

Over 14 trading days this is making an average of 1.76R per day.

Superb results! Great work Matt, and great progress!

[JS 10]

10 hours ago, MattfromNZ said:

MattfromNZ Trading Summary for January 2021

Journey

I started learning and watching daytrading in the last months of last year, but this is my first month of real daytrading where I am treating it as if it was real and trying to follow actual strategies. I started properly recording my trades in the second week of January after I set myself up with fixed risk hotkeys.

Goals

The main goals of this month was to learn as much as possible and try out different strategies to see what works for me.

Trades

Over all my trades, I managed to make a small profit of 0.19R per trade or 24.63R total. Over 14 trading days this is making an average of 1.76R per day. I am extremely happy with these results in the early stages of my trading career. The main strategies I focused on were ABCD and 5min ORB.

When I take into account whether I followed my strategy rules or not, we can tell where the problem lies. When I follow my rules my win rate for ABCD patterns increases from 40% to close to 60%, and my profit per trade increases from 0.5R to 1R per trade. 

Strategies

• ABCD: For this early stage in my trading career, this is my specialty. I managed to profit almost 0.5R per trade over all my trades, and I feel that I have learned and improved so much since the beginning of the month.
• 5min ORB: This strategy is very much a work in progress. I really want to be able to trade this, but it is revealing itself to be much more difficult than I expected.
• 15min ORB: Not something I gave a lot of attention to.
• Lightning Bolt: I did not see as many opportunities for this trade as I thought I would, and the ones I did get, did not seem to be very convincing for the strategy.
• Mountain Pass: I tried this strategy in the last week. I can see it becoming my new favorite, because I like it a lot. The rules are very clear for when and how you should enter, and when you should not. This is a HOD/LOD reversal strategy and I will need to get used to finding and watching stocks for this.
• Range Breakout: This isn’t really a strategy, because it has no rules. It’s just me watching a stock oscillating in a range and entering upon breakout. Not really working too well though.
• No Strategy: These are trades I make upon impulse or whatever, without following any rules or strategy. The times I try to chase a bull run for example. Interesting that I am slightly green on these trades!

 

Going Forward

• Focus on ABCD, 5min ORB and Mountain Pass Strategies, and develop my playbook for these so I have clearer rules for entering and exiting trades.
• Learn more about reversal strategies. Not necessarily to be able to trade them, but to help me identify them and (for example) see the difference between reversals and pullbacks on ABCD patterns.
• Not make “no strategy” trades as this is bad discipline
• Continue to watch and try and read L2 tape

Hi Matt, great result for such a short trading time! 

One question for your risk management: do you have a max loss number for the day? What is it and how have you been able to follow the rules? thanks a lot!

[MattfromNZ 55]

2 hours ago, JS said:

Hi Matt, great result for such a short trading time! 

One question for your risk management: do you have a max loss number for the day? What is it and how have you been able to follow the rules? thanks a lot!

Thanks JS! For this month I did not have a max loss for the day. I am only trading in a simulator for now, and I am on the fence to whether I want to implement one or not for simulated days. On one hand it would be good to follow rules like this as if I was trading for real, but on the other hand it would mean less time trading on some days, and I feel that time accrued watching the markets is one of the most important factors to success. I could just watch and not trade, but I feel much more engaged with what is going on when I am actively looking for setups to trade. I have been thinking though that when I do go live my max loss will be 3R, after which I can still trade in sim if I choose to.