Live Journal Exercise – Learning to Trade an Edge like a Casino

[Mike B 624]

July 30, 2019 - $PFE x 2 (Stopped, Partial)

A much better day today after revising how I am taking partials. The first trade I got stopped out on $PFE after the rejection of VWAP, break of the previous candle and the quick pop back above VWAP. 

Second trade, I started looking at $AMD and $UAA, but either of those stocks had any good setups. I looked back at $PFE and I could tell the stock just did not have the buying power to stay above VWAP. I entered again when it lost VWAP and broke the 15 min candle to the downside. I made a mistake on the placement of stop loss as I had it too high, so my 1R was quite large. I was able to execute my profit taking plan and took a partial at 1R and got stopped out at break even. The only thing I would have changed here is that I would have taken a larger partial due to my large risk and the smaller ATR of $PFE. Other than that it was a good day.

Sample Set Results,

S E P S P 16 17 18 19 20

[Mike B 624]

July 31, 2019 - Nothing

All I have to say today is that July aka "Adversity Month" is over and I am glad. 

Yeah for August.

Sample Set Results,

S E P S P 16 17 18 19 20

[Mike B 624]

July 31, 2019 - Nothing

What a way to start a vacation. Terrible trading all around. I gave into FOMO and took a trade that wasn’t even close to anything I trade. Why? Simple, For two days in a row I have no setups and I have this huge urge to work my profit taking plan. Absolutely, positively the worse trading day in a very long time. I even took a sim trade because nothing was there and then went back and took a live trade.

No Trading for me tomorrow as I will be on the road. Hopefully, I will trade on Monday and Tuesday.

There is one good thing. I stuck to my stop loss and only had a 1R loss. I guess that is a highlight to focus on.

Sample Set Results,

S E P S P 16 17 18 19 20

[Mark D. 435]

I would have taken that same long in GM had i not already hit max loss. 

[Mike B 624]

August 7, 2019 - Profit Target ($BAC)

Coming off vacation was much better than before going on vacation. Came back after about a week off and took a short on $BAC. This was definitely not the top stock on my watch-list, rather it was just a standby that I saw my entry start to form and decided to take the trade when it appeared. I executed my profit taking with the revised plan that I developed while sitting around the pool in Arizona. I took a partial at 1R another at 2R and than set a range order to let the rest ride to the profit target or back to 1R. The range order executed when the stock moved back to my 1R level.  I plan on posting the update this weekend when I transition to my next sample set. It does feel good to be back in my normal trading area.

Sample Set Results,

S E P S P 16 G 19 20

[Mike B 624]

August 8, 2019 - Profit Target ($AMD)

Today was a good day trading. I had $KHC, $CRON, $AMD, and $SYMC on my watchlist. I dropped $CRON as soon as it sold off as I did not have shorts. I started watching the other three and really was looking to $SYMC long at the VWAP when I noticed $AMD sold below the VWAP and right before the close popped back above right below a 31.83 level that I had marked. On the chart I moved the line up to my 1R level. I decided to take it long if it broke above that level. It had a couple of candles that tested VWAP again that really pushed my limit on my new profit taking plan. Additionally, Andrew was in the same trade long and decided to get out. As it was holding the 9 EMA, I decided to stick to my profit taking plan.

I took a partial at 1R and 2R. I set a range order to exit at the profit target or at 1R. This would give me a 1.32R if I hit my 1R again or a 1.49R if I hit my profit target.

I make a mistake and put the wrong range order in, so I ended up buying more shares. Luckily for me the stock continued to move up and once I realized the mistake I exited the trade. I ended up with a 2.14R.

Overall I was happy with the day. 1 trade left in the sample set. If I get it in tomorrow I will record it, but if I do not, I still plan on trading my new sample set on Monday.

Sample Set Results,

S E P S P 16 G G 20

[Mike B 624]

On 8/9/2019 at 1:16 AM, peterB said:

have you noticed that in the majority of your trades which worked you could start to partial at 2R instead of 1R?

I have noticed that but the 1R out helps with my emotions. I am now tracking, the difference between taking the 1R and not taking the 1R out before the 2R level. This may help with my emotions as well. 

[Mike B 624]

No trades again today. I only had about 30 minutes available this morning before having leave for the train. Everything seemed to choppy for me, as I am not one of those traders that trade before the 5 minute mark. There were some nice 1 min and 2 min Orbs this morning.

Looking forward tomorrow.

[Aiman 86]

2 hours ago, Mike B said:

No trades again today. I only had about 30 minutes available this morning before having leave for the train. Everything seemed to choppy for me, as I am not one of those traders that trade before the 5 minute mark. There were some nice 1 min and 2 min Orbs this morning.

Looking forward tomorrow.

it's good to stick to your rules, and good that you don't rush a trade cuz you've only 30 mins available, a problem I really had and suffered overcoming! Sometimes white day is better than a possible red one)

[Mike B 624]

August 13, 2019 - Partial ($AMD)

So I have a what is wrong with the snap shot question for everyone? It is not very obvious with the first image but the second image it is very clear.

Today I was looking to take $JD short if it rejected the VWAP. It did not, so I moved onto $TME which was not giving me a pullback towards VWAP. Eventually, I went with trusty old $AMD. I got a B+ setup on $AMD as it popped above VWAP but than lost it. There were a lot of large Bids, so when it sold off hard below all the moving averages and lost VWAP, I took it short once it broke the support level at 32.06. I took a partial at 1R and than I exited at what I thought was break-even. As you can tell this was after the tariff news came out and I started having some issues with my DAS platform being delayed. When I hit the cover hot key I got filled almost .08 above where the price marker was. My ping rate was fine, I just think the market got flood with orders so since I was on WIFI, I wasn't get the most current data.

If you didn't see what the issue was on the snap shot below, look at the level 2 data. In real time the BID was moving but the ASK with stationary for me. Overall I call it a win, because I could have gotten squeezed really badly. Tomorrow I will start my new sample set.

Sample Set Results,

S E P S P 16 G G P

Edited August 14, 2019 by Mike B

[Mike B 624]

Hey Everyone,

Well sample set 5 brought to light some issues in the numbers in relation to ratios and proper account building. I think this is a product of being more comfortable with my entry point, so I have started focusing more on profit taking and the actual management of the trade.

Here is the biggest change for this sample set. After analyzing my numbers, they did not make sense. My daily goal was below 2% of my actual account (not $ amount in the broker due to it being offshore) and I was risking 1% each trade with a daily max loss of 2% of my actual account. See the numbers do not make sense. I think I ended up with this as I was looking to increase my $ risk per share, but never changed what I was looking for as a daily target.

Four areas I want to work on during this sample are:

         (1)       Taking profits only at 1R, 2R, and Profit target

         (2)        Holding through the initial pullback if the stock does not drop right away

         (3)         Learn it is ok to be wrong and lose.

My desired outcomes I am looking for at the end of the sample set are:

         (1)    Focusing on the execution of each step in my trading plan. (Indicators, confirmations, risk analysis/management, entry, and profit taking)

         (2)    I want to be comfortable being wrong.

         (3)    I want to see the results of trading using a 1% max loss per day and a 2% daily goal based off a $5000 account size.

All of my indicators, confirmations, and risk analysis that defines my edge is based on information obtained in Andrew’s book, lifetime Webinars, William's & Aiman Trade reviews, and the BBT website.

Edge Defined – I am trading 3 strategies.

Trading Plan: I plan is to trade (1) 5 min Orb, (1) 15 min Orb, (1) Moving Average crossover. If I do not trade a 5 or 15 min orb those trades can than transfer to the afternoon Moving average crossover trades.

Edge Criteria 5/15 Min Strategy: I have three parts to my trade plan: risk analysis, indicators, and confirmations

                Risk Analysis: 1:2 or Greater

                Indicators: Must meet 3 of 5

                                Trades within the ATR

                                Small share size with high volume

                                ORBO closes above VWAP/ORBD closes below VWAP

                                No large wicks (wick cannot be larger than body)

                             Close Should be close to the VWAP

                Confirmations: Must meet 2 of 2

                                Pullback towards VWAP in a “ꓥ” (long) or “V”(short) Direction

                                Rejection of VWAP with Moving Averages in a favorable position

Edge Criteria Moving Average Crossover Strategy:

                Risk Analysis: 1:2 or Greater

                Indicators: Must meet 3 of 5

                                Fails to make a new 15 Min High/low

                                9/20 EMAs cross the 50 SMA on 1 Min chart

                                9/20 EMAs sloping to cross the 50 SMA on 2 Min chart

                                50 SMA on 1 Minute is Semi-flat

                                50 SMA slopes are the same on the 1 and 2 min charts

                Confirmations: Must meet 2 of 2

                                Has a 5 Minute Setup

                                Has a 15 Minute Setup

                                MAs are above/below the entry point

Profit Taking Plan: I decided to completely overhaul my $ risk per trade and the $ account size I base my trading off of to be more in line with the teachings of BBT. (I keep only a portion of my equity in the CMEG account). So, I am seeing if I can grow an account that is smaller than my total equity. If I can't grow this how can I expect to grow my total equity. I figured I should use what BBT recommends as the minimum to trade with.

Account Size: $5,000

Max loss per Day: $51 or 1.02% of Account

                                 $ Risk Per Trade = $17

Daily Profit Target: $102 or 2.04% of Account

Partial Plan:

            Plan A – 25% Out 1R, All out 2R, profit target, or break even (minimum 1.75R)

            Plan B – 25% Out 1R, 75% out 2R, rest out at profit target or 1R (minimum 1.56R)

            Plan C – 25% Out 1R, 75% out 2R, rest out at profit target or break even (minimum 1.38R)

Share Size: I am taking share size based on a fixed dollar amount. Thanks to KyleK29 & fjmocke for the hotkey setup.

Daily Trading Goal: My daily trading goal is to trade only within my edge, stick to my profit taking plan, control my emotions, and be disciplined. If I meet these then it is a green day regardless of what my P/L says.

[Mike B 624]

August 14, 2019 - Stop and Partial ($BAC, $AMD)

Not too bad of a day today. I got stopped out on $BAC. I had a good entry and decent setup, but I did not manage it well once in it. I noticed the price action was bouncing off the 50 SMA and not breaking it several times. I should have exited near it and then re-entered if it could have broken the level. I exited at the stop but the squeeze filled me a little higher.

I than took a short on $AMD for 15 min ORBD and had another good entry. This trade I did not manage the profit taking according to my plan. I took an all out before the 1R level, mainly because I lost confidence in the trade. If I would have stuck to my plan I would have gotten a 1R and stopped at break even. It than gave the exact same entry as before and did the move I was looking for.

Not too bad of a day, very comfortable just not happy with how I handled the trades once I was in them. But for a middle Wednesday, I will call it a win. (biggest losing day of the month)

Sample Set Results,

S 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

[Mike B 624]

August 15, 2019 - Stop and Partial ($AMDx2)

Not too bad of a day. I missed my perfect setup on a 5 min ORBD at the open. Man it was perfect, I just hesitated a little bit because the five minute candle was above the VWAP. This lead me to take a bad 1^st trade on a pullback towards VWAP. I managed the trade well, it is just not my normal entry. Gave into FOMO.

My 2^nd trade was much better. Allow I got stuck in chop, it was my entry I like and I stuck with profit taking plan. It eventually hit 1R and I got a partial, and then stopped out at breakeven. The stock never hit 2R before hitting my original stop.

Overall a good trading day

Sample Set Results,

S 2 3 P 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

[Mike B 624]

August 16, 2019 -  Early Stop, Stop, and Partial ($AMDx3)

A pretty bad week overall. Out of 4 days, I only met my daily goal of trading within my edge once. I had an issue of getting into the trade before my entry appeared. I seemed to be a little more eager this week than in the past.

 

Overall it was a messy, messy day today. I took 2 trades way outside what I normally trade. 1^st one had my entry pattern, but lacked all the indicators and other criteria. I got out when it didn’t drop. I should not have been in this trade.

2^nd trade similar to the first. I was forcing my entry plan to meet and entered too early and got stopped out. Where I got stopped out was my indicator to start looking for a good 15 Min ORBO entry. I put the trade behind me and took another trade when the entry appeared.

I got a partial at 1R, 2R, and stopped out at 1R. 1 cent lower on the range order and I would have survived and hit my profit target. Oh well.

The best thing about this week although, I traded horribly and outside my edge, was that all of my loser were within 1R or less and the 2 winners I had covered the majority of losses. I was still down on the week but last weeks winners still out performed all of this week’s losers.

Sample Set Results,

S 2 3 P 5 6 P 8 9 10 11 12 13 14 15 16 17 18 19 20

[Mike B 624]

August 20 & 21, 2019 -  Profit Target ($AMD)

I did not trade on Monday as I had only 4 hours of sleep.

Well got an extra day of trading that I was not expecting to get. Actually about an extra 20 minutes. I had $KSS, $TJX, and $CGC on my watch-list today. $KSS and $CGC both opened up well below the VWAP and I was not going to get my edge, so I stopped looking at them. $TJX did not have volume at the open and was choppy around the VWAP, so around the 3 minute mark I decided to take a chance and looked at $AMD. It had just started selling off and eventually have me a pullback towards VWAP. I got my B+ rejection of VWAP setup, so I took an entry. I got a 1R partial and almost got the 2R partial. It touched it, but bounce off it quickly. I decided to take the partial anyways a little above it since a lot of Bids started coming in.

I set a range order for the profit target and I decided to set the break-even amount my entry instead of the 1R because the moving averages were above the 1R. I figured it would test the moving averages and either break down again or go back to VWAP. I could have exited one candle before my entry, but I decided that I would let it test VWAP as VWAP was below my break-even point by this time.

Sample Set Results,

S 2 3 P 5 6 P G 9 10 11 12 13 14 15 16 17 18 19 20