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

[Mike B 624]

January 23 - $MU

I had a decent day, but still having some issues with the montage input. I am going to do some remediation today on it. I am not sure what is but I will see with the DAS replay today what I keep messing up. Other than that it was a day to be patient. I had several setups in the morning and early afternoon, but just as they were getting to my entry order, the stock would reverse and break the setup, so  I would move on to another stock. $MU though was not bad today. I got a good entry at 58.71 and set my limit order to partial at 1R, except that instead of covering I added to my position. I quickly implemented my crisis response plan and covered some and set my break-even to may new average cost. Unfortunately, the stock pulled backed to this level and I exited. Had I not had this error the stock would have made it to my 2R level and the plan would have worked.

This is a perfect example of why you need to focus while in the moment and execute well. The good thing is that I did not get over excited and just managed what occurred after that. 

[Twin Traders (Bhavan & Bhuvan) 3]

1 hour ago, Mike B said:

January 23 - $MU

I had a decent day, but still having some issues with the montage input. I am going to do some remediation today on it. I am not sure what is but I will see with the DAS replay today what I keep messing up. Other than that it was a day to be patient. I had several setups in the morning and early afternoon, but just as they were getting to my entry order, the stock would reverse and break the setup, so  I would move on to another stock. $MU though was not bad today. I got a good entry at 58.71 and set my limit order to partial at 1R, except that instead of covering I added to my position. I quickly implemented my crisis response plan and covered some and set my break-even to may new average cost. Unfortunately, the stock pulled backed to this level and I exited. Had I not had this error the stock would have made it to my 2R level and the plan would have worked.

This is a perfect example of why you need to focus while in the moment and execute well. The good thing is that I did not get over excited and just managed what occurred after that. 

 

Hi Mike,

Beautiful entry and systematic journaling! Thanks for all the posts, it’s helping us a lot and especially your disciplined 20 sample set approach!

I was wondering if I might take a few minutes of your time to ask couple of questions.

I have been using Kyle’s hot key from past couple of weeks and I am seeing issues where my orders gets rejected while going long and short. I am using CMEG SIM and the below script for the long/short positions.

1. Should I change the route to LIMIT? Or is there anything I am missing in the below script?

2. And also should I change the time force to Day on the order template?

3. Could you please share your equalized risk per trade hotkey script and order template screenshot that you use on the CMEG for SIM and Live trades.

LONG:

StopPrice=Price-0;DefShare=BP*0.925;Price=Ask-Price+0.00;SShare=5/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price= Ask+0.05;TIF=DAY;BUY=Send;DefShare=200;TriggerOrder=RT:STOP STOPTYPE:MARKET PX:StopPrice-0.05 ACT:SELL STOPPRICE:StopPrice QTY:Pos TIF:DAY;

SHORT:

StopPrice=Price+0;DefShare=BP*0.925;Price=Price-Bid+0.00;SShare=5/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price=Bid-0.05;TIF=DAY;SELL=Send;DefShare=200;TriggerOrder=RT:STOP STOPTYPE:MARKET PX:StopPrice+0.05 ACT:BUY STOPPRICE:StopPrice QTY:Pos TIF:DAY;

Thanks for your time.

Brothers!

 

[Mike B 624]

3 hours ago, ShivaMani said:

1. Should I change the route to LIMIT? Or is there anything I am missing in the below script?

2. And also should I change the time force to Day on the order template?

3. Could you please share your equalized risk per trade hotkey script and order template screenshot that you use on the CMEG for SIM and Live trades.

Hey there,

1. You shouldn't have to change to limit. The only thing I notice different is you have no variance in your price. Everything is set to 0. I would try to change it to .01 and see if that helps. I have not had any issues getting filled at the prices I want with the scripts below.

2. Yes definetly change the TIF to "Day". Once you go live if your script or montage is set to "Day+" it will not execute. I learned that the hard way.

3. Here are my hotkey scripts

Live Script

Long

StopPrice=Price-0.01;DefShare=BP*0.97;Price=Ask-Price+0.01;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price= Ask+0.05;TIF=DAY;BUY=Send;DefShare=200;TriggerOrder=RT:STOP STOPTYPE:MARKET PX:StopPrice-0.1 ACT:SELL STOPPRICE:StopPrice QTY:Pos TIF:DAY;

Short

StopPrice=Price+0.01;DefShare=BP*0.97;Price=Price-Bid+0.01;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price=Bid-0.05;TIF=DAY;SELL=Send;DefShare=200;TriggerOrder=RT:STOP STOPTYPE:MARKET PX:StopPrice+0.1 ACT:BUY STOPPRICE:StopPrice QTY:Pos TIF:DAY;

SSR

DefShare=BP*0.97;Price=Price-Ask;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price=Ask;TIF=DAY;SELL=Send;DefShare=200;

Sim Script

Long

StopPrice=Price-0.01;DefShare=BP*0.97;Price=Ask-Price+0.01;ACCOUNT=TRCME0877;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price= Ask+0.05;TIF=DAY;BUY=Send;DefShare=200;TriggerOrder=RT:STOP STOPTYPE:MARKET PX:StopPrice-0.1 ACT:SELL STOPPRICE:StopPrice QTY:Pos TIF:DAY;

Short

StopPrice=Price+0.01;DefShare=BP*0.97;Price=Price-Bid+0.01;ACCOUNT=TRCME0877;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price=Bid-0.05;TIF=DAY;SELL=Send;DefShare=200;TriggerOrder=RT:STOP STOPTYPE:MARKET PX:StopPrice+0.1 ACT:BUY STOPPRICE:StopPrice QTY:Pos TIF:DAY;

SSR

DefShare=BP*0.97;Price=Price-Ask;ACCOUNT=TRCME0877;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price=Ask;TIF=DAY;SELL=Send;DefShare=200;

Let me know if this helps, or if you are continuing to have issues. 

[Twin Traders (Bhavan & Bhuvan) 3]

36 minutes ago, Mike B said:

Hey there,

1. You shouldn't have to change to limit. The only thing I notice different is you have no variance in your price. Everything is set to 0. I would try to change it to .01 and see if that helps. I have not had any issues getting filled at the prices I want with the scripts below.

2. Yes definetly change the TIF to "Day". Once you go live if your script or montage is set to "Day+" it will not execute. I learned that the hard way.

3. Here are my hotkey scripts

Live Script

Long

StopPrice=Price-0.01;DefShare=BP*0.97;Price=Ask-Price+0.01;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price= Ask+0.05;TIF=DAY;BUY=Send;DefShare=200;TriggerOrder=RT:STOP STOPTYPE:MARKET PX:StopPrice-0.1 ACT:SELL STOPPRICE:StopPrice QTY:Pos TIF:DAY;

Short

StopPrice=Price+0.01;DefShare=BP*0.97;Price=Price-Bid+0.01;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price=Bid-0.05;TIF=DAY;SELL=Send;DefShare=200;TriggerOrder=RT:STOP STOPTYPE:MARKET PX:StopPrice+0.1 ACT:BUY STOPPRICE:StopPrice QTY:Pos TIF:DAY;

SSR

DefShare=BP*0.97;Price=Price-Ask;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price=Ask;TIF=DAY;SELL=Send;DefShare=200;

Sim Script

Long

StopPrice=Price-0.01;DefShare=BP*0.97;Price=Ask-Price+0.01;ACCOUNT=TRCME0877;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price= Ask+0.05;TIF=DAY;BUY=Send;DefShare=200;TriggerOrder=RT:STOP STOPTYPE:MARKET PX:StopPrice-0.1 ACT:SELL STOPPRICE:StopPrice QTY:Pos TIF:DAY;

Short

StopPrice=Price+0.01;DefShare=BP*0.97;Price=Price-Bid+0.01;ACCOUNT=TRCME0877;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price=Bid-0.05;TIF=DAY;SELL=Send;DefShare=200;TriggerOrder=RT:STOP STOPTYPE:MARKET PX:StopPrice+0.1 ACT:BUY STOPPRICE:StopPrice QTY:Pos TIF:DAY;

SSR

DefShare=BP*0.97;Price=Price-Ask;ACCOUNT=TRCME0877;SShare=17/Price;Share=DefShare-SShare;DefShare=DefShare+SShare;SShare=Share;Sshare=DefShare-SShare;Share=0.5*SShare;TogSShare;ROUTE=SMRTL;Price=Ask;TIF=DAY;SELL=Send;DefShare=200;

Let me know if this helps, or if you are continuing to have issues. 

Mike !  Thank you very much for the quick response and for sharing your scripts. This is going to be super super helpful for us ! We are so fortunate to have a disciplined trader like you in the community. ! Thanks again for spending your time to answer my queries. Learning loads from your journals and posts...surely will learn more from you moving forward. I will let you know tomorrow how it went. Have a great night ! and Good Luck for tomorrow. 

[Mike B 624]

Jan 22, $MU

Got a nice setup early in the morning today on $MU and unlike yesterday, I executed the partials much better. I took a partial at 1R and my out at 2R. It did run a little bit past my 2R level but would never of made it to my next level. For me right now it all about sticking to a workable plan and executing it. I am not worrying about the few cents here or there that I miss out on, because when I was doing that I ended not getting those few cents on top of messing up my other partials. I have plan and I am sticking to it.

Ended the day at 1.5R and completed this sample set of 20 twenty trades. I am not seeing my orb strategy set up very often but I believe that is because of the current market. I am fine with it. I know it works and eventually it will start appearing again. Until than I will keep trading this moving average cross-over layered with Thor's PLBO.

See you all tomorrow in the chat.

[Rob C 826]

Hi Mike, great MU trade.

I have noticed you seem to be entering trades just before the MA cross over. Which is a great advantage if you can predict it. Is this planned? How do you do it? Do you enter the trade when the fastest time frame has the cross so it preempts the MA cross on the longer time frames?

[Twin Traders (Bhavan & Bhuvan) 3]

On 1/21/2020 at 6:39 PM, Mike B said:

Hey there,

1. You shouldn't have to change to limit. The only thing I notice different is you have no variance in your price. Everything is set to 0. I would try to change it to .01 and see if that helps. I have not had any issues getting filled at the prices I want with the scripts below.

2. Yes definetly change the TIF to "Day". Once you go live if your script or montage is set to "Day+" it will not execute. I learned that the hard way.

3. Here are my hotkey scripts

Hi Mike,

First of all nice trade on MU. Thank you for the hot key script...it worked great today. I had been struggling with order getting rejected from couple of weeks. I had 3 trades on SIM today and keys worked perfect. Good luck for tomorrow. 

[Mike B 624]

6 minutes ago, ShivaMani said:

Hi Mike,

First of all nice trade on MU. Thank you for the hot key script...it worked great today. I had been struggling with order getting rejected from couple of weeks. I had 3 trades on SIM today and keys worked perfect. Good luck for tomorrow. 

Glad to here. 

[Mike B 624]

19 minutes ago, Rob C said:

I have noticed you seem to be entering trades just before the MA cross over. Which is a great advantage if you can predict it. Is this planned? How do you do it? Do you enter the trade when the fastest time frame has the cross so it preempts the MA cross on the longer time frames?

Hey Rob,

Yes it is planned but my entry is more based on a price level breakout that Thor discusses; however, the setup is based on the moving averages crossing over. I will make a post tomorrow about the process with some screen shots. Basically, I am looking for 9 and 20 to cross on the 1 minute while sloping towards a cross of the 50 on the 1 minute, while at the same time the 9 and 20 on the 2 minute are sloping to cross the 50. Then I am moving to find the price level with a build up on the level 2 for the entry.

[Mike B 624]

13 hours ago, Rob C said:

Hi Mike

Hey Rob,

Here is a break down of what I look for on what I call a moving average cross over layered with Thor's PLBO strategy. The numbers coincided with the images below. For this example I am looking for a long.

1. After 7:00am I switch my layout to where I have 1 minute thumbs on my center screen and two trading screens on the side (2 second image). I am looking for the 9/20 to cross while sloping towards the 50 MA on these thumbs.

2. Once I see that indicator I pull the stock up and I look to see if it will or has made a new 15 minute low. If it has than I move on. I do not want it to make a new 15 minute low if I am going long.

3. I than go to the 5 minute chart and look or the same thing

4. I than move to the 2 minute and check to see if the 9/20 moving averages are sloping to cross the 50 MA.

5. I than determine if there is an entry point by looking on the charts to see if there is a price level that continuously is getting tested. If there is I mark it and than go to the Level 2 to see if there are orders building up on the other side of that level. If there are, I check the risk to reward, then input a stop limit order for the entry just above that level.

Let me know if that helps. It can be confusing as it has a lot of moving parts. I got eaten alive in August because I didn't really have a defined area to take an entry. Once I added Thor's price level breakout to it. It has been producing solid results.

Edited January 23, 2020 by Mike B

[Rob C 826]

Mike, thanks for the explanation. Let me know if this is correct:

1) 9/20 cross on the 1min

2) 5/15min low/high in the wrong direction vetoes trade

3) 9/20 sloping towards 50MA on higher time frames

4) Watch/wait for support/resistance levels.

5) Entry on L2 signal beyond the support/resistance levels.

So which longer time frames do you need for step 3? I know the more the merrier. But is 2min enough or you need it on 2/5/15min?

Do you look for the min of 3 touches of the support/resistance like Thor? Do you need to see a ascending/descending triangle?

How large of a Bid/Ask do you need to see to call it a signal?

Thanks again. Due to my recent start in swing trading and looking for a good entry, I inadvertently started taking trend trades. Which I now better learn fast before the bull market disappears.

[Mike B 624]

1 hour ago, Rob C said:

So which longer time frames do you need for step 3? I know the more the merrier. But is 2min enough or you need it on 2/5/15min?

Do you look for the min of 3 touches of the support/resistance like Thor? Do you need to see a ascending/descending triangle?

How large of a Bid/Ask do you need to see to call it a signal?

Hey Rob,

1. I use 2 minute for step 3 only. If I get more that is better

2. I will trade it on the break out of 2 if the level 2 support it, but I prefer 3 touches 

3. The ascending/descending triangle almost always appear because of the requirement of no new 5/15 high/low.

4. It depends on the stock, I prefer it to not be equal. Meaning you can tell there is more bids then asks or vice versa.

 

[Rob C 826]

1 hour ago, Mike B said:

 

2. I will trade it on the break out of 2 if the level 2 support it, but I prefer 3 touches 

 

 

Mike,

Any particular time frame (1min chart?) you look for the resistance/support touches?

[Mike B 624]

1 hour ago, Rob C said:

Any particular time frame (1min chart?) you look for the resistance/support touches?

I usually look on the 1 or 2 minute chart for the touches. Once you start looking for them you will be surprised at how easily they jump out at you. 

[Mike B 624]

Janaury 23, $PCG

I feeling a little behind the markets all day today. Missed a 5 min Orb on $MU, and a 15 min Orb on $JD. I knew coming into today that I was just not on top of my game. I wasn't tired but I could just  feel my mind was not operating at the speed it was the past couple of days. I was able to keep myself calm and I got a setup for a breakout on $PCG. I was a little worried about it prior to entering because, I just like the previous trades, I had missed my normal entry. If you look you can tell the entry came on the second time it broke the price level. When I saw it hold the moving average and go for the break, I decided to enter anyways. I should have moved my stop up from my original stop and it would have given me a better risk to reward. I ended up cornering myself and introducing added friction to the trade as I was on a time crunch with taking my daughter to school and I had not gotten the partial yet. I have no plan for this situation, so tonight I developing a plan when this happens again. I was lucky and got the partial prior to leaving and set a range order for my 2R level. As it is a morning trade I only look to get to 2R on this. Overall, a good day  and I will take it. I am not worried about the run afterwards, because it in not within my current plan. Maybe later I will start at looking to take advantage of these.

Once I get through 20 of these moving average breakout trades, I am going to consider looking at increasing my risk per share. But for right now I need to gather data on this setup.