Ratios & Harmonics: a Different Way to Trade

Learn from it and keep moving forward you are doing

Thank you for the welcome Mr Pip, I am 100% looking forward to to this journey.

A bit of pain today. I do not like to enter, when price did not correct somehow. NQ was more appealing to me (was a bit to aggressive with my trades, but went well).

Bad days happen bro, but keep your head up. The only thing I noticed that could have been done differently in this situation is that price broke structure on the short term to the left and you shorted right into structure. The rotation candle was pretty weak as well in comparison to the intense bull candle it followed. Best of luck trading and I hope this helps some.

Hi fellow traders,

This is my humble attempt to pay something back to the thread that has given me so much.

I won't go into charts as there are plenty of those already and Mr. Pip himself explains the flow regularly on his videos or live trading sessions.

But instead I would like to talk about probabilities as I have noticed many new comers being worried about failed trades. I understand that a confirmation of reading the chart correctly is in place after a failed trade, but it will always be offered with hindsight and there will always be another NSL or NSH to be found on a different timeframe. As long as you follow the swings of the timeframe you're trading, your trades will succeed and fail with a certain percentage. And that's something everybody just has to accept. What matters is, how many times would that same situation have failed out of 100 and what would your R gain have been. A single trade doesn't mean anything (except offers an opportunity to learn from mistakes, if any).

I ran some Monte Carlo simulations with excel (I know the random number generator is questionable, but is more than adequate for this purpose).
I ran 500 trades 100 times with different win %. 60, 70 and 80.
I came up with the following numbers, the maximum consecutive losses for 60% was 11 trades (happened twice during those 100 runs), 10 for 70% and even 80% had a max of 7. Averages were 6.3, 5, and 3.7.
To me the numbers came as surprise (of course 100 sets give big extremes). I know the biggest numbers aren't really likely to happen, but it can happen or put differently, will happen if you take enough trades.

I don't know how many of you have ever thought of losing streaks and how long they can be even if the odds are in your favor (heavily, in case of win 80%). It just shows that you might lose many trades in a row even though you're doing everything perfectly right in terms of expectancy. Of course your system has to be a profitable in the first place.

The way to reach Mr. Pip's calm and emotionless way of trading is to think in probabilities and focus on the process as he has so many times repeated. You can't change the results of a single trade, you'll get what the market offers. But you can improve your process.

I myself am training to reach the right mindset by trading in sample sizes of 30. When I start a new series, I know my maximum drawdown and fully accept it and then while the set progresses I can see the max dd getting smaller and smaller after each BE or win. And at some point (last time happened after the 21st trade) the max dd is equal to my starting equity and everything that I can make is just pure profit. This experiment has helped me a lot to distance myself from the results of a single trade and just focus on the bigger picture. For example where can I afford to TP in order to have high enough RR to be profitable, I had a habit of closing trades too early, still do actually, but my numbers have improved a lot.

Something to read: Mark Douglas, Trading in the Zone (I think someone mentioned this book earlier in the thread). Spot on about probabilities, beliefs and mindset. But there might be better ways to close trades than the early closure of 1/3 that he suggests. My stats (for my trading) show that it is more profitable for me to keep my positions open longer than what he suggest. I keep comparing 3 or 4 different ways of managing my position after I've taken a trade. And Mr. Pip favors a different method too.

I hope this made any sense and you all didn't fall asleep as soon as you started reading this.

Happy pippin'

Good morning,

Today gonna start small account in live trading. I think emotions will be much different and will get more experience to control feelings.
Unfortunately with free ninja is very hard to trade because there are no SL and TP so probably will have to look at Ninja and take trades on MT4. First entry here:

Reached last highs, setting my SL at BE as blue line..

Maybe im giving back too much to the market but i still waitting to complete this intraday harmonic to take profit. Will close if price will go below this second small leg.

London just opened, lotsa new participants.

https://www.youtube.com/watch?v=Jn92jhHN0_4

Closed at 38% seems bulls out of strength.. Let's see where correction goes maybe we will get back.

EU kicked me out of the bus yesterday.
Looking to long in this general area. ABCD shorter term completion, 1,618 extens + good structure , at my area of interest ( depth - projection - momentum)

USDJPY Analysis

Intraday: NSH

- Price made a NSH 30 min before market open
- 3 different harmonic completions at NSH

Expectation: Price is accelerating to my golden zone. Bears are moving strong, however expectation is still a NSH until the main swing structure is broken. Will wait for what price does in sometime

Long term: NSL

- Market is overall bearish and correcting quite deep
- Going with intraday expectations

Update: longed around the 61.8% fib
Lets see what mood the EU is in today, at the LO session. Keep you guys updated

Expectation is a NSL

Might miss entry but expecting deeper correction due to low NSH. Let's see.

Stopped out next, probs because of the Catalonian referendum, EUR lost his strength quite quickly, didn't hope for that.
Current status, trades: 3 wins:0 losses: 3.

But that is alright, currently trying to deal more with the psychology of the trading itself, it was a good trade setup according to my tradeplan, so no need to feel bad about it. moveon.com, only thing that counts is the next setup

Took a stupid shoot for a long but momentum kick in to my teeth. Expectation changed for a NSL.

short