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Dbrown101's Training Wheels

  • #1
  • First Post: Edited 2:34pm May 15, 2018 1:27pm | Edited 2:34pm
I've finally decided to create a trading journal to document my journey into the world of the forex markets .Part of the reason I am making this journal is to have an environment where like-minded traders can discuss, critique, and contribute to the growth of eachother. So feel free to post if you have any questions, comments, or suggestions. That being said... Please be respectful and considerate to others. Those who cant leave their insults and negativity at the door will be blocked.

Trading Method:

My MO is based off the Technical Analysis Fallacy thread. I am NOT affiliated with FTI or anyone else on the TAF thread. The way i trade is based off of my interpretation and understanding of the teachings in that thread. Although I try to adhere to his teachings as close as possible i may differ from what was taught there as I was a late comer and missed the opportunity to discuss with him the things i didn't quite understand. Nevertheless, this will be my attempt to put his teachings(as I understand them) into practice.

I will not be giving a brief summary of my MO or what is in the TAF thread. For those who are curious here is a link:
https://www.forexfactory.com/showthread.php?t=57639
everything is in the first 200 pages but there is a ton of valuable information throughout the entire thread.



I'll see you on the battefield!
  • #2
  • May 15, 2018 3:01pm May 15, 2018 3:01pm
Hi dbrown101

Well done for starting a journal, can be hard going at times as it can add a little extra pressure on the trading, always good to see what others have got from the TAF thread, will be reading as you post, do not let other people’s (no matter who they are) bias or sway you, test everything for your own satisfaction and make your own mind up on how well (or not) they work for you, as our friend FTI says take what is useful to you now and discard the rest (for now)… things tend to click on our journey that we first may of thought not that important.

I am off to bed now, good luck my friend.

Regards

Phil.
-be careful about what you allow to be put in your mind-
  • #3
  • May 15, 2018 8:47pm May 15, 2018 8:47pm
Quoting phil13
Hi dbrown101 Well done for starting a journal, can be hard going at times as it can add a little extra pressure on the trading, always good to see what others have got from the TAF thread, will be reading as you post, do not let other people’s (no matter who they are) bias or sway you, test everything for your own satisfaction and make your own mind up on how well (or not) they work for you, as our friend FTI says take what is useful to you now and discard the rest (for now)… things tend to click on our journey that we first may of thought...
Phil,

Thanks for stopping by! As for the highlighted section above...I agree. In the end its all up to me to figure out what works for me. However, I am always curious as to what i can learn from other people and their experiences. I was hoping TAFers that were still around would contribute to the learning process if it suits. You stumbled on this thread pretty quick. Please feel free to offer your input wherever you can. Or just stop by to say hello!

Dustin
  • #4
  • May 16, 2018 12:15am May 16, 2018 12:15am
So here it goes! my first trade post...

For anyone reading or following please bear with me. It might take a sec for me to get used to posting trades and articulating my trade ideas efficiently.

Although this is not my usual MO i thought i'd post Tuesday's trade because it may offer insight to how i pulse the market. The reason I say it's not my usual MO is because this trade was left unattended with a SL in place( this is actually the first time i've left any trade unattended since starting the TAF thread). Although overnight positions are allowed in TAF MO as long as they are scout size and with the day trend most of my trades are babysat until i exit them. This trade was done with a small scout and foreign capital as a cushion in case i sustained any loss. Plus i was in the direction of the D1 trend.

The reason took this trade is pretty simple. Although i do not use the D1 to place trades i do use it as context to determine where price is in the grand scheme of things. I use it to see the bigger picture and to be aware of possibilities. As you can see in the first chart, the D1 trend is down with a couple day bars in retrace mode. The 1 hour showed an impulse(1) in the direction of the D1 trend and then stalled(circled area). This created a pin-bar on the D1(i dont read too much into pinbars or other single candle formations but it seemed like a good sign the D1 trend was going to kick in). While in the circled congestion phase i looked for opportunities to enter to catch impulse (marked 2) on the 1h chart. Once i saw signs of selling on the 5m i took the trade. Entry and exit are indicated on the 5 min chart .I manually closed before the US news at 5:30 pst because i dont trade during news release.

Profit: +43pips
Attached Image(s) (click to enlarge)
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  • #5
  • May 16, 2018 2:13am May 16, 2018 2:13am
Hi Dustin

There seems to be a big misunderstanding around the use of stops and the TAF thread, what is meant (and I have seen and discussed this with FTI), is not to rely on them to save you or constant use in some sort of money management, it is better for us to take full responsibility for our trades and manually manage the trade as you have been doing (helps create a better mindset), stops have their place and use in such things as protection for profit in cases of overnight trades for example, we must understand a stop is a not fool proof way of protection, if price gaps or moves quickly you will be stopped out at the price the broker can achieve as soon as the stop level is passed and that could in some cases be very far away from where you intended to achieve.

Nice analyse and use of the TAF MO for following the impulse on that trade you have shown.

Regards

Phil.
-be careful about what you allow to be put in your mind-
  • #6
  • May 16, 2018 2:27am May 16, 2018 2:27am
interesting, subscribed
  • #7
  • May 16, 2018 11:15am May 16, 2018 11:15am
Quoting phil13
Hi Dustin There seems to be a big misunderstanding around the use of stops and the TAF thread, what is meant (and I have seen and discussed this with FTI), is not to rely on them to save you or constant use in some sort of money management....
Phil,

Thank you for clarification regarding stoplosses. I didnt mean to sound so anti-stoploss. Stoplosses are tools and just like any other tool, they can be used correctly and incorrectly. As i understand it tight stops upon entry to control risk:reward ratio can actually be counter productive and take you out of position when your original analysis is correct. I prefer to use them as an over-loss protection and keep them out of harms way if possible.

For example, in the chart posted...A was the support that caused the D1 retrace so some people getting long there. B and C probably enticed some of the traders that use "predictions" to place trades. Those traders (seeing that potential double bottom of B and C and looking to get long) are probably looking for another bounce place stops just below those levels to control their "risk/reward ratio". At least that's what i feel is taught as a "good money management practice". Once price breaks that level and hits their stops it causes a self feeding run because it turns those buyers into sellers when they are stopped out. Break out traders hop in a push it down further and creates an impulse. At least that is how i understand it although i am still investigating the scenarios in which this may occur. It's hard to tell what is happening on the other side of the screen that's why i just try to flow and react. It's hard to know the exact reason why things are happening. the most important thing is staying in the "now". Please let me know if my thinking is off the mark. Im sure this is something you take in to consideration. I am just thinking aloud so that my thoughts are recorded here...
Attached Image (click to enlarge)
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  • #8
  • May 16, 2018 11:31am May 16, 2018 11:31am
Quoting dbrown101
{quote} Phil, Thank you for clarification regarding stoplosses. I didnt mean to sound so anti-stoploss. Stoplosses are tools and just like any other tool, they can be used correctly and incorrectly. As i understand it tight stops upon entry to control risk:reward ratio can actually be counter productive and take you out of position when your original analysis is correct. I prefer to use them as an over-loss protection and keep them out of harms way if possible. For example, in the chart posted...A was the support that caused the D1 retrace so some...

Hi Dustin

yes, you are bang on right about how that works and why tight stops can cause us to lose trades.... well done you have a good understanding of it.

regards

Phil.
-be careful about what you allow to be put in your mind-
  • #9
  • Edited 12:09pm May 16, 2018 11:58am | Edited 12:09pm
Last nights trade

Terrain:
1D trading down
1h Still trading down

I was a Eur/Usd bear. Had to be cautious as i was selling into an area where buyers were lurking(D1). So had to keep my positions small. Here is a chart of the terrain layout. Level 1 is possible rescue area. I usually consider any rescues or re-averaging before this area as "buying on discount" which gets me a better average for the impulse. If price goes past this level i may look to unload positions(depending how much i have) in order to reduce draw down and make rescue cheaper should it reach level 2. If it breaches level 2 i wouldve cut and called it a day.
Attached Image (click to enlarge)
Click to Enlarge Name: h1 new.png Size: 28 KB



Entry: first entry was scout (1)
second entry was (2)
Ro3k gave me the signal for that 2nd entry. At the beginning of my session the gbp/yen was tearing so the 3k were a little out of sync. I saw the gbp/usd realign and decided to enter again .gbp/usd and usd/jpy were leading by several bars and the Eur was a bit behind which made for easy timing.
I ended up closing at break even because i was exhausted. It was 2am here. I am on PST. Quite possibly the worst trading time zone London opens 12am and New York 5am. Need to up my coffee intake because i missed a good run down of about 90 pips that i was positioning for.

squared: 0 pips
Attached Image(s) (click to enlarge)
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Click to Enlarge Name: entry 2.png Size: 35 KB
  • #10
  • May 16, 2018 12:55pm May 16, 2018 12:55pm
Just For Fun...

I am not an elliotician. I dont use wave counts to predict anything. I take note of possibilities...
this may not be a correct analysis of a 5 wave structure. It's just something im taking note of
3 impulses , 2 corrections= 5 waves... the last impulse has already retraced more than 50%
to the 61.8 fib to be exact but i don't use that either. Another pin bar developing on the D1 pointing North...
just thinking out loud...possibilities.
Attached Image (click to enlarge)
Click to Enlarge Name: eurusd-h1-gain-capital-group.png Size: 26 KB
  • #11
  • May 17, 2018 12:28am May 17, 2018 12:28am
Quoting dbrown101
Just For Fun... I am not an elliotician. I dont use wave counts to predict anything. I take note of possibilities... this may not be a correct analysis of a 5 wave structure. It's just something im taking note of 3 impulses , 2 corrections= 5 waves... the last impulse has already retraced more than 50% to the 61.8 fib to be exact but i don't use that either. Another pin bar developing on the D1 pointing North... just thinking out loud...possibilities. {image}

very nice sexy legs eh
  • #12
  • May 17, 2018 1:37pm May 17, 2018 1:37pm
After reading others journals and starting my 3rd read of the TAF thread i find myself intrigued by the concept of stop runs and 'trapping' traders. On one hand these can create impulsive runs, on the other i've read that they can be traps for unsuspecting victims. .This is something I am trying to fully understand. I need to do more research.

From TAF thread: https://www.forexfactory.com/showthr...48#post1735948 read full post for better understanding

FTI:
"His modus operandi, is to "duck and move quickly"
so as to have a better average on the up swing towards stops to maximise his shorting near the top of the swing.
This scenerio is most effective if there are stop near levels where he las a large order to sell,
where he can help the customer sell OB and "kill the sitting duck stops" in the same blow.
Another senerio is where by the heavy selling is CB levels or specific sell zones,
where many teir 1 are ready to pounch on the buyers.
You must understand that only tier 1 and some big tier 2 will have this advantage."
Attached Image

As, I understand it, seems like this chart that was posted a couple pages later is a good example of this. That last run of up before the big sell off may have been what FTI was talking about above. buyers took price up to that previous level and ran the weak bears stops causing the breakout above the level. Then price was pushed back down causing the long wicked candle(maybe because of the scenario fti described). Everyone who went long on that run and especially at the top is now trapped(ambushed). price gets pushed lower and tiggers those longs who placed their stops and essentially converts them to shorts (thus the rubber band). the reason i am posting this is because I feel like I see this scenario and ones like it fairly often.

That being said...I have no way of knowing what is actually taking place behind the screen. All i can do is create the different scenarios in my head of why things are happening on the charts. In the end its all about the "FLOW".

FTI:
"There are many lessons in markets, cannot learn by making terrain. Need adjust to it.
You talking specifics.
I cannot talk to you specifics. was situational examples.
and they not even real, just the feel flow as at. you can understand?
when you try learn by disecting you becomes rigid.
learn it from the flow, from the situations.
Was just he moved i responded , he moves i responded, because i market maker(vested interest)"
  • #13
  • May 17, 2018 7:44pm May 17, 2018 7:44pm
Quoting dbrown101
learn it from the flow, from the situations
But to feel the flow you need to have a technique or some sort of tool don't you think ?

Just as in when you're learning to play an instrument you have to learn the tools to play that specific instrument "notes" thats your tool but just because you've got tools doesn't always mean you have a technique so you use the tools and master the technique just then you'll be able to flow as great musicians do they make it seem so effortless and improvise - I liked that he emphasized "feel the flow" initially but not soon after I was slapped in the face for feeling the wrong flow lol, that's a very vague term "feel" even for art you need technique, "the right" technique.

But I do understand why he kept emphasizing "feel" aspect rather than "analyzing" because it is alive, it changes and shifts nothing is constant so rigid ways to see the markets will never be sustainable in the long run.

And back to my music metaphor you have your notes and when you play it over and over again it never quite sounds exactly the same each time there's settle differences maybe only recognizable to the musically inclined as in trading you see a situation a set of patterns and you think you recognize it from memory but will it still produce the same outcome as it did in the past OR is there any settle differences and visual cues that suggest it's going to be different this time around ?

I tried memorizing scenarios and patterns they never worked exactly the same, there's always a change, even if it does what I expected it to its never quite the same. So tools are a must and I better master the "right technique" before I go on feeling the flow. Only then I'll be able to feel the right flow and improvise - consistency - profitability.
...
  • #14
  • Edited 3:18am May 18, 2018 2:57am | Edited 3:18am
Quoting dbrown101
After reading others journals and starting my 3rd read of the TAF thread i find myself intrigued by the concept of stop runs and 'trapping' traders. On one hand these can create impulsive runs, on the other i've read that they can be traps for unsuspecting victims. .....
trend + orders: where are they/who are they/reactions... there's a lot going on. Still trying to pull it all together in market place - trying not to be a duck too often. I think they feel each other where they are/what they are doing and we need to try and learn this feel: if there is a strong push then what is behind it and what comes next.

So on chart above at top if I had lots to sell I need peeps to buy from me at my price please. On bottom if I have lots to buy I need peeps to sell to me please ( breakout traders)

FTI:
left hand side on price charts, is basically the prices that were traded and the general volatility of the price gyrations.
right hand side is blank space for you fill in the new data that comes on stream.

trend is basically flow. It will continue in direction of its flow until it meets stronger forces to stop it in it tracks and/or reverse it.

"projections from historical prices" , in dealing is known as bias

right hand side of chart, its alive, left hand side of chart is dead.

supports bids exist on the right side of the chart. not on the left.
the left tells you where they will set traps for you.



Alex
check out the terrain - follow never lead
  • #15
  • May 18, 2018 9:28am May 18, 2018 9:28am
Quoting alexandria
{quote} trend + orders: where are they/who are they/reactions...
Today at lunch - I watched as they set up some nice weaker down waves to go hunt some stops for more selling after such a long down run. After the last strong down candle (selling zone at start of it) they knew they had reeled in sellers (they can see the orders) then such a strong push long which ran out of steam.



Alex
check out the terrain - follow never lead
  • #16
  • May 18, 2018 10:53am May 18, 2018 10:53am
Quoting alexandria
{quote} Today at lunch - I watched as they set up some nice weaker down waves to go hunt some stops for more selling after such a long down run. After the last strong down candle (selling zone at start of it) they knew they had reeled in sellers (they can see the orders) then such a strong push long which ran out of steam. Alex
Alex,

Welcome! Thank you for the FTI quote. It is a good reminder that a trade is not defined by whats to the left of the chart but what is on the right side. Are you talkin about the Eur/usd? where they swept both sides before the drop down?
Attached Image (click to enlarge)
Click to Enlarge Name: eurusd-m5-gain-capital-group.png Size: 20 KB


that run up to the pin bar on the right of the red box may likely be a scenario like the one i posted above from TAF. A place for bulls to gun stops and try to trigger a run up. Even better ambush for those with sell orders to pounce on unsuspecting victims and get in at a better price for the run down. people looking to make stuff happen. Still learning and more research and observation are needed needed.
  • #17
  • May 18, 2018 12:57pm May 18, 2018 12:57pm
Quoting Piquant
{quote} But to feel the flow you need to have a technique or some sort of tool don't you think ? Just as in when you're learning to play an instrument you have to learn the tools to play that specific instrument
Piquant,

Have you read the TAF thread linked in my first post? If not i suggest reading through the first 200 pages and when you've done that...do it again and again. It takes multiple readings and lots of contemplation to extract all the information. I myself am on my 3rd or 4th read ( i think its actually my fourth). I am still gaining new insight from posts I have read many times before. The reason I suggest this is that FTI presented valuable tools and insights into trading the markets. The thing is a tool is just that...a tool. The efficacy of the tool is dependent on the user and his experience with that tool. (an electric saw is a great tool but using it incorrectly can cause serious damage).

Quote
that's a very vague term "feel" even for art you need technique, "the right" technique.

"feel" is gained from experience. The act of doing...and deliberately refining that process. the more you practice and DO the less vague "feel" will be.

I have been a musician most of my life playing gigs, touring the country so i can relate to the music analogy. Maybe I can relate my experiences to the market . Maybe it will help you understand my point of view.

In music i learned many things that i would consider tools. Songs, chords, scales, theory, ear training, licks(musical phrases). In the practice room i try to internalize these tools as much as possible. I practice them over and over and analyze how i could use these different tools in different scenarios to serve the music. That process becomes so internalized that when i step on stage i am not thinking about it. A lot of the music i play on stage is improvised. When i am in the head space I just listen and flow and react. The band goes one way I follow...someone hits a bad note...how can i make it sound good? Is the band about to trainwreck(music falls apart)?....can it be saved or is it time to cut and move on? How do i differentiate between a good night where the band is on or a bad night where the band is off....by how it "feels". They are subtle nuances gained through experience .By learning tools, using them, refining my skills by DOING I develop "feel".

Similarly, I learn different tactics (trend, pattern,candelstick analysis,money management in trading) i analyze charts and i see where i could've used those tactics.(always in hind sight thats why its better to gain experience through doing). I analyze after each trade. what did i do right? what did I do wrong? what could i have done(also in hindsight). But when i am in the trade my mindset is the same as if i were on stage. What is the market doing? how should i react? are we in sync? .

Quote
I tried memorizing scenarios and patterns they never worked exactly the same, there's always a change, even if it does what I expected it to its never quite the same. So tools are a must and I better master the "right technique" before I go on feeling the flow. Only then I'll be able to feel the right flow and improvise - consistency - profitability.

The trick is learning to adapt.Some tools are one trick ponys. Other tools you can modify and adapt to the situation. there are some musical phrases i can improvise over just about anything. some musical phrases fit in to specific spots. The point is to learn when and where to use each tool and maybe more importantly...when not to use them.

I hope I am not confusing you further. I could keep going on and on...but i am not a guru....nor am i trying to be
take my advice with caution... as my thread title suggests im still a noob trying to figure it all out
  • #18
  • May 18, 2018 1:11pm May 18, 2018 1:11pm
Piquant,

As a final note, one way i developed my technique and feel for music is learning from the "masters". I learn their music, i dissect every bit of it. I try to get inside their head. I begin to see things as they MIGHT have seen it. I can begin to develop their feel. This is how some musicians end up sounding like their influences. In the end you will develop your own....

this is all based on my musical knowledge

as for the markets. we'll see if i can put my money where my mouth is haha
  • #19
  • May 18, 2018 2:01pm May 18, 2018 2:01pm
Quoting dbrown101
{quote} .....Are you talkin about the Eur/usd? where they swept both sides...
Yes exactly. except they were not sweeping both sides to me at the tine this was war ...news around so RoK important too....to me in live while I can still feel it..so much down so who will buy from me ....oh yes waves down will set up some stops from weak bears and some breakout traders ...so I can sell and they did.. so much buying tho and Friday end so not surprised deeper buying came next after run down. Not sure exactly but just what I felt.


Alex
check out the terrain - follow never lead
  • #20
  • May 18, 2018 2:37pm May 18, 2018 2:37pm
Quoting alexandria
{quote} Yes exactly. except they were not sweeping both sides to me at the tine this was war ...news around so RoK important too....to me in live while I can still feel it..so much down so who will buy from me ....oh yes waves down will set up some stops from weak bears and some breakout traders ...so I can sell and they did.. so much buying tho and Friday end so not surprised deeper buying came next after run down. Not sure exactly but just what I felt. Alex
I see. So let me if i get this. you're saying the first wave in the box down was a set up to entice bears to get in and place stops. which the market reversed and took those stops making the bears now buyers and so they could sell to them? Definitely something to ponder.
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