Gejordan Weekly Journal

I don't know if anyone other than Rearden is following along, so I did this set of trades for Rearden's benefit, but if anyone else is following along, look at the picture and see what you think, take note of your feelings about what you see, and then read the rest of the post.


So, we made a high on Wednesday and ended the day and started the next running back at the high, but failed and went back to the pivot. I have seen this a number of times during the exercise and the majority of time hasn't worked out well. BUT, I took these trades because I noticed some things in Rearden's journal and I wanted to make a point to Rearden. Once you have learned trading this way, you easily see what others are struggling with, especially on this forum where we have to type out our thoughts.

I know these are low probability trades, but they are the "out of the box" basic trades of the exercise. In up bias, up move, enter a trade from the 50 and pivot. Rearden is struggling with things seen and should I deviate from basic rules to incorporate things seen. Now, this sounds easy enough, but when you see something during the exercise, you immediately want to see if you can find 100 other things. If you've traded before, you already have 1000 bad ideas from everything you've ever read about trading. If you hang out on FF, you already have 10,0000 bad ideas locked in the noggin.

During the exercise hopefully things will be learned just from the few things on the chart. I only have a s50 and pivot, along with lines I use to make the swings. I've learned 4 things and am on the brink of a 5th thing. The 4 things are listed a few posts above.

Now, based on what I have learned to date, I shouldn't still have these trades open. I learned this lesson in Things Learned #1. It was some of the first things learned a few months ago. I know there is danger in these trades and even if I missed the signs and found myself in the trades, I have learned I can close them on a close and stay below the 50 and pivot (which Rearden did).

But even if I opened them, and didn''t close them, and then opened more from the bottom... ITS NOT A BIG DEAL. I am in the exercise. I am not getting rich or going broke in the exercise. I AM LEARNING. I clearly see again the trouble of the trade, the place I could close the original trades, the place I could have closed the lowest trade and reduced the net loss to almost nothing. More data points.

If you are doing the exercise and find yourself mad about how you handled anything, hopefully you identified that anger or fear, etc. That's the point. But also identify that having those emotions tells you your grip is still way too tight. Make sure you address that... don't start going through the mental rolodex of 10,000 bad ideas.

I'll ride these trades out, they will work or they will not. I will not be broke, I will not be rich from it. But, I will have further learned something.

Had to go out of town on business... what did I learn from last week in the exercise?

Look at the picture...


What can I take from this.... Well, to me, it's clear... don't be scared to close a trade. In both instances, there were clear signs to get out of the trade. And in both cases, the loss got worse by not closing them out.

When I started trading, I never wanted to close a trade. I wanted to be right. As I have typed on here at least a hundred times over the years and covered in old videos... Trading isn't about being right, it's about being profitable. In real life, would I take losses like this.. no. But in the exercise, I can, and I can pound in my brain that trading isn't about being right.

In the upper example, which I already talked about, I could've actually taken the trade from the white line and closed it back at the s50 and been net profitable. As for the other day, I could've lost 20 instead of 60.

This is a big deal and makes a HUGE difference.

Next, I love that price went back into an up move in an up bias and FAILED. IT HAPPENS. Deal with it. But deal with it by taking a small loss, not a huge one.

Now, to continue... new week.

No Bias, Down Move. Let's review what I've learned.

1. Bias week - Opens below s50 and pivot on Up Bias week (or reverse in Down Bias) in a range a problem. Wait to bottom of range or close back above s50 and pivot and enter on retrace.
2. Switch from Bias to No Bias - Use caution, watch for failed new highs (lows) as price may reverse.
3. No Bias weeks - Be less aggressive, possibly look to bigger chart and see where you are.
4. Bias week, Opposite Move - If bias up and move is down, take a trade on a close above and stay above the s50 (opposite for down bias, up move) IF the s50 is moving in the direction you want to go. See Rearden put this in action here. See the s50 working against me here. Notice the down moving s50 the day before my entry. Versus the up moving s50 the day before Rearden's entry.

So, now I have to put my mindset back into #2 and #3. #2, use caution on the switch. If price moves back into an up move, be less aggressive. #3, look to the bigger chart. On the weekly, price in an up move an pulling back. Price could turn here, or 1.1880, and swing down at 1.16. I'll keep those in mind, but main focus will remain on the hourly chart.

So, this week, NO BIAS, DOWN MOVEMENT.

Last week, no trades. Why? I could have traded... but, I put my mindset into #2 and #3.

I didn't rush in at the beginning of week. Price tried to go lower and failed and then immediately headed up. I also mentioned in the last post about #3, see where you are, and I made the comment I wouldn't be surprised to see us go up... and we did.

The thing last week really brought to light, was risk, reward. The rules of the exercise only allow me to trade with the move and bias, but what I noticed this past week, is where the places are that might offer good risk reward against the move and bias. I didn't act on them, want to follow my rules, but the idea of not always taking a trade helps really see the good places to trade, bias or not.

As for this week, Price opened between the pivot and s50, so an attempt to go short from the top of this range was where I wanted to trade from. I missed it, didn't get to the charts last night, but, this was the time to try again. Now, I'll monitor how I feel about missing the trade (feel fine), and see where we are tomorrow.

Down Move - No Bias

Took the one I missed the other day. A basic short during a down move from the top of the range. Price began the day below the 50 and pivot the other day, entered an order at the 50. It did close back above both the 50 and pivot, but such low risk, I kept it on.

40 solid pips with things in my favor.