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enoc's psychology&probabilities thread

  • #1
  • First Post: May 17, 2007 1:20pm May 17, 2007 1:20pm
Im creating this thread in order to share some of my thoughts on the mental aspect of trading and how that combines with actual edges which present themselves to me and how I react to them. Any thoughts or ideas on a similair level are welcomed.
  • #2
  • May 17, 2007 1:27pm May 17, 2007 1:27pm
At the moment im looking at cable and seeing plenty of support at the lower end, including 123 pattern macd divergence and all the usual patterns which point up... price is attempting to draw me in to a trade however I will exercise retraint and wait for a clear move, short term trend is apparently down for now, will consider a long entry only after a clean breakout up and fib pullback to support, I will not enter long unless i get this setup for a long side trade... I will not go short until the lower range beneath 9730 is broken.

Price finding resistance at previous range low, ie 9750 level. Must stand aside and wait for the above edges to emerge.
  • #3
  • May 17, 2007 1:51pm May 17, 2007 1:51pm
Reasons I would NOT take a trade at the moment,

1. low volitility
2. nearing asian session will look for range to form during this session and size up potential breakouts in the AM.
3. Mentally favoring possibilty or price remaining contained by both upside and downside pressure, or passive accumulation before the next expansion phase.
4. short term trend is down rally's might be faded back to support.

These are several probabilities I forsee in the upcoming session.
  • #4
  • May 17, 2007 2:06pm May 17, 2007 2:06pm
Potential impact even GBP retail sales at 4:30 am est. Stand Aside and wait for edge confirmation.
  • #5
  • May 18, 2007 7:15am May 18, 2007 7:15am
exited position short on cable at +20 pips, for the day so far... followed my system and made my exit effectively. next risk event is usd consumer sentiment.

New minirange from 9717 to 9699 has been defined on 5min will wait for a breakout for entry inline with the current downtrend, Continuation setup.
  • #6
  • May 18, 2007 7:39am May 18, 2007 7:39am
Quoting enoc2g
exited position short on cable at +20 pips, for the day so far... followed my system and made my exit effectively. next risk event is usd consumer sentiment.

New minirange from 9717 to 9699 has been defined on 5min will wait for a breakout for entry inline with the current downtrend, Continuation setup.
enoc:

Interesting. Hopefully others will work along with your thread.
I would, however, I have to be at a meeting in 1/2 hour.
Great results so far today. How long have you been trading?
I shall continue to read later.
  • #7
  • May 18, 2007 8:39am May 18, 2007 8:39am
So far Iam still waiting for my edge\trigger entry to play itself out, until then I do absolutely nothing and remain flat. whats interesting is that this new small minirange has held very well providing a low risk setup for an entry and a break.

Price "should" hold beneath the bottom line of the previous range 9732 support now acting as resistance, this will establish this level as a confidence zone from which to look for a new trigger event.
  • #8
  • May 18, 2007 8:40am May 18, 2007 8:40am
Winter, hi thanks for posting ive been trading since 2005 and its been a long and difficult journey im constantly trying to learn and improve and adapt to the market.
  • #9
  • May 18, 2007 8:47am May 18, 2007 8:47am
I have created this post mainly to try to maintain a level of honesty with my self regarding my thoughts and trading... and to look back and analyze my thinking and behavior over time.
  • #10
  • May 18, 2007 10:25am May 18, 2007 10:25am
Just to recap what just happened basically suprise chinese fund annoucement sent cable higher and the yen lower, lesson learned pay more attention to possible chinese Risk events in the future, My system would have allowed me take a long entry once the minirange was broken, how ever this was not in line with the current trend, I shall wait for the next setup and wait for the next trigger event also I shall try to reidentify the trend nextweek, I believe IF strength continues on cable i would favor upside range breakouts to the north. However anything is possible and nothing is certain.

The point is i was able to retain my gains and exercised self control in waiting for my signal to trigger I did not try to chase price long as this was not part of my original plan.
  • #11
  • May 18, 2007 10:27am May 18, 2007 10:27am
I have just defined a new potential range to examine for triggers leading into next week if price holds.

9777 to 9761 waiting to see if price consolidates within this range or makes another push higher...
  • #12
  • May 18, 2007 12:32pm May 18, 2007 12:32pm
Quoting enoc2g
Just to recap what just happened basically suprise chinese fund annoucement sent cable higher and the yen lower, lesson learned pay more attention to possible chinese Risk events in the future,

How could you identify the "Chinese fund" announcement has being
the cause?

The point is i was able to retain my gains and exercised self control in waiting for my signal to trigger I did not try to chase price long as this was not part of my original plan.
In determining that you would wait for a "bear" move, I do believe
that you may have a good point about not changing to accomodate
a bull move. But then, I too, am learning.
  • #13
  • May 18, 2007 12:42pm May 18, 2007 12:42pm
Quoting enoc2g
Im creating this thread in order to share some of my thoughts on the mental aspect of trading and how that combines with actual edges which present themselves to me and how I react to them. Any thoughts or ideas on a similair level are welcomed.
ok.
BAM BAM BOOM! -bravado
  • #14
  • May 18, 2007 12:56pm May 18, 2007 12:56pm
winter good point, the thing is I do like to take fundamentals into account, i didnt realize this chinese announcement was slated for today... even if I didnt take the trade its good to be aware of events like this which can act as a catalyst to move price and shift trends.

I try to identify these events prior to taking a position.

I have taken a low risk position at the low end of the 5min range on cable with a stop just beneath it, im basically testing these levels... this range is sitting on top of previous resistance, the short term probabilites now may possibly point to an upside continuation which iam testing at the moment.

My reason for entry is basically a possible up trend continuation range play,I have decided to take 1 of 3 possible entry levels which happens to be the most risky...

1. enter at breakout of range high
2.enter after breakout of high at pullback
3.enter at range low anticipating push higher

In each case protective stops must be adhered to control risk, because nothing is certain. I play the edges probabilities the market presents to me and use market structure to determine my entries and exits. If something doesnt look famaliar I avoid it at all costs.
  • #15
  • May 18, 2007 1:06pm May 18, 2007 1:06pm
Quoting enoc2g
winter good point, the thing is I do like to take fundamentals into account, i didnt realize this chinese announcement was slated for today... even if I didnt take the trade its good to be aware of events like this which can act as a catalyst to move price and shift trends.

I try to identify these events prior to taking a position.

I have taken a low risk position at the low end of the 5min range on cable with a stop just beneath it, im basically testing these levels... this range is sitting on top of previous resistance, the short term probabilites now may possibly point to an upside continuation which iam testing at the moment.

My reason for entry is basically a possible up trend continuation range play,I have decided to take 1 of 3 possible entry levels which happens to be the most risky...

1. enter at breakout of range high
2.enter after breakout of high at pullback
3.enter at range low anticipating push higher

In each case protective stops must be adhered to control risk, because nothing is certain. I play the edges probabilities the market presents to me and use market structure to determine my entries and exits. If something doesnt look famaliar I avoid it at all costs.

enoc:

I was surprised that Cable and Euro/US continued up
after the good news about US sentiment rating.

Will look forward to your posts Monday.
  • #16
  • May 19, 2007 7:17pm May 19, 2007 7:17pm
Nice thread bro. Do you think the 9700 area will play a major role in support in the upcoming week, this area has been such a strong resistance in the past few months.

I hope all your trading is going well, and it looks as if you finally have a certain trading strategy, Congrats friend!

Let me know what High you will expect on G/U in the coming weeks, I am interested in hearing your thoughts.

Ken
  • #17
  • May 20, 2007 8:45am May 20, 2007 8:45am
Monarch yes will do, im gonna utilize a new bilateral trade setup i have found and see how it works, right now price looks like it can shift to the upside and continue its rise, time will tell just one probability we shall see if someone tips thier hand to one side or the other, but yes I feel that 9700 provides good short term support that confidence level must hold in order for the potential start of this uptrend to remain intact, I also must anticipate total failure of this hypothesis, the market is the ultimate teacher its lessons are swift and you pay for them with each stop u take.
  • #18
  • May 21, 2007 5:47am May 21, 2007 5:47am
executed Bilateral trade setup on cable on break from range short... position closed on limit for +50 pips.

Looking to exploit the next range of SR, with a similiar strategy. Possible new minirange defined on 1min chart from 9687 to 9677. Resistance from previous range at 9695.
  • #19
  • May 21, 2007 9:11am May 21, 2007 9:11am
[quote=enoc2g;1445932] im gonna utilize a new bilateral trade setup i have found and see how it works, quote]


enoc:

Could you explaing this setup to us please?

Thanks
  • #20
  • May 21, 2007 7:43pm May 21, 2007 7:43pm
Sure Winter this is a really great website BTW, again this setup fits my personal style and this is not my sole setup just one of many in my play book... that exploit SR breakouts and pullbacks.

On a mental side note to myself, I must cut my losses more quickly in order to preserve my capital im contemplating exiting my position if price moves under my low time frame entry bar, Im looking for quick into profit moves, I must not tolerate too many trades which move against me off the bat I must cut these off quicker.

This will be until I have more of a cushion as far as capital, lower my risk per trade is the key to long term survival.
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