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Lusan Journal III

  • #1
  • First Post: Edited Aug 1, 2012 6:33pm Jul 9, 2011 12:05pm | Edited Aug 1, 2012 6:33pm
My trading rules **to be simplified even further later
1. Follow the Daily candle trend
2. Near term momentum analysis
3. Trend direction:
North when PA faces north
South when PA faces south
4. General skew in attack mode: 1-1-1 (in snowballing mode)
5. Rescue: 1-1-2 with wide spacing...this is a daily strategy
6. On reversal: Flip
7. Congestion strategy: Single trade
8. Trend strategy: Attack skew

Mindset Therapy
1. News are meaningless. PA is all.
2. Never against 1W trend
3. All is in the chart
4. No predictions
5. No emotional trading
6. Pure discretionary PA trading
7. All decision made with Newton law in mind
8. No stop ever!
and
9. Use the brain. No mechanical trading.

Others
1. DOW theory for trend
2. Simple Elliot as per fti's teachings.
3. TD/S&R to help visualization only
4. Eye on the 1D direction
5. Fundamentals and other economical/political lies are also considered.

What is this all about?
Seeking for a way to sharpen the trend analysis knife and to trade while holding a full time job.
Since the market is fractal, I believe that these ideas can be easily translated to lower time frame.
However, the emotional level and the trading sizes must be changed to avoid a broken book.
Empty as water and soft as a facing wind mountain
  • #2
  • Jul 9, 2011 1:12pm Jul 9, 2011 1:12pm
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Empty as water and soft as a facing wind mountain
  • #3
  • Edited 3:34pm Jul 9, 2011 3:08pm | Edited 3:34pm
An excellent summary of what my trading is all about. My current and future trading will strive to meet this standard.<...With some minor variation because of my own personal issues-
Thanks God I did not have to write it. The master did.

Quoting fti
.......All Charts patterns have strong probability mutate from one to and another over the time sequence.
Importance is to be able tell between the major toppings and bottoms formation.
Also reversal formations and consolidation formations.
The hardest to manage positions in is the assasin formation. The chartist calls that the broadening pattern.
Consolidations and trend continuation patterns are very straight forward.
Importance must be given to the focus of the mutating patterns, because they normally do mutate to many variations before settling...
Quoting fti
Alternatively , if you cannot get into rythm, you may want use some SMAs guide you initially, but they are always such laggers that will hinder good traders.
Always late and not profitable.
But if you lucky and ride a big wave which is seldom can still hold book in black.
...Because they are laggers, you will mostly be flat of P&L sometimes in the low reds until some good trends materialises.
And because Good trends are only persistence over much time decay, then you may be sucked into gambling scenario if need hold over nights without babysitting the positions, which is strongly discouraged. ....

...watch out for figs which if you can peruse from the ff calendar of major figs reports and flash news that can suddenly swing markets.
.... when uncomfortable best seek safe harbour, unless you had build a nice foreign cap to defray any eventualities.

There is no short cuts, you need develop read skills while honing you skewing abilities.
Focus and it should come to you over time.
If it doesn't come to you then i am sorry , this is not going to be your thing.

.....So never risk what you cannot afford to lose in markets.
Empty as water and soft as a facing wind mountain
  • #4
  • Jul 9, 2011 6:07pm Jul 9, 2011 6:07pm
very nice... something to ponder!

i will be visiting this place regularly, again it's good to see you back Luis...

i have learned a lot from your old journal and saw you evolve from early days.

regards
Success consists of going from failure to failure without loss of enthusiam
  • #5
  • Jul 9, 2011 10:40pm Jul 9, 2011 10:40pm
Lusan

Thanks for starting this new journal. Much like Eddy I have also learned a lot from your earlier journals. In fact I was spending the past week re-visiting your journal and is getting fresh ideas on my own trading from them

Will be following your journal closely


Regards
Philip
"Thinking Heart & Feeling Brain"
  • #6
  • Edited 11:26pm Jul 9, 2011 11:02pm | Edited 11:26pm
All the best LuSan. Haven't seen your earlier journal but I'm sure this one will be better yet.

FX4
Trade what you see, not what you think or feel. Let the market come to you.
  • #7
  • Jul 9, 2011 11:24pm Jul 9, 2011 11:24pm
Quoting dongsky
very nice... something to ponder!

i will be visiting this place regularly, again it's good to see you back Luis...

i have learned a lot from your old journal and saw you evolve from early days.

regards
You are always welcome.

Sylar, FX4newbies, you are welcome
Empty as water and soft as a facing wind mountain
  • #8
  • Jul 9, 2011 11:30pm Jul 9, 2011 11:30pm
Quoting FX4Newbies
All the best LuSan. Haven't seen your earlier journal but I'm sure this one will be better yet.

FX4
Good or bad? Who knows?
But it will be somewhat different.
Not because the first journal was any bad
but because we evolve
and our own trading evolves with us.
Cheers,
Empty as water and soft as a facing wind mountain
  • #9
  • Jul 9, 2011 11:36pm Jul 9, 2011 11:36pm
Quoting luSan
Good or bad? Who knows?
But it will be somewhat different.
Not because the first journal was any bad
but because we evolve
and our own trading evolves with us.
Cheers,
That is exactly what was behind why I said...this one will be better yet.

Yes. We all evolve as we grow and I'm sure you can see areas where you have grown as a trader. Any positive growth in my mind is better and will find a way to be expressed.

Take care,

FX4
Trade what you see, not what you think or feel. Let the market come to you.
  • #10
  • Edited 1:33pm Jul 10, 2011 12:05am | Edited 1:33pm
Checking the monthly before bed.

Edit on next day:
In the last 23 years, we have 43 reversals in the monthly chart.
This means that about twice a year the monthly takes a different direction. ...therefore...
trading the monthly anyone would be wrong at the most twice a year...
the rest of the time
they would be making money...
I think it is a good time to open a small short position and to check on it
2 or 3 months from now, right?
Of course,
this is really a boring way of making money.
Attached Image (click to enlarge)
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Empty as water and soft as a facing wind mountain
  • #11
  • Jul 10, 2011 12:11am Jul 10, 2011 12:11am
Quoting luSan
A new beginning. A time full of expectations.

My trading rules
1. Follow the Daily candle trend
2. Trade the 15M bar cluster reversals
3. Off trading for 30 min after mayor U/EU announcement
4. PT a congestions and consolidations. Then wait for the second 15M reversal
5. Reversal warnings:
For 1D white bar: if Bid < yesterday opening
For 1D black bar: if Bid > yesterday opening
6. General skew: 1-1-2
7. Rescue: 1-1 only....After 50 pips drawdown or more
8. On reversal: Exit trade(s) and flip. If reversal strong, 2X entry
9....
all the luck to u

V
  • #12
  • Jul 10, 2011 5:35am Jul 10, 2011 5:35am
Quoting luSan
A new beginning. A time full of expectations.

My trading rules
1. Follow the Daily candle trend
2. Trade the 15M bar cluster reversals
3. Off trading for 30 min after mayor U/EU announcement
4. PT a congestions and consolidations. Then wait for the second 15M reversal
5. Reversal warnings:
For 1D white bar: if Bid < yesterday opening
For 1D black bar: if Bid > yesterday opening
6. General skew: 1-1-2
7. Rescue: 1-1 only....After 50 pips drawdown or more
8. On reversal: Exit trade(s) and flip. If reversal strong, 2X entry
9....
Lusan

What is your current TF 1D->15min or it still your fav combo 1H->15mins->5mins with eye on the 1D?

Can you elaborate more on the following points:

7. Rescue: 1-1 only....After 50 pips drawdown or more
- If u have the full attack skew on i.e. 4 lots how does the above apply?

8. On reversal: Exit trade(s) and flip. If reversal strong, 2X entry


Are you still doing your short dance of 1-2 hours since you are working fulltime now?

Do you think you can PM the Getit software password as I have just downloaded it from your last journal. Thanks


Regards
Philip
"Thinking Heart & Feeling Brain"
  • #13
  • Jul 10, 2011 7:59am Jul 10, 2011 7:59am
Quoting Sylar
Lusan

What is your current TF 1D->15min or it still your fav combo 1H->15mins->5mins with eye on the 1D?
1D guides me about the preferred direction.

Then things get a little tricky in choosing a timing chart. I have been using 1H for timing but I realized that 1H is a little to slow for my tendencies and that I have plenty of time to check the general shape of the chart during the day using my iphone, so I am moving to 15M...but then this is just similar to the dance that I use to do...1D/15M/5M...The 15M demands quick fingers and to pass the time in front of the computer...I found that using 1D/1H or 1D/15M I have some breathing time. The reversal clusters are better observed using 15M...the impulse waves are better using 1H...So 1D and 15M and take a pick sometimes to 1H

However, nothing has really changed because PA is a fractal. Trading a set or another is all the same...after all, the charts are just maps of the past. We are cartographers.The important point is to know the trend/timing maps so well to act without thinking, acting by feel or intuition. It takes time to develop...probably trading 15M/5M or 5M/1M is a good way to start because things move pretty fast then.

Quote
Can you elaborate more on the following points:

7. Rescue: 1-1 only....After 50 pips drawdown or more
- If u have the full attack skew on i.e. 4 lots how does the above apply?
1D/1H trading using a large skew such as 1-1-2-3-5- etc has either too large exposure or not enough time for full deployment...The waves never reach 3-5 etc...So 1-1 or 1-2 appears to be the best...I have been using 1-1 for the last 2 months and I grew my book without any problem...Exposured is managed through the position size.

The waiting for drawdown of 50 pips or more is there to deal with the piggy tendency I might have...We do not know the future, so sometimes we go into the war to early...I have not seen too many ranges wider than 50 pips...so it is a good number to take for an example of entering at the bottom of a range (a thing that we should never do, but sometimes it does happen)...less than that and the buss switching kills you.

Quote
8. On reversal: Exit trade(s) and flip. If reversal strong, 2X entry
This week I concluded that if I see a good opportunity, I would just skip the skew and go full force into the trade. For example after the last unemployment figs. I jumped in with 3X, I rode it for 80 pips and I jumped out before the crazy retracement.

Quote
Are you still doing your short dance of 1-2 hours since you are working fulltime now?
Nope. Too intense for me. I do not think I have the stamina for the intensity of the 5M dance. If the trend is my friend, I have enough time to take care of my regular life. Believe me...the iphone saved my trading life..

Quote
Do you think you can PM the Getit software password as I have just downloaded it from your last journal.
Sure.
Take care.

Regards
Luis
Empty as water and soft as a facing wind mountain
  • #14
  • Jul 10, 2011 8:30am Jul 10, 2011 8:30am
Quoting luSan
[...]
However, nothing has really changed because PA is a fractal. Trading a set or another is all the same...after all, the charts are just maps of the past. We are cartographers.The important point is to know the trend/timing maps so well to act without thinking, acting by feel or intuition. It takes time to develop...probably trading 15M/5M or 5M/1M is a good way to start because things move pretty fast then.
[...]
Hi Luis,

cool to see you back in your trading shoes.
Hope it willl work out for you alongside with your job ....

I do agree basically with your statement above about the fractal character of PA over the different timeframes. But something is very different, when you are going to trade of fom the longer ones:
The probability that any external event (like terrorist act, natural catastrophies, a politician making a bold suprising statement ...) may disturb the flow, is increasing significantly. Expecially theses days, when some Euro-Zone news can hit the market at any time.

So I think the probability of trading successful with a flow-based style is bigger, when shifting your trading timeframe more to the shorter TF's.
But that'S just my very personal opinion ;-)

All the best!
Niesl
  • #15
  • Jul 10, 2011 8:47am Jul 10, 2011 8:47am
Niels, welcome to my cave. Nice to see you here. I missed the old days.

Quoting MaMood
.....But something is very different, when you are going to trade of fom the longer ones:
The probability that any external event (like terrorist act, natural catastrophies, a politician making a bold suprising statement ...) may disturb the flow, is increasing significantly. Expecially theses days, when some Euro-Zone news can hit the market at any time.
...A crazy thought i have lately..."PA knows about the news before the news...PA creates the economy not the other way around. Crazy?" I traded through the whole Greek mess with that belief and it works for me...Since those events do not happen everyday, and I have clarity in the max that I allow myself to lose then they do not bother me...Tsunamis do not happen here but rarely...(I will comment on tsunamis lately.)

Quote
So I think the probability of trading successful with a flow-based style is bigger, when shifting your trading timeframe more to the shorter TF's.
But that'S just my very personal opinion ;-)
But the mental energy cost is very very high...the lower TF gives a lot of flexibility but the demand on the soul is a price that I do not want to pay. I do not believe I could sustain it for 10 or 20 years...hey, I do not want to be rich but to enjoy this spiritual practice....Another crazy thought, "trading is a form of meditation."

Cheers,
Empty as water and soft as a facing wind mountain
  • #16
  • Jul 10, 2011 1:15pm Jul 10, 2011 1:15pm
Quoting luSan
Niels, welcome to my cave. Nice to see you here. I missed the old days.
[...]
....hey, I do not want to be rich but to enjoy this spiritual practice....Another crazy thought, "trading is a form of meditation."

Cheers,
Hi again,

yeah, have made exactly the same experience. Trading is like meditation.
Whenever I enter my tradingroom, whenever I watch the charts, and whenever I enter a trade, I'm very very calm and relaxed immediately.

My tradingroom and the trading mindset is something very valuable for me. It is like entering a relaxation room. All the trouble that the daily life might have created lately are forgotten immediately.

Well - I think that is based on some training, cause with an unbalanced mindset you will face some trouble soon.

However, sounds like you have developed a lot of trading wisdom during the time you have been off ..

Cu,
Niels
  • #17
  • Jul 11, 2011 6:33am Jul 11, 2011 6:33am
Quoting luSan
Checking the monthly before bed.

Edit on next day:
In the last 23 years, we have 43 reversals in the monthly chart.
This means that about twice a year the monthly takes a different direction. ...therefore...
trading the monthly anyone would be wrong at the most twice a year...
the rest of the time
they would be making money...
I think it is a good time to open a small short position and to check on it
2 or 3 months from now, right?
Of course,
this is really a boring way of making money.
For any one that ask....
Yes...I did open a small south E/U position at 1.4205 which I will check by the end of August....Out of sight is out of mind.
Empty as water and soft as a facing wind mountain
  • #18
  • Jul 11, 2011 5:21pm Jul 11, 2011 5:21pm
What a 200+ pips ride.
Attached Image
Empty as water and soft as a facing wind mountain
  • #19
  • Jul 11, 2011 9:12pm Jul 11, 2011 9:12pm
For those that track the kingdoms.
Give me a dollar,
Give me a Yen...
Are the Japaneese cash desperatos?
Markets are not in sync but I am making all kind of pips
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Empty as water and soft as a facing wind mountain
  • #20
  • Jul 11, 2011 9:22pm Jul 11, 2011 9:22pm
After E/U breakthrough the 1.400 mark,
will this lady also drops the monthly flag?
Things are happenning so fast...
Attached Image
Empty as water and soft as a facing wind mountain
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