Bob Volman Price Action Scalping

[HornedGod]

Another moribund day. Looks like EUR/USD is having a second dull as dishwater week. The only movement seems to be happening during the New York session on US data.

1 – skip 1 – Price opened in a four pip block right in the middle of a 20 pip range. I didn’t fancy the odds with the block right in the middle of the range so skipped on the BB. If the block had been on the upper or lower edge of the range than I think it would have been a stronger signal, as a lot of volume kicks in right at the London open.

If the small block at 2, along the bottom of the range, had continued for another two or three bars I would have taken a long break out of it.

3 – skip 2 – The block highlighted here was a higher block than the one that had just preceded it. I was more inclined to take a long signal because of that. When the block broke south I skipped due to the afore mentioned previous block.

Motivational quote of the day that I came across:

“I’ve missed more than 9000 shots in my career. I’ve lost almost 300 games. 26 times, I’ve been trusted to take the game winning shot and missed. I’ve failed over and over and over again in my life. And that is why I succeed.” – Michael Jordan

 

[Giorrgi]

One trade today. It was a pretty nice Mm pattern but it didn't work out. I don't really have an explanation for it except for the fact that it's just a probability outcome. Would welcome any comments though :smart:

 

[BLS]

One trade today. It was a pretty nice Mm pattern but it didn't work out. I don't really have an explanation for it except for the fact that it's just a probability outcome. Would welcome any comments though :smart:

I took the same trade

 

[JRS]

I took the same trade

So did I, along with 2 other IRBs that got stopped by the 20 level. Frustration today.

 

[matty_dunn]

One trade today. It was a pretty nice Mm pattern but it didn't work out. I don't really have an explanation for it except for the fact that it's just a probability outcome. Would welcome any comments though :smart:

I thought about that trade but skipped it on account of the double bottom sitting above the 20 level that preceded the block.

I just wanted to share a couple of thoughts about this learning process we're all on, as I think some things are slowly starting to click into place for me.

After hearing/reading (I can't remember) a recommendation from Don Miller, I have begun reading "The Tao of Poker" by Larry W. Phillips. It is a fantastic read and so applicable to what we do. Do yourself a favour and read it. I know it sounds simple, but all comes down to knowing yourself, and making correct decisions.

BTW, I also find Don Miller's blog insightful and inspiring. He is a good man.

Don Miller's S&P Trading Tank

The question that has really been helping me to improve, which I'm trying to
place firmly in the forefront of my consciousness on the brink of any trade, is - "How am I going to feel if I'm stopped out on this trade?"

Simple I know, but it seems to be working for me in eliminating many debatable wagers. Often is the time I have executed a trade then quickly in hindsight have regretted it, knowing full well it was not a valid entry with a high probability of success. This in turn makes the management of the trade difficult because there is little confidence in the original decision.

If however, I ask myself this question before entering, it is like bringing that hindsight consciousness into the present and I'm making better decisions as a result.

It also helps me to fully accept the risk - not just thinking I am accepting it, which, as it turns out, is often the case. I know this because of the upset I have felt when trying to accept a losing trade, or giving it an extra pip or 2 in an attempt to avoid the inevitable.

I, like many I'm sure, have a strong perfectionistic tendency, and this whole notion of accepting loss is not an easy one at first. However, I'm seeking to express this perfectionism in the way I execute my plan instead of avoiding loss.

And, as we all know, there is no such thing as perfection anyway - it just helps you set the bar high: If we shoot for the stars we will hopefully at least get off the ground.

Anyway, things are looking up, here are my charts from yesterday.

 

[JRS]

I know it sounds simple, but all comes down to knowing yourself, and making correct decisions.

So true. Excellent post.

 

[JRS]

Couple trades today. Any thoughts on where I exited the first trade? Valid tipping point exit or trailing too closely?

 

[HornedGod]

-11.1 pips – 28 June 2013

If yesterday’s early London session was moribund in a 20 pip range what do you call today’s 10 pip range? Sheesh.

1 – trade 1 – Price had been within the boxed range for over an hour already. Price had been hugging along one pip below the top of the box for quite a few bars and I considered this pop a valid break attempt. In hindsight, it is pretty similar to the previous tease that I had passed on. Not sure why I thought this one was more valid since the setup is almost identical. Given the tight range and extremely low liquidity I should only have gone for a breakout that directly hugged the top of the range.

2 – trade 2 – Second bite of the long cherry. Much better setup here. I went for an entry when the second box was broken after a couple bars of build-up. A small block then formed at this level. The breakout of the block (3) looks to be an ARB entry point too. The two main cons I can see for either of these entry points is the 50 level could still pull price back into the range and the EMA was quite a distance away.

The main takeaway from this week is that there is still work to be done on identifying quiet markets and staying my hand when I do see them.

 

[matty_dunn]

Couple trades today. Any thoughts on where I exited the first trade? Valid tipping point exit or trailing too closely?

I think it's understandable that you exited where you did considering the way the market was stalling and the possible double top that may have been forming, even though there was a good chance the 80 level would provide support. It's a tough call isn't it. As Bob says - you just have to make your decisions as best you can with your current skill level and hope to improve each day.

 

[matty_dunn]

-11.1 pips – 28 June 2013

The main takeaway from this week is that there is still work to be done on identifying quiet markets and staying my hand when I do see them.

I think we all probably have work to do in this area.

With your first trade I think the overall conditions were not supportive - given the bear move preceding the block. The market had a much better chance of breaking higher once the lows were rejected again after your first trade. However, I don't see any valid entry here.

It's also tough when you've only got a 2 hour window to trade. I am often in this situation too. Have to keep reminding myself that there's no need to trade, but a need to trade well - which more often that not means laying low on the sidelines.

 

[matty_dunn]

Today's charts.

Only took one trade, but not happy with the way I managed it because my exit was emotionally driven.

I'm interested to hear what others allow themselves to do/not do when it comes to exits other than the trade reaching target or taking out the tipping point.

If you look through the charts Bob has sent out over the last year or so there are a noticeable number of trades where he advocates booking profits early, before reaching target. This can be due to a perceived lack of follow through, support or resistance, a 20 level threat etc. I must admit he does also note that this decision should be applied sparingly.

I am finding the use of this discretion difficult, and am considering not using it at all, as Bob advocates in his book - due to the problem of "where does it stop?"

As we all know, mental and emotional stability is more important than technical skill in this game, and there is a peace of mind that comes in knowing what you will do ahead of time in any given situation. At least then, regardless of how things play out, you know the path to follow.

I'm thinking, at least with my current level of proficiency, I'm probably better off not using this discretion and just letting the trades take their course - for peace of mind and avoidance of the emotional turmoil that using such discretion can generate (for me anyway).

Another idea is to have some kind of rules or guidelines around its use, e.g. only booking profits when at least +8 pip and having two sound reasons to do so (similar to mentioned above).

Anyway, interested to here anyone's thoughts on the matter.

 

[datamold]

Couple trades today. Any thoughts on where I exited the first trade? Valid tipping point exit or trailing too closely?

I would classify your exit as valid because it was what I consider to be an adverse BB.

 

[BLS]

Week 26 charts from Volman:
https://www.dropbox.com/sh/1amxmi9af0fk6ej/VA5_ZrjQF1

 

[matty_dunn]

Week 26 charts from Volman:
https://www.dropbox.com/sh/1amxmi9af0fk6ej/VA5_ZrjQF1

Thanks Bob and BLS

 

[garageboyFUJI]

Week 26 charts from Volman:
https://www.dropbox.com/sh/1amxmi9af0fk6ej/VA5_ZrjQF1

Thank you very much Bob and BLS.

 

[JRS]

I am finding the use of this discretion difficult, and am considering not using it at all, as Bob advocates in his book - due to the problem of "where does it stop?"

I agree with you. For me I've found that if I use discretionary exits, I'll eventually get myself into a place where any little hesitation in the price will compel me to close the trade. I start being happy just getting a quick pip or two. The problem is that I'm still initially risking the full amount so those trades that immediately go against me end up wiping out days of work quickly.

Probably more importantly though, it makes me focus on my pips rather than on my trading technique. We all know that never ends well.

 

[HornedGod]

1 – trade 1 – RB out of the range that had been developing over the prior two hours. Ranges formed from midnight onwards that get tested and broken in the early part of the London session seem to offer great odds.

4 – trade 2 – After a double top just above the 50 level (2-3) price pulled back. I saw a FB/DD setup form right above the block that had formed at the 40 level. In hindsight, the cons of the 50 level and the double top seem to evenly balance out the pros of the nice support block and the orderly pullback. At the time, the great support level and the fact the trade was with-trend were enough for me to pull the trigger.

5 – trade 3 – A series of lower highs were being put in place with support at 1.3038. I felt that if the support cracked that price would probably go back into the previous range of 1.3020-32. Once it finally did crack (after two teases) it was only for a short while before pulling back into the upper range. I got out with just a 3.2 pip loss after having moved my tipped point down to the support/resistance line at 1.3038.

 

[HornedGod]

I'm thinking, at least with my current level of proficiency, I'm probably better off not using this discretion and just letting the trades take their course - for peace of mind and avoidance of the emotional turmoil that using such discretion can generate (for me anyway).

I'm sticking to the KISS principle for now.

For example, today on my first trade I saw that it was hovering at around 9.6 pips in profit. Then it would fall back to 7, back up to 9, down to 5, back to 9. It seemed to go on forever, edged closer, 9.7, 9.9, then falling back. Arrggh. In the end I just stopped worrying about it and just let it do whatever it was going to do.

 

[matty_dunn]

Thanks for the feedback JRS and HornedGod, appreciate it.

I'm on school holidays at the moment so have more time to contribute to this forum.

No trades for me on Monday. Came very close on last option (chart 3), and in hindsight, perhaps an entry worth taking. Thoughts?

I'm finding that being more selective does mean I skip more trades that work out. However, this certainly doesn't make up for the losses accrued from sub-par wagers.

 

[JRS]

After yesterday's slow market, it's nice to see one of these.