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It's not falling yet. Let's go over my 6 points again:

1) overstretched in ticks (>150 ticks top-bottom)
Yes, almost 200 ticks already.

2) overstretched in hours (>18 hours going up or >12 hours going down)
Yes, 21 hours going up.

3) time is right (9 am or 9 pm)
Yes, it's passed 9 am.

4) pivots (touched S2 or R2)
Yes, passed.

5) reversal pattern (increasingly shorter legs)
not yet

6) EUR/GBP difference in favor of trade (>50 ticks apart)
no, just 40 ticks apart in favor (counting top-bottom on both charts)

At least four of these requirements must be met in order to make the trade. How about that?
 
LAST VERSION OF OVERSTRETCHED METHOD

In order to make the trade, these two requirements must be met:
1) overstretched in ticks (>150 ticks top-bottom)
2) overstretched in hours (>18 hours going up or >12 hours going down)

And at least two of these four requirements must be met:
3) time is right (later than 7 am or 7 pm)
4) pivots (touched S2 or R2)
5) reversal pattern (increasingly shorter legs)
6) EUR/GBP difference in favor of trade (>50 ticks apart)
 
I am going to go over the requirements with the situation as of now and see which ones are met:

OVERSTRETCHED METHOD

In order to make the trade, these two requirements must be met:
1) overstretched in ticks (>150 ticks top-bottom)
YES, 190 ticks
2) overstretched in hours (>18 hours going up or >12 hours going down)
YES, 22 hours

And at least two of these four requirements must be met:
3) time is right (later than 7 am or 7 pm)
YES, 10.43 CET
4) pivots (touched S2 or R2)
YES, all of them.
5) reversal pattern (increasingly shorter legs)
NO
6) EUR/GBP difference in favor of trade (>50 ticks apart)
NO, only 40 ticks in favor.

Yeah, I'd make this trade any time. Only I would not conceive a stoploss, because the more it goes up the more it makes sense to go short. So this is a problem to be solved, because that'd mean limitless risk for me, and yet it makes sense that way.
 
Ok, now also #5, reversal pattern, is there. Now everything is in favor but #6. I wish I could buy 10 contracts or so. Instead I am down 500 dollars. If I had waited, I'd be making 500 dollars more at the end of this trade. Since I can't buy 10 contracts, next time let's at least try to enter at the right time.

Now I can go back to sleep and come back at about 7 PM CET, and grab my 4000 dollars. Or I could come back and find I have blown out my account yet another time. It's only happened dozens of time in the past 12 years of discretionary trading.
 
Amazing... it still doesn't want to crash, after a whole 22 hours of rising. Yes, it's risen for 36 hours before, but there's also all these other factors against a further rise. I'm expecting a huge fall any time now. Anyway, here's the last version of my system (each time it only seems like the final version):

OVERSTRETCHED METHOD
A) Set up a month of hourly candles with pivots

B) In order to make the trade, these two requirements must be met:
1) overstretched in ticks (>150 ticks top-bottom)
2) overstretched in hours (>18 hours going up or >12 hours going down)

C) In order to make the trade, at least two of these four requirements must be met:
3) time is right (later than 7 am or 7 pm CET)
4) pivots (touched S2 or R2)
5) reversal pattern (increasingly shorter legs)
6) EUR/GBP difference in favor of trade (>50 ticks apart)
 
OVERSTRETCHED METHOD NEWEST VERSION
A) Set up a month of hourly candles with pivots

B) In order to make the trade, these two requirements must be met:
1) overstretched in ticks (>150 ticks top-bottom)
2) overstretched in hours (>18 hours going up or >12 hours going down)

C) In order to make the trade, at least two of these four requirements must be met:
1) time is right (later than 9 am or 6 pm CET)
2) pivots (touched S2 or R2)
3) reversal pattern (increasingly shorter legs)
4) EUR/GBP difference in favor of trade (>50 ticks apart)
 
I am understanding better how the market works. You'll say "I don't believe in pivots", because you didn't find them to work on some occasions, but on other occasions they work. You'll say "I don't believe in support and resistance" or "I don't believe in trendlines", for the same reason. Well, it doesn't matter if you don't believe in it or not, because there's people who believe in them, and they will move the market. So you either find a way to understand where the market is going, without looking at these things, which is what I did with my systems but without great accuracy, or, especially if you do discretionary, you should look simultaneously at all these things that other people believe in, and take advantage of it. That's to some extent what's happened with my "overstretched" discretionary method: I've been adding more and more inputs.

All these inputs would be very hard to back-test and implement on an automated system, so you're encouraged to think black and white, and that's good for me because I already think black and white, and you're encouraged to oversimplify, which is also good because I am great at synthesis ("it sucks", "it's awesome", that's a good example of synthesis). But that shouldn't make you think that these things do not work at all. Only for systems they might not be effective or worth using. Mainly because they're too hard to program, and make you incur the risk of overoptimizing, which makes you prefer oversimplifying and saying "they suck".

But, when you take into account all these inputs, with discretionary, your task is not easy at all, because weighing these different inputs and variables will drive you crazy, unless you've got the right personality, which is rare, and that is why automated trading is superior. I think I may be able to do one very thought out trade per day based on these requirements I wrote. I could never make 200 trades a day like some people do.

I am already losing it now because after all these hours the EUR still didn't start its fall. It's making me doubt everything I said in my last 20 posts. That's what I mean when I say I am impatient. A reasonable trade for me should last hours, and imply two transactions (open buy and close sell) per day. Yet, I keep on looking at it all day long, and it's unlikely that I'll wait until it's the right time to open my position, and then wait the right time to close it.
 
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I can't believe it. I went to sleep for 2 hours. Had another nightmare, woke up two hours later, came back and everything is still exactly the same. That's very unusual at this point. Now I'll go for a bath.
 
Unbelievable! Just when I do everything right, the market hits me in the face! I totally suck...

...and obviously I went short yet another contract.
 
Ok, now it went up 200 ticks, for 26 hours. Hopefully it will reverse now. It's not responding to the ES, which keeps on flying. But how many times have I already said "it will reverse now"? Every minute since 10 hours ago.
 
Ok, it's happening... it's happening! I am down 1000 dollars right now.
 
New version: I got rid of #4 (difference EUR/GBP doesn't make a difference)

OVERSTRETCHED METHOD
A) Set up a month of hourly candles with pivots

B) In order to make the trade, these two requirements must be met:
1) overstretched in ticks (>150 ticks top-bottom)
2) overstretched in hours (>18 hours going up or >12 hours going down)

C) In order to make the trade, at least two of these four requirements must be met:
1) time is right (later than 9 am or 6 pm CET)
2) pivots (touched S2 or R2)
3) reversal pattern (increasingly shorter legs, do not enter after a tall candle)
 
Now it will fall a lot and really fast. I can't wait. Right now I am still at -1000. I just need 20 ticks down, and I'll be breaking even (with 4 contracts).

Now the real danger with me is that having been very scared of losing money, after being -1100 in the red, I will get out as soon as I'll see a break-even balance, instead of staying and cashing in 1000s of dollars.

Yeah, that's right. Because where else is it going to go? Up? Impossible. It can only go down.
 
I'll have to take a break because I can't stand the pressure. See you in 30 minutes. Hopefully making thousands, and without having closed any of these potentially very profitable positions I opened.
 
It happened, as usual. The recent fear made me get out of 2 of the 4 contracts open, as soon as I reached break-even. Maybe it's rational rather than irrational, in the sense that it's an insurance. I accept making less money, but in case it goes back up to where it was, I'll open those two contracts again, from a better position, and also to protect myself from disaster in case it does go up and I have 4 short positions open, which would make me blow out my account.
 
Wow... lucky! It started going up about a minute after I closed those two positions.
 
I'll open another short contract at 1.4997, or I'll just keep these two contracts open. And if it does go down from here, I'll keep my short open for the next few hours, until 10 PM CET.
 
New version:


OVERSTRETCHED METHOD

ENTRIES:
A) Set up a month of hourly candles with pivots
B) Keep a discretionary eye on correlations with ES and GBP

C) In order to make the trade, these two requirements must be met:
1) overstretched in ticks (>150 ticks top-bottom)
2) overstretched in hours (>18 hours going up or >12 hours going down)

D) In order to make the trade, at least two of these four requirements must be met:
1) time is right (later than 9 am or 6 pm CET)
2) pivots (touched S2 or R2)
3) reversal pattern (increasingly shorter legs, do not enter after a tall candle)


EXITS:
Close position after >9 hours:
1) between 6 and 10 PM CET
2) between 9 and 10 AM CET
 
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