my journal

[Yamato]

potential trading allowed

Analysis of the situation, looking for trades

That's good. I thought I might be able to place a trade but we're exactly at the pivot point and it's lingering, as expected. On top of that, price is neither above nor below the 15m 15p average.


So we can't trade at all.

I am going to show the 4 hour chart even though it's not even relevant, because trading is not allowed by the 2 days chart.


ENTRIES if:
1) you haven't lost over 250 dollars for the day (from discretionary trading)
2) the 15-period 15-minute ma is in favor
3) the 15-period 1-minute ma gets crossed by price (in favor)
4) your entry and your take profit are >10 ticks away from any pivot lines
EXITS
Bracket order of 20 ticks. You can exit early if you wish, but not increase the distance of the stoploss.

I'll come back in about 9 hours to see if there's any opportunities for trading, according to the rules above.

 

[Yamato]

I felt a very subtle temptation

Elder said it clearly: like for a recovering alcoholic, staying without drinking/gambling for a few days it's easy. And yet today, as I was looking at those charts, I did feel a little temptation to look for trading opportunities beyond what the rules of my system allowed. It's going to be an achievement if I can do it for a whole week, and without efforts even. Because even as of this morning, less than 24 hours from reading the chapter and promising to myself that I'll try, I did feel some temptation there, even not completely conscious, I did look at charts to spot any opportunities and not just those allowed by the system.

 

[Yamato]

Going to work. I looked again, compulsively, but there were no opportunities still. There would have been, SHORT, if we had crossed the 1m 15p ma bearishly below 1.5050, but it did so at 1.5055, so it doesn't qualify as a signal, because it's less than 10 ticks away from the pivot line at 1.5060.

 

[Yamato]

I slept well. I am going to buy some propecia. Then I'll go to the vending machines and eat something.

I am doing ok, even though the rest of my office isn't. My office is overflooded with work, that is passing through me, but that I don't have to actually do.

I only have to register the reports, do a lot of statistics on them, and let them take care of the heavier work. However, I am the one who's working the most, so everything here is in perfect order, statistics are on time and perfect, and all the work is behind schedule. We're... they're in deep trouble. My statistics certify that we are in deep trouble. We're behind schedule by 131 reports not processed. Two years ago, with a different boss and different processing requirements, we were at zero reports not processed. Now 131. I'm receiving over 20 reports per week, and they're processing less than 10. We're screwed. They're screwed.

But they can't get me involved because I am working most of the time, and producing ten times the work they produce. If anyone of them wanted to do what I am doing and let me do what they're supposed to be doing but are not doing, I'd be able to do it, but they wouldn't, so that's why they're not even remotely considering that possibility.

 

[Yamato]

I went to eat something, at a cafeteria rather than at the vending machines. I feel I can now afford to spend some extra money. Now that I'll start trading with a reasonable discretionary method. Or maybe I wanted to eat healthy for once.

I bought all the pills, propecia and melatonin, and placed them in the case. I threw in the trash empty boxes and it will look to the cleaning lady like someone tried to commit suicide by taking dozens of pills.

I will now go to brush my teeth, and start working again. By the way, I also printed Elder's second chapter, which I'll read during breaks from work or in the bath tub. Or in the cab. Probably I'll finish it by tomorrow.

I can't wait to get home in just 4 hours and make all my money back with discretionary trading. I can't wait to test my new method and finally trade and make money. Another four hours and, either way, we'll know if I am in control of myself or not. Tonight I'll trade for sure, because the signals are there. I will trade for sure and I will either get out with a loss of 250 (250 to 490 to be precise), or I'll get out with a win of... up to any amount. I'll definitely find out if I can resist gambling or not. I'll see if I can trade within the rules I set or not.

 

[Yamato]

My first day of non-gambling trading

The final countdown has begun. In just two hours I'll go home and make my first non-gambling discretionary trade (my automated systems have been doing that for two years already), according to all the rules of that method I posted, which does allow some margin for discretionality, in the sense that I can ignore signals, but of course not imagine signals that aren't there, and in the sense that I can close a trade before my bracket order, but not beyond the 20 ticks allowed by the bracket order. Everybody make sure you're here to witness the event. It could be the start of discretionary profitability for me.

Remember, the difference between trading and gambling is that the gambler's losses are out of control, whereas, as Elder said, the trader never takes "a loss greater than his predetermined risk". That's the point one needs to understand about this book, or at least that's all I needed to understand.

 

[Yamato]

Finally home!

Ok, this is it. I am home, ready to make some money, any amount of money, or to lose a limited, predetermined, amount of money.

 

[Yamato]

Slow average and pivots

From this chart, our next trade will have to be a LONG entry, based on a 1-minute chart moving average bullish crossover signal, 10 ticks below the 1.5061 pivot line. But price will also have to be above the slow average, which is at 1.5026. And it may be hard to satisfy both conditions (less than 1.5051 and more than 1.5026 while getting a 1-minute bullish crossover).



Indeed, here's my rules again:

CHARTS
SET UP THESE EUR.USD@IDEALPRO CHARTS ON IB'S TWS:
2 DAYS OF 15-minutes CANDLES WITH PIVOTS and 15-period moving average
4 HOURS OF 1-MINUTE CANDLES WITH 15-periods moving average
----------------------
ENTRIES if:
1) you haven't lost over 250 dollars for the day (from discretionary trading)
2) the 15-period 15-minute ma is in favor
3) the 15-period 1-minute ma gets crossed by price (in favor)
4) your entry and your take profit are >10 ticks away from any pivot lines
EXITS
Bracket order of 20 ticks. You can exit early if you wish, but not increase the distance of the stoploss.

 

[Yamato]

waiting for bullish crossover here >1.5026 and <1.5051

I don't have to take the signal, according to the discretionality allowed by the system. So I will wait until it's a bit more oversold. Plus I want to look at correlated markets.

 

[Yamato]

I am not taking the signal, because the slow ma is in favor but not by so much, and because we've been in this area for too long, and because we're overbought as well. All within the system. I hope I'll get a short signal, because it looks better to me right now.

 

[Yamato]

Time to look at correlated markets: how bullish are really the ES, CL and the GBP? Yes, everyone is bullish. But I am getting a bearish signal on the EUR. Bearish crossovers on both and far enough from the pivot line. I am gonna take it, also because we're quite overbought and this is exactly what i like to do: go short when it's overbought...

the slow one ain't there yet...



It is indeed holding me back from going against the trend as usual. And i will let it hold me. Oh yes!

 

[Yamato]

Now if both moving averages will be in favor this will not be enough to make the short trade. I need to have the slow in favor and the fast to cross over, otherwise we won't be overbought enough. The pivots are fine. Once again, here's the system, with the satisfied requirement in blue:

ENTRIES if:
1) you haven't lost over 250 dollars for the day (from discretionary trading)
2) the 15-period 15-minute ma is in favor
3) the 15-period 1-minute ma gets crossed by price (in favor)
4) your entry and your take profit are >10 ticks away from any pivot lines
EXITS
Bracket order of 20 ticks. You can exit early if you wish, but not increase the distance of the stoploss.

 

[Yamato]

Now price will go back up for a while. Ready to enter at the next bearish crossover of the chart below:

 

[Yamato]

I have like at least 10 minutes of freedom. I can go to the bathroom and fix some stuff here at home. Brb.

 

[Yamato]

The gambler in me just feels that he would have done better than the trader, because he would have gone short on this one at the top of the mountain. But the gambler would have gone short because the trader made him wait those 10 extra minutes by looking at the averages. Had the trader not been there, the gambler might have gone short much earlier and would be breaking even right now.

Hourly Reminder:
The difference between trading and gambling is that the gambler's losses are out of control, whereas, as Elder said, the trader never takes "a loss greater than his predetermined risk".

Hey, I am not going to be happy with a small bounce before going short. I need better than this before acting on the SHORT signal. Give me a bigger bounce up, and we can talk about going short. It sure feels awful to the gambler having missed this move.

 

[Yamato]

I hope my dad won't come home before I finish my trading day, because he definitely screws up my mood.

Anyway, I'll go short only if price goes up beyond the average, stays there a little, a few minutes, and then crosses back down (discretionary part allowed by system: i can discard signals).

 

[Yamato]

Guess what. The overall trend is up for all the major correlated markets. BUT. BUT. BUT. It's monday and monday things are not so regular. We could have a reversal. However, price has gone above the average, and I'll let it stay there, and take the next bearish crossover and go short. I'm going to do it. Too bad if I lose 250 dollars. I'll give it another 5 to 10 minutes and hopefully it will rise a lot during those minutes.

 

[Yamato]

Ok, ready. I looked at all markets and they're ready to fall. I am going SHORT at the next bearish crossover, and then I'll take the snapshot of the chart and place it here.

 

[Yamato]

Damn. I've done it. Followed all rules:

ENTRIES if:
1) you haven't lost over 250 dollars for the day (from discretionary trading)
2) the 15-period 15-minute ma is in favor
3) the 15-period 1-minute ma gets crossed by price (in favor)
4) your entry and your take profit are >10 ticks away from any pivot lines
EXITS
Bracket order of 20 ticks. You can exit early if you wish, but not increase the distance of the stoploss.



Too bad if I'll lose. I'm already down 100 dollars.

 

[Yamato]

Going a bit better now. I am down 65 dollars. If things do not work out, I'll lose 250 dollars for the day and stop my discretionary trading (not discretionary compulsive gambling) for the day. I don't think I'll exit early.

The two stops of the bracket order are at 1.5022 and 1.4982. Hopefully the lower one will get hit, since I am short as I said repeatedly.

Going much better now. Up 20 dollars.