Oct 022011
 

Sorry for lack of updates, this past week was really busy for me.  I didn’t trade very much due to some personal commitments.  On Thursday I went on a field trip with my daughter’s class.  We went to Thoiry which is a zoo/safari in France.  It’s actually not too far from where we live and I’m not sure what the safari animals do when it snows.  The animals looked happy, at least the two lions that started mating right in front of our class!  One thing that was very cool was we were right next to the tigers with only a window between us.  That’s the closest I’ve ever been to a tiger.

Two other days I had appointments in Paris.  On the days I got home in the middle of the US morning session I traded on sim, not being comfortable having missed the pre-market and the first hour.  I did well on sim so as usual I just need more confidence to take my setups when they occur.  Fortunately for me Friday was a day that I got home late.  In studying what I missed I probably would have taken a loser there when ES made a new high and then didn’t follow through to the upside.

So that’s really good news that I shattered my weekly record despite not trading for roughly half the week.  Half of my winnings this week were from two trades, both of which I was going for a big win by targeting a gap fill.  I stopped swing trading a while ago so I could focus on day trading and ultimately my goal is to hold a portion of my day trades when the stars lined up.  This week they lined up twice and I took advantage of this.  It worked great and it’s something I want to continue doing.  Without these two big wins I would have still had an above average week.

Avg(4) = 4 week average

A year ago I wrote a series of blog posts entitled A look back on my journey.  It’s hard to believe that was a year ago, it seems like yesterday.  I will be posting an update to this series in the near future so if you haven’t read it, you may want to read it.  I just reread it and surprisingly enough, not much has changed since then, except for my performance.

 

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  17 Responses to “Shattered my weekly record”

  1. Very nice Michael,

    Been following you for quite a time and happy to see your progress, certainly encouraging for the beginners, it is easy to fall into believing it is not possible to make a living from trading…

  2. I used to feel that way myself, many times. It was so hard that I was even suspecting other “profitable” traders of faking it. I was discouraged many times. But I never gave up.

    What’s odd is that now I’m having great results and I’m not really doing anything drastically different than I was doing a year ago. I can’t really explain it, something just clicks and trades start working. It’s even a bit spooky sometimes.

  3. well done Michael, congrats on the improvements!

  4. Congrats Michael!

    I am really struggling with the “clicking” part of the process. It appears to me to be lack of experience in my reasoning as price action evolves with volume through the day. I understand FT71′s questions (where is the market trying to go? How good of a job is it doing getting there? ) but it doesn’t seem to click for me and I experience confusion and get overwhelmed.

    Do you know what I mean? What helped you in this area?

    Thanks

  5. max – It takes time. I’ve been studying FT71 for a little over a year now. And this makes 4 years in trading. So it takes a lot of time. Maybe 10,000 hours.

    I still get lost, get tricked, get trapped, etc. Yesterday I completely missed that huge rally. I don’t typically trade then so it’s ok but I was at my PC and I expected to make new lows. The move completely blow me away.

    Every day I make mistakes and some days I make mistakes on every trade. So the confusion and frustration that goes along with it will continue for some time. I guess I’m a perfectionist and that’s why I have so many “mistakes” but I think as long as one is improving and willing to stick it out then one will find success. Journaling is important in order to see improvement.

  6. Nice work Michael. I look forward to your look back article. The last two weeks have been great for me also. This week though I am having a bit of trouble. I think I am overtrading. I have caught some big winners but it has just kept me at about breakeven for the week. Any thoughts on over trading and how you avoid that pit fall? Also I would be interested to understand how you are scaling with your contracts or if you are not scaling.
    Thanks,

    Paul

  7. Paul – I traded terrible this week. I took a few fades that didn’t work and totally missed some great opportunities. I’m going to rewrite my trading plan and try to work out some of my issues and make it a bit more mechanical. I plan to make a checklist to help me avoid mistakes (such as fading the VA trend). So I’ve been overtrading too.

    The way I normally handle overtrading is I put audio alerts where I want to trade and I work on something else. I play music, program, study previous trades, etc. This is really what works best for me. It separates me from the market and keeps me from inventing trades.

    Coincidentally my wife was home on sick leave the first 3 days this week and I couldn’t do my music (didn’t want to disturb her). And I lost 2/3 days she was home. Now I’m not blaming her but I am saying it’s really important for me to to distract myself so that I don’t invent trades. And it keeps me calm & relaxed.

  8. Paul – I forgot to answer about scales.. I experiment but typically i put my first scale at the next level and try to get 3-4 pts on that first scale. Sometimes I don’t scale and sometimes I scale early, in both cases I often regret it. :)

  9. Thanks Michael,
    I like your idea about setting an alert on an area. I think that could really help me not invent trades and not jump in early.
    I took your advice from your Aug 21 blog and dropped to one contract. I really focused on my trading. Although this week has been a bit tough I have made more money overall (3 weeks). Which is really interesting since I was trading 3-4 contracts. I am going to stick with this for another week and then add the second contract. So, I appreciate your insights into how you are scaling. I also like your comment on regretting your scales when they are too early or too late. It’s so true… ;)

  10. I’ve went back to 1 contract many times in the past. I think it’s good to do when one is cutting winners short. If you only have 1 contract you have to stay in for the target. And if you can stay in for the target, does it really make sense to scale one out early???

    I rewrote my trading plan today and my first target is the next level and the 2nd target is either a major target if one exists (gap fill, key level, etc.) or the next level after the first. And I’ll try not to scale out earlier. Targets or stop I tell myself! :)

    Glad to hear you’re making money with 1 contract. That’s great because then when you get back to 4 you will probably make more than you were making before. You’ll stay in longer.

    It’s really great to hear that something I’ve shared has helped someone else, thanks for letting me know and continue to keep me updated with your progress. This week was very tough, I’m 2-2 (2 win days & 2 losing days) and being very cautious today so I can finish positive. Cheers!

  11. nice work! How much do you think the larger ranges we are seeing now has to do with the difference in performance?

  12. I think it has helped but it can hurt as well. I had a big loss 2 weeks ago and finished positive but not by much. Last week was average. So I think that good couple of weeks I had was just luck.

  13. Hi Michael,

    Hope you are well ?

    I have been following your website for some time now out of curiosity for Market Profile and then just generally to see how you are doing. Your work is excellent, credit to you.

    I do have a couple of questions for you but first a bit of backround.

    I myself do not use Market Profile (yet) as I don’t know how to but increasingly find myself attracted to it. In fact I follow Barry Taylor at Eminiwatch who obviously you know. After a number of years of studying charting and looking at rubbish systems it was my own curiosity on volume that led me there and to you. I have the full suite of Barry’s indicators and have been SIM trading the EMini for 2 months using the Better indicators. I’m really copying Barry’s style of a 4 point stop with a 4 point target most of the time.

    My weekly average is +21 points. Which is great. But, sometimes I still feel like I’ve got luckly a few times. And of course I’m yet to go live, which could change those stats. I need to go live soon and prove to the wife that I can cover my monthy salary for some time before going it alone.

    I feel like I need to know more about market structure to feel comfortable which brings me to Market Profile. However, do I muddy the waters or will it complement what I am doing already ?

    I have Mind over Markets to read and will start soon. I did think of running some Profile charts alongside the Better indicators in TradeStation to get a feel for them and see how I go. At the same time not changing my current trading style/strategy.

    Any thoughts would be greatly appreciated and do you know how to get some Market Profile charts into TradeStation ?

    Thanks & regards

    Jason.

  14. Jason –

    There are a couple schools of thought as to picking places to enter. One is to determine S/R levels in advance and wait for the market to show up. This is the MP approach. The other is to use an indicator which can detect a reversal and then use the indicator to enter.

    If you’re having success with the indicator approach, then I don’t think it’s necessary to complicate things with MP. MP takes a long time to learn, I’ve been studying it for 2 years now and I’m still learning. I still miss plenty of things real time and only see it in hindsight.

    If you’re getting 21 pts/week that’s around 4/day. That’s all you need really. Once consistent you can slowly increase size. I would recommend continuing on sim for a little longer unless you really feel you’re ready. When you’re ready, start with 1 contract if you can (if you don’t use scaling in/out as part of your method) and try to trade the same as you are currently trading on sim. It will be difficult because the fear of losing money and greed of losing open profits will be nagging on you to trade differently. If you can resist you have it made.

    When I traded with eminiwatch method I had a few good months and then a few bad months, so I think another month or two on simulator would be great if you have the patience to do it. The more time you trade on sim the more you imprint the proper trading into your brain and the less likely you will be to deviate from your plan.

    I’m really curious to see how this goes for you so please keep me updated.

    For MP in TS, there is volume profiling built in but if you want real MP & VP tools you’ll need Investor RT which starts at $50/month.

  15. Michael,

    Thanks for your reply.

    Your right, if I’ve got this far with decent results, why change it. I guess it’s that classic story of tying to find the holy grail. I’ve got a habit of jumping from one system to another and until now haven’t really settled on one.

    I also read somewhere that I could be delaying the reality of having to trade live. But then I know what I have to achieve if I’m going to trade for a living and so I need to take the next step. As an Investment Manager and previously a Bond trader I’m hoping previous trading experience will help. With a wife, mortgage and two kids I need to get it right.

    I’ll give it another month on SIM and see how I go. I must admit I am bored of SIM now and want to make real money.

    I do like Barry’s indicators and he’s obviously a very intelligent guy. I also like the fact that he records his trades live most days. So there’s no hiding !

    It will be a pleasure to stay in touch and let you know how I get on.

    BTW, I’m not far from you. Jersey in the Channel Islands, near St Malo.

    All the best with your trading.

    Cheers.

    Jason.

  16. Hi Michael,
    I am enjoying your blog. It helps to see someone honestly sharing how they trade.

    I am new to trading. I’m using Ninjatrader. I was wondering if you had any experience with the Acme Analytics (Rancho Dinero) indicators… especially the volume profile indies?

    Thanks.

    Bryce

  17. I haven’t used it but I’ve heard good things about it. I know RomaTrader uses it.

    A free alternative is the GOM framework. I have used the GOM volume ladder but not the GOM market profile. It’s free for a donation to BigMikeTrading.

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