Thursday, March 12, 2009

Thursday 03/12/09 - Know thyself

In several posts, I've written how I need to put my bias aside and trade what I see, and yet I was unable to do that today. I began the day by shorting the bounces, and was down -$100 in the morning. I *knew* a break-out was in the mix at the 732 level in the morning, but thanks to my short bias, my brain was unwilling to *act* upon that knowledge. This is where knowing yourself and your weaknesses comes into the picture. I knew that I was trading my bias and not the charts, and knowing that weakness helped me keep my losses very small; I was using 2-4 tick stops. In the past, I would be down $500-1000 on a day like today. Instead I ended the day with a +$175 gain with zero long positions and a little bit of luck.

We closed on strength today but I am expecting a re-test of lower levels before we move any higher. Btw, I was trading the March contract today, but have switched over to the June contract for tomorrow.

ES 133-tickbar chart (Morning Trades)

ES 133-tickbar chart (Afternoon Trades)

I got stuck in a short position in the afternoon. I wanted to exit for a +2 point gain a couple of times, but Tradestation kept throwing an error message (pictured above). This emphasizes the use of OCO bracket orders. I have my platform setup to automatically submit a bracket order (1 stop-market 6 ticks from entry and 1-limit at profit target 12 ticks from entry). I think I got lucky on this one and my profit target was hit just before price shot off to higher levels.

The following chart shows why I would short the double-top on price ($tick divergence) and why I should have reversed to a long (higher low on $tick)

ES/$TICK (1-min) at 2:30 PM central

No Gap Today

ES/$TICK (3-Min) $TICK remained above zero all day indicating a strong trend day.

No comments:

Post a Comment

At the minimum, please provide your name or Twitter handle when posting comments. Do not post as Anonymous. Comments that contain links to commercial websites will be marked as spam.