Tuesday, 2 February 2010

Pants Around Ankles Day

Trade 1 gave me the first scale and at break even on the balance as the consolidation happened followed by the break down.

I then sold Trade 2 into the hole. The POC of yesterday held and I had about 10 minutes to see that and exit for a tiny profit. Again the 99EMA gave the same info.

Trade 3 was the trade of the morning. Kiki just watched all the green candles and exited her whole position all out when the red one appeared outside of the Keltner. Way to go Kiki. I had a late entry by a bar as I was not focused enough. Luckily it did not cost too much. Maybe it was not really late. Depends on how aggressive you want to be or how much red meat you've been eating lately. I'm now waiting for something to happen as RTH is near as I write this first half of the blog.

I'll be looking carefully at yesterday's VAH.

The RTH open was not easy to trade. Trade 4 was a sale into the hole again but I covered it pretty fast at a 1 tick loss. I then stood aside waiting for the VAH I spoke about above. There was lots of chop and although the VAH held, I wasn't smart enough to get on board - I don't really know why, lost focus again. When the breakout came it just looked like more chop and by the time it was recognisable, by me at least, it was too late to catch that bus. Now looking for a pullback to buy to trade to the 1093.25 resistance. It didn't happen so I am sitting here figuratively with pants around ankles. The only good entry was at the VAH at around 1084.00 or perhaps as the Profile went into double prints above 1086.50, but that was the mid range of the chop.

If this is a trend day in the making, I'll find a re-entry where my stop is meaningful. If not, we have the DVAL to work with.

Afterwords, I did see a higher risk entry at 1093.75. As I write this, I can see price heading towards 1097.75 resistance and then 1104.25. It certainly looks like a trend day and you just buy it and hang on, scaling out at the resistance areas. You just need to be aware that there will probably be another rotation before the close and the idea is not to get caught by that.
Click to enlarge


  1. Thanks Tom. This is very helpful. A stream of consciousness post like this helps me review what I was seeing and compare it to your thought process.


  2. Well done, Kiki. It appears you have been a good apprentice. Tom, not to worry about the P/L table, if it is too cantankerous to extract and post. I closed an account today which used the NinjaTrader platform and Zen-Fire feed, which could reproduce VB etc. I am now left with Interactive Brokers, which apparently is not a true tick feed. They push out consolidated snap-shots. Is there a substitute you can suggest that can indicate order flow for such a feed (may not be as accurate as actual ticks at bid/ask)?

  3. Hi Tom,

    Thoroughly enjoying learning your trading methods here. I currently mainly trade the YM emini, rather than the ES emini. I "think" I have built my charts similar to yours, with the only exception being I am not sure what Range Bar Setting to use for the YM market. I noticed that you are using a 1.25 Pt Range Bar for ES, or about $62.50 in dollar terms. Should I start out with a similar objective in selecting a Range setting for YM, which would be about a 13 Pt Range Setting, or $65? I assume all the rest of your settings will be fine. I know you made a change on your Range Chart setting for a different market as I read through your Blog Posts, but I was unclear as to what specifically you are looking at to make that determination.

    Thanks again Tom for being so open and sharing with all of us here.


  4. Hello Boss,

    So I go to my buddy, “hey! you got that 20 bucks I lent you?” and he says to me,
    “I’ll see you straight when I get my new glasses”.

    What does that have to do with the price of eggs? Nothing, it just popped in my head when you said you were losing focus. Excuse me a second. Hey Kiki,dad needs some robot eyes, what’s taking so long? It’s just a bunch
    of 1’s and 0’s. jk

    Actually this started out just to say thanks MIKE for the help on the CV. I recalled EL did a 21 by 9 after reading that.
    I am going to pick up some Ginkgo Biloba tomorrow if I remember.

    Thanks 4 U


  5. Back from africa I see that I have a lot to review. Thanks for that and your ongoing work! I will try to pick up and get on track.

    @GEO: I'm at the same point in terms of brokers. For me Sierra and Open E Cry is the combination I will go with. Sierra provides historical bid ask data for the traded instruments.

  6. Geo, timokrates, IB snapshot data is OK,I am told, for volume, not ticks. Compare an IB data chart with one I post.
    Richard, non overlapping vertical movement is what you want to see with range bars. I'd start with a 5 tick and see how it catches the trades and increase by 1 until its OK. I think 13 may be way too big???
    Hi Rino, keep on trading well!

  7. Yes EL, IBs data is fine in general, the problem is that it does not provide historical bid ask data. It is possible to get this with Sierra and OEC. Also the margins are an issue with IB. IB in general is a great broker if you get used to the TWS, but for EL style trading OEC should be better.

    I like Sierra, which offers the best value for a very low price ($41 with TPO). I'm working on the chart setup at the moment and will post it if it is ready.