Wow, what a weird day. I guess with oil hitting a new high, the market was a bit more hurky-jurkey today. There were 5 valid set-ups today, 3 winners and 2 losers. Yes, all strategies have losses. Luckily for us, they don’t happen very often and are controlled with proper money management. Here are the charts for the first and second half of the day.
First Half
Click on chart to enlarge.
Second Half
Click on chart to enlarge.
The first trade of the day happened after a trend line break to the downside below the 56 EMA followed by a trader’s trick set-up. Notice on the chart below how the 56 EMA held the price in to the downside. The second trade happened after a break of the first hour low (for those new to my blog, the first hour high or low are very strong resistance or support areas. A break of those areas are considered a trend line break.) followed by a trader’s trick set-up. Notice how the price came back up to the first hour low. That makes the trade even that much more valid. Here is the chart for the first and second trades.
Trade 1 and 2
Click on chart to enlarge.
The next trade happened after a trend line break to the downside below the 56 EMA. There was a perfectly good looking bobber set-up that failed losing 2 points. Here is the chart.
Trade 3
Click on chart to enlarge.
Trade 4 happened after a trend line break to the upside above the 56 EMA followed by a perfect trader’s trick set-up. Again, the trade was stopped out for a 2 point loss. Every time I take a loss, I look to make sure that I didn’t violate any of my trading rules. The last two trades were perfectly valid set-ups. They just didn’t work. If I determine that my trading rules were not broken, I go on to the next trade. If I do find something I missed in making the decision to trade, I work on trying not to make the mistake again. Taking loses is just a part of trading. Learning how to deal with the emotion of taking a loss is important to becoming profitable. Here is the chart for trade 4.
Trade 4
Click on chart to enlarge.
The final trade of the day happened after a trend line break above the 56 EMA, followed by a trader’s trick set-up. Here is the chart.
Trade 5
Click on chart to enlarge.
For those of you who think there might have been a trader’s trick after the 5 trade (as shown on the above chart), I wouldn’t have taken that trade because of the tails on the bars after the run up. Also if a trader’s trick doesn’t happen in 3 or 4 bars, the less likely it is for it to work.
So for today, there were 5 trades, 3 winning trades and 2 losing trades for a net profit of $200 ignoring slippage and commission. One final thought about losses. I try to take a longer view of trading. In other words, one day’s trading results is not important. Look at the record of your strategy over a week or so to gain a real perspective of how your trading rules really perform.
Hope that these post help you to catch a whopper!
Warm regards,
Ron
This is not a solicitation to buy or sell.
There is a risk in any investment
Comments
