Wednesday, 14 March 2007
March 14 Trade Summary
Well this morning showed some great volatility and I was in the zone. I had no fear or flight or fight responses today when trading, it was all gravy. What happened, and what made the difference today??
In one word: BONDS
I've been missing out on the the best indicator of all that I just recently started watching this last week, and today it was a beauty. The reverse correlation between the stock indices and ZN/ZF is the best indicator for spotting reversals "CURRENTLY", especially when you see volume piling up in opposite directions. If you also watch Yen/US dollar, you can see the same pattern, with the yen/us dollar being a leading indicator for some of todays action.
I'm done trading today, I'm not in the zone any longer, so I'm not getting back in. I'm taking the money and running.
I made a video from this morning, which is going to be great to watch.
I also made the decision last night to do away with all of my indicators. The only indicators I need is price and volume. So, I'm still using volume profile and VWAP, everything else I see no use for.
I noticed today my eyes were glued to ZN, ES, JPY, and ER2. I occasionally glanced at NYSE A/D and my SPY chart which shows block trades.
What did I do wrong today:
1.I bought YM and didn't exit for a quick loser, instead I let the trade take a large negative drift of 50pts, only to later make 30pts in profit, it ended up going 120pts my way.
2.I bought ER2 1 tick away from the low at 667.8, and put in a quick scalp profit and exited for only +0.7pt in about 30seconds, Sounds good right,,,NOPE,,,,,,, it ran 14pts. That is really hard to think about. I missed the forest for the tree leaf so to speak.
3.I should have gunned my ER2 long trade, instead I just kept my YM long(I was thinking I didn't want to be leveraged up to much in one direction)
4.I exited my biggest winner for the day on ER2 for $300 less because I moved my profit target, I admit, I got shaken out. When My original target was hit, the price reversed and made a new low.
What did I do right:
1.I was focused on what mattered, I didn't hesistate, and I stayed true to my conviction on my loser ym trade turned winner(ZN was putting in a double top, that's when I got my quick scalp long on ER2 and new I had to ride out YM).
2.I made money.
3.I stopped trading because I started feeling happy.
Observations:
We had a double top in ZN and a double bottom in ES at 9:57 PFT. ZN was leading indicator for the big reversal.
Final thoughts:
You gotta love todays Volume and Volatility because it is scalpers dream.
Edit: Upon further analysis I could have traded better today. I should have stayed focused on trading the setups instead of my P/L. I missed out on making more money by looking at my account and felt that todays profit was good. I need to stay focused and trade the setups. Get rid of the P/L and unrealized P/L. Use your stops, accept small loses, and keep trading and look for potential runners when you got momentum.
Labels:
bonds,
JPY,
market reversal,
volatility,
volume profile,
ZN
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