Don’t Let Perfect Ruin Good — Jeff Davis

Don’t Let Perfect Ruin Good — Jeff Davis

 

Perfection and trading dont mix. There is no perfection in trading. Perfect entries, perfect exits and perfect setups may exist, but that shouldn’t be your goal. Your ability to perform as a trader can be directly linked to just how imperfect your entries and exits are. The trader waiting on the perfect entry may never get the chance to take an exit. This week one of my students was waiting on the perfect entry and missed a good trade. I took the trade and was paid promptly after entry. When I asked him why he failed to take the entry his first words were I thought it would go lower. The trade level we had identified as a high probability entry was fading the selling.

Plan for variance. My entries wont be perfect. Make this part of the strategy. I did this. My student failed to do this. In high volatility, the probability of the perfect entry is greatly diminished. Its about planning for pain after entry so that its accepted pain. It is just part of the trade. I entered knowing this. I planned for this. I executed the strategy and didnt bail out due to it being in an uncomfortable spot. I have done my work, I know my edge and I can be confident when others may be uncomfortable. This is where my student still has some work to do. He knows the strategy, he actually is even confident in the strategy but he needs to step up and execute. When you can find comfort in entries where others find discomfort you are probably finding edge.

Very interesting article and timely. I am confident in my strategy but suffer a lot with no fills. In my weekly review, I coming around to thinking that my approach to my no fill problem is more to do with looking for the perfect entry as close to where I am wrong as possible. But the problem is I end up not in the trade and these frustrations build up over a period of time and I end up taking a lower probability trade.

There is some excellent advice, and I am going to be looking at ways for me to include this within my strategy. More wiggle room and an expectation that the price could trade deeper into the level.

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Trading the Bund – Weekly Trading Review – 18-22 January 2016

What one thing did I do best this week and how I did I do it?

Followed my trading plan, kept to my new stripped down rules. Though I need to work on my target placement on my hypo / swing trades. My management of the scalps is good, but the swings not so good. Still leaving money on the table.

What one thing did I do badly this week and what led me to do it?

On Friday, I was too aggressive with the entries, whilst the orders were part of my trading plan, I was early twice. This was partly due to I was only trading for half the day and I wanted to get a couple of trades in before finishing. And partly due to the accumulation of no fills over the whole week, and getting fed up and determined to get filled and end up being too early.

What specifically will I do next week to continue doing what I did best?

Upon entering my swing trades, the core position I will leave and not fiddle with the target based off what is happening on the LTF chart. Also see below.

What specifically will I do next week to improve what I did worst?

Keep following my plan and do not force trades if I am trading within a time limit. I have to accept that if there is no set ups then there is no trades. This is going to be a recurring situation over the next couple of months as I a couple of meetings a month booked in between now and the Vendee Globe start.

And on the second part, I need to accept that getting early is not a solution to my no fill situation.

How well did I achieve my “continue my best” goal last week and what do I need to do this week to continue/improve upon that progress?

Did well up to Friday. I need to keep focus on my rules and work to get filled on time not early. One tick difference is not problem.

How well did I achieve my “improve my worst” goal last week and what do I need to do this week to continue/improve upon that progress?

I added 1 tick to my levels (increase overall to 2 ticks in front of my level), did not make a difference to my fills. But one week of doing this is not any indication to whether this will make a difference.

Overall

I am too obsessed with getting in as close as I can to the level. Rather than miss the trade because it means that I getting in 1 or 2 ticks from my ideal entry then I have to take it, and on triggers where I am 5 ticks away from level and up to 13 ticks away from where I am wrong on my idea, I should still take the trade and reduce my size. My risk adverse nature is making myself too inflexible with my trade size and entry.

These problems are not going to be solved by themselves, there is no magic bullet. I am the only one that can change the outcome by changing what I am doing.

22nd Jan 2016 – Bund Daily Trade Plan

News

0745 EZ Draghi 0830 Ger Man PMI 0900 EZ Man PMI 0930 UK Retail Sales
1445 Us Man PMI 1500 US Exist Home

Stats

DATR 0.85+

WATR 2.03-

WK.50% 59.61

M.50%

Weekly Summary – Normal up range week with bull close at W.R.H 160.28

Previous Day –  No test of bac origin at 160.42 with Trend Up day with bull close with Bof of ath at 61.81 and @ d.rot SD

Hourly Bias – Long Bias Sc 2

What happened – OIR test bz 86-72 and rej with rot up to bof y.hi and into bal till ECB Oresser and then erc.v rot up to bof ath at 81 and into bal till MC

Hypo 1 – Up – if price holds 55-45 then longs t 66-71 t2 81-94 bac 94 then longs t 62-17 t2 62.33 t3 datr

Hypo 2 – Range – if price holds / bof 81-94 then shorts t 6 t2 54-45, if price holds 54-45 or holds 35-20 then longs t 66

Hypo 3 – Down – If price bac 20 then shorts t 95 (60.bz) t 2 81-72

Red flag levels – For short trades bac 61.94 For long trades bac 61.20

My Review of Trading the Bund – 21st Jan 2016

My Review of Trading the Bund – 21st Jan 2016

Good focus this morning with a good read. A bit slow off the mark for the first trade and no fill on second.

Third trade played well and then a second no fill on forth trade. Then it was a wait for the ECB, after the announcement I was not that focused and missed one opportunity the initial pullback to 50% and then was shy about placing the order in too short above 81. 86 was as per my rules but 81 would have been better the previous high. Even so it would not have filled at 80 and did not test 81.

21st Jan 2016 – Bund Daily Trade Plan

News

1245 EZ IR 1330 US Philly Fed 1330 EZ Presser 1600 US Crude

Stats

DATR 0.85+

WATR 2.03-

WK.50% 59.61

M.50%

Weekly Summary – Normal up range week with bull close at W.R.H 160.28

Previous Day –  Bac of ID X 2 @ 160.42 with Normal up day with neutral bull close, tested d.sz @ 161.33-161.81 and at SD daily rot.

Hourly Bias – Long Bias Sc 0

What happened – OOR gap up and erc.v rot up to 60.bz 18-30, rej and rot down to 15.bz 86-71, rej and rot up on decreasing volume tot test d.sz at 161.33 and low volume rej back to mid for MC

Hypo 1 –  Range – if price holds / bof 86-72 then longs t 08-18 t2 24-33; if price holds / bof 24-33 then shorts t 00-94

Hypo 2 – Down – if price bac 72 then shorts t 55-52, bac 52 then shorts t 42-37 bac 37 t2 44-15 t3 24-15 t4 00-86

Hypo 3 – Up – if price bac 33 then longs t 45-47 t2 55-63 t3 73-81 (60.sz ftb), if price holds 73-81 then shorts t 63 t2 44

Red flag levels – For short trades bac 61.33 For long trades bac 60.71

20th Jan 2016 – Bund Daily Trade Plan

News

0700 Ger PPI 0930 UK Av Earn 1330 US Build Prmits / CPI

Stats

DATR 0.82-

WATR 2.03-

WK.50% 59.61

M.50%

Weekly Summary – Normal up range week with bull close at W.R.H 160.28

Previous Day –  Neutral Range Up day with strong bull close (ID x 2 ) 60.42/59.82

Hourly Bias – Long Bias Sc 1

What happened – OIR rot up but unable to fill gap and reject of lvn at 30, rej down with erc.v rot to test 50.bz 96-83 and bof of 96 y.low and then rej with a grinding roj up to fill gap for mc

Hypo 1 –  Up – if price bac 70 then longs t 84 t2 95-00 t3 18-30 (60.sz ftb)

Hypo 2 – Range – if price holds / bof 16-06 then longs t 30 t2 42-52, bac 52 t 61-70;

if price holds / bof 160.42-.52 or holds / bof 160.70 then shorts t 52-45 / 160.30 t2 16 -06;

Hypo 3 – Down – if price bac 08 then shorts t 96-83 (60.bz 3TB) bac 83 then shorts t 74 t2 64-54 (60.bz ftb), if price holds 64-54 then longs t 83

Red flag levels – For short trades bac 60.70 For long trades bac 59.83

My Review of trading the Bund – 19th Jan 2016

My Review of trading the Bund – 19th Jan 2016

Good focus and read, should have been looking for shorts more aggressively as it open below VA and 15.bz, but was waiting for test of gap.

Entered too early on number 4 but bailed for a 1 tick loss and then too my preferred entry.

The retest at 3 was a lower probability trade was taken on a trigger, but after the stop out I was bid on the retest of 07 but no fill.

19th Jan 2016 – Bund Daily Trade Plan

News

0700 Ger CPI 0930 UK CPI 1000 Ger ZEW / EZ CPI 1200 UK Carney

Stats

DATR 0.89-

WATR 2.03-

WK.50% 59.61

M.50%

Weekly Summary – Normal up range week with bull close at W.R.H 160.28

Previous Day –  Normal up range day with bull close (ID)

Hourly Bias – Long Bias Sc 1

What happened – OIR rot down to test bz 00-83 and rej up to p.vah and into bal till MC

Hypo 1 –  Up – if price bac 70 then longs t 84 t2 95-00 t3 18-30 (60.sz ftb)

Hypo 2 – Range – if price holds / bof 160.42-.52 or holds / bof160.70 then shorts t 52-45 / 160.60 t2 12 -06; if price holds / bof 12-06 then longs t 30

Hypo 3 – Down – if price bac 96 then shorts t 89-83 (60.bz 2TB) bac 83 then shorts t 74 t2 64-54 (60.bz ftb), if price holds 64-54 then longs t 83

Red flag levels – For short trades bac 60.70 For long trades bac 59.83

18th Jan 2016 – Bund Daily Trade Plan

News

US Holi

1400 Fr Auc

Stats

DATR 0.89-

WATR 2.03-

WK.50% 59.61

M.50%

Weekly Summary – Normal up range week with bull close at W.R.H 160.28

Previous Day –  Normal up range day with bull close

Hourly Bias – Long Bias Sc 1

What happened – OIR gap up above flip zone atr 159.83, retest of this flip zone and rej with erc.v rot up to bof the weekly hi at 160.29 and into bal till mc

Hypo 1 – Range – if price holds / bof 160.42-.52 or 160.70 then shorts t 160.23, if price holds / bof 18-11 then longs t 40

Hypo 2 – Down – if price bac 11 then shorts t 00 t2 89-83 (60.bz FTB) bac 83 then shorts t 74 t2 64-54 (60.bz ftb), if price holds 64-54 then longs t 83

Hypo 3 – Up – if price bac 70 then longs t 84 t2 95-00 t3 18-30 (60.sz ftb)

Red flag levels – For short trades bac 60.70 For long trades bac 59.83