1st March 2016 – Bund Daily Trade Plan

News

0815-0900 Var Ez PMI/Unemploy 0930 GBP Man PMI 1445 Man PMI
1500 US Man PMI

Stats

DATR 76-

WATR 1.96-

WK.50% –

M.50% 60.92

Weekly Summary – Range up week with strong bull close inside prev week. IWx2 Hi 66.25 lo 63.72 TU 68.60 TD 61.28

Previous Day – Normal up day with strong bull close TU 66.99

Hourly Bias – Long Bias Sc 2

Big Picture – Bac of ID – up, BIC exp for 60m bz/support to hold and higher highs

Hypo 1 – Up – If price holds / bof 54-48 then longs t 49-63 bac 63 t 80 t 99/datr

Hypo 2 – Range – if price holds / bof 63-71 then shorts t 48 t2 29-25; if price holds 39-25 then longs t 48 t2 36

Hypo 3 – Down – if price bac 25 then shorts t 20 t2 10 t3 02-95

Red flag levels – For short trades bac 66.63 For long trades bac 66.25

29th Feb 2016 – Bund Daily Trade Plan

News

0700 Ger Retail Sales 1000 EZ CPII 1445 Us Chic PMI
1500 US Pending Home

Stats

DATR 77-

WATR 1.96-

WK.50% –

M.50% 60.92

Weekly Summary – Range up week with strong bull close inside prev week. IWx2 Hi 66.25 lo 63.72 TU 68.60 TD 61.28

Previous Day – Normal range day with Neutral bear close, id x2 hi 66.25 lo 65.51 TD 64.77 TU 66.99

Hourly Bias – Neutral bias Sc 0

Big Picture – test and rej of 75-57 and into bal within idx2, bac / bof of bal and then id will give direction

Hypo 1 – Range – if price holds / bof 57-75 then longs t 95-00; if price holds / bof 16-25 then shorts t 95-00

Hypo 2 – Up – if price bac 25 then longs t 66.43 t2 67 t3 99/datr

Hypo 3 – Down – if price bac 57 t45 t2 20-16

Red flag levels – For short trades bac 65.25 For long trades bac 65.54

Weekend Reading – 27-28 Feb 2016

Weekend Reading – 27-28 Feb 2016

This is a collection of articles I have read over the weekend to further my education and to get a feel for the overall macro conditions / themes.

Trading

Chat with traders with Ari Pine

EP 061: A scientific trading perspective, process over outcome, and the law of large numbers w/ Ari Pine.

Ari Pine has many years of real market experience on his side, and during this time he’s traded a whole range of markets in various positions and roles…

Some of those include; working at J.P. Morgan, developing risk management software, trading for a long volatility hedge fund, making markets in gold and silver options, and even giving presentations to the Chinese stock exchange.

Our conversation includes all the above, plus some really valuable info about; positive expectations, the law of large numbers, and process over outcome.

Very interesting listen, worth an hour of my time. The best stuff for me starts at 44 mins in.

Full story at Chatwithtraders.com

An Alternate View: Filter Ticks

I have been very impressed by my friend Japhy’s new enterprise at datatraderpro.com, which provides a “deeper look” beneath the surface of the markets. One feature he has promoted strongly on his twitter feed is to watch for block institutional trades and what transpires around the price levels where they occur.

FT71 had a similar insight the other day where he called out some very large block trades just before the market opened, that turned out to be the key resistance zone before price surged upwards.

For this reason I was extremely interested when Investor RT announced tick filtering in version 12.5.

I am always interested in the new features of Investor RT and how people are using them to improve their trading.

Full story at Trading for Singles 

Defining “No-Trade Zones”

The problem we attempted to address was one of continual attempts to fade long and extended price swings, finding that instead of timing that entry to perfection we more often than not end up with two to three stop outs, and a mindset destroyed for the remainder of the session.

Lance Beggs articles are always an interesting read about applying price action practically into real markets. This article about timing a pullback, has a lot of useful advice on fading a move (pullback).  Something most of us can identify with.

See full article here

Train your pattern recognition to become a fluent chart reader

Trading is all about pattern recognition and the setups you trade are patterns with unique characteristics that allow you to put the odds in your favour by reading market clues. Your job as a trader is then to make sure that you can reliably identify your setup patterns and differentiate between high probability and low probability setups.

Pattern recognition is a skill and you can train your brain to process information in better and more efficient ways so that you are able to recognize patterns fast and accurately.

Developing pattern recognition as a skill. It is important to remember that it is not practice that makes us perfect, it is perfect practice.

See full article here

Macro

Marc Chandler

Three reads for the weekend.

Liberty and 500 Euro Note

The Return of Moral Economy?

Sovereignty and Brexit

Commitment of Traders and the US Dollar

Small Changes in Speculative Positioning in the Futures Market

Are the Dollar Bulls Retaking the Initiative?

Notes from the Underground

A Quickie On the G-20, Or the Summers of Enchantment

Trading the Bund – Weekly Trading Review 22-26 February 2016

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

Good read of the market and when I did not, I stood aside. Focused on trades that had decent R:R at the best levels.

Looking back at my trades, a good percentage of my scalps are low R:R and provide very little of my overall expectancy. The 80-20 Pareto rule definitely seems to apply to my trading.

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

Broke my anti micromanagement rules, a couple of times. This is still an ongoing problem for me, but overall an improvement on previous trades. My stats show that the linear trend line on my exit price vs the maximum favourable excursion (after exit) is in an uptrend compared to the beginning of the month where it was flat.

Drivers of this behaviour

1) Lack of confidence in myself. This is slowly improving.

2) Having a string of winners, makes it harder to hang on to subsequent trades. Focusing on that each trade whilst an individual trade is just part of a sample size of 1000’s of trade have helped.

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

Monitoring 2 markets has taken the pressure of finding a high probability trade in just one market.

I will also keep the focus on just taking the trades that are the best setups and work on improving the return from these trades rather than trying to improve my volume of my overall trades.

My reviewing of the market at the end of the session has been very sporadic over the past couple of weeks, mainly due to life getting in the way. No excuses must get back to doing this as it was helpful for me and improved my chart reading.

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

I will keep the new management rules in place for intraday swing trades.

I will keep my daily mediation practice up.

I will continue video analysis of my trades, this has been a bit sporadic mainly on the scalp trades, as I forget to do it. I want to video before entry so I can see my reasoning without any billy bollocks hindsight. But as a stepping stone, if I forget to do video before entry then I will do it afterwards, and work towards making this a habit.

Summary

Main goals this week –

To hold on to a core position for the hypo /swing trades, with new rules for managing these trades.

To continue to front run my levels by 3 ticks with the main bias and front run 2 tick to levels against the bias.

To trade the Eurostoxx on the main levels if there is not an opportunity in the Bund.

Video every trade preferable before entry, but if this is missed then after entry.

Get back to reviewing the market and posting it every day.

Edgewonk Trade Journal – What I think along with tips and improvements

Edgewonk Trade Journal – What I think along with tips and improvements

I think that we can all agree that journalling our trades and the analysing of these trades are a very important part of the trading journey. In my opinion without this, it very hard to succeed in this business.

Therefore, a good trading journal must have the ability to not only record and analyse the effectiveness of our system, but also identify when we deviate from the system and also provide statistics on what we can do to improve our trading.

For years I have used my own excel spreadsheet to record and analyse my trading, but since Edgewonk has come on the scene, I have used Edgewonk alongside my own sheet. I would move solely to Edgewonk, except it does not quite track a certain metric as well as my own sheet but I will come to that later.

Before we start please read my review policy here.

There is no point in covering every single feature of the journal, you can find a breakdown of their analytical tools on the website and their excellent Youtube channel.

Performance Tables

One of the features that I really like about this journal is the ability to breakdown the performance of a setup by many different variables. From what market to the day of week, grade, return, and how well we actually managed the trade.

Trade Management

The other feature I like about this Journal is the Trade Management table, which allows us to drill down into whether our trade management is hindering or helping our strategy.

Though please note that there is an error in the labels, the green line is the Actual Performance and the red line is the Performance without Trade Management. But apart from that, this is an excellent table to drill down into each setup / instrument to see whether our current management is a valid strategy and give us some ideas on what to do to improve this.

If you are new to journalling then I would also recommend the Edgewonk 12 week Course, which is very good and I will do a separate review of that down the line.

Screenshots

Another great feature is the ability to add screen shots, for each trade. As they say a picture says a 1000 words, and it helps to see a screen shot.

An improvement would be the ability to add a second screenshot so that we can compare before and after shots of the trade.

Personally I have taken the screen shot feature a step further. Instead of taking a screenshot, I record a video, where I go through the reasons why I am taking a trade, the context, the stops, target and management of the trade.

Whilst this sounds a bit of a chore and complicated, but Jing the free screenshot software, allows us to record 5 mins of video and save it to the screenshot folder. All we need is a micro phone. Job done.

I prefer videoing the trades, as this allows me to summarise the trade plan quickly and also when reviewing the trades at a later date, I am always surprised by how much information I get about my emotional state at the time, just from the words I use and the tone of my voice.

Downsides

Time

One of the problems with Edgewonk and any journal that tracks a lot of metrics, these need to be entered into the spreadsheet. This can take time, so if one takes a lot of trades during the day then this can take quite a bit of time.

What can we do about it

First there is an excellent page about organising our data to save time.

Secondly and this idea comes from another trader, I cannot remember exactly who, but I think it may be my friend Mobs from Trading for Singles. If it was not Mobs then whoever it was, thanks it is very helpful.

Most execution platforms allow us to export our entries and exits into CSV / Excel, I then use an Excel sheet to re purpose the data into a format that allows me to easy cut and paste directly into Edgewonk.

Improving Exits

The main reason I am still using my old journal alongside Edgewonk, is that I track my trades after exit to provide statistics on how far these trades actually go, and then use excel to draw up a distribution curves to help me formulate alternative target and exits, to then test to see if these have a better expectancy than my current system.

My table also has the ability to filter for markets, long, short, winners, setups etc. I find this invaluable to monitor what the potential for each setup over a large enough sample size and whether my stops and targets are making the most of each setup and market.

Whilst Edgewonk has the ability to track alternative strategies, I find this table gives me the stats to come up with alternative strategies to test.

Summary

Overall, this is an excellent journal and for its price point, I would say that if you are serious about trading then this should be a tool which will pay for itself many times over.

I have used quite a few of the commercial journals, and they never really hit the spot for me, which was the reason why I developed my own. Whilst it was a good learning curve to make my own, to be honest if Edgewonk had been available at that time I would have definitely chosen Edgewonk.

Links

Edgewonk

Keywords

Edgewonk

edgewonk 12 week course

edgewonk shortcuts

26th Feb 2016 – Bund Daily Trade Plan

News

0745 EZ French GDP 0800 EZ Span CPI 1020 EZ It Auc
1300 Ger CPI 1330 US GDP 1500 Us Mich EXP

Stats

DATR 81-

WATR 2.02+

WK.50% –

M.50% 60.92

Weekly Summary – Range up week with strong bull close inside prev weekly bepin. Hi 66.16 lo 63.72 d.t 62.56-43 on bac of lo

Previous Day – Normal up, range day with strong bull close

Hourly Bias – Long bias Sc 0

Big Picture – unable to bac 57, and into bal till us session and rot up with buyers in control to test but no bac y.hi at 66.25, for buyers to remain in control then need to bac 25, if bac of hvn 95-84 then possible range day.

Hypo 1 – Up – if price holds 08-05 or 96-84 then longs t 15-25, bac 25 then longs t 40-50 t2 60-70 / datr

Hypo 2 – Range – if price holds / bofr 16-25 then shorts t 06 t2 96-84; bac 84 then shorts t 75 72 65-57; if price holds / bof 65-57 then longs t 85-95

Hypo 3 – Down – if price bac 57 then shorts t 44-34 ext t 20-16

Red flag levels – For short trades bac 65.25 For long trades bac 65.54

25th Feb 2016 – Bund Daily Trade Plan

News

0700 Ger Cons Clim 0930 UK GDP 1000 EZ CPI
1330 US Core D.G/Initial Jobs

Stats

DATR 83-

WATR 2.02+

WK.50% –

M.50% 60.92

Weekly Summary – Range up week with strong bull close inside prev weekly bepin. Hi 66.16 lo 63.72 d.t 62.56-43 on bac of lo

Previous Day – Normal neutral day with weal bear close (bepin) bac 65.51 t 64.79

Hourly Bias – Long bias Sc -1

Big Picture – OIV buyers in control and erc.v rot up thru 60.sz to bof ath at 66.16 and good volume rot back to open and above range breakout. For buyers to stay in control, then 56 or 43-36 to hold with rot back into value, bac below 36 would see price back into range and a possible push for low of the range. Unable to close inside range and rej from y.vpoc could see range day.

Hypo 1 – Down – if price holds 80-92 then shorts t 57, bac 36 then shorts t 22-14 t2 95-74

Hypo 2 – Range – if price holds 56 or 43-36 then longs t 80-92, if price holds 92 then shorts t mid

Hypo 3 – Up – if price bac 92 then longs t 04-16, bac 16 t 25

Red flag levels – For short trades bac 65.25 For long trades bac 65.36

24th Feb 2016 – Bund Intra Day Trade Plan

News

0930 UK Mortgage 1035 Ger Bund Auc 1300 US Lacker / Buba
1445 US Serv PMI 1500 US New Home Sales 1530 US Crude oil

Stats

DATR 84-

WATR 2.02+

WK.50% –

M.50% 60.92

Weekly Summary – Range up week with strong bull close inside prev weekly bepin. Hi 66.16 lo 63.72 d.t 62.56-43 on bac of lo

Previous Day – Neutral extreme up range day with strong bull close

Hourly Bias – Neutral Bias Sc 1

Big Picture – Open in 60.sz 2tb and rej down with erc.v rot to bof low / 60.bz and erc.v rot bac to 60.sz at 40-61 3tb, fpr buyers to remain in control, bac of 61 and hold of 22-16, otherwise possible cont of range

Hypo 1 – Up -if price holds /bof 46-34 then longs t 57-61, bac 61 then longs t 77-84 and 98-16 60.sz ftb

Hypo 2 – Range – if price holds / bof 56-61 then shorts t 46 t2 34 t3 22; bac of 15 then shorts t 92-72, if price holds/bof 92-72 then longs t 22

Hypo 3 – Down – if price bac 72 then shorts t 67-62 t2 50

Red flag levels – For short trades bac 65.62 For long trades bac 64.72

23rd Feb 2016 – Bund Intra Day Trade Plan

News

0700 Ger GDP 0900 Ger Biz IFO 1000 Uk Carney
1330 Us Fomc Mem Spks 1400 US HPI Comp 1500 US Exist Home

Stats

DATR 84-

WATR 2.02+

WK.50% –

M.50% 60.92

Weekly Summary – Range up week with strong bull close inside prev weekly bepin. Hi 66.16 lo 63.72 d.t 62.56-43 on bac of lo

Previous Day – Normal up range day with bull close

Hourly Bias – Long Bias Sc 1

Big Picture – OIV and test of 15.bz and rej, up to test 60.sz 2tb, for buyer to remain in control needs to bac 61, bof of 61 or pullback past mid/y.vpoc at 24/22 and possible range / bal

Hypo 1 – Up -if price holds /bof 34 then longs t 57-61, bac 61 then longs t 77-84 and 98-16 60.sz ftb

Hypo 2 – Range – if price holds / bog 56-61 then shorts t 34 t 22; bac of 22 then hsorts t 05-95, if price holds/bof 95-854 then longs t 22

Hypo 3 – Down – if price bac 85 then shorts t 70 t2 65-53

Red flag levels – For short trades bac 65.62 For long trades bac 64.85