Journal - 10/28/04

Today's Lesson: Never trade somebody else's strategy/system without first testing it. There usually are nuances in one's strategy/system which the developer has learned through experience. Also, before adopting somebody else's strategy/system, it is important to determine if it fits your trading style.

Trade 1

03:17 - L ESTX50 2 @ 2814 stp 5 - trend, 5m RH
03:23 - Exit 1 @ 2816 +2 - scale out, stalling here
03:24 - Exit rem 1 @ 2816 +2 - looks like short-term res at 2717/18, 5m bline ob

Trade 2

03:35 - L ESTX50 2 @ 2814 stp 5 - trend, 3m pb10ema
03:51 - Exit 1 @ 2816 +2 - scale out at res
03:54 - Exit rem 1 @ 2816 +2 - taking too long, tape not getting active here

Note: Price broke thru resistance after I exited. Apparently, slow tape activity at resistance/support may indicate impending breakout/down. Abnormally big blocks went through 1 tick above resistance which signalled breakout.

Trade 3

09:01 - S EUR 1.2700 stp 5 - counter, 10m AJ 1-2-3 setup, pbl brk
09:02 - Exit 1.2705 -5 - stopped

Note: Aggressive entry of 1-2-3 reversal setup. Entered on break of point 3. The conservative entry is break of point 2.

Comment: 5 and 10min chart showed price developing an uptrend, broke above and pulled back to 50ema, near lowbb support therefore making this low probability trade.

Trade 4

09:40 - L EUR 2 @ 1.2748 stp 11 - trend, 5m RH (invalid setup, pb exceeded 3 bars)
09:43 - Exit 2 @ 1.2737 -22 - stopped

Note: RH not valid here because more than 3 pb bars. Price went against against me and never went positive, market saying bad trade but I failed to listen because I was occupied with the new system.

Trade 5

09:49 - L EUR - 2 @ 1.2746 stp 12 - trend, no setup
09:53 - Exit 2 @ 1.2734 -24 - stopped

Note: Trade was emotional after trade 4 loss. Still shocked at the big trade 4 loss and traded trying to recover loss.

Comment: Emotional trades have always been disastrous! Judgement is clouded and I throw away all my rules especially the one where the market has to prove my trade correct for me to stay in the trade. When feeling emotional, it is best to stand up, regroup and clear mind of the emotion, which I did after this trade.

Also, AJ's system does not seem to fit my risk tolerance because stop placement is wide. I have to selectively take setups that are within my risk tolerance.

Trade 7

09:57 - L EUR 2 @ 1.2740 stp 5 - trend, 5m pb10ema, potl cci zlr
09:59 - Exit 1 @ 1.2750 +10 - scale out
10:00 - Exit rem 1 @ 1.2750 +10 - stalling here, pos res

Note: Market says good trade. Trade was positive quickly!

Comment: Nice regroup. Focusing on the proven system and trading within the plan always produces good results!

Trade 8

10:21 - L ER2 2 @ 582.2 stp 8 - 3m counter, 30m trend, 30m pb20ema, lowbb, 10m 1st T50ema
10:25 - Exit 1 @ 583.2 +10 - scale out
10:27 - Exit rem 1 @ 583.2 +10 - at 3m 10ema pb res

Note: Trade was negative on entry due to selling pressure of downtrend but quickly reversed, which proved trade was correct.