TF Trade 11/ 28

As with my FX trade, this was a trade I sat on.

Entered LONG at 437.8 on Nov 26.

I guess I was both tired and fed-up of scurrying in and out of a market that's searching for direction itself.

I took a view that it was going up - even if it's going to turn out to be yet another sucker's rally - and I stayed. Trailing with a 3-point stop now.

Where Are You Going, DOW?

DOW Weekly (Click to enlarge)

What I'm seeing:

- Trendline 1 and 2 NOT breached.

- Trendline 3 NOT breached yet (no closes below that line to date), but more on this below

- Trendline 4 breached in Aug 2001, but DOW resumed its uptrend after retracing slightly more than 50% in the 1st quarter of 2003

- Trendline 5 breached during last week of Sept this year.

BAD NEWS:
Given that what DOW has punched through is a weekly trendline (trendline 5), the likelihood that it's going to continue to fall is high (at least that's what I'm going to assume for now)

Using trendline 5 as the neckline to measure how far DOW will fall, the estimated target is around 5210 [ 9914 - (14,198 - 9494)].

By the time that DOW drops to that level, and closes below that, it would officially have breached trendline 1.... (I'm going to have to stop projecting beyond that before I fall off my chair....)

Consolation:
As DOW has broken out of an Uptrend line, volume after breakout will have to be trending up to support a substantial drop.

The way I see it is that volume is not exactly on an uptrend after breakout. So there's HOPE that things could get better afterall? (With the Fed's money printing machine starting to go in full force again, I'm keeping my hopes HIGH in the short-term...of course that would mean a depreciation of the USD is imminent...which means that I can now SHORT THE USD...which is exactly what I'm doing now anyway)

As it is now, DOW is seen to be testing the high (after breakout) of around 9800...

GOOD NEWS:
Although DOW has breached trendline 5, it's NOT breached trendline 3, and it's not known if we are looking at a trend reversal or merely a correction (to date, DOW has retraced about 50% from beginning of trendline 3) looking at the period spanning 1991 and the present.

In fact, anyone looking to short the market after DOW's breakout from trendline 5 would be wise to wait for DOW to:
a) first test the high (after breakout) of 9655 to 9800, and having tested that,
b) to fall below approx. 7445 (red solid line in chart above)

Personally, unless both conditions a) and b) have been fulfilled, I won't be comfortable taking short positions (except in scalping of course) from this point on, not with trendline 3 apparently providing some sort of support...

Now, the REALLY BAD NEWS:
Should DOW punch through trendline 3, and fulfill the conditions for a trend reversal (points (a) and (b) above shows how I would qualify a confirmed reversal), we'll find DOW all the way down at 1040 (which effectively brings us back to 1983, when DOW first took off from its base and went on a parabolic ascend without looking back even once).

I'm PRAYING for DOW to climb back up to hit at least 9800, and stay up there for a while...if it doesn't, the future's going to be pretty bleak for everyone on planet earth.

FX Trade 11/27

Tired of scalping. Am letting this one run until there's reason for me to change my view wrt where the pair's heading.

Trades on 11/25 were all stopped out at minimum damage to my account. Am starting to accept that getting stopped out doesn't mean I'm a failure. Although it still doesn't feel good, it sure helps to keep my drawdowns small.

FX Trades 11/25

Long: USDJPY, CADJPY, AUDUSD, GBPJPY, GBPUSD

TF & FX Trades 11/ 24 - Update

Exited my TF short positions from yesterday with 3k damage to my account.

FX: exited 4 pairs manually, and was stopped out for the remaining 6 pairs.
Damage: 2000 pips on total of 10k units.

Thick grey lines on charts below roughly show the point of my short entries.

Exited 4 positions at the low of the day before the pairs rallied again. The others (with the exception of USD/JPY) were stopped out slightly above the low.

I'm blaming all my losses from yesterday on:
1) The position of my monitors
2) My restless cats
3) The temperature of my room (so cold it froze my brain)
4) D, for my very bad mood
5) Flu virus, which always attack me on days when I'm in very bad mood

Yes, I'm blaming everything except:
a) My pea size brain
b) My utter reluctance to reassess my view on where the market is heading when my view is apparently flawed
c) My total lack of respect for stop losses
d) My abandoning the method that was perfect for me simply coz by adhering to all the parameters that come with it, I'd be limiting myself to just a few choice setups a day, which means fewer points to earn

No trading today. Switched the position of my monitor and end my 3-week long suffering. What was I thinking when I moved it from my right to my left???

Down with something - haven't quite made out what it is. I'm freezing in a home with the air-conditioning turned off and windows all shut. My head won't stop throbbing, and I'm very very very grouchy.

TF & FX Trades 11/ 24 - Disastrous Open Positions

Totally paying for not letting go of what I shouldn't have owned in the first place!!

But since I own them now, I'm keeping!!

ALL OF THEM!

There's just no cure for stupidity.

FX Trades 11/ 24

Short 10 pairs.

HAPPY!

Positions opened between 2:30am to 3:30am EST.

All there's left to do now is WAIT.

Abomination

As a girl, I grew up beating up boys and detesting them coz I think they are rascals.

As a women, I always end up hating my boyfriends and husbands.

Maybe I hate men in general.

No, correction: I just simply detest them.

They are perpetual liars. The reason they like to say things they don't mean, do things behind your back, don't tell you about the things that bother them is probably because they think all women are idiots.

No, correction: they just think their girlfriends and wives are idiots.

I won't waste an ounce of my energy anymore on the part of my life that's forever filled with deceit, sorrows, regrets, anger and hurt.

I won't spend my life - which could otherwise be productive and meaningful - on a person I would never figure out coz he thinks he is too deep and complex to be understood.

Sheer arrogance.

And I won't have it anymore.

Men can continue to play their games and feel good about it for whatever reason.

Maybe they are programmed to think they know better, and that they are free to break rules and hearts simply because they are superior to the female species.

I shan't destroy my own life getting even anymore.

Ultimately, the men win.

I'll let live.

I have something I can live for now, and I'll be a bona fide idiot to focus on what I can never control, instead of living my life to the fullest with what I've been given - at long last - a passion.

Ready For The Nine-To-Five Grind

I've been thinking about this for quite a while now: going back to full-time work.

The 14-month break has been fulfilling. I totally lived my dream of being a recluse, and confirmed that I can be an island by myself.

I'm now more confident than I ever have been, and know that I'll have no problem being seen eating lunch alone.

Now, the easier part: getting someone to hire me.

Ha.

Haven't a clue where to begin.

As a matter of fact, I'm not sure I know how to ask for a job.

But if I want it badly enough, I will find a way.

TF Trades 11/ 21

Total: +7.6 Points

At a certain point, it becomes difficult to believe that professional bears are selling.

I felt compelled to BUY.

And I kept buying as TF went down as the momentum going down was just not there (ie not like the typical TF plunge).

All there was left to do after that was to sit and WAIT patiently for the bears to be taken out.

The only concern I had was that RUT was diverging negatively from DOW.

So while my initial target was support at 383.7 (5min chart), I got out at 381.8 for my 380.2 contract, when the already slow upward momentum was coming to a halt.

As I'm writing, TF is consolidating below 382.

Looks like a bull flag to me.

But I'm calling it a day.

TF 11/ 21 - STOP PLUNGING, TF!!!

With D's company in the limelight - in a VERY BAD way - I think it's about time I do my part in calling the bottom.

Not going to put up any other charts - the DOW chart alone looks pretty creepy and telling of a market that's going to get severely punished for not having done all the healthy corrections on its way up after it left base in the 1980s.

TF


I'M REALLY HOPING the support at 394 holds today. If it doesn't, there's still HOPE for a double or triple bottom next week.

Ok, traders should never "hope".

Fine.

I was about to "PRAY" instead anyway.

LOL!

FX Trades 11/ 21

Long:
EUR/USD (1000 units)
EUR/JPY (1000 units)
CHF/JPY (1000 units)
NZD/USD (1000 units)
AUD/USD (1000 units)
AUD/JPY (3000 units)
CAD/JPY (2000 units)

Positions opened: 8:15am - 8:35am EST
Positions closed: 12:35pm EST

Charts used: Daily, Hrly, 15-min, 5-min

Total: +990 pips

TF Trades 11/20

Total: +9.1 Points

Starting to see double, and feel like I might just go blind soon.

Can't wait for M's emini futures class to start. Mid Dec seems so far away....I desperately need to pick up a saner way to trade.

Help, M!!!

TF & FX Trades 11/19

Timeframe Traded: 9:45am to 10:08am EST

Total: +6.1 Points

I'M HAPPY!

Totally unlearned everything I knew about scalping/daytrading and did what I never had the nerve to do before. I no longer want to be the scared animal that when out in the open, is constantly looking for the nearest shelter. I want to hunt. Not to be hunted.

And as a hunter, I don't want to go into the jungle with an outdated map. Charts older than today's are simply good for telling me where the market is today in relation to yesterday. Today, I look at everything with fresh eyes. I want to know my terrain, and only use tracks that have been used time and again by others, and I set up my traps along that track.

Then I watch. I take note of how many ticks the market moves up before it comes down for each ascend and vice-versa. I keep a lookout for supports and resistances via the market depth trader and I look for setups that tell me that the bulls are cleaning up the bears and vice-versa at these levels, and when they show up, I get ready to go in for the real breakouts when market retests those levels.

For the first time, I didn't sit on the edge of my chair; there was no cold sweats, racing heart, dry mouth and stiff shoulders. No more getting out with a 3-point loss after missing the best chances to bolt when the market's clearly trading in a range in an unhurried manner. I took the chance to make some trades as price went below where I placed a long entry. It didn't matter that I could only BUY to not offset the first long entry. I made a few ticks here and a few ticks there, leaving only 1 contract outstanding. Then I bought 2 more contracts from the low of the day (at that time) and sold all above the point of my first entry.

Radical approach for me. I wasn't averaging my loss though (not that I think it's a bad strategy - it's really for an experienced trader to assess on a case-by-case basis if that's the way to turn a bad situation around).

I was simply playing along a well-laid track. Where I entered gave me some room to decide if i want to scratch the trade or bail at minimum loss, or wait for it to come back to give me some profits (on hindsight, really a habit I have to kick). I started at the mid-point of the range, and not too far from where my "point of no return" is. Worst case scenario: I bail at a loss that I've set to be the maximum drawdown for today, and that's an amount that allows the market to test the low and come back up. If it doesn't come back, I bail at max pain.

FX
Long:
EUR/USD
EUR/JPY
AUD/USD
EUR/JPY
Positions opened at 12:30am EST
Positions closed at 7:00am EST
Total: + 240 pips

Counting Waves

SPX Daily

No matter how I look at this chart, I just couldn't count that death drop fall as wave 5 without having to break some sacred Elliot Wave rules (e.g. wave 4 not supposed to overlap wave 1, wave 1 must not be longer than wave 3, etc etc).

BUT I DO SO WANT THAT PLUNGE TO BE WAVE 5!!

So, what do I do?

I decided that the shaded area will be wave 1; that dreadful plunge, wave 3.

All EW rules observed.

Phew!

So what becomes of wave 5?

EW practitioners call it a "truncated fifth" (Given that wave 3 is visibly over-extended, what I'm looking at is a totally valid truncated fifth).

And what follows a bear market truncation is .... happy news: A RALLY!! (If you notice that HAMMER from yesterday, that's one reason to believe that bulls will be happy at least for today...and maybe for this entire week....)

I'm not even going to be bothered about confirming that there are 5 subwaves in that wave 5.

I'm just going to say that IT IS WAVE 5.

I mean, why can't I, when a pessimistic EW expert can always claim that that triangle where I've labeled wavee 3,4 and 5 is in fact a wave 4 made up of diagonal triangle, and that what follows is usually a continuation of the previous trend (ie. DOWN!!!)??

And THAT is exactly what they're calling that triangle at the base of a similar plunge on the daily EUR/USD chart!

The beauty of EW, in my opinion, is that you can interpret it in anyway you want and no one can really say that you're wrong, unless you break those ridiculous rules. It's arbitrary, and yet complicated enough so when you make an attempt to explain your reading to a layman, you stand a good chance of sounding REALLY SMART.

Ok, so I USED TO BE fascinated by Elliot Waves.

Truth be told, anything that baffles me has my attention until I can say for sure that the only reason that it had baffled me is that it's pure nonsense to begin with.

It was only recently that I realize that the one and only thing I BUY about the EW principle is this: that you can't use physics to explain the market, and that everything that happens within the market has NIL correlation with things happening beyond it. WE move the market. Events don't.

So out of the many tenets underpinning the Elliot Wave Principle, I find myself agreeing whole-heartedly with just one.

Just so that I can bore myself to sleep when I revisit my postings in the distant future, I'm just going to talk a little about the 2 EW tenets below, one of which is the one I buy, and the other ...well...not entirely...

Tenet 1) Social moods determines the development of events, not the other way round.

A much used example is that of the Enron Scandal.

While most of us, out of sheer forgetfulness, would attribute a bearish market to the unfolding of a string of events closely resembling and following the Enron saga, practitioners of EW principle will tell you that it is the bearish sentiment around the time that the news first broke that precipitated those scandals.

A detailed writeup on how they arrived at that conclusion is available on the EWI website. Get a free membership and download their "Independent Investor eBook".

A more recent example (NOT taken from EWI - though I'm sure they would already have written something on it on their newsletter): the repeated rescue efforts US has taken to save companies deemed too big to fall had seen their major indices making lower lows and nearing the 2002 low.

An EW expert will tell you that it's the REACTION of the market towards these bailouts that has precipitated a market meltdown. THIS I totally agree with.

When sentiments have gotten this bad, it's damn if you do, and damn if you don't for policy makers. I don't want to be in their place.

Tenet 2) Investors that take the contrarian path, one which is almost always against the nature of man, win.

The analogy used in one of the reports found in the Independent Investment ebook is that of someone NOT ducking when a stone is coming at him.

In the investment context, this is analogous to BUYING when everyone is looking to dump what they have.

This kind of activity is definitely not for the faint hearted - which supposedly (according to statistics) represents 90% of investors/traders.

The special breed that dare make such moves are prepared to take the consequences.

The faint-hearted will simply end up losing when they are the ones who are the most afraid to lose.

I have big issue with tenet 2).

I agree with it up to the point where it says that it takes remarkable emotional strength to stick to one's conviction (if that's what the writer is implying).

But I definitely think that to be able to go against the trend outright and make a killing - you need more than courage and foresight.

You need to have a very deep pocket to buy when people are selling, and then sit on your paper loss if your buying doesn't send the market back up immediately.

You either have to be already loaded, or the mettle to take an exceedingly high leverage or borrow from a loan shark to play the market this way. Should luck be on the side of the latter 2, wall street will have yet another rags-to-riches story to use to lure the ignorant into the market. For the one with deeper pockets than the average Joe to start with, if a major market meltdown doesn't kill him and the companies he buys, he's simply going to be an even richer man when the market rebounds.

If someone were to throw a stone at me, and it looks like there's a 70% chance it's going to hit me and a 100% chance that it'll kill me, I duck.

It doesn't take the Elliot Wave Principle to point out the obvious: that to make it in trading and investing, to be well-capitalized is a PRE-REQUISITE.

How and where you get the money is a separate issue altogether.

You MUST HAVE MONEY

Period

Moyo's Article: 800 Support To Hold On The S&P

This is an excellent piece!

I really have to give it to Moyo.

His determination to make each posting informative and educational makes me feel a little guilty for not doing the same with my blog.

That said, I'm most definitely going to continue writing whatever that comes to mind while I still can. That's what novices are entitled to doing. Hur hur...

I'm linking to Moyo's posting coz I share his sentiments. I'm on a head-on collision with some of the best traders of our time (some are on my blogroll), and as frustrating as it can get, I can't help but feel differently from them about how events are going to unfold.

I've been a bear ever since I first knew anything about trading. I have no idea what a bull market is like. I always find Dr Brett's non-psychology postings a struggle to read - all his NYSE lows highs, his charts and almost all the indicators he uses are Greek to me - the only thing that I can read is his tendency to benchmark against a bull market. And it is through that that I get a vague idea of the characteristics of bull markets. And although what I'm seeing today is nothing like that image in my mind, something tells me that I'm a bear that should really start to fatten up and get ready to hibernate.

Which probably explains my moodiness for the past few weeks!

I can no longer ask the market to PLUNGE.

That word has an uplifting effect on me.

I get it - I'm evil.

TF Trades 11/18

3.3 Points

It took me 15 round turns to make 24 ticks, and only 1 to lose them all.

Went on to lose 4 trades in a row which cost me 19 ticks; made all back in the next trade and my net for the day was 1 tick.

21 round turns to make 1 tick.

Encouraging.

9 more trades and +3.3 points later, daytrading felt like the most tormenting job in the world.

The biggest takeaway for the day: I finally saw with perfect clarity what "the path of least resistance" looks like. It doesn't really matter who's playing games. I just need to learn to sit and wait for the path to show. Charge out blindly - especially in a mad market - and sure death awaits me.

TF 11/18

Not looking so good after all...

Everything that TF can fall through, it is now under it: triangle, wedge, support, channel...

We're 4 hours and 2 PPI data release away from market open.

I'm counting my toes to kill time....

FX & TF 11/18

FX

Closed my positions from yesterday, coz it was apparent that the pairs weren't going in my direction (down). Got out with 10 bucks profit. Ha ha.

I'm getting really micro now, since my account is NANO.

EUR/USD Hourly


EUR/JPY Hourly


AUD/JPY Hourly


AUD/USD Hourly


All seem to want to go sideways for a while.

Waiting for confirmation to go in again.

The EUR pairs are now hovering along the floor of B1. Looks like a round bottom to me. We'll see.

TF

Displaying similar pattern seen in the FX charts above.

TF 30min


Going by the theory that the start of a robust uptrend is usually supported by unimpressive volume and a gradual upslope, it seems possible that TF has seen its bottom - provided that no one's game to play savior and fairy godmother anymore.

Am keeping my fingers crossed for now.

FX Trades 11/17 & Network Connection Problem

Ugly.

Positions were opened right after I went long on TF at around 1am EST today.

D asked if this is my way of hedging.

Er....

NOPE.

I was long TF at 450 only coz I saw a familiar pattern - that of it testing resistance before US market opens. My target was no higher than 460 (It didn't even get there before 9:30am EST of course). I was half expecting TF to plunge back down to its 440 support at least once today.

Nearly missed taking profit when I was disconnected from IB and couldn't get back in after the 150th attempt (serious)!

Switched to mobile network after D reminded me that I actually had a piece of gadget lying around somewhere just waiting for mishaps like this to happen to justify its purchase and the monthly bill it incurs.

Got back into the system in time to put in a trail stop.

On hindsight, I would have been much better off had I just waited for D to come back from his night out to fix my network problem.

I would have gotten my 10-point profit (managed to put in a profit target of 460 before I was logged out of the system)!!

TF Trade 11/17

Another crazy day all set to take out both the bulls and the bears. All I did once market opened was watch how buyers and sellers got slaughtered.

Decided to stay out coz I really want to keep the 1.1 point I earned pre-market.

As I was watching IB's BookTrader (after US market opened), I realized how crazy I had been to trade both sides before. I'm surprised I didn't kill my eyes after that few days of taking 20 to 30 trades in one day (45 mins to an hour to be precise - couldn't last longer than that).

It was because of the sheer madness of the method (it's actually not so bad when used on 10 year treasury - it moves like a snail when compared to TF and NQ) that I was banned from using it.

But it's difficult to give up something that gives you so much edge. While keeping my fingers off the keyboard, I was doing a whole lot of talking. Couldn't help it. I could totally tell each time that the bears and the bulls were getting tricked. Having the 1min chart opened helped.

Having said the above, when it comes to the execution bit, whether you make money for being right will depend on how fast your fingers are - they have to be as quick as your eyes. And you need a little luck. Sometimes you just don't get filled.

After experimenting with various ways to play this market, this is by far the best - for me. To make my life a little easier, I'll be using the 1 min chart along with booktrader, so I always trade in the direction of the immediate trend only. That way, my focus would be on setups that lure either buyers or sellers.

Am not even going to paper trade for the next few days. Sitting and watching, and pure talking with no action is the best way to learn to tape read.

My turn to irritate the hell out of D!!

Ha!

Battling It Out In A Tempestuous Market

Was staring - in disbelief - at the daily profit target I had set for myself some time back.

$1000.

What a joke.

A revision to "NOT LOSING $1000 per day" is in order.

My hyperactive brain started churning out one idea after another on how to get to the bottom of what trading is really about, when I was supposed to be in dreamland.

I desperately need and want to, get a full grasp of the basics of trading: how all the biddings and offerings move price up and down, what the motivations surrounding buying and selling are, what strategies to employ at 1)the open of the trading session, 2)half hour after that, and 3)during the last 2 hours.

Charts, I decided, are literally useless at 930am EST as far as daytrading goes. And news - as always - are just distractions at best. There's always the option of not trading the first half hour of the session of course. But that's a hell lot of opportunities to give up.

Candlestick patterns - that is the first thing I'm going to start ignoring from now. Even failed patterns FAIL miserably these days.

There is nothing you can get from any sort of patterns anymore. I'm not even talking about using a chart to get some sense on what's likely to unfold next (which one really SHOULDN'T do), I'm talking about using it to get some clues as to what market sentiments were like minutes, hours and days ago.

There are all sorts of reasons people buy and sell at specific price levels and I don't have to know why. It could be because it's a support or resistance, or because that's where the profit zone is, or where it's the best place to puke. I don't care. I just want to know who wants to make a killing where, and how many want to puke that day and where they will end up puking.

The people who move the market don't look at charts - seriously, this is what I am starting to believe. Some I think, can't care less about fundamentals even. When Soros nearly brought down the HK market, he had either a) blatantly ignored that the company he was short selling had strong fundamentals, or b) KNEW that it was a good, strong company, and that by sending its price down 5% in a single day, it would surely fuel a panic sell-off - from which he would stand to gain immensely.

Back to daytrading.

The violent swing in intraday price actions we see these days is clearly caused by factors beyond general market conditions and sentiments.

I'm not going to start a thesis on the ills of interfering with what is otherwise an effective free market model, coz many are already doing that. Whatever the intentions and justifications, the market is now officially screwed.

The best I can do to stay afloat in this storm is to FIND A WAY to get on board a titanic vessel and take a ride with it to wherever it wants to dock.

If it sounds abstract, it's only coz that's what trading is about, essentially.

I'm going to be taking a 3-pronged approach.

Monday to start; details to be documented.

D needs to start a trading journal.

FX Trades 11/14

Entered Long:

EUR/USD, AUD/JPY, EUR/JPY, AUD/USD, USD/JPY


Charts (Hr) of Pairs Traded



Pairs That I'm Watching Today:

TF & FX Trades 11/13

2(1.8) + 1.3

Done.

All these nose dives are starting to make me sick.

Tapereading works (for me) in a market where few actually know why they are buying/selling.

FX Trades 11/13

Closed positions (all 3 pairs failed to break out of consolidation):

AUD/JPY - Bot 61.343 Closed 61.555 (21)
CAD/JPY - Bot 77.43 Closed 77.87 (93)
GBP/JPY - Bot 143.64 Closed 143.578 (44)

Total: 158 pips

AUD/JPY and CAD/JPY are now attempting a break above resistance. Waiting to see how they close.

GBP/JPY is still going nowhere.

A Man That Makes Me Laugh

I can't help it - this is going on my blogroll.

This is the first blogger that really makes me laugh! Non-stop!!

SeaBloke,

look past the bras, the boobs and words like "masturbate" (even these are funny - this guy doesn't give you a reason to dislike him :-)), and you'll appreciate his wit, his wicked sense of humor.

Come to think of it, YOU are more wicked than him! LOL!!

So Much To Learn, So Little Time!!!

My brain is about to explode.

I am now:

• Monitoring my FX trades (went long after the long bearish candle right below the BB Centreline; entry price represented by pink dotted line)

(Click on charts to enlarge)
3 Trades (Long) : CAD/JPY, AUD/JPY, GBP/JPY

Reason for entering long: JPY looks way overbought and pairs have bounced off their lows in years.

All the above hourly charts show a HAMMER from 14 hours ago before price extended downwards.

BB seemed to be squeezing price from BB -2 into the area between BB -2 and BB Centreline, as price bounced off its low with strong bullish candle and is now consolidating above what seems like a support provided by the hammer (for all 3 charts).

Pairs did a 38.2% correction and I entered after the retracement...

Perhaps a little too early...

If subsequent candles don't pierce through BB Centreline and fall below green solid line, I'm bailing.

Plan is to enter again on confirmation that there's support by BB Centreline.

Post-Trade Review (For Nov 12's Trades):

Entered SHORT on all the above 3 pairs (2k units each) yesterday (Nov 12) and made $90...not impressive, but shows the BB method works

Grey dotted line on charts shows my entry point and grey solid line shows where I covered.

It's clear that it was stupid of me to exit at precisely the point that support was breached and the pairs were diving towards their lows.

I had to close my trades coz I needed to focus on TF when the US market opened, and mainly coz I knew I was pushing my luck with the pairs (very near their 5-10-year low)

Most importantly, I haven't really worked out an exit strategy, and the best exit for me then was to simply grab whatever's on the table.

Stupid! Stupid! STUPID!!!

• Going through my analysis on the various FX pairs to see if I've missed out anything

• Studying the movement of TF in the past 20 days, and figuring out what it's likely to do today.

If my FX is making money, it should help a little ie. if yen is going down, I'll be more comfortable taking the bull's side.

I'm not expecting TF to bounce off its low with vigor, but I'll be cautious with my short entries should TF show any sign that it's not going to plunge right through support (its low at 438.5).

TF Hourly

• Going through my TF trades from yesterday to figure out why and how I made all those stupid mistakes

TF 5 min (Nov 12)

• Studying a tapereading book called "No BS Daytrading"

• Tapereading 10-year Treasury and struggling to identify setups that show big players at work to move the market

• Keeping a very close watch on Alberto, who's licking his skin off the place where the clinic gave him his drip.

Can't bear bandaging him again after causing his paw to swell to twice its normal size after I decided to tie it really tightly to prevent him from licking it off.

My heart bleed when I saw him approaching me with a limp yesterday.

Took me half a day to massage him before he could walk again.

I'M SO SO SO SO SO SO SO SORRY, AL!

• Drafting reply to Moyo's comment and question regarding my posting on "All Is Not Lost Yet"

Moyo, thousand apologies for late response.

I want to say something smart, so give me a little time please?

And my apologies for not having been able to call you.

Life's been crazy!!

• Deciding what to order from Pizza Hut for lunch (looks more like for dinner now)

To: The Lonely Trader

TLT,

You would know what this is about: http://fxjules.blogspot.com/2008/11/ta-1111.html

The BB method is perfect for daytrading futures too! Thanks for sharing!

I used it to trade TF last night, and although it was trading in a pathetic 8-point range before 2am, I scraped over $100 testing the method. Was conservative and hesitant at first. In retrospect, TF was nothing like before (when it was called ER2). It crawled like a snail, and has lost its insanity. I'd rather it lose its mind and move like a maniac. But it's a market where no one's betting big and aggressive. And probably very little scared money is playing.

In any case, I ran a few times for nothing, and realized it was stupid. I lost 200 at first, but ended up 100 up by applying the BB method. And I stopped playing by 1o:30, but continued to watch the market til 2am, and the method worked reliably enough.

Will share more if I continue to use it. These days, I can't seem to settle on a specific way to trade.

I would like to think I'm being adaptive.
:-)

All Is Not Lost Yet

During a time when the wisest and most experienced traders are calling for 5000 for DOW, I feel compelled to present a different view - one that I used to think has very little bearing on my daily trading activities, and hence not worth documenting.

You see, despite my primarily bearish SHORT-TERM view of the market, I've always belonged in the camp that believes that Rome didn't actually fall. I think it simply morphed into a different society.

I'm not going to tell a grandfather story on how and why Rome was perceived to have fallen, there are many free resources out there that detailed that, and one needs to just google "how/why did Rome fall" to find heaps of write up on it.

What I want to do really is to look at some charts - our bread and butter - and then document my own observations about them, draw my own conclusions, and finally, to find some reasons to support my belief that life's going to go on...for now at least.

DOW Monthly

How I look at this is that DOW has retraced over 38.2% since 1900.

No big deal.

It retraced by that much before, in the late 1980s. And few made a fuss over its parabolic rise in the decade following that correction.

Fundamentally, what's unfolded in the states is nothing new. It's happened many times throughout the history of mankind, and I'm sure that during those times, people actually believed that the events unfolding before them were unprecedented. The only unprecedented event that I know about, and will kick a big fuss over, is the one that involves Eve taking a bite of the forbidden fruit. If not for her, I won't be eating today just to live. *&$#*$**$^@

SPX Monthly

Almost a twin to DOW, except for the double-top.

But we've seen double tops and mountains before.

And what happened after that?

S&P 500 shot through the roof.

RUT Monthly

This is an interesting one.

What we see in the area shaded green - take a close look, then look at the whole period spanning 1991 - 2008. Pay attention to the fib levels in the various colors and you'll notice that each of those retracements was 50%. Look at the lines 367.586 and 493.2621 and see what happened there.

If anything, I'd think that RUT is really boring and predictable.

NDX Monthly

Consolation?

The Nasdaq 100 is clearly still on an uptrend, despite the dot com catastrophe.

Well, ok, it was saved by a bigger evil, and it seems we're going to have to pay for it now.

But I doubt we will.

Human beings is such an adaptable species that even something like an ice age will still leave a few standing - enough to breed a whole new pack of wolves that will continue to rule earth.

On a more serious note, we aren't really doing as bad as most thought, and we definitely are not living in the worst of times.

While it makes sense for traders to do TA on charts plotting movement in POINTS, to get a clearer sense of how we are doing in relation to the past, I personally prefer looking at a LOG chart that plots PERCENTAGE change.

If we want to whine about the extent to which things have soured, we have to first look at the magnitude by which they've gotten so rosy in the first place.

Comparing a 1000 points drop now to a 100 points drop in the 80s is no different from comparing apples to oranges.

A log chart compares apple to apple, and an orange to another orange.

So, here goes our log charts for the indices:

DOW Monthly (Log)

Now, the drop we see in the shaded area - THAT is a depression.

Where we are now is simply a period where we are pausing to contemplate on how ridiculously and frivolously extravagant corporations and individuals have become.

But since nothing new really happens under the sun, after this phase of reflection, we'll be all ready to welcome a new era of decadence and profligate consumption.

SPX Monthly (Log)

Same shit.


RUT Monthly (Log)

Uptrend breached.

So?

We simply draw another trendline from the beginning of RUT to the current month.

And we're up again!

Just like before.

BORING.

NDX Monthly (Log)

With this, I don't even have to re-draw lines. NDX is clearly still floating above its uptrend line.

I feel for D's family, and for my friends who are living in the states when they question if they are ever going to see light at the end of the tunnel, if they are going to lose everything - their house, their jobs, their retirement funds, their investments. D works for THAT US bank, and I feel for him too.

But from the bottom of my heart, I don't believe this is doomsday.

When everyone's living like there's no tomorrow, THAT's the end of the world; when all are wondering what the future holds, it's a good start.

Cat's Game

VEXED

I used to hate the first 4 months of the year. They almost always suck. But now I'm going to have to blacklist April and Oct, and very likely Nov and Dec as well.

I'm officially down to having no good months!

It has gotta be me.

I'm aimless.

Trading has gone from bad to worse. I have gone from having a plan each day before going into the market to impromptu trading.

And when I used to ask NQ when it will plunge, I'm now actually EXPECTING it to (Thanks, Harry, for pointing out...).

I can't settle on a trading timeframe, and I have no idea where to put my stops. Been scalping a fair bit, but am still not getting a good feel of NQ's rhythm.

And I threw away my charts.

I'm going to have to come up with a list of crazy things that I might do next and have D make sure that I don't do them!

I'm all over the place. And knowing that for a fact isn't helping.

Being in denial was so much better.

I really have to find my balance and focus AGAIN.

How many times do I have to do that a year??

Oh, LIFE, PLEASE, just stop throwing me curve balls!!!!

NQ 11/7 - Plunge

NQ looks all set for a mini plunge to 1234.

Even if it breaks out of 1270, strong resistance above at 1295 is likely to send it down given the grim news on Ford, GM and the really unimpressive job data.

Pre-Market Analysis NQ 11/7 & HOPE

NQ 30min

This is how I'm reading those rectangles:

Green: Result of a failed double bottom ie. bulls bailing

Red: Bears puking

Blue: OBAMA!!

Grey: "What Now??"

As far as today is concerned, I'm not too pessimistic. Pre-market trading is probably going to continue to go sideways in the range of 1245 - 1270.

I'm taking the view that market's going to find support at around 1245 - 1252, and that if it hits 1290 and STAY up, and the broader market and energy sector were to show the same trend, then it's time to SELL that lousy energy stock that D's mum's relative had convinced her to buy. Can't sell it now coz the size she's holding is equivalent to the equity's one day volume. A rally is needed for us to get rid of it bit by bit.

I'm really not a bear now, but I'm not bullish either. As much as I like the US president elect, wall street doesn't, and for valid reasons. But those who take a slightly longer perspective will appreciate that a suffering middle class and economy will not serve anyone well in the long run.

Wall street blood suckers will have to be weaned prematurely off blood though.

If NQ doesn't break above 1295 before 10am EST, It's likely going to do something like yesterday: all over the place in the first half of the trading session, and plunge in the second.

Well, that's my view.

Which got me thinking: what on earth am I doing this for since I'm just going to tape read??

Well, maybe I won't tape read today.

This whole following the price going up and down and tick by tick is really killing my eyes and my brain cells.

I am going to go along with Lord Tedder and D's observation that I do DO BETTER when I'm selective with my entries and only strike when I see MY setup.

At 6:19am EST:
NQ 13min


Encouraging.

D's going to swing 1 long contract if NQ bounce off trendline.

NQ Trades 11/6

An even lousier day.

LOSS: $277

Reduced position to 1 contract per trade coz I was expecting the market to be really schizo.

What I wasn't expecting was for NQ to turn out to be so SLUGGISH and LILY-LIVERED!!

On hindsight, I ought to have stayed out of trading all together today, and watch some good movies instead!

%&$#*&#$**!!

I didn't even have to look at a chart to know that it's a trendless, rangeless day for NQ.

Prices were basically crawling up and down within a tight range throughout the morning session.

Nil commitment from buyers and sellers.

Says a lot about the current market sentiment indeed: pure confusion.

I want to blame Obama.

44 is not exactly an auspicious number in my culture.

As a matter of fact, it's a REALLY BAD number.

A single "4" is bad enough.

44 is double whammy.

Ok, this is lame.

I mean, I really like the guy.

And it's not like he chose to be the 44th president.

Totally my fault that I don't know when NOT to trade.

But at least I'm not chasing.

Not today.

Maybe not even tmrw.

I'm not going to ask that same old boring question about when NQ is plunging.

It doesn't look like it will anymore.

Just a very LABORIOUS climb up.

SLOW is bad for my style of trading. A lot of adjusting to do.

At this rate, I'm much better off holding a day job.

But after being out for 18 months, I wonder if I'm going to be able to get back in....

Worst case scenario: WAITRESSING!

Definitely going to be hell of an experience.

Hur Hur.....

NQ Trades 11/5 & HATE

Profit: $275

A lot of actions with little reward.

LOUSY DAY.

Totally not in the mood to transfer my trades to excel, so am not tracking wins and losses and points.

D and I are a total mismatch.

We can't communicate.

I can't seem to be able to ask any questions without getting him all suspicious that I'm accusing him of sabotaging me or deliberately making my life miserable and difficult.

The D I know keeps things to himself, as long as he's with me.

He can spend hours, days, weeks talking to others, telling them what he FEELS about things and life in general.

But everything in D's heart is a mystery to me.

Coz that's the way he wants it to be.

The site that D has been checking out once he got home from his trip was Facebook.

Messages, and all the other JUNKS there are things that captivate him.

For days, he knew nothing about the pictures I left on my blog for him.

Why did I even bother to do something that I've always hated, for someone who has NIL interest in me???

I'M A MORON.

It took an unhappy and totally embarrassed and awkward me to prompt him to drop by my blog.

Maybe D really hates reading.

Except mails from others.

He dedicate songs.

Something I never knew he was sentimental enough to do.

In fact, I had to be told, by D himself, that he is actually a sentimental man.

He hadn't been showing that side of him coz he didn''t have an audience - until lately, that is.

The song wasn't for me.

It was for the audience he finally found.

I HATE FACEBOOK.

I ABSOLUTELY HATE FACEBOOK.

I FUCKING HATE FACEBOOK!!!!!!!!!!!!!!!!!!!!!!!

And I HATE all the women he's opened his heart to.

Today is the day I refuse to take any blame for his reluctance to communicate with me.

Today I just want to be ME - the wilful, evil, devastatingly callous person that absolutely HATES THE WORLD but has to get up each day pretending to believe that everything and everyone around her is good and normal and that she's the only one that needs fixing!!

I'm Not American, But I'm SO SO Happy Obama Is President

Hallelujah.

The US finally has a smart, good man as her president.

Long due.

Trading Psychology: Cutting Loss

Spent the session going over D's mum [who left for home in LA earlier today :-( ]'s portfolio.

3 items on it - 1 is an energy stock, 2 are mutual funds.

The portfolio - with the energy stock making up 2/3 of it - has lost 58% to date.

While it certainly looks like one of the mutual fund (the other one is a goner) is the one that's worth holding since it's paying a monthly dividend, I am FOR selling it when there's still something left.

Maybe I'm prejudiced, I've NEVER believed in owning mutual funds. Mutual funds that are newly launched, well-packaged and publicized are the ones that go up in value while the rest basically die a slow painful death, in my opinion.

Today's the first day I got to see D's mum's portfolio, and I have to say that the relative who gave her the tip to buy the fund SHOULD BE SPANKED.

She bought the fund at $14. It's now $6. It plunged from $9 - $4 in less than 2 weeks, and that's just the first leg down.

A picture is worth a thousand words:

Weekly Chart


Daily Chart

I certainly don't care that the market might rally whoever the president of the United States is going to be after the big day tmrw - if there's a right time to cut loss, it was the day that the fund was bought.

We managed to sell every unit of the fund, all within 15 mins.

After we sold, the fund went up by $0.04.

I'm not regretting the decision. If anything, I'm happy that someone's bottom fishing. I'm happy that we could still sell such a chunk and someone's willing to buy.

I'm not showing the ticker coz I feel for those who are still holding. I do. But I can't NOT sell it. Trading is a zero sum game.

And I told D that there's no looking back.

To wait for the fund to go from where it is now back to $14 is fat hope at best. If anything, it's going to end up like the other fund, which is now sitting at literally zero.

By selling, D's mum has officially said goodbye to $50k. But at least she gets to keep the remaining $25k.

Holding the energy stock to see what it's going to do in the next few days and weeks.

It will take some time to break even, if it ever breaks out of its current range (am looking at 4 major resistances on daily chart).

But at least there's a chance. It's not going to do any worse than before, and it's not incurring any variable costs or having any cash flow problems. It's not going to take long to see if it will break below support -and when it does, the additional loss is negligible.

So we're giving it a chance.

What a day.

If by some divine intervention, the mutual fund that we just sold goes up to $14 in the next 12 months, I'd have been the most ungrateful creature on earth.

D's mum is a thousand times more motherly to me than my own mum. And I like her a million times more than I like my mum.

No.

Correction: I can't even use the word "like" to describe the feeling I have for my mum.

She's merely my obligation.