Thank you, DT, Ryan, MVW, Cory and Sandy.
I woke up an hour ago, and the first thing I did was turn on my big monitor (I don't shut down my computer until it crashes LOL!) to look at my chart. And I saw what I expected to see. Price hitting 923.50. It went way beyond actually, to hit 928. It was the kind of action I had waited for for an entire week. And what did I do just before that monstrous candle appeared? I closed my last position (at the candle that I had indicated with a huge black arrow in my chart above).
I don't know if you recall that I wrote in my notes sometime last week, on one of my charts, that at around 345pm, when you see either a bear or bull trap, you can prepare to see bear/bull runs for at least 2 long legs.
In the chart above, you can see that sellers realized they were trapped at the candle before the one that I had exited. Price had gone 1 tick below the low of the bull candle at 335pm after luring sellers in with a "short" setup (the bullish 335pm candle had a high that's higher than the candle before and after it, and a low that's lower than them - a text book Outside-Inside-Outside signal for shorting coz the 2nd Outside bar is a bearish candle).
When price had gone 1 tick below, stop orders to sell were picked up, and sellers are now in an open position. What happened next was not what they would have expected - price closed right where their entry bar had opened. With just 30 mins to market close (and we know most don't want to be in position after 330pm), many would immediately send limt/stop orders to get out. The collective actions of sellers would send price soaring north until everyone who wants out is out, and of course along the way, some buyers would jump in and chase price up, sending price higher in matters of minutes.
The best entry for a scalper, would be the bar that I covered. The candle before it was the signal. That was the candle that surprised both sellers (who are now trapped in a losing position) and buyers (who are NOT in position and hope they are), who would then react in the candle that followed. At 15 to 30 mins before market close, you can expect price to just go in the direction of those who are scrambling for the exit. The profit taking point? When you see the first bearish candle (for a bear run).
When I closed my position and logged out of the AT platform, D chided me for giving up (strange, really, given that he's always the one that tells me to take it easy). I had to tell him I wasn't giving up, that I know that price would hit 923.50, but that there was no point in holding that trade for that profit target of 923 and capturing the day-end score coz the results were from a mixture of scalps and swings. What I wanted to capture was the statistics for swings and the figures for yesterday were invalid. I do want to beat myself up for messing up the very day that would have given me the stats that would validate whatever hypothesis I had on the strategy I was testing out.
Murphy's always just a click away.
What I had learned in few days' of experimenting with the holding method was that there is indeed an ideal hard stop that i can use even in scalps. And that is precious. The reason that I had wanted to give up scalping is coz my risk-to-reward ratio is just horrendous. I've never believed in 2R, 3R or 4R. But 1 for 1 - that seems appropriate. Or 8 ticks stop for 6 ticks profit - that's still very acceptable, to me. Many times, I was able to find entries with 3 tick risk and 3 to 6 ticks immediate profit (if I take it). Very short window to take profit before price does its usual - comes back to bite you.
So what I've decided to do is that I'll resume live trading doing what I'm used to doing, while continuing to paper trade the holding strategy. I probably can't do both at the same time, so D will help me to execute the paper trades on his computer (and in the process helping him to appreciate the benefit of WAITING for setups).
I'm NOT giving up. No way. I don't know what I would do if I don't trade. I'll probably be out causing trouble like I always do when I feel bored (I have the shortest attention span among the people I know) and aimless.
Thanks, again, guys, for the very thoughtful notes. I was surprised to see 5 comments when I logged on to my blog to do an AAR for yesterday. And I thought I hadn't really slept for that many hours! LOL!
Cory, those are black mambas. "Black" does not describe the color coz there are no "black" mambas - only green, metallic and brown and I think there's another color. I absolutely love them. They are very very nice to touch - their skin is smoother than mine LOL! Without their fangs, they are lovely creatures. They don't attack when they sense threat - they get away. And they are FAST! But once they are cornered, they retaliate and they are extremely accurate with their strikes. One dose of their venom can kill up to 15 adults. I love their eyes. Just stunningly captivating beautiful jewels.
Now that I'm feeling upbeat again, I shall wane off ice-cream (
Sandy, are you psychic?!). I've had more ice-cream in a week than I've had in a year! LOL!
Total: USD 375
Not a fun day in general. First the morning scare, then the extremely distressing counter-trend longs during the US session.
