A good day on the standard setups....

Hi Everybody,

Even after what I said yesterday on the standard setups, true to fashion, and in line with the Cyclical Nature of Trading, the standard and automatic setups had a good day yesterday.

As the STF was blue, Standard Traders should have been looking for buy (not sell) setups. And we got a lovely DP buy on the 3min ES that nailed the low of the day ! The ES rallied nicely to the first target where +2R Profit (ignoring slippage and commission) was available.

But this was not all, as we will see in the next post

Thanks, Steve

How to avoid losses

Hi Everybody,

Yesterday was a hard day for the Standard Traders among you as there were a number of losing (-1R) trades that unfolded in the afternoon, so the question I am asked all the time is whether there is a way to avoid these losses. As I know, we all don’t like losses.......

Well, yes, and this is what I teach day after day on the Advanced Blog, and it is to use the “larger degree trend” on the 15min Charts.

I know that the STF was still blue, so the standard guidelines said to buy, but what you all need to understand (and I go into detail on this in the Trading Course), is that every indicator in the world is “lagging”. In other words it will always be “behind” a tune. We only have the STF in the program as an easy way to help newer traders get to the basic level, before they make the transition to a more advanced trader. But for the more Advanced Trader, we have WPT’s and DP’s which are “leading” in other words ahead of the turns. But you need to “learn” how to use them....

So we DO have a brilliant way to help you “anticipate” the larger degree trend, and this is why I spend so much time on this education, in the hope that once you become comfortable with the Standard setups and guidelines, you all want to take the next step and become an Advanced Trader. When you make this step not only can you avoid otherwise losing trades like these, but also additional trade opportunities open up to you.

Please now take a look at the Advanced Blog to see how all these long traders were “against” a decline off a 15min DP resistance area, so should have been avoided.

Thanks, Steve

Trail or take

Hi Everybody,

Today I would like to look at a question I ask in the Trading Course, whether it is better to simply “take profits” at profit targets, or to start to “trail” (for example 1 tick beyond bar high or lows) once a target is reached.

Well, there is no set answer, you do whichever you feel most comfortable with. As long as you stick to the same method each time.

A good example is on the 3min Russell yesterday, please see the chart, where the long off the TS3 buy reached the first target, where a nice +3.2R Profit was available. But if you were using the “1 tick trail” method, this would have help the log into the high for +6R Profit (ignoring slippage and commission).

There is no right or wrong way, just stick to the same method and don’t “chop and change”

Thanks, Steve

PS please remember that today (Thursday June 10) is rollover day for the US e-minis.

Russell helps out.

This is a good example of why I say to follow all 4 e-minis, because they do unfold differently. So with -2R on the 3min ES, this +2.2R Profit (ignoring slippage and commission) on the 3min Russell was welcome.

As you can see, the TS1 sell was “in line” with a red STF so was a Standard setup. Even at the first target, this was a nice +2.2R Profit (ignoring slippage and commission). Yes, there was a -1R loss earlier, but that still makes +1.1R Profit on the day for the 3min Russell. +1.2R helps offset the -2R from the ES, making yesterday only a slightly down day.

Thanks, Steve

PS, But the Advanced Traders among you should have spotted another lovely trade on the ES. Please see the Advanced Blog.

Cyclical Nature of Trading....

Hi Everybody,

You are all very well aware with the Cyclical Nature of Trading by now, so a quiet day yesterday should have come as no surprise, especially after the brilliant trades over the last few days.................

A good example is the 3min ES, where we had two (-1R) losing trades. It is important to show losses, as it is important to understand that losses can and do happen when trading............ But (and this is the important part) the losses were kept small.

But, if you were following all the 4 e-minis, like we suggest, then the TF (Russell Index) would have help make some of these losses back, see next post.

Thanks, Steve

The difference between a Amateur and Professional Trader....

Hi Everybody,

Yesterday was a great example to show the different attitudes between an Amateur and a Professional Trader. If you look at the 3min NQ chart, we had 4 trades yesterday, 2 winners and two losers. The Amateur would complain that this was only a 50% hit rate and they wanted higher. They would also see that Profits were taken on the last DP sell early and then they would also complain that they missed the biggest move of the day. So basically, they would just moan and complain about everything..........

BUT, the Professional would just look at what is important – the money. They would look and say that they made +4.8R (+4.7 -1, -1 + 2.1) on the day. They would know that this followed on form a +9.9R Day the day before, so would be very happy that they had made +14.6R Profit over two days. At 2% per R, that was approx 29% return in just two days. As a Professional, they would know that was fantastic trading, and as such they would be very very happy....

So do you see the difference. The Amateur lives in “what if” and “what could be” land, whereas, the Professional lives in the “real world” and just looks at what is important, the money made over a period of time. That is what is important, not the number of profitable trades, or what the market did, but what the trader actually ended up making...............

This is where MTPredictor will help you, as it keeps the losses small, which allows your Profits to be larger, which should then give you the edge, over time, you need in your trading....

Thanks, Steve

Then another nice Profit from the YM

But Friday did not stop there, as you can see, we got a nice TS3 sell later in the day on the 3min YM that made approx. +3.9R Profit (ignoring slip[page and commission). Again, this was a completely standard trade as the TS3 sell as “in line” with a red STF,. And then profits were taken at the first target as the STF was weak....

Can you all see what a brilliant day Friday was here we had two trades for a massive +9.9R Profit (ignoring slippage and commission). This is brilliant trading and would more than have made up for small losses the day earlier...... This is why it is so important not to get emotionally involved with any losses. Don’t get angry or frustrated, as you will then just miss the good trades that will come round next.

This is one of the main difference between amateurs and Processional, Amateurs worry about losses and spend their lives trying to avoid them. This then get this into such a psychological mess that they then miss then next big profit or cut profits too early, as a result they never manage to make the most of the Big Profits when they come through. The last few days last week has been a brilliant example of this, where MTPredictor has done its job of keeping the losses small and then maximising the Profits, exactly what the Professional trader needs.

Thanks, Steve