Keep Calm and Don't Move Your Stops.....

A little risk management saves a lot of fan cleaning!

The Purpose of Life is Joy!!

Thursday, June 29, 2017

Bye Bye Bye CL????

My love affair, if you can call it that with CL is slowly but far more rapidly most recently , fading away. The beautiful moves it used to make every morning are slowly becoming a thing of history. In its place at least for the moment (am I becoming a player?) is NQ, It moves more or less like CL of old, has a smaller tick value which leads to better risk control and once in a while, a lot more size potential!

Today I made my first official NQ trade. Yes I had a couple earlier in the week just to test the waters but today I made it my priority instead of CL. Of course, I got stop ran with a subsequent nose dive to the target! But instead of cussing it out like I have been in the past, I just laughed and let it go. I did try to get a fill at resistance but it missed printing me by one tick before hitting the target zone.

This trade was a potential 110 tick trade per contract and I would have been at max size had I not been stopped out. I went in small with the intention of sizing up rapidly if it went in my favor but it one ticked me in and reversed to the stop and then reversed to target. Nice....

All that said, that trade felt better than most of the CL trades I've taken in the last few months. I like the way the tape moves, I like the trendiness of it, etc. So I think I will work with NQ as my primary instrument at least until it begins acting different. I think I held on to the idea of CL way to long. I might even look at some of the other not so obvious instruments to see how they move. After all, I'm not supposed to marry the thing, just trade it and I've been married to CL for to long now. I mean, NQ has moved 150 ticks and CL has barely ground out 20 or so in the last hour....please....


Oh, here's a chart and a video

Wednesday, June 28, 2017

Mid week update...actually

Taking 5 minutes out to recap the last three days.

Trading well....5M charts and a tick chart on inventory days POST inventory number...

Being very deliberate I have booked 70 ticks per contract this week in both the CL and the NQ. There has been LOTS more money available. But within the context of my trading hours and limitations, I am quite pleased.

I used the tick chart today to get into CL on the long side just a bit early, waited it out, got long again and rode it for 40 ticks I think. No trades in NQ today even though there was opportunity, the cost for that opportunity was well beyond my comfort zone so no trades.

Net net, its been a good week so far.

I am working on my mind every day. I feel different. Something is different. The energy has changed even if only slightly but I can feel it and I like it.

Ok, back to the day job.

Thursday, June 22, 2017

Mid week update

Ok, its not mid week but its as close as I'm gonna get this week.

This project is sucking up time like a black hole. It pays really well so I'm not complaining but in a perfect world, I wouldn't need it. But I do and so we work with what we have! They pay by the hour with essentially no limits on the number of hours you can work in a week with a minimum of I've been banking a lot of them since the beginning of the project....I can't sustain this indefinitely but this phase of the project will likely be over end of this month. Once that's done, there is probably going to be a much longer aspect of the project with more focus on quality vs quantity which means it could last or months.

I traded Monday, Tuesday and yesterday. I can't really remember what happened the first two days, they seem like they were a lifetime ago but yesterday I made a bunch of money prior to inventory and gave it back after inventory. I'll try to do a weekly update on Saturday or Sunday.

Scalping works well when you can pay really close attention and not so well when your attention is divided as it was yesterday.

Today, no trading as I had no time this morning, I put the charts up on a secondary monitor which I never use and glanced at them from time to time but with a never ending flow of files to review and pass judgement on, I decided not to trade today.

My daughter hyper extended her elbow last week which appears to be a season ending injury before its even started. Shes got at least two weeks of rest which is going to make the summer camp impossible. She's still going but can only participate in activities that doesn't include putting pressure on her left arm. Doctors note and everything. She is pretty bummed out about it. Its a good life lesson in how to handle disappointment both for her and for us.

We ditched the cable tv that cost about $150 a month and replaced it with SlingTV and our existing Netflix and Amazon Prime memberships. New monthly cost of entertainment, $52.00. I'd say that is a good thing. My kiddo NEVER watches TV, I only watch sports which I get on SlingTV, my wife only watches old movies and British TV and she gets those on SlingTV, NetFlix and YouTube and we can get all the music we want for free on YouTube or Pandora so no need to pay for all those extra channels on cable. Can't believe we didn't do this a long time ago. I watched the baseball game today on SlingTV sitting in my daughter's doctors office . That was awesome!!

I'm seriously considering getting a standing desk or perhaps one of those risers that sit on top of your desk and allow you to raise your monitor and keyboard up and down as you like. They cost anywhere from $200 for  base model to around $500 for a higher end one. Has anyone had experience with these contraptions? If so, drop me a line and let me know how it has gone for you. I'm sick of sitting all day and I type better when I am standing anyway.

Last thing, I am also considering a flirtation with NQ. It moves similar to CL but doesn't seem to have as many stop runs. I've been watching it for a few days now albeit not that close due to trading CL and working at the same time but in time, I think CL may trade more like QM does now. As energy becomes more and more renewable based, oil is going to eventually find a price range of $25-40 a barrel and more than likely lose its liquidity. For instance, I could NOT get filled on a single lot the other day on a profit target. granted, my target was at the extreme of the range and it must have printed it at least 10-20 times without filling it. I punched out manually at that point but that's the worst experience with not getting a fill I've ever had in terms of watching it print my price a dozen or more times without a fill. So NQ looks attractive from a movement standpoint but I haven't traded it live in a really long time so not sure about fills and liquidity yet. If anyone has suggestions or ideas along these lines, let me know.

Ok, its getting late in the afternoon, I've been up since 3:30AM I think, I can't really remember and I have commitments tonight until about 9PM or so....long day and I'm already tired enough to sleep.


Friday, June 16, 2017


Two charts to show you.

The MP/VP chart...its messy but makes sense.....then the tick chart. I also have a daily minimized, a 120M, a 30M and a 5M stacked up on the right beside the tick chart. Those all have a single 89EMA on them.

The trading chart has an 89EMA, a 34 EMA and a multi EMA with 21 being the largest one of those....Charts were out of sync today against the  HTF but the 5M was in agreement with the tick chart and yesterday's VPOC and 50% level lined up and looked likely to be target areas. I went there twice with a bounce off the current day mid point and the current day Volume VAL. That trade worked as well.

Yesterday and Wednesday looked pretty similar in terms of how the trades were entered and exited. Nothing fancy, just getting in on the current dominate trend and taking bites where it appears most likely to work.

Interestingly enough, at least yesterday and today, Most of my trades were 2:1. I did not track it on Wednesday but I think it was more or less about the same. In that regard, I can win less than 50% of the time and still make money. Since I primarily like to risk $100 or less per contract per trade, when presented with risk of 5 ticks or less, I can trade larger size. This happened once today which was nice. So I risked $100 to make $200 once and $60 to make $100 twice. So that worked out to risking $220 to make $500. Just a bit better than a 2RR day!

If I am at the charts when all the time frames align, I might be able to to find 3 or 4:1 trades without having to wait as long for them to pay of as these did today. With a 5 tick risk (not going to see these all the time) and a 20 tick trade, I'm looking at 4:1 and that works for me. I can live with that.

I don't know if I am going to include charts all the time when I post but I've included them here for reference.

It's getting late and I'm feeling the effects of working almost around the clock this week. Tomorrow is sleep in day (til 7AM that is) some honey do's around the house, 3-4 hours of work and then perhaps a movie later in the day. On a side note, its supposed to 111 degrees tomorrow and 119 by Tuesday next week . That's 43.8 and 48.3 for those of you using Celsius! People say its not actually hell but you can see it from here!

Have a great weekend!

Do what works

Patience is the key....or at least its in the top three things you need to be successful as a trader.

The other two might the edge you have and sound money management.

Beyond these three things, there is only one command in trading.

Do what works.

That's it. Well maybe there's one more thing....Do what works FOR YOU. Ok, that's it.

Ed Sekoyta said a trader should only trade as system that works with their personality. This is, in part, a portion of what it means to get yer mind right. Stop trying to work something that doesn't work for you. Insanity right? Indeed.

As part of the deconstruction of my process and mental/emotional state, I've been reviewing past journals. Some really old one as well as some more recent ones. A couple of years ago, I went several months without a losing month. A few weeks ago I had my largest winning week ever. In January I didn't have losing day, a first for me. And there have been numerous other "winning streaks" along the way. They all have two things in common.

1. In each instance, I was scalping 10-20 ticks per trade depending on the daily ranges.
2. In each instance, I began looking for ways to further maximize the SIZE of the winning trades, whatever they were at the time.

Essentially I got greedy looking for more. More for me requires a set of traits and skills I do not have. I have the knowledge to trade for larger wins but the emotional traits are not in my possession. Every time I begin winning, I also knew I was leaving money on the table IF ONLY I would hold longer or wait longer for better set ups, etc....

Trouble is, when I do the IF ONLYs, I don't actually do them. I say I am but I behave as though I am scalping. The net result is lots of break evens, losers and very few large winners needed to make this way of trading work. Some overcome this by scaling out of a trade but this ignores the mathematical fact that losing with an initial large position does not overcome taking smaller profits on most of the position that is a winner unless you let the last bit run a really long time. Most don't. I didn't and so this doesn't work at least for me.

The final analysis is this; I am a scalper. I suppose I've always known it. But over time, I've allowed well meaning people to talk me out of it. People like;

Big Mike
Tiger Trader
Others like these
Assorted "experts" I've read over the years.
Well Meaning Friends that have written me private messages over the years.
Anonymous blog readers that send me private messages.

All telling me I must have bigger wins. That scalping is a losers game. And yet, I am personally acquainted with a couple of very wealthy scalpers. Every time I do this exercise, I find people killing it by scalping. There is a disconnect here. Perhaps the non scalpers are telling me the least from their perspective and the scalpers are also telling me the truth......from their perspective.

I have a theory about the universe. That when truth presents itself, something inside a person will resonate with that truth. Whatever the truth that person needs to hear for themselves will leap within their spirit. And somehow scalping has resonated with me. Its time I acknowledged this publicly.

There is a book out now that is quite popular. The author even has a Ted Talk. The book is called "The Magic of not giving a f**k!. I haven't read the book nor listened to the Ted Talk. The title looks like click bait to me but there is a truth contained within the click bait. That is, those that are successful in any endeavor have really one thing in common. They don't care what other people think about them in their pursuit of their goals.

I have spent a long time as a trader giving a f**k about what other traders thought about me. I knew I needed to have big wins to impress people and truth is, this is a limiting belief.

As John D. Spooner once said, "Do you want to make money or do you want to fool around?"

I've been fooling around it appears trying to impress everyone except my bank account.

On Wednesday, I went back to scalping. I made 50 ticks, yesterday, I made 30 ticks, today I made 30 ticks. No trade was larger than 10 ticks. Granted I could have sold on Wednesday and just held and made a ton of money but that goes right back to the issue I discussed earlier. Greed.

I made more in the last three days than I did in the 30 days prior. I will be a scalper from now on.

It fits my personality like a glove. There is a source of pride and ego in being able to say I made a 6R trade or made a 100 tick trade but I would rather make $100-$200 per contract day in and day out than try to hit home runs every day.

Onward and upward as they say.

Suggested by Anonymous.

Tuesday, June 13, 2017

Scratch day

A directional move to the short side followed by a V bottom to new HOD....followed by sideways chop. Essentially a non-tradeable day. There was one short I could have taken that would have worked out well but I was otherwise occupied with this project....After the V turn at the bottom, I shorted near the highs for a smallish win followed by another short for a smallish loss. Overall a scratch for today.

A few days ago, I broke down and bought Fin-alg's VP and TPO indicator for ninja trader. Its not as robust as Sierra Chart's but its close enough for my purposes. Haven't traded with it yet, but its handy to have for sure. Working with those levels gives you something to lean on to set up your trades. Price action needs to confirm these levels of course but its nice to have.

No trading yesterday as I had a doctor appointment in Phoenix which takes all day since I have to drive 3 hours over and 3 hours back plus at least an hour at the doc's office plus whatever else we want to do. Turns into a 10-12 hour day most of the time.


Saturday, June 10, 2017

Weekly Update

I've been slammed this week with literally no time for anything extra outside working on this project. I have traded just a little bit this week, actually only yesterday and I made 3RR making the simplest trades possible. I did not have time for complex analysis nor did I have time for a long trading session, so I was done fairly early.

Even though I haven't been trading much this week, I have been thinking about it nonstop and I have been mostly thinking about the why I win sometimes and why I lose sometimes. I especially was curious about the days when I can go back in time to those losing days and in hindsight plainly see where had I just done what I know to do, I would have won. I wondered what was different about those days vs the winning days.

Turns out, I think it is about my mental state or more specifically, my emotional state. Essentially I think it has to do with my sense of joy, happiness or peace. The more joy, happiness and peace I feel, the better I trade. The less I feel these emotions or worse, feel the opposite, the worse I trade. I know it sounds simplistic but I think its true.

I've been thinking this for a while now but only really thought in depth this week as I had these many hours to mindlessly work and think at the same time and then today I read the following article excerpt by Jared Dillan of Mauldin Economics. He is a trader, a writer and DJ if I remember correctly. He was once the largest bond trader at Lehman Brothers right before the collapse so he has credibility in this venue.

"People Are Crazy

I think most people (and the legal system especially) completely underestimate how emotional and irrational most people are.
Sometimes I walk down the street and look at people and think to myself how everyone is just barely holding it together. Go to a cocktail party—at least half the people there are in some kind of emotional turmoil that they are barely keeping under wraps.
Trading is about being smart, yes, but it is also an exercise in emotional fitness.
Neurotic, sad people generally don’t make money. Happy, confident people are the ones who make money. (Emphasis mine)
There’s a reason why guys like Paul Tudor Jones hire guys like Tony Robbins as a coach. I think Tony Robbins should stick to his knitting and stay away from real estate conferences, but he has probably helped people be competitive in a very competitive industry. All that hooey about being a winner really is true.
I have seen a lot of people succeed and a lot of people fail at investing, and let me tell you, it is not usually a function of intelligence. These dour, bad-stuff-happens-to-me-all-the-time guys really struggle. They struggle mightily. And not coincidentally, bad stuff does happen to them all the time.
People who act like winners usually win. They aren’t always nice guys, but they are winners. Like I said, it is rarely a function of intelligence.
I’m still working on the secret sauce. I’m profitable, but I’m a bit of a grinder. It’s never easy.
Here’s to things being easy.
Jared Dillian
Editor, The 10th Man
Mauldin Economics
The implication here is that I am sad and neurotic. At first glance I would deny that accusation but deeper thinking about this statement begins to ring true in many areas of my life. The sad part that is. The last few years have been years of loss: financially, my health and of course the passing of both my parents. Sadness is to be expected. To think otherwise is neurotic and I have expressed to others and denied to myself the presence of sadness. But now I think its time to own it. To acknowledge its presence in my life, embrace the reality of it and then move on to a more joyful place. 
A starting point for that is acknowledging my health is nearly completely recovered. I only need to lose about 40 pounds and I will be in arguably the best shape of my adult life. That is something not every one achieves. Recovered health is something to be grateful and happy about. Instead of focusing on the difficulty of losing the weight, I now intend to focus on the gratitude I have that my heart has NO scar tissue from the heart attack. All of the bills from that episode in my life are finally paid and I can chase any goal I want from here! 
This summer I am embarking on a new segment of my spiritual journey. It is uncharted waters for me. It is about the idea of self love. Not the dirty minded kind, but the complete internal acceptance of myself, my successes, my failures, strengths and weaknesses. The acceptance of who I truly am and learning to fully and completely love that person.  
As I've worked toward this journey over the last few months and yes even years, I've always known there would be a point where I would need to confront this aspect of spiritualism. I've postponed, delayed and ignored it and now find myself at the point where it is no longer possible to ignore or delay. Nor do I want to. I want the freedom that comes from reaching this place in life. 
I will write about this sporadically as this kind of journey progresses in fits and spurts. It is non linear and therefore it is not possible to construct a linear narrative about it as it progresses. Instead it must be narrated in hindsight. 
For now though, I have adopted a marvelous quote I read the other day as my new spiritual motto. Its from Gandhi and it goes like this; "I will let no man walk through my mind with his dirty feet!" From this day forward I guard my mind and heart as though it is a priceless treasure....because it is!
Til next week.....

Saturday, June 3, 2017

Get yer mind right!

I debated about the wisdom of posting this rambling stream of consciousness post. I thought the example I used was to negative and it is but I love the movie quote even though the movie is quite dark. So take what you will from this post. It's intended to illuminate the necessity for proper thinking about trading. I'd be interested in your thoughts regarding this subject.

There's a great movie about getting your mind right....Its called Cool Hand Luke and its about a petty criminal that gets thrown in prison to work on a chain gang. He doesn't adapt to prison life well and tries to escape. Down south where the movie takes place, they don't cotton much to such things and a large portion of the movie is about the prison trying to "get Cool Hand Luke's mind right". In other words, they work hard to break his mind down so he will be compliant and not try to escape or make trouble.

Trading is about getting yer mind right and the market will work overtime to break your mind and make you give up. I realize there is a negative connotation in the movie and I'm using it in a negative fashion with regards to the market trying to break your spirit but the hard truth is this: You must get your mind right if you expect to beat this thing called the market.

There is a prison most of us lock ourselves up in with regard to trading. The market reinforces that locked up mentality. It punishes bad behavior nearly all the time and once it awhile it rewards that same bad behavior just enough to make us believe we can continue same and somehow avoid the consequences. Regardless of how you arrived there, nearly everyone lives in a prison of their own making with regards to the market.

Here is the prison I've been locked up in for nearly all my trading career:

In simplistic terms; I have believed the market was evil and out to get me. Its why I have been so aggressive with moving to break even on good trades only to see them ticked out and then go on to the profit targets. It's why I have habitually bailed out of good trades way to early thinking the market would take back all my open profits and leave me with nothing or a loss after all the hard work of finding a good trade. It's why sometimes I insist on "taking" something from the market when in fact, all I need to do is wait until its ready to simply "give" it to me. Its why sometimes I think "If I could find an easier way to make the kind of money I know I can in trading, I'd do it in a heartbeat".

This as all the teachers say, is "a limiting belief". It places a cap on what I can realistically expect to receive from the market. As Ed Seykota once said, "Every one gets what they want from the market". If you expect bad from the market, you should expect to receive bad from the market. If you expect to have to "beat" the market, you should expect a fight just to get the smallest degree of profit. If you expect the market to be stingy and evil, you would be correct. It is.

Instead, a more correct belief would be; The market is a wonderful mistress. She is good and generous. She is not out to get me, instead, she is looking for ways to give me what I desire. My only job is to get in tune with what she wants to give me and simply receive it with joy and calmness.

This all comes down to a famous Einstein quote. He once said, "the most important decision we make is whether the universe is friendly or hostile". It seems like a trivial question for the philosophers of the world to debate but it has direct bearing on our success. Everyone I have ever read that has written on success says it must come from a place of joy. Joy is hard to come by if you believe the universe is a hostile place. This way of thinking creates conflict between the stated desire and the underlying belief. If the subconscious is the driver of behavior and it knows you don't believe in a friendly and generous universe/market, then your behaviors will mirror your beliefs even though you verbally state the opposite. In trading terms, this is known as the monkey brain. It acts in opposition to your stated goals but in line with your fundamental belief system. You will find yourself doing exactly the opposite of what you KNOW to be the correct course of action and seemingly powerless to change or stop that behavior.

Eventually we give up altogether or we arrive at that place where Cool Hand Luke did. He got his mind right. He broke and accepted the truth of where he was and his inability to change it. This is a negative example but it serves the purpose of demonstrating that eventually we must get our mind right and that means accepting the fact that the market is a good and generous place to be and that we love it. We are patient with it. We allow it to reach the point where we can simply receive what it is offering and be in the flow of its offerings. Trust me, its there. It's quiet and not always obvious but its there. A never ending flow of money ready to be transferred from those that demand to those that receive.

I am getting my mind right. I know what to do and sometimes I do it correctly. Other times I fight it and my monkey brain is in complete control because my belief system allows him free reign. But I feel as though I made a huge leap this week in terms of getting this part of my trading life correct. Patience will probably always be an issue but I am following the advice of Ed Seykota in terms of allowing myself to trade in accordance with my personality vs trying to trade in a manner that looks good to the outside world. Harmonizing personality with trading style is important but not nearly as important as harmonizing my beliefs about the market with the truth of the market.

There's another quote and I think it is from Will Smith in The Pursuit of Happiness. He said, "I wasn't free until I got my mind right". What an incredible statement. Get your mind right and freedom follows!

Here's the clip from Cool Hand Luke.

Friday, June 2, 2017


I didn't make much money today but I'm over the moon at how the process unfolded and what my emotional state felt like.

First of all, the monkey brain was no where to be found. Once again, I was calm and collected and thinking clearly. The counter trend trade was clear and I found it easy to understand the nuances of the trade. It did work without me but being stopped out on a counter trend trade at BE is no big deal. Being stopped out at BE on a trend trade is just stupid and today was a great demonstration of how these two dynamics work.

The big win was the patience for the trend trade after watching the counter trend trade work without me. Normally I'd be upset and try to get that short in hoping for a retest of the swing low it put in. Of course that would be a death knell and then I'd be trying to get in the long at the wrong place and expose myself to excessive risk. Not today though. I waited until there was clear support and went with the trend. No heat, it went quickly to my target and sure enough, it worked out just fine. Total risk was 10 ticks I think so 20 ticks on the win.

Using the 5M for trend and the 1M for entry. I'm well aware the long trade was also counter trend on the 30M chart but thats fine. As along as I don't get greedy in those situations, then I'm fine with higher time frame counter trend trading.

Thursday, June 1, 2017

Clear and Certain

These words from Tony Robbins really sank in...but they were simply reinforcement of the work I've been doing with regard to meditation, visualization and functioning properly in the universe.

Basically Tony drilled me with the truth that you cannot have something unless you are 110% crystal clear on what you want but more importantly the WHY you want something. Parallel to this is the true key to the whole equation. Emotion. The why establishes the reason but the it means nothing if there is no emotion attached to the successful outcome.

What I stated I wanted was more patience to be able to wait for the trade and then to wait for it to pay off.

What I really wanted was the financial freedom successful trading brings with it. Oh wait, there's more beyond that. The real truth is I want the security financial freedom brings and I want to provide the best life I can for my family. That is the real underlying reason for needing patience. Oh and I wouldn't mind a some first class travel!

Tying emotion to it reveals internal fortitude I didn't know I had. Of course no trading Monday, Tuesday I didn't have time to trade and yesterday was my daughter's 8th grade graduation so I didn't didn't trade either. So today was my first trading day this week.

Today's trading was completely different than anything I have experienced before. Nothing changed about the trading method but I did not experience the monkey brain at all today. In fact, I felt calm, collected and totally focused. I knew exactly what I wanted to see before I engaged in a trade. I saw what I wanted 5 times. Two ended in break even, one ended in a 1RR loss, one ended in a 1RR winner and one ended in a 2RR winner.

The trading was pretty boring which is exactly what I know its supposed to be. I am both pleased about today's trading and looking forward to tomorrows.