Dave from Sydney's Journal [Awarded Title: the Box-Trader]

[Dave]

I've neglected my journal quite a bit lately, but here's some action from tonight. Had a good uninterrupted session and just hit what I saw without hesitation. Had a few rents too but the fun was on EJ, cya tomorrow.
P.s. Turned off 2 mins early! The DAX long was a cracking setup for 60+ with just one entry! Hoping you got it!

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[Nikita]

Super add-on session on EJ!
I m still avoding add-ons, but within this summer i think i will get them!
Nice trades!

[Darren]

Nicely done on EJ Dave - that was some fantastic adding on! \m/

[Dave]

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[Dave]

Hi everyone,

My last couple weeks of trading have been pretty ordinary. Actually, let me rephrase that.... my last couple weeks of trading have been shit house. The lack of journal posts has been the dead giveaway of this! )

I know I'm refining my entry method, using the M5 pullback to validate the M1 setup, but this has had a negative effect on my trade management. Instead of managing the entry on its merits I've been thinking, "but M5 pullback is perfect, it has to drop, this is the HPT! I'll leave my SL behind the M5 level or trail the M1 level with no regard for any other signal". So I'm reminding myself now that no matter how sweet the M5 pullback and M1 S1, there is absolutely no substitute for correct trade management once triggered. Once you're in, the setup now means nothing, you're in, the setup is the past, so manage the trade appropriately. There's nothing wrong with trailing AIMS levels once you're into a nicely moving trade, but in the infant stages it's equally important to accept when things aren't going my way.

I did a quick little analysis of my results and my losses were larger over the last few weeks than they've been all year! For the month of May, my average loss is 53% larger than my average for the year (-9.52 pips vs -6.21 pips). And it's all because I've been allowing that extra retrace, being taken out on an AIMS break for a loss rather than swallowing my pride and forgetting how good the setup was and just knocking the small loser on the head. I've moved away from closing 50% of an entry. I strongly believe that this is a means of managing emotions rather than producing profit, because when you hit that once a month London DAX breakout for 50 or even 100 pips, you'll have only done it with half. While you've been dicking about with your -4 trades at full size waiting for the runner.

So from this point forward I'm employing Grant's no bullshit objective trade management:
- SL behind the trigger candle/candle that breaks the AIMS level;
- Move to -4 at +5;
- Move to BE at +10;
- Trail AIMS levels/consecutive candles/fruit as appropriate;
- If price hits a HTF level (such as a classic M1 S1 where the M5 level is 8 pips away), SL to BE no matter what. It'll break with style or it'll stay stuck and I'm not letting those winners become losers.

Add ons to be treated as follows:
- SL behind the add on trigger candle/candle that breaks the add on AIMS level;
- SL behind the add on seed candle;
- No more add ons on the M5 break from an M1 S1 as it doesn't allow an objective SL, using the M1 candle isn't appropriate and often now my add on is too far from my initial entry. So it's add ons from M1 and that's it;
- Manage with regard to +5/+10 as though the add on is now the initial entry, ignore the initial, it'll close in profit if the add on closes (unless I close one of the positions in which case the remaining just trails AIMS levels). Most importantly here, capital protection is significantly affected when you add on, and letting that turn against and run right back through an AIMS level can mean a 2% loss if not dealt with swiftly.

Good entries are the easiest part of the process. Taking the loser and keeping it small is much more challenging, so I'm sorting that out right now. Cya tomorrow

[immy]

All I can say to this post is Excellent.

Guys read this post and try to understand what Dave's telling us and himself. This post is a proof of a serious trader doing his job. A sign that he wants to get there. He's monitoring his performance and he's observed things and made adjustments. This is trading, professional trading.

[bambino45]

Thanks Dave,
I understand completely the logic behind removing the 50% entry close. I think it creates an inconsistency in results and as you say, those big runners need to be maximised. You end up with an imbalance of 100% on losers and 50% on (some) winners. it's hard to look objectively at your results then.

As much as possible you have to mechanise everything. The only problem is putting SL so close to the trigger candle if provider doesn't allow so sometimes a manual order has to be taken. Personally I like the trades room to breathe but you still have to be very disciplined. The SL is still tight. Again, your results and analysis thereof will tell you if this is profitable.

These are triggers for breakouts so let's focus on them being so and kill them if they are false.

Thanks for the post, a great read and showing the attitude record keeping and introspection that is absolutely essential to be a professional and profitable trader.

Cheers

[Darren]

Great post Dave - I know exactly how you feel!

With your adaptations I am sure things will work out a lot better.

[Dave]

"These are triggers for breakouts so let's focus on them being so and kill them if they are false."

Spot on mate!

[Dave]

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