Simulated Trades and Analysis

[pavilion103]

I'm monitoring this one at the moment.

What do we think about this one if it can break above (and possibly consolidate at) the resistance points indicated on both charts.

Volume has started to increase and is showing bullish signs imo. Obviously all will depend on whether it has the power to break.
Is this worth entering on a break or on consolidation around this point after any break?

Any reasons for not entering this one should it break?


CPU (Mar12).png

CPU2 (Mar12).png

[pavilion103]

Is this one a good entry/potential good entry coming up?

IIN - see analysis on chart.

IIN (Mar12).png

[peter2]

Pav: You keep asking if the chart shows a good entry. It's an ignorant question and you should know this by now. Nobody knows what is going to happen next and we don't know what you are looking for. Your job is to identify trading opportunities that you want to use. You asked about CPU which looks like a break out trade. Then you ask about IIN which looks like a buy on support trade. Two very different types of setups. It looks like you still haven't decided what you are trying to trade. Make up your mind. Master one setup before adding another.

Have you thought about creating a checklist to help you evaluate your charts in a consistent manner? If you had one then you would know if a setup fits your criteria. You won't need to ask because you'll know.

[tech/a]

Is this one a good entry/potential good entry coming up?

IIN - see analysis on chart.

IIN (Mar12).png

Look at the 2 volume spikes.
The first penetrated new ground at the low huge volume
What is it trying to do? Push up and it succeeded.
Now the difference with the last high volume bar is
That it's trying to sell off. The effort after the sell off is
Very poor ( trying to go up )
There is a vast difference between the two.

This is going to come off and I expect penetration of support in 1 or 2 bars.

So no not a good one.

[pavilion103]

Pav: You keep asking if the chart shows a good entry. It's an ignorant question and you should know this by now. Nobody knows what is going to happen next and we don't know what you are looking for. Your job is to identify trading opportunities that you want to use. You asked about CPU which looks like a break out trade. Then you ask about IIN which looks like a buy on support trade. Two very different types of setups. It looks like you still haven't decided what you are trying to trade. Make up your mind. Master one setup before adding another.

Have you thought about creating a checklist to help you evaluate your charts in a consistent manner? If you had one then you would know if a setup fits your criteria. You won't need to ask because you'll know.

I have specific setups that I trade. I have a detail written entry plan as well as trade management plan.

I am aware that both of these are very different types of entry. I am asking questions to learn, particularly to get opinions on supply and demand. As well as focusing on my own setups, I am interested in expanding my knowledge, particularly in reading what stage of a phase a stock might be in.

I am not afraid to ask questions and will continue to do so. If you have meaningful information to contribute feel free to be one of the people that answers.

[pavilion103]

Look at the 2 volume spikes.
The first penetrated new ground at the low huge volume
What is it trying to do? Push up and it succeeded.
Now the difference with the last high volume bar is
That it's trying to sell off. The effort after the sell off is
Very poor ( trying to go up )
There is a vast difference between the two.

This is going to come off and I expect penetration of support in 1 or 2 bars.

So no not a good one.

Thanks Tech. I guess because I didn't see climactic volume at the top, I thought maybe it was pulling back, before resuming its uptrend (also due to the strong support level). I'm not used to seeing such a high volume narrow spread up bar (3 bars ago) in that place. I'm used to seeing them closer to the top.

[Gringotts Bank]

I agree IIN looks like a buy on trendline support, ie. buy at today's close.

CPU I'd put a bid in at 8.55. Double bottom target of 9.39

Are you sure you're not over-complicating things pavillion?

[peter2]

Do yourself a favour and find an example of a perfect setup. A setup so perfect that you would trade it every time you see it. Then list all the reasons that make it perfect in your eyes. This is your starting checklist. This list will probably be quite long (~10 items) when you first create it. Prioritise the important items. This should be 3-4 items that are essential for your setup. The next 5-6 items are then confirmatory items, nice to have but not critical.

You'll simplify this list as you gain experience. You can't start with a simple list as you don't really know what is and isn't important for you yet.

Next, find and trade (monitor) the next 20 perfect setups and evaluate your results. You will learn much more by trying this and if you fail to make a profit you might learn even more.

[Timmy]

Do yourself a favour and find an example of a perfect setup. A setup so perfect that you would trade it every time you see it. Then list all the reasons that make it perfect in your eyes. This is your starting checklist. This list will probably be quite long (~10 items) when you first create it. Prioritise the important items. This should be 3-4 items that are essential for your setup. The next 5-6 items are then confirmatory items, nice to have but not critical.

You'll simplify this list as you gain experience. You can't start with a simple list as you don't really know what is and isn't important for you yet.

Next, find and trade (monitor) the next 20 perfect setups and evaluate your results. You will learn much more by trying this and if you fail to make a profit you might learn even more.

We really need a "Like" button. Another great post Peter2.

[pavilion103]

I agree IIN looks like a buy on trendline support, ie. buy at today's close.

CPU I'd put a bid in at 8.55. Double bottom target of 9.39

Are you sure you're not over-complicating things pavillion?

Maybe I am overcomplicating things.

[tech/a]

Maybe I am overcomplicating things.

Maybe your too concerned about being right
Than learning how to profit when you get it wrong?

Understand that profit more often comes from profits that far exceed losses.

[pavilion103]

Maybe your too concerned about being right
Than learning how to profit when you get it wrong?

Understand that profit more often comes from profits that far exceed losses.

You're right.

Every time I get a trade 'wrong' I do the right thing and analyse it but I start to think about how I can avoid it next time, rather than accepting that sometimes my analysis can be good but it just didn't work out this time.

I'll go through a period where 3R-4R wins are pouring in and then as soon as I go through a lean patch I think I must be donig something wrong.

I have the fundamentals right; my wins far exceed my lossess and my accuracy is enough so that, based on the above, I have a positive expectancy.
I've been particularly good with the risk management side of things in exiting positions which a) go against me b) don't move quickly enough.

I am too concerned with being right every time which is not helpful. I go through patches where I produce strong 3-4R wins, but as soon as I get 5-6 losses (even small ones) in a row I start to doubt. I need to develop more confidence in my system.

I didn't see this as a psychological issue but maybe it is rather than a technical one.

[pavilion103]

Do yourself a favour and find an example of a perfect setup. A setup so perfect that you would trade it every time you see it. Then list all the reasons that make it perfect in your eyes. This is your starting checklist. This list will probably be quite long (~10 items) when you first create it. Prioritise the important items. This should be 3-4 items that are essential for your setup. The next 5-6 items are then confirmatory items, nice to have but not critical.

You'll simplify this list as you gain experience. You can't start with a simple list as you don't really know what is and isn't important for you yet.

Next, find and trade (monitor) the next 20 perfect setups and evaluate your results. You will learn much more by trying this and if you fail to make a profit you might learn even more.

This post resonates with me.

I guess it's like a business operating in a niche market. There are other products/services they could also do to be profitable but can they do it as well as their main business? Find something that works and repeat it with consistency over and over.

Thanks

[Trembling Hand]

I go through patches where I produce strong 3-4R wins, but as soon as I get 5-6 losses (even small ones) in a row I start to doubt. I need to develop more confidence in my system.

I didn't see this as a psychological issue but maybe it is rather than a technical one.

No its not a "psychological issue" its an issue of skill.

When you understand what "phase" the market is in then you will know when to risk trading and greatly reduce your periods of drawdown/consecutive loses (although they never fully go). You will know what pattern to look for and when and what is looking like fools gold (ie potential breackouts just as we are about to tank)

Until then you will be like every other skill-less pilot. flopping around hoping for the best but worrying mostly about the crash landing.

[blue0810]

No its not a "psychological issue" its an issue of skill.

.

Plumber is a Plumber, Priest is a Priest, Trader is a Trader.

[Gringotts Bank]

Plumber is a Plumber, Priest is a Priest, Trader is a Trader.

Some wisdom in that blue.

However I feel like pavillion knows what he's doing (and it would be good if he felt the same way!)

[peter2]

This is a classic example of a common psychological obstacle that needs to be overcome.

If you can have a batch of 3-4R winners and keep the size of your losers <-1 then you have the basics of a profitable trading business. Your overall W% must be high enough so that the total wins exceed the total losses. You only need a W% of 33% to be profitable with these basic stats. With a W% of 33% you will commonly have periods of 12 - 16 consecutive losses. Be prepared for it. Think about it 12 losses of -0.6R = -7.2. Two winners of +4 and you are back.

The losing sequences experienced by a system with a W% of 70% is very different to that of a system with a W% of 33%. Understanding these differences is purely educational. Trading through them is purely psychological. Every minor rough patch that you trade through makes you a better trader. When you can do it you will have developed a very valuable skill.

I agree with TH in that it would be helpful to evaluate your results in the context of the market conditions. This would allow you to fine tune your basic strategy and be able to recognise both favourable and unfavourable market conditions for your strategy. This is pure research (work) but it may help you psychologically knowing this.

[pavilion103]

ICN - with this one just wanted to see if people think the volume is climactic?
It is coming into a previous resistance zone which looks like it will be very difficult to penetrate. It has already had a good run.

In the more recent action price has fallen on lower volume, but as we know volume doesn't have to be huge for it to decline further.

The two recent wide spread high volume down bars suggest some support in this previous high volume zone, confirmed by up days the following days.

Can this one push back up to its highs or is this one done? I'm not too confident but would love some thoughts.

ICN.png

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[pavilion103]

Here is another one.

DML.jpg

[Spongle]

PLEASE IGNORE THIS ONE I STUFFED IT UP... ahem

the next one is fornatted better