Trading Homework

This weekend I realized I need to do chart homework.  The measured moves are awesome and are a staple of my trading plan and setups but there is another one I had started doing but stopped due to my revelation with the 2 legged measured moves.  What I am bringing back in (Mack highly recommends this) to my primary trading setups is the small trend channel lines.  Time after time when you see price break out of the small trend channel line it will come back and make a new low (in a downtrend) before turning back up.  You draw the line from the majority of the closes in a downtrend.  Below are some charts where I just downloaded the whole day and put the entries based on Mack's trading criteria.  You will notice time and time again that price will break out of the small trend line and then will come down and make a new low before reversing up (when in a downtrend).  When price is in an uptrend you will see price break below the trend line and come back and test or make a new high before reversing.  If you incorporate the 2 legged measured moves with this then you are doing really well in setting yourself up for great success.

I also need to remember to enter in at key reversal points which are the extremes of the trend lines, the EMA and support/resistance areas.

Your best entries come off the trend lines.  Your second best entries come off the EMA.

This is going to take a lot more work and focus to get this down.

4-26-2013

My Notes:

2 legged measured moves will be pretty clear.  They will not be very hard to spot.  If you are having trouble spotting one then it is probably still the first leg of a 2 legged measured move that just happens to have a couple of really small retracements in it.

Wait for 2nd entries off of the lows when going long and off of the highs when going short when you are looking at getting in to the 2nd leg of a 2 legged measured move.  I find that when I go off the highs for longs I am getting in too early and could have gotten in better waiting for a 2nd entry off the lows for the 2nd leg of a measured move up.  It also gives my 2nd lot a better chance of catching the runner.

Today was a good old fashioned range day.  The 2 legged measured moves still proved to be the way to trade for me even though all of my runners ended up getting stopped out.  I made one bad trade.  I think I was not realizing how much of a range day it was and was looking for the 2nd leg of the measured move to be completed rather than realizing it was a fakeout breakout.

Still, much better job.  Slowly getting better.  In the past I would have been down today but I ended up +1.50 points.  Take out that bad trade and I am up +5.00.

After watching Mack's video I think I was off on counting the big measured move.  I labeled the "correct" measured moves in black that Mack said were the correct ones.

Mack's Notes:

A trap is a setup that fools people or surprises them in taking the wrong direction in their trade.
When prices are all over the EMA then that is how you know it is a trading range day.
Draw all of your short term trend lines.
Usually when price breaks the short term trend line in an uptrend it will go up and create a new high before selling off.

Draw your short term trend lines.


My Trades:

1.  2nd entry long and was looking for the 2nd leg to the measured move long.  I dropped my order in 3 ticks below where the original entry was b/c my stop would have been right on the low of the swing.  I got a scalp out of this before price came down and took out my BE stop on the 2nd lot.  Very good read on this trade!  Not sure if I could do anything about price coming and taking my BE stop out before it shot up.  Great job on recognizing this 2 legged move.  The only thing I could have done is take the entry I have circled b/c that is the 2nd entry off of the lows and then drop my entry order in 3 ticks from the entry.  That would have been the only way for my runner to work.

2.  2nd entry short off of the 45 EMA looking for the 2nd leg down of a big 2 legged measured move.  I got in 3 ticks better than where the entry signaled for an easy scalp.

3.  2nd entry short off of the 45EMA after a 2 legged measured move up had been completed and am still looking for the big 2 legged measured move down to complete.

4.  2nd entry short off of the high after a 2 legged measured move up had been completed.  I got in by getting my limit order filled 3 ticks better than where the entry bar signaled b/c the bars were too big for my stop w/any wiggle room.  I got my scalp filled but price just doesn't want to make it down to the 2nd leg of the big measured move.

5.  2nd entry short.  Was looking for the end of the measured move to get filled.

6.  2nd entry long looking for the 2nd leg of the measured move.  I actually got in one tick better than the signal bar but it cost me a runner.....lol.  If I had gotten in where the signal was then I probably wouldn't have had my scalp filled.  Then price would have retraced and I still would have been in the trade before moving back up to the previous resistance.  Good job in spotting the setup though.

Missed Trades:

1.  (9:11) 2nd entry short and you are looking for price to go back and test the lows.

2.  (10:37) Failed 2nd entry long and am looking for the 2nd measured move to get filled.  Very had to get in b/c the entry bar never really came back and was too hard to get in.

3.  (11:51) 2nd entry long off of the swing high.  There were a bunch of doji's and overlapping bars.  I was in the short trade which was a bad trade so I wasn't looking for the long.  I think it's a good trade long b/c it looks like the 2nd measured leg has been close enough to being filled and price is eating up all the short orders and is getting ready to go long.

4-25-2013

My Notes:

The 2 legged measured moves are the basis for almost all of my trades.  I look for this first for almost all of my setups.  Then I look for a 2nd entry off of the 2 legged measured move whether it is the end of a measured move or the beginning of the 2nd leg.  The only time I take a 1st entry is if price is in a very steep trend and it is off the EMA and I doubt I will take that trade very often b/c I like the 2 legged measured moves w/2nd entries so much.

Today I am going to focus on dropping orders back inside the entry bar when the fill is almost my full 2 point stop.  I am going to drop the orders 2-3 ticks back from where my entry would have been depending on the size of the bar.  I may miss some trades this way but I think it is safer then utilizing the full 2 point stop loss too often.

Made one bad mistake today but saw very clearly what it was.  Trade #2.  Learn from it.  Always be aware of the 2 legged measured moves and if they have not completed yet.

Mack's Notes:

He just went over a live trade.  Didn't really say anything that stuck out to me.

My Trades:

1.  End of a 2 legged measured move down and am looking for the 2nd leg of a big measured move up.  This is where I dropped my entry 3 ticks from the signal spot since the fill would have taken up my full 2 point stop with no wiggle room.  I got the scalp at least.

2.  Was looking for the 2nd leg down of the 2 legged measured move.  Obviously that leg had completed even though it didn't reach the target.  I see why this was a bad trade now.  This was finally the 2nd leg to the big leg from early this morning.  Price had made a 2 legged measured move lower (even though it didn't complete by about 1 point) and was going up to it's measured move.  I missed seeing this until it was too late.

3.  End of a 2 legged measured move down and was looking for price to bounce back for at least a scalp.  I still could have gotten in better b/c where I got in was not a 2nd entry.  The 2nd entry was 4 bars to the right.  I'm not sure why I got in where I did b/c it wasn't a 2nd entry even though it was the end of the measured move.  Look how fast price shot up on the 2nd entry after it formed.  Once I saw this was at least a 2 legged measured move I got out 2 ticks below the top of the measured move.  If price goes up much further than the end of the measured move then this is the first leg and I'll look to go long on a pullback for the 2nd leg.

4.  2 legged measured move short with a 2nd entry off of the EMA.  This is a beautiful trade where I knew what to do and what I was looking for.  Once I saw the strong leg down I was pretty sure that was the 1st leg of a 2 legged measured move so I put my entry one tick below the previous close once price pulled back.  I counted the 2nd entry from the high at 1588.25.  My 2nd lot exit was 2 ticks above the low of the 2nd leg of the measured move.

Missed Trades:

1.  Failed 2nd entry long counting from the low and was the 2nd leg of a 2 legged measured move down.  I missed this b/c I got confused and was looking for the 2nd leg up of a 2 legged measured move that was incorrect.

2.  The end of a 2 legged measured move down and was a 2nd entry from the swing high.  This would have been a beautiful trade to take if price had moved down another 3-4 ticks.  Since it didn't get there I was not looking for the long yet AND I didn't realize this was the 2nd leg of a 2 legged measured move down.  I got confused and subsequently I made a losing trade just after this b/c I was off on my interpretation of price action and what it was doing.

4-24-2013

My Notes:

Focusing on 2 legged measured moves and only taking 2nd entries unless price is in a very steep move and it is a first entry off the EMA, then I'll take it.  Otherwise every other entry is a 2nd entry with the 2 legged measured moves being the basis of almost all trades.

Since I started doing this a little over 2 months ago I have improved.  On a range day like today I would normally be fortunate to break even but today I didn't have a a losing trade using the 2 legged measured moves.  I am still very far away from going live but I am much further ahead than I was 2 months ago.  I even took almost every trade Mack said was a good trade by focusing on these 2 legged measured moves.  I am becoming more and more convinced that these are the key for me to be a profitable trader.

Good trend line drawing today and S/R lines.  Getting better at this as well.  They are easier for me to see now.  They are not perfect but are way better than where I was 2 months ago.

Mack's measured move arrows are in black.  I could not see this which is why I did not label it.  I just couldn't make it out no matter how hard I tried.

Mack's Notes:

You want to buy at support and sell at resistance.  If you try to trade breakouts you will go broke.

Buying at support and selling at resistance goes against common sense b/c you are trading against the way price had been moving.

If you are sim trading just follow the rules the best you know them and take all of the good trades you see.  At the end of the day review your charts and see what you did right and do more of that. See what you did wrong and correct that thought process.  That is how you become a better trader.

Do not try to learn with a live account.  If you haven't proven that you can make money on the simulator then you will not make money trading live.

When you 1st go live you will struggle with your emotions but you will be light years ahead if you have proven to yourself that you are consistently profitable in sim.

My Trades:

1.  2nd entry and was looking for the 2nd leg of the measured move up.

2.  Thought it was a 2nd entry short off of a double top but as soon as it didn't go down to start what I thought was the 2nd leg of a big measured move down I got out at BE.  I have no idea where price is going right now.  (AS SOON as I get out price moved down to take out my scalp.  Oh well at least my reasoning for taking the trade was correct)

3.  2nd leg of a 2 legged measured move.  2nd entry counting from the lows off the EMA.  I got in one tick too high b/c I didn't have my entry correctly placed.  At least I got the scalp.

4.  2nd leg of a two legged move.  Entry bar had a great short trap.  2nd entry long counting off of the lows.  Should have taken my 2nd contract out at the 1 point scalp b/c that is where the end of the measured move was.  I had it 2 ticks below the resistance level.

5.  End of a 2 legged measured move up and was a 2nd entry short.  Obviously I was a little early but it still worked out.  I was also looking for the 2nd leg of the bigger measured move down.  I thought it was a great setup since the 2 legged measured move pullback had been hit and formed a beautiful 2nd entry where I was looking for the bigger 2nd leg of the measured move down.  I had my 2nd contract 1 tick above the low of the measured move.

6.  End of the bigger 2 legged measured move down and of the smaller 2 legged move which was withing the bigger 2nd leg down.  Price was coming off support and was a 2nd (maybe 3rd entry).  I took my 2nd lot out at the end of what I thought was the 2 legged measured move up.  Obviously I wish I had put it at the resistance level.

Missed Trades:

1.  2nd entry long off of a double bottom.  I thought about taking this and if I did I would have dropped my order 2-3 ticks into the entry candle since my stop would have been too big where the entry bar gave me the entry.  I also didn't take it because I had no idea about the measured move since there was not one.  But I did see this trade and marked it before I watched Mack's review video.

2.  He said this was a 2nd entry long but I just do not see it from counting from the lows or the highs.  He also said this was a failed break lower but this is an advanced trade that I am not taking because I would just be guessing if I took this trade.

3.  2nd entry short off of the highs and off resistance.  I didn't take this trade b/c I was unsure if price was going to go back up and reach the measured move long.  I should have taken this short since this was obviously a range day and price had made a higher high.  The only thing was that what I thought was the 2nd leg of the measured move down where the 2nd entry short was too close to the end of the measured move down.  Obviously it wasn't close to the end of the 2 legged measured move since it went all the way down to support.  I was confused so I didn't take the trade which is fine for now.

4-23-2013

My Notes:

Still focusing and identifying the 2 legged measured moves.  That has been the breakthrough for me so far.  Today I am going to take every trade based off of those 2 legged measured moves that I think is a good trade.  I am not going to tighten up after I have a couple of winning trades.  I am going to continue to look for good setups and take the trades.  This is all in sim so take every good trade you see.

Mack's Notes:

When there is a trend line break in an uptrend then price will usually create two more legs to a new high before going into a range or reversing.

Usually when price moves big from a news reaction then price will usually come back and fill it during the day.

You never trade w/o safety stops.

My Trades:

1.  The 2 legged measured move was 1-2 ticks from completing and this was a 2 legged move down.  I expected price to go to the big overall 2 legged measured move.  The was also a 2nd entry from the previous swing high.  (I took my 2nd lot out when price stalled)

2.  2 legged measured move down that had completed and was a 2nd entry off of the low which was also off the EMA.  This might not have been a good trade but I at least got a scalp.

3.  Was the end of a 2 legged measured move down but the long trap got me on the first entry.  Should have waited for the 2nd entry which I got in below.  2nd entries + 2 legged measured moves are the key to success.  The 1st entries are tempting but I think they lead to more losses than the 2nd entries do.  You cannot get impatient.

4.  The 2 legged measured move down had been overdone and this was the 2nd entry from the previous swing high.  I took my 2nd contract out when a down trend line developed and a 2nd entry short formed with a double top.  I wouldn't even be trading this late anyways if I was live.

Missed Trades:

1.  Pullback in a strong trend to the EMA.  I am not really taking this trade.  I saw it but was waiting for a 2nd leg down that was a measured move for me to take the trade.

2.  2nd entry short off of the previous high.  It was also off the EMA.  I suppose I could have looked for the 2nd leg of a measured move down.  I was actually looking for a 2nd entry short off of the lows but I see why I missed this.  I should have been going off the highs when looking for a 2nd entry short on a 2nd leg to a measured move.

4-22-2013

My Notes:

The 2 legged measured move has been my bread and butter since my breakthrough a couple of days ago so lets keep on hammering it home.

If I don't understand and/or do not have an expectation about where price is heading then do not trade.  This is in reference to not being able to identify the correct leg in a 2 legged move.

I got too complacent after I made 2 good trades from the start.  I have to utilize and trust the 2 legged measured moves b/c they work.  I noticed after I was  up 6.5 points I tightened up and ignored trades I should have taken b/c I didn't want to give any of it back even though I am in sim. This is something I need to change b/c I need to be taking all of the trades I can that I think are good trades so I can note the ones that work and correct my thinking to the ones that do not.

Decent job drawing your trend lines.

The good news is that I was able to correctly label all of the good trades I missed after watching Mack's video review.  This is basically from just focusing on the 2 legged measured moves.

Mack's Notes:

When you break a trend line in an uptrend price will usually will make 2 legs to a new high before deciding what to do.  When you break a trend line in a down trend price will usually make 2 legs to a new low before deciding what to do.

You are not trading based off the EMA.  You are trading based on what price is doing in relation to where it is to the EMA.

If you ever start to pray for a trade to turn around then GET OUT IMMEDIATELY!  If you feel that urge to hang on and HOPE then get out immediately.


My Trades:

1.  2 legged measured move down and a bigger two legged measured move down.  Was also a 2nd entry and am looking for the 2nd leg to the move up from early this morning.  Got a scalp.  Not sure now if price is going to go any higher.  We might be in a range or will go back and test the lows.  Not much strength to the upside even if this 2nd leg long that is forming at 8:31 that took out my BE stop reaches it's full potential.

2.  This was the end of a 2 legged measured move up and was also a 2nd entry off of the top of the trend channel.  I got the trend channel by connecting the two swing lows and it fit perfectly up top. Price looks like it is making lower lows and lower highs so I thing we might be in a downtrend channel.  My 2nd lot is at the bottom of the trend channel.

Missed Trades:

1.  2nd entry short from the previous high and the beginning of a 2nd measured leg move.

2.  Interesting trade.  It wasn't a 2 legged measured move up that had ended or even a 2nd entry.  It was a first entry off of the EMA but you are looking for the 2nd leg down and since it is off the EMA it is probably a wise move to take this.  Only b/c you are looking for the 2nd leg of the measured move down.

3.  2nd entry short off of the EMA.

4.  2nd entry short off of the top of the trend channel.  I was hesitant b/c I was looking for a 2nd leg of the measured move up (which eventually did happen).  This was good enough for a scalp.

5.  2nd entry long off of the lows with the support of the EMA.  Mack said it also had a short trap. This was the 2nd leg I was looking for of the measured move.  It was also off of the bottom of the trend channel but I had not drawn that yet.

6.  2nd entry long off of the EMA.  I was looking for a 2nd measured move down before going long.  If I had seen or known that this was the 2nd leg of a measured move then obviously I would have taken it.  Hard trade to take but if I had drawn that measured move then I would have taken it.

4-18-2013

My Notes:

Still focusing big time on the 2 legged measured moves.

From 7 - 8:15 I had no idea what was going on so I hung tight.  I was expecting price to make a measured move up but the high it created was really weird and once the 2 legged measured move down was obliterated then I knew that price wasn't making a 2nd measured move up.  I thought price might be in a range but when price made that beautiful 2 legged perfectly measured move up to the 45 EMA and was a 2nd entry short, I had to take it.  Especially since I expected price to make a 2nd measured move leg down which it did!  This is why these 2 legged measured moves are amazing!

I got sloppy after about 9:30 when I started pressing too hard for measured moves and trades.  The good news is that the 2 trades that were losers is that they eventually went where I thought they would go.  I was too early and not patient. That is good to know that my expectation was correct but I was just too early.  Have to be more patient.  I am afraid of missing a winning trade.

Mack's lines are in the dotted black lines.  They make more sense since when I was trying to draw the blue trend lines the upper line would not fit.  That is a good sign that you need to use the other side's trend line.

Mack's Notes:

Stay with the rules and with the system.  You have to trust it b/c it works.

If you are struggling keep with it b/c eventually you will get it.

My Trades:

1.  2 legged pullback, 2nd entry off of 45 EMA and 2nd leg of the measured move.  I used the measured move for my 2nd lot exit.  When it got within 2 points of the lows I didn't want to give a bunch up so I had my exit 2 ticks above the previous bar's high.  Since I was doing this as my trailing stop with over 6 points for my runner I moved my profit target one tick above the measured move and it worked out beautifully.

2.  Failed 2nd entry long off of the 45 EMA.  Had enough of a 2nd measured move down leg to at least get the scalp.  I wanted in b/c since the market was so weak I was looking for another move down past the lows.

3.  2nd entry long off of the EMA.  It also had a funky measured move down that just about reached it's lows but didn't.  I wanted in on this trade b/c of the expectation of it being the 2nd leg of the measured move (which it turned out to be).  My 2nd lot was 3 ticks below where I took the other short for a big move down.  It was about a point or a little bit over from the measured move but I figured this spot is fine for a 4+ point gain on the 2nd lot.

4.  Was looking for the 2nd leg of a measured move down.  Obviously I was off and did not recognize the situation correctly.

5.  2nd entry short off of the high and looking for the 2nd leg of the measured move down.  Price came out and took out my 2nd lot before reaching the end of the measured move.

6.  2nd entry long.  Price had gone wayyy past the 2 legged measured move and was at least a point away from the EMA so I expected price to bounce back up.  The problem here is that I do not know where to get out with my 2nd contract since there isn't a measured move?????  I guess I'll just use a trailing stop 2 ticks below the swing low.  (Nevermind, price came back and took out my BE stop w/one bar)

7.  I thought it was failed 2nd entry short but I had even marked it as being a good 2nd entry short so this is a trade I should have just avoided since there wasn't any measured moves.  This confused me and I took the wrong side.  This is a good trade to stay away from.

Missed Trades:

1.  2 legged measured move that had completed and overshot the trend line and the move.  The signal was the 2nd entry short.  It was also off the 45EMA that had been the resistance earlier.  I saw this and should have taken it.  It would have been good for a scalp.

2.  2nd entry long.  This is the trade he took live.  It was good for a scalp.

3.  2nd entry short off of the 45 EMA after a completed measured move.  It would have been good for a scalp.

4.  2nd entry long off of the low looking for the 2nd leg to the measured move.  Price had already overshot the big measured move down so I was looking for a pop up.

5.  2nd entry short and 2 legged move off of the 21 EMA looking for the 2nd leg to the measured move.  This would have been another great trade to take but I was tired and was running the replayer at 500 just to close out the day.  My 2nd lot probably would have only gotten a point or two since I would have been looking for price to go to the end of the 2nd measured move which it never came close to but it did go 5 points in the direction.

4-17-2013

My Notes:

I am again really focusing on the 2 legged measured moves.  After yesterday's breakthrough I will be looking at this for every trade.  The 2 legged measured moves seem to be the key here.

In the afternoon session I got confused so I didn't take any trades.

Good job identifying the same pattern that confused me earlier in the day and caused me to take a losing trade.  I recognized it had happened earlier so I took the short from the failed 2nd entry long and made up for the loss earlier.

Mack's Notes:

You don't enter close to previous support without room for at least a scalp.

You make the majority of your money off of the trend line channels at the key entry points.

We don't counter trend trade.

A trend line is an angled support and resistance.

My Trades:

1.  2nd measured move leg of a short.  Was also a 2nd entry counting from the previous high off of the EMA.  I was wondering if this was a 2nd leg up or down but once price made a 2nd entry low I felt good in taking the short and was able to get in where the original entry bar was.  My 2nd lot target was the big move from earlier.  I got out about a point early than the measured move said b/c I would rather lock in 4 points than give it all up trying to get one more point.

2.  Turns out it was a failed 2nd entry long.  I thought it was the 2nd leg of a measured move after a 2 legged measured move down.

3.  2nd entry short and 2nd leg of a 2 legged measured move down.  2nd lot was the measured move which was a scalp.

4.  2nd entry short off of the EMA.  My scalp was at 3 ticks since that was one tick above the low just in case price didn't break the low.  2nd lot was orignally 2 ticks above the big mesaured move down but I moved it up to one point after price got close but didn't touch it.  Great trade!  (Price ended up going a point lower than the measured move)

5.  Failed 2nd entry long.  This is the same formation that happened on trade #2.  There was a strong move up from the bottom to the top of the channel and it looked like it was going to make a 2nd leg to the measured move.  This is where I would have gone long around here but I noticed it was the same setup as trade #2 so I took the short.  My 2nd exit was around the previous low.

6.  2nd entry short and I thought it was the 2nd leg of a measured move down off of the EMA.  I think it was too low of an entry and I could have gotten in 2-3 ticks better but I was still able to scalp out.

7.  2nd entry long off of the EMA and I think it is the 2nd leg of a measured move.  My 2nd lot is 2 ticks below the high of the measured move at 1547.75.  (Doesn't matter b/c was hit at BE for 2nd lot)

Missed Trades:

1.  End of the 2nd measured move at the top of the channel.  Had a nice reversal or long trap signal bar.

2.  2nd entry short.

3.  2nd entry long and was the 2nd leg of a measured move.  Mack also had a failed 2nd entry short on his charts.

4.  2nd entry long off of the trend channel and was expecting the measured move to get hit where you had another 2.5+ points to get out.

5.  2nd entry long off of the EMA.

4-16-2013

My Notes:

Still focusing on taking trades that are the 2nd part of a measured move.  I would prefer the pull back to be a 2 legged move but if it is in a strong trend then I'll take a 1st entry as long as it is off the EMA.  I am going to try to stay away when price is in a range unless it gives me a clear two legged move to the support/resistance area.

Whenever price makes a 2 legged measured move to a new high look for a 2 legged move down as a correction before price moves up again.

It's okay that I'm getting a bunch of losing trades right now b/c I am working on the measured moves.  I'm seeing where I am messing up with them.  When I draw them on the right trends then it is very easy to see where price is going to turn.  It is very obvious when I get them drawn on the wrong moves b/c price moves against my trades.  Like where I drew the black arrows begginning around 9:12.  Those were the correct ones I saw after the fact and I had counted the 2nd black measured move arrow as a 1st leg move when really it was a 2nd.

After finishing today I'm not sure if I've had a breakthrough or if I am trading recklessly.  I've been really focusing on the 2 legged measured move and that is how I took all of my trades today.  You can tell when I messed up counting the legs correctly but when I did see it correctly my trades were doing great.  I actually ended up today and felt confident in every single one of the trades I took.  When the ones didn't work I could see pretty quickly that I had messed up and was on the wrong leg to count.  Or maybe the market just moved very well today and I was lucky.  I'll find out very soon in my review sessions.  This is the most confident in my trades I have felt since I have been doing this and it feels very refreshing after about 2 months of frustration.

I think a good rule of thumb is if a trade does not workout then I have labeled or counted the measured moves incorrectly and I need to redo them before I take another trade.  Do not trade off off of the measured moves of a trade that was previously a losing trade.

Mack's Notes:

It is important that you find the correct trend lines.  Generally your major trend lines are going to come from the first couple of swing highs or swing lows.

The trades off of the trend lines setup the best trades.

A valid trend line should hold the majority of your prices.

Your big moves come off of the sides of the major channel lines.  Those are your key entry points.

My Trades:

1.  2 legged pullback to the EMA and 2nd entry long.  Was also close to the trend line.

2.  Though price was in a channel and would bounce back up.

3.  2nd entry long.  Price made a double bottom and had extended past what I thought was a 2 legged measured move.  Bounced up for a scalp.

4.  Thought it was the 2nd leg of a 2 legged move up.  It was but I got in at the top rather than at the bottom.

5.  It was only a 1st entry off the EMA.  Should have waited until the 2nd but didn't want to miss the 2nd leg if there was to be one.

6.  2nd entry short.  I at least got a scalp but I thought it was the beginning of a two legged move down.

7.  2nd entry long and 2 legged move close to the EMA.  Price also had just completed a 2 legged measured move down.

8.  2nd leg of a 2 legged measured move.  I had my 2nd contract where I thought the top of the end of the 2nd leg of the measured move was but it was actually about 2 points higher b/c I had somehow dragged it down to low.

9.  2nd entry long after what I thought was close enough the end to a 2 legged move down.  I jumped the gun and should have waited until price came closer to the end of the measured move which would have been right at the EMA.  I was still able to scalp but the EMA would have been the better entry since it would have been the bottom of the two legged measured move and there was a short trap.

10.  2nd leg of a 2 legged measured move off of the EMA.  My 2nd lot was 2-3 ticks under the top of the major 2 legged measured move.  I wonder if there would have been any signal to get in closer to the EMA b/c I could have gotten in a full point better?  Price did make a double bottom at the EMA but you can only see that after the fact.

11.  2nd leg of a 2 legged measured move down.  I had my 2nd lot 2 ticks lower at first near the edge of the end of the measured move but when price touched it and turned up I took the point profit.

12.  2nd leg of a 2 legged measured move up.  2nd entry if you are counting from the lows and was off the EMA.  2nd contract was 2 ticks below the end of the 2 legged measured move.
Missed Trades:

Missed Trades:

1.  2 legged move down to the trend line and the end of a 2 legged measured move down.  This trade was hard on my chart to get in.  Maybe I should have had my entry 2 ticks above the end of the measure move down since it was a great setup to go long?

2.  2nd leg of a 2 legged measured move up off of the trend line and the EMA.  I called and saw both of these trades but didn't take them.

3&4.  3 was a entry at the end of the 2 legged measured move off of the 45 EMA.  Mack didn't like this entry.  4 is a 2nd entry counting from the lows.  Mack liked this entry.  Notice how the 2 legged measured move up worked perfectly after a new low was created from a 2 legged measured move down.

5.  2nd entry short off the EMA and was the beginning of a 2 legged measured move down.  I had incorrectly labeled the measured move so I was taking trades the wrong way.  It is very obvious now.

6.  2nd entry long counting from the lows (there was also a trap on the lows).  This was also after a 2 legged measured move down so price was probably going to reverse and at least go for 2 legs up.

7.  He didn't really explain why to get long here.  I saw it and already had it labeled as a missed trade b/c I thought it was the 2nd leg of a 2 legged measured move.  I should also notice that this would create a higher high so that is a signal that price would probably continue higher.  Maybe that is the time to use a trailing stop then the measure move exit?

4-15-2013

My Notes:

Today I am focusing on taking trades that are the 2nd part of a measured move.  I would prefer the pull back to be a 2 legged move but if it is in a strong trend then I'll take a 1st entry as long as it is off the EMA.  I am going to try to stay away when price is in a range unless it gives me a clear two legged move to the support/resistance area.

If I do not understand what is going on then I don't attempt to trade.  Confusion = No trading!

When a measured move does not come close to filling then does that mean the direction in that market is weak and I should look to trade the other direction?

Mack's Notes:

What normally happens after news is that the market will come and fill the big move it made.

The market moves in 2s.
The 2 legged moves do not have to be exact measured moves.

After a 2 legged move to a new high/low you'll usually get a correction or a range before price decides what to do.

Mack doesn't buy in a downtrending market unless price starts making higher highs and higher lows.

On down trending days look for reasons to go short:  Pullbacks to trend line, pullback to EMA, double tops.

On up trending days you are looking for reasons to buy.

On range days you are looking to buy the lows and sell the highs.

My Trades:

1.  2 legged pullback and 2nd entry long.  Could also have been the 2nd leg to a measured move but it wasn't.  Only got a scalp out of it.  The 2 legged move down was also a perfect measured move so that made me even more confident in taking this trade.

2.  2 legged pullback at the upper trend line where price had reached the top of it's measured move.  Just didn't work out.

3.  I'm not sure if it was a failed 2nd entry long or a 2nd entry short but it just looked like price wasn't going to be able to reach the measured move up at resistance so I went short and put my 2nd contract 2 ticks above the previous low of the day since I didn't know if the trend line was still in play and this looks like a range day.

4.  Thought it was a 2nd entry off the EMA and was looking for the 2nd leg of the measured move down.

5.  Entry off the EMA in a very strong down trending market.  I was willing to take a losing trade if it was going to be a two legged pullback since this was just a 1st entry off of the EMA b/c I did not want to miss the 2nd measured move of the leg down.  Usually when price makes a big move like that it will move in 2s.  My 2nd lot exit was about one point above the end of the measured move.  Maybe I should have moved it 2 ticks more to maximize the move?  Good trade.  (Mack said it was a breakout pullback short)

5.  Two legged pullback, 2nd entry and close to the end of the measured move.

6.  2nd entry long counting from the low and price had bounced off of the yellow trend line and gone up.  Usually it will go back up again.

7.  Entry off the EMA looking for the 2nd measured move down.  Price never reached the lower level so my 2nd contract was stopped out at .75.

Missed Trades:

1.  2nd entry short (counting off the highs) and it was the 2nd leg of a measured move.

2.  Breakout pullback short.

3.  2nd leg of the measured move and 2nd entry short.  Real hard to get in b/c you would have had to put your limit entry halfway up the big bearish bar.  Very hard to get filled but a valid trade.

4.  2nd entry long b/c price had made two legs to a new low previously and this was the beginning of the 2nd leg of a measured move.

5.  Failed 2nd entry short.  This is where I went short so I go completely fooled here.  Was also off support and you had to figure we would go and test the previous highs.

6.  Breakout pullback short.Also looked like a 2nd entry short.

10-1-2012

My Notes:

Again, not too many trades b/c there are just so many times where I am unsure about which way price is headed.  I can feel the confusion and can make a case for price heading either direction.  The trades I did take I felt confident I had read the price action correctly.

I recognized a couple of trades I should have taken but was not confident in my views yet to pull the trigger.
My blue trend line on the downtrend was a tad to high.  Should have been lower.

On the yellow lines I draw look for price to break it and then go back and test the other side of it before reversing.  These really help so draw these.

Mack's Notes:

Generally when you get a news spike, price will come back and fill the gap or the big bars created by the news gap.

My Trades:

1.  2nd entry long and a double bottom off the EMA.  With my 2nd contract I should have exited when I saw the top of the trend channel form but I got greedy and thought price was going to rocket up to the huge measured move.

2.  2 legged move and 2nd entry long.  Price moved so fast I could not move my 2nd contract up one more point where the end of the measured move was.  That is where I would have gotten out.

3.  2 legged pullback and 2nd entry long.  Price had broken out of the yellow line and I looked for a  2 legged move down to test the lows before turning back up.  That is exactly what it did.  Now for the 2nd contract I thought it was going to go to the 2nd measured move but obviously it did not.  Not sure how to handle the target for that scenario.

Missed Trades:

1.  2nd entry long counting off the lows.  Price also broke the yellow line and made a 2 legged move down before retracing back up.

2.  2 legged pullback and 2nd entry short.  My trend line was too high, the correct trend line was  hitting the price.  I saw this trade and should have taken it.

3.  2 legged pullback to the EMA and a 2nd Entry short.  I saw this and should have taken it b/c of how nice the setup was and how I expected price to go down and at least test the previous lows before going up.  It was also the end of a measured move.

4.  He had 2 tests of the trend line but I had drawn mine too high so I didn't see it.  I should have also have been looking for the 2nd measured move down from the one that started at around 11:48.    So that is another reason why I should have taken this trade but I didn't even think about it.

1-17-2013

My Notes:

I had a hard time seeing any trades today so it was a good lesson in doing nothing.  I was confused and had no bias of where I thought price would go.  I'm sure after watching Mack's video I will see 6+ entries I could have taken.

My thought process was on target with Mack's, especially with my measured moves so that is a really good sign.

Mack's Notes:

If you are not sure what is going on then never enter a trade b/c that is gambling   You only want to enter a trade when you are confident that you know what is going on.

Whenever the market does something twice and fails then it usually will go in the opposite direction.

He usually exits around the trend channel lines.

When price breaks a trend channel on the positive side, look for a 2 legged correction to at least the other side of the trend channel before resuming the trend.

My Trades:

1.  Entry off of EMA and 2nd leg to a 2 legged move.  Price had been bouncing off of the EMA previously so I entered long here.  My 2nd exit was 2 ticks below the measured move which was just outside of the upper trend line.  Was also a failed 2nd entry short and a double bottom.

Missed Trades:

1.  2nd entry long and a failed break out lower.  This is a great reversal setup.

2.  2nd entry long and beginning of the 2nd leg of a measured move.

3.  2nd entry short after the overshoot of the upper trend channel.  Price is expected to go to the other side of the trend channel.

4-12-2013

My Notes:

From Ray's advice about major trend reversals (MTR) I am not going to wait 30 minutes after price breaks out of a channel in an extreme way before I look to take a trade in the original direction where price came from.  There will be trades I take when price breaks out of the channel for the 1st time in a two legged move but I'm talking about where price just goes straight down out of a channel and is doing a good sized correction or it has broken out of the channel for the 2nd plus time.

Still focusing on those two legged moves and am going to draw a ton of measured move arrows to help identify these.  I am also going to draw the yellow dotted trend lines to show the trend line breaks.

Today was the first day since I have been doing these reviews that I didn't feel totally lost.  There were still moments where I was confused but I did not take any trades when I was not sure what was going on.  I think that by drawing all of the measured moves and minor yellow lines that shows when price breaks the move really helps me out.  I still took some trades which Mack didn't recommend but luckily I at least got a scalp out of almost all of them.  The one bad trade I took was the same one Mack took but he was able to scalp out b/c he got in 2 ticks better than I did.

Mack's Notes:

Gaps don't always get filled but you have to keep them in mind.

Price action works on any chart at any time level.

The only time you want to look at yesterdays price action is where there is a big breakout that had never come back and was filled.

You can learn to see everything on one chart, you do not need multiple charts.

Any time you do not know what is going on you are guessing.  When you are guessing you are gambling and we don't want to gamble as traders because we want to know that the odds are on our side when we trade.  You just need to sit tight and be patient when you are not sure what is going on.


My Trades:

1.  2 legged move up adn 2nd entry short.  Price also made a very nice signal bar that extended past the measured move.

2.  2nd entry short off of the EMA and I thought price would make a push down to the lows where the measured move was but it came back and stopped out my 2nd contract at BE.

3.  2 legged move to the top of the trend channel.  I didn't take the initial 2nd entry b/c I was hoping to get in closer to the top of the measured move which was originally at 1579.75.  I got in one tick better but I could have gotten in another tick or two better.  It also was an hour when price went into the channel from the downtrend.  I was able to get a scalp but turns out I got lucky.

4.  Beginning of the 2nd leg off of the EMA.  I got greedy with my 2nd contract.  I orignally was going to take it at the top of the measured move and where the top of the trend line was.  I thought price was going to go back up to the high of the day so I didn't exit there and got stopped out for a 1 tick profit.  That's what being greedy will get you.

5.  Entry off the trend line and EMA.  I got out for a 2 tick loss after price came down and made a 2nd entry short.  I felt it was making a 2nd leg down.

6.  2nd entry short.  This is where I reversed my trade from long to short and had my 2nd contract 1 tick above the measured move.  Turned out to be a great call.

Missed Trades:

1.  2nd entry long off of EMA and lower trend line.

2.  2nd leg entry off of the trend line and EMA.

3.  Hitting off resistance and the end of a measured move.

4.  2nd entry short off of the EMA.

5.  Failed 2nd entry short.  2nd leg entry off of the lower trend line.

6.  2nd entry long off of the EMA and the lower trend line.

7.  This was the end of a measured 2 leg move down that had taken an hour for a correction.  It also had a good signal bar and I was looking for price to make 2 legs up to test the previous high or make a new high.

4-11-2013

My Notes:

Focusing on the measured moves.  This helps me with the 2 legged moves which then helps me with 2nd entries.  Made two really bad trades that didn't work out.  The 2nd bad trade at least had a sound reason unlike the first one I took.  Made another bad trade that worked out for a scalp since it was at the end of a measured move and price reversed.

I missed two trade that I should have taken that were 1st entries off the EMA.  The first one I should have taken b/c there was still a lot of room to the end of the measured moe.  The 2nd one I should have taken b/c it was off the lower trend channel, the EMA and price still had at least one point to scalp out before it hit the previous high.

I also started drawing a lot of those inside lines in small trends.  My charts are going to look like a mess for a while but I think it is better to draw too many lines and get the practice in then to not draw enough lines.

Good job today with my trend line drawing.  Looks very similar to his, even with the minor trend channels so that is a positive to take away for the day.  The 2nd good thing is the live trade he did is the same trade I took.  He had his 2nd lot at the same exit I did for the same reasons I had which was the lower trend channel (and was also the low of the measured move).

Mack's Notes:

Price action is still valid during news but most of the time price moves too fast to recognize price action correctly.  The FMOC is the news that moves the market the most.

He gets out when price touches the other end of the trend channel with his 2nd contract.

WHEN YOU ARE LOOKING FOR 2ND ENTRIES YOU ARE REALLY LOOKING FOR 2 LEGS!

You have to draw the lines when you trade.  You can take them off as the day moves on but at the present time you have to draw the lines.

My Trades:

1.  Failed 2nd entry long and a 2nd entry short.  I used the measured move to get me out of the 2nd contract 2 ticks from its low.  Even though this trade worked I'm not sure if this was a good trade since it looks like it was near the support and that we were in a range.

2.  2nd entry long off of the EMA.  I had my 2nd contract 2 ticks below the top of the measured move but after price made a 2nd leg and turned lower I moved my stop up to take a point profit.

3.  Wasn't a 2nd entry long or anything.  Price had just gotten out of the trend line for the first time.

4.  Price had broken out of the down trend line and was a 2nd entry.

5.  2nd entry long.  I thought it was the beginning of the 2nd major leg of the move up.  Looks like it was the beginning of the 2nd leg down.

6.  2 legged move and 2nd entry short off of the upper trend line.

7.  Failed 2nd entry long off of the EMA.  My 2nd contract was 2 ticks above the measured move, it touched but didn't get filled to exit.

Missed Trades:

1.  2nd entry long off of the EMA.

2.  Entry off of the EMA and lower trend channel.  Still had a point until the high so you could at least of scalped out of it.

3.  Same as previous trade.

4.  This was the correct entry for this area.  It was a 3rd entry but the 2nd entry would have worked as well.

5.  2nd entry short with a double top.

4-10-2013

My Notes:

Really focusing on 2 legged measured moves so I plan on drawing a lot of blue arrows today.  Not just to take for trades but as moves with 2 legs to signal when a run could be over and for targets.

Wow, a day where the market goes up all day long and I end up losing a couple of points on the day.  If anyone is reading this then use this blog as how NOT to trade.  Goodness gracious this is frustrating.  Have to keep grinding away.  Take a break and come back to it.

The correct lower trend line is the black line that I drew after watching Mack's video.

Mack's Notes:

Inexperienced traders are better off waiting for 2nd entries.

On a day like today you should only exit your runner after you overshoot the upper trend line.

My Trades:

1.  2nd entry short and 2 legged move at a resistance level.  Obviously this wasn't a good trade and I read it wrong.

2.  This isn't a trade I take.  There were 2 measured moves indicating this was the top before a retracement.  I would have ended up getting a scalp out of it.

3.  2nd entry long and 2 legged pullback to the EMA.  Price had also broken out of the narrow uptrend channel for the 1st time so the rule is that when price breaks out of the channel for the first time it will usually retrace for a bit and then go back up to test or create a new high before turning back down.  I remember from my butt kicking I took yesterday about drawing the narrow trend channels.  That is how and why I took this trade.  I just left my 2nd contract at 2 points since that was a new high even though it was 3 ticks away from the upper trend channel.

4.  2nd entry long off of the EMA.  Price had broken out of the narrow trend channel for the 1st time so the rule is that price will usually go on to test or create a new high before retracing or going into a range.  Pretty much the same as trade #3.

5.  2nd entry long off of EMA and off of purple trend line.  Price had borken out of the brown trend line but was now in the purple trend line.  I could have taken 2 points profit but since price had been going up all day I was going to let it ride.

6.  I knew I should have waited until price moved down to the lower blue trend line channel but I thought it was going to bounce off the EMA and move up after the hour consolidation like it had done all day.


Missed Trades:

1.  Failed 2nd entry short

4-9-2013

My Notes:

Still really focusing on spotting 2 legged moves and drawing the correct trend and support/resistance lines.
Also I am focusing on measured moves since price usually moves in twos.

Well today I did horrible.  Oh well, keep plugging away and trying to learn.

Mack's Notes:

He doesn't worry about previous day's trend lines.

Price will break the channel and then usually make 2 legs back up to retest or make a new high before reversing or going into a range.

When you have a double bottom and then a higher high you do not want to take a short.

Draw the short term trend lines, this stuff works.

Price moves up, breaks the trend line and then moves back up to retest the previous high.

My Trades:

1.  2 legged move and 2nd entry short off of resistance.

2.  2 legged move and 2nd entry short off the top of the channel.  I found the channel by using the first swing low and the 2nd one at 8:58.  I drug it off the days first high and this is how I found the area for my this trade.  My 2nd contract was down at the bottom of the purple trend channel.  Price never made it down there before taking me out at BE.

3.  2nd entry short just above trend line.  Obviously a horrible trade. When you have a double bottom and then a higher high you do not want to take a short.  That is the opposite of what I did.  The 2nd measured move never happened so that was another signal. I went short and he said to go long here.

4.  Thought it was a failed 2nd entry long.  Obviously not.  I went short and he said to go long here.  This is why I sometimes think I am not improving very much.

Missed Trades:

1.  Failed 2nd entry long.

2.  Breakout pullback short.

3.  2nd entry long and a breakout pullback long.

4-8-2013

My Notes:

GREAT VIDEO TO WATCH FOR 2 LEGGED MOVES!

Draw your trend lines off of established pivot points.  Do not draw them off of places where you hope it will be a pivot point just so you can take a trade.  I've done this many times and finally it clicked that this is a losing trade almost every single time.  I am referencing trade #3 b/c that is exactly what I did.  Now that I realize this I hope to eliminate this error.  Today's lesson is to not take the losers and to only take the winners.  I notice my frustration rising b/c I get confused.  When I get confused I take bad trades.   When I take bad trades in my confusion then I get frustrated b/c as soon as the trade doesn't work out I can see clearly that it is b/c I did something incorrectly b/c I was confused.  This could be drawing an incorrect trend line or trading like I'm in a trend when I'm really in a range.

Need to draw my support and resistance lines.  Today was a range day and I treated it like a trend day.

I did not draw the yellow S/R lines.

Mack's Notes:

You don't want to enter close to a support/resistance area unless you have room to scalp out.  That is when he'll drop an order back in the bar after he gets a 2nd entry signal if there is not enough room to scalp out where the entry signaled.  If he gets filled then this gives him enough room to scalp out.

The market usually moves in twos.  You always look for two legged moves which signal 2nd entries since the market usually moves in twos.  You can do the

When you are trending you count off of the highs if up and off of the lows if down.  In a range you can count off of the lows if wanting to go long and off of the highs if going short.

You can find a two legged move in almost every move.

Count off the lows on the way down and off the highs on the way up.

If you are looking for a reversal then look for the failed 2nd entries.

My Trades:

1.  2nd entry long after price broke the trend channel for the first time.  It might not have been a trend channel.  I was fortunate to get a scalp out of it.

2.  2 legged pullback and 2nd entry short off the EMA.  Beautiful trade.

3.  2nd entry long off of the EMA and my incorrectly drawn trend line.  I missed the good trade earlierand took the losing trade.  If I had drawn the trend line off of the two tops then that would have been the correct trend line and I would not have taken this trade.  The correct trend line is the light green line.  I had this originally drawn but went with the brown line which is obviously incorrect.

4.  Misclick.

Missed Trades:

1.  2 legged pullback and 2nd entry short at the EMA.  I saw this and should have taken it.  Not sure why I didn't.  I think it was b/c I was in the long which I shouldn't have taken.

2.  2nd entry long.  Mack said it was too risky until you get back up into the range to go long.

3.  Failed 2nd entry short.

4.  Was off my false green trend line which was an okay trend line since I correctly drew it off the pivot highs.  It was actually a failed breakout short that reversed and made some people a ton of money.  I was right that the market was going higher but wrong b/c I drew an incorrect trend line and didn't even draw the S/R lines which would have helped me get in.  I did see this setup and tried to get in by dropping an order back but obviously that was the incorrect play.

1-16-2013

My Notes:

Still focusing on the 2 legged moves is my number one priority.  Also focusing on when to switch from range to trend and trend to range mode.  The red boxes are demand areas and the green boxes are supply zones.  Price seems to come back and fill these up before moving in the major direction it came from.


Mack's Notes:

The best trades are always the 2 legged pulback to the extremes (trend channel lines and support/resistance areas).

Eventually all trends will break their trend lines and then go back and retest it's highs/lows before reversing.


My Trades:

1.  2 legged move and 2nd entry short off of resistance level.

2.  2 legged pullback to the lower trend channel.  I used the measured move and what I thought would be the next resistance area for my 2nd contract exit target.  It also happened to be close ot the upper trend line which worked out well.

3.  Got caught in a long trap.  Thought it was a 2 legged pullback and 2nd entry long at the EMA.  Was looking to hit up near the 2nd measured move before price might go into a range.

4.  Same reason as last trade except this time price was off the lower trend channel.  Price came and stopped me out by one tick then reversed and ran up to the 2nd measured move like I thought it would.  I should have waited until price filled the big green bar I had labeled.  If I had then it would have been a winning trade.  That is why I mark these b/c price tends to come and fill them before moving back in it's original direction it came from.

5.  2nd entry short or a failed 2nd entry long.  I should have waited until the true 2nd entry short formed since price ticked up and made a new high but I still ended up getting in a the same price I would have.  I still should have waited for the 2nd entry short to develop b/c that is the correct discipline to practice.  I thought that price would turn lower since the 2nd measured move had been hit and price was stalling from going up.  Price came and took my 2nd contract out at BE by one tick before turning down and would have hit my target at 2 points.

Missed Trades:

1.  2nd entry long and failed 2nd entry short at the lower trend channel.  Double bottom with a short trap.  I thought price was still in a range so I wasn't looking for this trade.  He drew his trend channel from previous 3 highs and then drug it to the bottom to get the channel and then got the trade.

2.  This is the area that got me good today.  The entry bar was a good short trap bar.  It wasn't a 2nd entry, just pure price action reading.  Where I got caught in my 2nd trade Mack said he could see why people got beat there.

3.  2 legged pullback and 2nd entry long off of the EMA.  I was looking for a short here but this would have been good for a scalp since it had a very nice signal bar off the EMA.

4-5-2013

My Notes:

Nothing really to talk about.  Lots of trades today.  A good learning day b/c it had a big move, a range and then a reversal. 


Mack's Notes:

When you have one big leg down you are probably going to have a second so use the measured move.
You are better off sticking to the highs or lows when you are looking to trade.  Trade at the extremes.


My Trades:

1.  2 legged pullback and 2nd entry short with the first break of the trend line.  It was also hitting a bar that needed to be filled but that is just a bonus and not something that influences if I need to take a trade.  I was hesitant b/c I thought this could turn into a failed 2nd entry but I was hoping to at least get a scalp before price went higher.  I felt price was at minimum was going to go into a range.  I got out 2 ticks above where most of the lows were in the support area.

2.   I had been waiting for price to tick up b/c I thought where the short trade was that I would at least get a scalp before a failed 2nd entry formed.  Then I could go long.  I didn't get a tick higher until price came and matched the previous low and then took off.  The reason why I felt very strongly that price was at least going into a range was b/c we had 3 pushes lower and it looked like price was at least going into a range before deciding what to do.  This also created a double bottom.  It wasn't a 2nd entry or 2 legged move so maybe I just got lucky, I am not sure yet.

3.  2nd entry long off of support area.  I got in one bar later than I should have b/c I missed the original entry bar but luckily the next bar came back and got me in.  I had my 2nd contract 2 ticks below the previous high in the resistance area.

4.  2nd entry short and a 2 legged moved.  It became a failed 2nd entry short.

5.  2 legged move and 2nd entry long off of support area.

6.  2nd entry long off of support area.  I got the 2nd entry by counting from the previous low.

7.  2 legged move off the resistance area.  Obviously it was not a good trade.

8.  2nd entry long and a 2 legged move.  Obviously not a good trade.

9.  2nd entry long and 2 legged move off of support area.  Had my 2nd contract 2 ticks below the high in the resistance area but price never mae it there.

10.  This is what happens when you draw incorrect trend lines.  You get a losing trade.  It was a 2nd entry long off of the lower incorrectly drawn trend channel b/c I drew it too steep.  It should have been off of the tail of the one at 12:06.  When I drew the correct brown trend line off the tail at 12:06 then that next trade would have been a winner.  Incorrectly drawn trend lines leads to losers.

11.  This wasn't a valid trade.  The valid trade would have been at 2:28 where I have it circled with a yellow arrow.  That was a 2nd entry long and 2 legged pullback off of the trend line.  I should have had my stop two ticks below the upper channel but I was running the replayer too fast and got hit at 2 point profit.  I would have had a 3.50 profit on the 2nd contract if I had done it correctly and not run the replayer too fast.


Missed Trades:

1.  2nd entry short and 2 legged pullback.  When you have a one leg big move down then you have to expect a 2nd move of around the same size.

2.  Failed 2nd entry long off of the EMA and the upper trend channel.

3.  2nd entry short.  Took it too early.  Should have waited b/c this was the trade to take.

4.  2nd entry long off of the low.   I saw this and should have taken it.  Great short trap signal bar.  Not sure why I didn't take it.

5.  Saw this and should have taken it.  Great short trap bar on the entry bar.  2 legged move and 2nd entry long off of the lower trend channel.  The trend channel was not drawn yet which it should have been.  I thought it was a fake out break out and was looking for the failed 2nd entry long to go short.

6.  2 legged move to the lower trend channel with a short trap.  Also had a double bottom.

7.  This is where I should have gone long instead of a couple bars over to the left.

4-4-2013

My Notes:

After thinking about whether or not I should focus on being more of a swing or scalp trader I've decided to focus more on scalping.  Right now for me I think it would be better with my 2nd contract if I use channel line targets, support areas, resistance areas and measured moves as my exits rather than trying to battle the trailing stop and never having a plan on when to exit.

Keep focusing on identifying 1st the 2-legged moves and then look for the 2nd entries after the 2 legged move has developed.  This has really help filter the winning from the losing trades.  Also drawing correct trend channels has really helped.

Remember that on range days you do not worry about the EMA.  Fade the extremes.

(The blue channel bars are no good)
(All the brown lines are Mack's lines.  Draw these when you are wondering when to look for a trade the opposite way b/c price will break the line near the extremes when it is getting ready to reverse and go the other way)

Mack's Notes:

Very tough trading day.
When price gets in the middle of the range then that is no man's land and you do not know where price is going.
You have to keep on moving your S/R levels as the range bounces off of different spots.
It helps to draw the trend lines so keep on drawing your lines.
When price is on both sides of the EMA then you know you are in a trading range.

My Trades:

1.  Failed 2nd entry short.  Price was coming off the overnight lows and from where I drew my blue channel lines I just felt that if price came back and closed above it's previous bar after the 2nd entry short signaled then you would have a short trap and would take you to at least the top of the channel.  I was also looking at the big red bar to the left where price went down beautifully off the EMA that needed to be filled before resuming the downtrend.  That is exactly what happened.  A beautiful short trap bar formed and I got in the very next one.  Notice how price hit resistance at the green EMA before going up.  I had my 2nd lot at 2 points which is right where the upper trend channel lies.

2.  Tried to fade and go long at the support area.  2nd entry long counting from the low.  Obviously it was a bad trade but at least I'm looking to trade but at least I am looking to fade the support and resistance areas.

3.  2nd entry long off of the low.  I took this b/c I felt this was a fake out breakout and price would at least go to the top of the trend channel where I had it drawn.  Maybe it will go near the previous high of the channel but since it seems the purple trend line is correct I took my profits near the top of the trend line.

4.  Obviously that purple trend line is no good.  TODAY IS A RANGE DAY!  2nd entry short and 2 legged move off of my incorrectly drawn trend line.  THIS IS A PERFECT EXAMPLE OF HOW INCORRECTLY DRAWN TREND LINES CREATE BAD TRADES!

Missed Trades:

1.  Failed 2nd entry short.  Price had also broke out of the brown line that Mack drew and was coming off support.

4-3-2013

My Notes:

Focusing on looking for 2 legged pullbacks and then looking for 2nd entries.  The 2nd entries will be clear after you can spot the 2 legged pullbacks.

Today I decided that when I am in a range I am going to do this:  I will keep my runner if I'm taking the trade in the direction price went into the range and I will scalp all of my contracts if I'm taking a trade in the opposite direction that price came into the range.  For example, if price is in an uptrend and then goes into a range then on my long trades I will keep my runner.  If I take a short trade at resistance then I will scalp my 2nd contract out at one point or near the support level.  I am keeping my runner due to the bias of price movement and how it entered the range area.

Take trades in the direction of the trend.  Do not take counter trend trades.

Very good job drawing your S/R levels and your trend lines.  You have made great improvements in this area and it is showing in your trades.  I am getting more wins and avoiding more losses since I have the correct trend lines drawn.



Mack's Notes:

Do not counter trend trade.
If you stick to your rules, trade the same way and get out of your trades at your predetermined areas then you will win more often then not.  It is when you start picking and choosing when you are going to get in or get out of the trade is when you start to lose.

When price creates a trading formation earlier in the day then it probably will do the same formation later that day.

Your best entries and big moves come off your trend channel lines.

If you stay with the trend then you can still have a bad entry but your trade still has a great chance of being a winner.

My Trades:

1.  2 legged move and 2nd entry long to the support level.  Took both contracts out at one point since the long was the opposite way price entered into the range.

2.  2 legged move with a double top and 2nd entry short off of resistance.  (On Mack's charts it was off the top of his channel)  This is the trade where I did what I talked about in my notes.  Since the direction of the trend was down when it went into the range, I took my first scalp at one point and then was either going to get stopped out at BE or let my 2nd one ride.  The trade before I took both contracts out at one point since that was the opposite direction of how price entered into the range.  Not sure how good this is but it worked out well today.  I just like focusing on the bias of the direction price could go since the bias was down.  For my 2nd contract I was either going to get one point (if it came back that far) or I was going to get very close to the measured move.  Maybe I should have gotten out when price first hit the lower channel?  I think I should have done that b/c there were a couple of other trades I missed and I don't like how I went for all or nothing with the 2nd lot.

3.  2 legged move and 2nd entry short off of the EMA.  Notice how the entry bar filled the gap bar's body perfectly and then came back up before turning back down 3 bars later.

4.  2 legged move and 2nd entry short off of the green EMA.  Notice again how price came down and filled the big green bar to the tick before bouncing back up.  This was another reason I was confident in the trade b/c it seems that price comes to fill those bars up before deciding what to do next.

5.  2nd entry short off of the upper trend channel.  Obviously it was a bad trade.  I thought price would at least come down to fill the big green bar before moving up again.  DAMN IT!!!! If I had waited for the 2nd leg then it would have been an awesome trade!!!!  I jumped the gun and look what happened.  Price came to the tick and stopped me out before going back down.  ALWAYS HAVE A NOTICEABLE 2ND LEG!!!!!!!!!

Missed Trades:

1.  2 legged move and 2nd entry short.  This would have been the only trade you would have needed to take.  I saw this but I did not take it since it was close to the support area.

2.  2nd entry short and a 2 legged move off of the EMA.  Good for a scalp.

3.  2nd entry short off of the upper trend channel.

4.  2 legged pullback and 2nd entry short.  This is where I came in too early and got stopped out right at my stop before the big move down.