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.