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.

4-2-2013

Note: I am tired and going to bed so I'll do his video review tomorrow.

My Notes:

Mack has been talking about when there are gaps or big unfilled bars in a trend that price seems to come back and take them out.  I started labeling some of them in the uptrend and downtrend and it is very interesting how price would come back and fill those areas and then would bounce a little bit before resuming the trend or would go into a bit of a range.  The blue shaded boxes are the filled gaps and bars from the uptrend and the red shaded box is the bars or gaps filled from a downtrend.  The unshaded boxes are bars that never were filled.  Very interesting to watch.  The only thing is you do not know right now which gaps are going to cause the biggest bounce.  It looks like almost every time today price would come down to fill the gap, go one tick past the gap and then reverse for at least a scalp.


Mack's Notes:



My Trades:

1.  2 legged move and 2nd entry long.  Not sure if that is the correct trend line but I just drew it off the overnight low and the first swing low of the day.  For my 2nd contract I had the measured move going and I felt I stayed in there pretty good.  Keeping my stop 2 ticks below the swing low after each move.  I got out 2 points from the area of my measured move after a double top formed close to the end of the measured move.

 2.  2nd entry long and 2 legged pullback to the lower trend line and EMA.  Price should have taken off b/c this is a great setup but after a couple of dojis and price not really getting anywhere I got out which turned out to be a great call.  Especially after the double top and the long trap. 

3.  Double top and long trap so I went short.  Also b/c the previous trade did not go anywhere when it should have b/c it was a good setup.

4.  This wasn't a good trade (obviously).  The only reason why I took it was b/c of the double bottom and I thought it might be a fake out breakout. 

5.  Failed 2nd entry long.  Price came back and got my 2nd contract before it took off.  If I had gotten in higher where the failed 2nd entry was it would have been a great trade but I got in too low since I was in the other long trade and wasn't looking for this yet.



Missed Trades:

4-1-2013

My Notes:

Today I am focusing on 2 legged moves.  After speaking with Mack that is the basis behind 2nd entries so I think that by shifting my focus to look out for 2 legged moves will help my growth and make my focus stronger for awhile.
Did a good job with my trend lines and S/R area drawings.


Mack's Notes:

When there is nothing happening you just have to sit tight.
Keep your stop above/below your signal bar.
There are different ways on how to handle your stops depending on what you are comfortable with.  He likes to use measured moves and targets.
Notice how price comes and fills big moving bar where there is no overlap or thin areas between the bars.  Price usually comes back the other direction and fills them.

My Trades:

1.  2 legged pullback to the EMA.  It wasn't a 2nd entry but it was a 2 legged pullback to the EMA and price had been in a downtrend since the open so I took it.  The 2nd entry came 5-6 bars later.  I got out with my 2nd contract at 4.50 b/c that was close to the end measured move.

2.  2 legged pullback with first break of the trend line.  Made a nice signal bar but I took my profits one tick above the big tail 3-4 bars over and moved my 2nd contract to BE b/c the double bottom looks like a reversal patter at 10:26.

3.  Thought it was a 2 legged pullback and 2nd entry long with first break of the trend line.  Obviously it wasn't.  I considered getting out at a point loss per contract which I should have and reversing to a short b/c it was a failed 2nd entry long.  Mack has it labeled as a short.  (Well I don't feel like it was such a bad trade b/c even Mack saw the same thing and got fooled.  He went long but unlike me, he reversed out once he saw it was a failed 2nd entry long and went short.  At least all of those thoughts went through my head but I didn't pull the trigger.)

Missed Trades:

1.  Double bottom and at the end of the measured move.

2.  2 legged move and 2nd entry short off of support.  I called this move but didn't take it.

3.  Failed 2nd entry long.  This is the trade that fooled Mack and he went long at first but once he saw price turned down he realized it was a trap and reversed his position to a short.