BOJ again and again.

The Timeframe and chart I trade.

I'm starting more and more often to trade 10 seconds chart and 1 minute chart, 5 minute and 15 minutes is only for support/resist and 1hour-3hour-daily is mainly for bigger trend, in fact, the best case is use 1 minute for trend and 10 seconds for entry.

Following the trend is hard to get decent entry, but less risk as well.

As long as I control my average in size and think about what if scenario, I'm ok with trend following.

Current view of the market.

SPY is topped at 1190 level, as long as that stays, we are still having the potential of going back to 1040. I believe we will be choppy within this range to make our yearly gain at less than 10%.
Today ES was down 10+ points and closed within 5, bull is still around.

USD/JPY is temp bottoming at 80 level, I feel it's going to break below 80 to 79 or 78 and then the real bottom there and then we back to 90. Just like eur/usd couple month ago break to 1.19/8 and now is back to 1.40.

EUR/USD is topping, we have resist at 1.41 and we are due for the pullback to at least 1.36.
We will revisit this after next week's FOMC meeting.

2010-10-27

I was lazy these 3 days, I had a horrible day Sunday night, down 20%, which means all the profit last week was given back. So I have to adjust my mind and regroup, now it's about 10% back. And my mind is a lot clear.
This morning (actually both today and yesterday) I passed on some entry that I normally would take, and just because it's too risky or I don't have the time to manage it. They would worked out ok, but I didn't feel much regret, it's just a trade, it shouldn't make me or break me.
My plan was to close my longer term position on short EUR/USD and SPY in couple weeks (3 or 4), then focus only on day trading.
Early the year, around May and June, I was trading pretty well, and I thought I can manage day trading as well as swing trade, it turns out working for couple month, but now when I'm day trading, I keep on having the short bias. That makes me believe that my longer term position is somewhat affecting my short term view on the market.

I'm still debating if I should go with a system, like before, I traded breakout/moving average cross/support-resist, or go by reading the market and trade only base on price movement. I'm tend to go with the later, with "solid" money management of course.

Friday Thought

I was trading well this week, the smaller account (after blow out, now I trade with smaller size) gained over 20%, and I didn't feel much pressure during the week. There were probably one or 2 times I went all-in with this smaller account, and there is only one time I use the reserve.
If (and only if) base on this ratio, I would need 5 weeks to double this account and 25 weeks to get all the losses back for the current account. If I double up every 100%, it will be 11 weeks, that will put me in the end of Jan 2011.
This is a very aggressive goal and I'm sure I won't make it, so I will actually doubling my account with more funding from the reserver after 4 weeks of profitable trading so that my target ratio will be smaller, hopefully I can still get the same place by Jan 2011.
Trading is a long term goal, there should be any day / week to make me or break me.

Now let's talk about why I'm success this week, I mainly focus on how market moves, and because of the big loss last week, I wasn't really want to trade and I was watching here and there, but I clearly remember what the loss I have and what was the reason for it, it was fighting against the trend. This week, I still trade the same support/resistant type of setup, but I am more careful with the trend, and I can spot the difference of stronger trend vs. weaker trend on 10 or 5 seconds chart, with also the help of watching at price change real time. When price approaching a specific range, for example 50, the seller will try to stop it from going above 50, so you should see a slow down in the move, if the price movement continues, it can break and then because of the stop order, it accelerated, and most of the time in stronger trend, it stays above 50. So I was able to follow the stronger trend and fade the weaker trend. This is one reason of the success this week.

The other reason is, I am able to take some loss during the trade with out holding onto them for too long. Before, I was also able to take loss for individual trade, I cut them quickly because of stop-loss order, but I wasn't able to mentally take the loss for the day, I have to trade it back. This week, I did. I was able to identify the right timeframe and trading entry, when it's not working for me, I just stop, as I'm gaining any advantage on the market, why continue. This is always tomorrow that I can trade it back, no one day should make me or break me.

So 2 factors, 1: read the market and movement strong/weak. 2: risk management, always think of what if you loss this trade.

Bye for now, it's raining here in west coast, it sucks. It keeps my kids inside and they want to go out and play.

2010-10-22

2010-10-21

Timthy's letter hit WSJ again..

2010-10-19

1: daily is up 3hourly flat hourly down 15minute down 5 down
2: News to come is:
3: What's the main event just happened that move the market? and is it trendy? China hiked rate 25 bp, USD is higher across the board.we are trading at 1.3800 level for now. ES is down 12 at 1165 level right after market open.
Gold sold off 40$ at 13333

4: What do you think the market will do today? dropping

5: Were you right about the market? (After the trading session)

6: What's the trade? Is it related to the previous loser or winner? buying dip, selling pop
Do you take half at 1R?
How many pips it risk?

what's the daily limit and daily risk now? 60/20/3

Oanda lagging.

To all the oanda user out there, if you are scalper. Today morning (PST) Oanada data is lagging for about 10 to 20 seconds, compare to my IB. What you see is not what you trade. Your price filled base on what is real.

update: even better now, I couldn't connect.

2010-10-15

1: daily is up 3hourly up hourly up 15minute choppy 5 flat
2: News to come is: 6:55 Umich
3: What's the main event just happened that move the market? and is it trendy? not much overnight, Ben talked 5:20, we spike to 1.4160 in 2 minute and then retest it after 5:30 CPI Retail number. Now we pulled back at 1.4090 level.

4: What do you think the market will do today? we should go up, however, we have been up for a long extended time, so a turnaround is also expected. As well as it's a Friday. So take it easy.

5: Were you right about the market? (After the trading session)

6: What's the trade? Is it related to the previous loser or winner? buy 1.4050 or short 1.4160.
Do you take half at 1R?
How many pips it risk?

what's the daily limit and daily risk now? 60/20/3

VIX at 19.

Are we in a bull market? VIX is below 20. Let's see if 1250 of ES is the top.

2010-10-14

1: daily is up 3hourly up hourly up 15minute up-flat 5 down
2: News to come is: N/A
3: What's the main event just happened that move the market? and is it trendy? it's breaking out 1.40 the previou resist last night and then rally as high as 1.4120. German exporter is selling (don't understand why) and not much stop under.

4: What do you think the market will do today? drop, as we run too fast, there need to be some pull back.

The pop from 1.4050 level this morning was very strong, that's why I didn't short on 10 sec or 1 min ema62, as the move is fast and none stop. I managed to get some short on previous high close to 84-90 level, stop at 92. Profit was too early, should be at 75 and 65. It's now trading at 64.

5: Were you right about the market? (After the trading session) yes.

6: What's the trade? Is it related to the previous loser or winner?
Do you take half at 1R?
How many pips it risk?

what's the daily limit and daily risk now? 60/20/3

2010-10-13

Market is up in general, eur/usd almost no change, it tested overnight high 1.40 but with BIS and China selling, now fail back to 1.3935. The post FOMC minute run as stabled.

ES is up 8 points and Asia/Euro stock market is up ingeneral. Intel beat and JP beat. Market in happy mood.

2010-10-12

SPY head and shoulder?

Are we in an inversed head and shoulder in SPY/ES daily chart? If so, we can go up to 1300 at least...


Hope not, I am shorting it now.

2010-10-11

It was a less movement day, as lots of banks are not trading today (holiday in North America).

China was selling EUR/USD at 1.4000 level and it pulls back to 1.3870 during the day.

This week is relatively short as not much news also.

JPY is leaving the dangrous zoon as it's trading at LEAST at 82.00 level.

Why USD/UPY drop from 86 (post BOJ intervention high) to this level? Because Japanese exporter are hedging!

current market view on Stock, FX, Gold.

It's 2010-10-08, Friday.

Stock market is a bit strange, as the job report isn't really big changer this morning, yes we are worse than exp, but not by big numbers, so it came backup as we are in a bullish uptrend (mid term) anyway. The move behind is, 1T$ QE is expected by Nov 2010 FOMC meeting. Now the Fed is really playing a better hand, market is pumped up, they have way too many choices, compare to last year, they have to QE otherwise it crash. This time the market is almost at post-crisis high and they have QE on hand. Ofcource they will review again before the meeting about all the data, market will be happy if they QE, Market won't be very unhappy if they don't, because they can always QE the next time. overall, I think we are in a bullish mood just because QE push down $ so much. It will bring in more money from overseas.

FX is bit crazy, EUR/USD break couple key resist, even the 61.8% Fib retracement. Really, I mean Europe is no better than US, in fact, PIIGS suck! But so what, ECB put 1T$ out of pocket and stand behind them. Now market is happy and here we go, euro just going higher and higher. I'm still bearish on Euro longer term, but that doesn't matter anyway. USD/JPY is at 15 years low, OK BOJ intervention didn't work that well, they throw 20B$ into water! Nowadays, you need a Trillion, not couple Billion to fool around. I remember early this year, when ECB first say they will have 60B$ to back Greece, EURO tanked! Until they throw 1T out, it dropped all the way to 1.19. JPY will have no difference, they need to spend couple T to save YEN, well, it's also tricky that they are in a such bad political relationship with China, who hope YEN goes higher and higher, and probably China is the single biggest buyer of JPY. There are couple reasons, political pressure, both are exported driven country. Chinese and Japanese won't get along together anyway. Also BOJ lower the rate from 0.1 to 0.1-0, what a stupid move, who cares about 0.1 anyway.

Gold is THE super star this week, and last week, and last month, and this year! It moved up from 1280 to 1360 (80$) in no time! Stock market up, people buy gold, stock down, people buy gold. I'm still think this move is largely because of the weak USD. Now you can see how powerful Fed is and how smart big Ben is, they move up stock market and weak USD without even a single penny, not YET. It's just a few words from GS, and they don't really NEED to do it in Nov's FOMC.

I know lots of people are happy with the market, me too, as I'm happy to see more and more people can work and feed their family. However, I still feel extreme uncertainty about this market.

Have a good weekend everyone. See you all next week.

2010-10-08

I just had a sizable lost, now regrouping and hope come back next week.

2010-10-05

1: daily is up 3hourly up hourly up 15minute up 5up
2: News to come is: 7:00 ISM
3: What's the main event just happened that move the market? and is it trendy? BOJ lower rate to 0, where can they go next?

4: What do you think the market will do today? see how 1.3815 works, it's the top for now.

5: Were you right about the market? (After the trading session)

6: What's the trade? Is it related to the previous loser or winner? buying the dip and short the top.
Do you take half at 1R?
How many pips it risk?20

what's the daily limit and daily risk now? 60/20/3

Oanda eating my pip!

2010-10-04

1: daily is up 3hourly up hourly flat after the pull back of 100 pips last night 15minute down 5 flat.
2: News to come is: 7:00 pending home sale and factory order.
3: What's the main event just happened that move the market? and is it trendy? China was selling last night, plus the market was down. BIS and Asia buying, low at 1.3667

4: What do you think the market will do today? major trend is still going up, but a pull back to 1.3560 is possible.

5: Were you right about the market? (After the trading session)

6: What's the trade? Is it related to the previous loser or winner? buy dip and sell top
Do you take half at 1R?
How many pips it risk? 20

what's the daily limit and daily risk now? 60/20/3