Daily Report Card 05192020

19 May Daily Report Card 05192020

My week­ly goal

Only take trades when there are at least 4 con­flu­ences. Trade loca­tion. Mar­ket Pro­file. Price action con­fir­ma­tion. Fol­low hard entry and exit rules.

Good Pre-mar­ket routines

Good Ses­sion PECS

Good Trade selection

Good Trade Exe­cu­tion & Mgmt.

Good Risk Adjust­ed Returns

Yes Dai­ly review

Mup­pet meter (1 being best — 5 being worst): 1

Sum­ma­ry

• Lon­don opened below VA and range
• Before IB there was an exhaust­ed move into H1 Demand ZOI and M30 shows bull­ish engulfing
• IB extend­ed slight­ly to the upside hit­ting H4 con­ter­mi­nous sup­ply and low­er time frames indi­cat­ing fail­ure to con­tin­ue up
• This was a great entry for an entry based off the M5 con­firm­ing price action at a H4 con­ter­mi­nous supply
  • Short Entry 1.39347, SL 1.39547, TP 1.28947
  • Rea­sons for tak­ing the trade:
    • Open below VA
    • Mas­sive can­dle yes­ter­day reject­ing D1 QHi
    • Price hit­ting H4 con­ter­mi­nous sup­ply 1.39385
    • M5 bear­ish engulf­ing after a consolidation
  • Dur­ing the trade:
    • Price con­tin­ued a lit­tle high­er before actu­al­ly revers­ing (impor­tant to base stops on M30 and not M5)
      • Pos­si­ble future entry method could be wait­ing for the sec­ond fail­ure on M5 before tak­ing the trade for bet­ter entry 
        • But this would need val­i­da­tion through col­lect­ing empir­i­cal data on how often this occurs. For now enter­ing on the first is good enough.
      • Repo­si­tion­ing of SL to 1.39600 to stay away from the near­by round num­ber of 50 and to include my spread
    • What fol­lowed was a ‘2nd chance entry’ based on price retrac­ing back to new­ly formed M30 con­ter­mi­nous supply
      • Mar­kets being frac­tal it is safer to assume that after the H4 rejec­tion the M30 would reject as well
      • No need to wait for any close just on a hit is enough
    • A ledge formed dur­ing F
      • Ledges formed inside IB are less rel­e­vant but that’s what we had today
    • Going into Over­lap noise
      • Rea­sons for going into overlap:
        • Price had not tak­en it above IB again and want­ed to give it time to take out the ledge below. This means a high­er prob­a­bil­i­ty of a poten­tial run lower
        • Price wasn’t still in the top third of IB
        • Anoth­er nudge came from  the cur­rent devel­op­ing val­ue but that’s for anoth­er time
      • IB start­ed extend­ing down increas­ing the bias of a fur­ther move down
      • If price would break and the close above a M5 sup­ply (being a move against my direc­tion) I could have tak­en the trade off but I decid­ed to stay with the trade to prac­tice focus­ing on obser­va­tion and get­ting more com­fort­able tak­ing my time-based stop (which was now extend­ed by an hour)
      • The next bar closed above the sup­ply ZOI indi­cat­ing a stronger sig­nal that the mar­ket was try­ing to go back up again
      • Over­lap can work in the favor for exist­ing trades but it’s nev­er a good idea to open new trades
      • Time-based stop at 1.39252 for 9.5 pips 0.37% prof­it after being all the way to over 1% 1.39042 with 30.5 pips

• AFTERMATH (post trad­ing win­dow, after noon)
  • Includ­ed above

How accu­rate was my assess­ment of mar­ket context?

• I did good to see the M5 con­sol­i­da­tion at H4 con­ter­mi­nous sup­ply with strong fin­ish­er in the form of a bear­ish engulf­ing. The rest is detailed above.

How did I feel before, dur­ing, and after the trade?

• I always feel a lit­tle bit anx­ious get­ting into a trade slight­ly think­ing I’m mak­ing a mis­take but always try­ing to recen­ter myself on the process I am fol­low­ing to come to my deci­sions. This has been work­ing fine.
• Dur­ing the trade I was calm­ly observ­ing price action but with­out micro­manag­ing the trade. Even let my trade play out time-based after price action was con­firm­ing a (short/medium term) reversal
• After the trade I feel good hav­ing learned a lot today and gained valu­able expe­ri­ence. Don’t feel bummed at all for not tak­ing more prof­its. I am hap­py I focused on direc­tion­al expe­ri­ence and not on prof­it tak­ing. That will come later.

How well did I fol­low my process?

• Did a good job here

How well did I man­age my phys­i­cal, emo­tion­al and cog­ni­tive states?

• Did great here as well. Actu­al­ly for­got to eat but I think that helped me even more. 

What did I learn today?

• Weak Bear Engulfing
  • Doesn’t make a new LL and doesn’t close below pre­vi­ous can­dle open
• Strong Bear Engulfing
  • Sec­ond one makes new LL and clos­es below pre­vi­ous can­dle open
• Because W1 large time­frame has a phase 3 we’re expect­ing the most prob­a­bly out­come: liq­ui­da­tion / phase 4
  • There­fore any D1 QLo you come across might only have a lim­it­ed reac­tion before it is tak­en out
  • Hence good entries for a con­tin­u­a­tion move based on pro­file sen­ti­ment (this case being below val­ue) a H4 con­ter­mi­nous line turns into a ‘bounce point’ 
• Ear­li­er entries based not on TP exten­sion but a test of a near­by H4 Supply
• Entry based off H4 c‑supl using M5 rejec­tion entry with pro­file sentiment
• 2nd chance entry at new­ly formed M30 c‑sup
• Noise over­lap (and rea­sons for going into it)
• Ledge expe­ri­ence
• Using a slight­ly wider stop when near a ‘round’ number

What’s one thing I need to do more often?

• Keep com­ing back to the mar­ket gain­ing expe­ri­ence. Nobody or noth­ing can teach me that. 

What’s one thing I need to do less often?

• All good today

For my trade plan(s) on this par­tic­u­lar day, go here:

Pre­mar­ket Prep USDCAD 05192020