Tuesday, December 6, 2011

OK execution but mistakes cost me a lot

Tuesday, December 6
Total gross profits:  $75.00
Total trades:  10  [2 scratch]
Accuracy:  50.0%
Contracts per trade: 1

After an uneventful day yesterday, I was pretty sure today would provide better opportunities, but it was only a little better. Most of the regular trading day was in a choppy narrow range, except for a sharp 9 point news driven move, both up and down, during the final 1 1/2 hours.


  • Of the 10 trades taken, it was clear that 2 of the trades were not traded according to plan.
  • Rogue trade #1: Took place when I exited a short trade generated by Renato's DS alert trade while it was still active, only to take a long setup that had a full -2.50 stop. Renato's trade went more than +5, so I could have gotten at least a +2. OPPORTUNITY COST = 2.50 + 2.00 = 4.50 points.
  • Rogue trade #2: Was when I had gotten stopped out of a trade due to yet another Euro bailout news, and then tried to short against the news driven move before even waiting for the 30min bar to close. This was partially revenge driven and resulted in a -2.25 trade.
  • I missed Renato's final call of the day and missed a fill by just a few ticks. Based on how I usually execute his alerts, it would have gotten hit, but for whatever reason, I entered a more conservative entry level. That trade went as much as +9, but I count this as a +2 "could have" trade. 
Screenshot from my Tradervue.com journal - it's great, it's FREE!

6.75 points -- that's conservatively how much the rogue trades cost me today. 4.50 + 2.25 = 6.75. Wow.  I'm not even including the +2 trade based on Renato's final alert that I missed.  Shows how a couple of mistakes resulting in losses and lost opportunity can really impact the bottom line.

Therefore, a +8.25 day, that's what today could have been vs. a +1.50 day, had I been more careful and executed well against my plan. Perhaps I need to reconsider what I wrote in the first sentence above!

I only took advantage of some of the key areas today (highlighted in dark green) as appropriate with my current trading plan.  This is NOT a part of the Diamond Setups.  In the future, I will utilize these charts to better supplement the Diamond Setups trades. 

I believe there is great synergy and opportunity, but for now, I need to keep things as simple as possible and just execute well against my plan.
ES 5 min 12/6/2011


Tomross58 said...

Hey Grove,,

I was wondering how you are handling your fills? I know that its much different on sim and one of the guys in the room mentioned that to me yesterday, that I may have to adjust a tick or so to get "real" results. I know you ran accross this and ajusted on sim and was wondering how it went the last 2 days. I am using limit orders and usually have them sitting there waiting for the fill. I am getting filled to the exact tick at times but understand that once live I would'nt get filled in this manner.
Patience is such a difficult part here but as Rena says, its key. I am not used to waiting for the 30 min candle to close and get a little frustrated when it does close and there isnt a trade. I do believe that the 30 min chart is a strong level worth waiting for as Rena refers it all day.
Glad you were able to finish positive but it never stops amazing me how we all as traders look back after the day is over and see what could have been had we only stuck to our plan / discipline. We must conquer ourselves.


Grove Under said...

Hi Tom,
Yes, that SIM trading could potentially trick you into a false sense of confidence, so that's why I was SIM trading based on how I described here.

In essence, I counted +2.50 trades in SIM as only +2.00, since the SIM fills are so easy. So now that I'm trading live, it's not that different. It's like a baseball batter warming up with a weight. After you take the weight off, the bat feels really light.

But if you continue to enter orders the way you would in a live account, then just make sure you track whether the price when through your order level, and then count it as real.

And I hear you on waiting for the 30m closes getting tough, especially on boring days. This method happens to help put the brakes on me, a person that can easily overtrade.

But you can also trade the 377t with any of the other 30m+ timeframe levels (or even 10m), and you'll get a LOT more trades, likely 2-3 dozen a day!

However, I found that to be way too much, and needed to find a good balance. I made way too many errors (I'm not a algo-bot, lol!), and those errors ended up costing a lot.

Keep experimenting, and soon, you'll find a level of activity that works well for you. That's what is great about this Diamond Setups method, the rules are very adaptable to various timeframes. And keep up the great consistency you're achieving now!