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How to take a punch
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How to take a punch

by ScottOctober 9, 2014

The FOMC announcement really messed with Thor yesterday. I was short ES and AUDJPY, which were whipsawed out for breakeven and a 1R loss respectively. Also SI Z4 painted a 1R loss, and EURGBP got into a trade and out of it for roughly breakeven on the same day. With other intraday reversals my main account was down 4.7% (or $39,000 AUD) yesterday, and I feel it’s important to acknowledge that, and also acknowledge that I really thought we had a very small chance of doing anything but go down yesterday, and the surprise move caught me by, SURPRISE.  As you well know low probability outcomes lead to the biggest moves and many equity shorts (like me) had our fucking faces ripped off, as Gordon Gecko would say! Mea Culpa to those who took my advice yesterday, I honestly didn’t see anything bullish leading into it, although there must have been clues. Congratulations to those who took the other side of my trades, it was a ballsy move and you deserve your profits 🙂 The game is the game.

 

This is a daily equity fluxuation histogram (real money, the hypothetical one that Thor people should be trading is marginally better)  for my personal account, after the big single day drawdown on the left of the screen I changed the exit algo to reduce the risk of this happening too often, but here we are again.

Personally I’m feeling totally fine with it, it’s tremendously easy to paint winner after winner, but you really see what you are made of in a drawdown. Which leads to the important topic of

What Do I Do?

Mike Tyson said that “Everybody has a plan until they get punched in the face” and that is particularly true in markets. The important thing is to have a business plan around your trading plan, which includes a point at which you lower risk and keep lowering it in a drawdown.  The interesting thing is that you will not want to follow this plan if you get to that point, because it makes it harder to pull out of drawdown

There is an important principle of markets in this book by Jack Schwager that when you take a big hit you are no longer objective and you should just get out. I highly recommend reading this, there are several strategies to deal with this problem.

Anyway, after a night’s sleep so I am objective again, I can say the following. Big single day fluxuations are a concequence of running many simultaneous positions. My choices are to either limit the number of simultaneous positions or bank partial profits earlier (which I already do). Days like yesterday are just a fact of life for me, though I could lower my profit targets to get rid of them. I choose not to, so I accept the consequences.

Market wise, the big one day move has shaken weak hands out of their positions in both directions. As long as the sequence of lower highs lower lows stays intact, the bears still have the advantage (with a lot of energy being expended making the big up candle yesterday), though if we go up even a little a serious squeeze will start.

How I am thinking is as follows. If the market wants to continue going higher then we should paint a small range day (in either direction), whereas if the upmove is a last gasp effort by the bulls then that move should be quickly reversed. We should have resolution either way shortly

Scott Phillips


About The Author
Scott

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    Confession IS good for the soul. But all the veteran rats have been surprised themselves
    at one point or another. If not, they haven’t been doing it long enough!

    The important thing is, worst case, 1R loss. part of the trade. circuit breakers tripped.
    don’t fixate too much. Move on.

  • newbfxtrader

    @scott did you check Thor with crude? Seemed that it would be a good trend down. Couldn’t reverseeven with dollar down yest.

  • SS_JJ

    Back on the short train

  • Skynard

    /ES support @ 1950 Rats:)

  • newbfxtrader

    Real battle going on now. Some markets have reversed all the gains from yesterday.

  • Scott Phillips

    Oh yes my crude thor short looks really good, so does my ZB long. Not all bad by any means

  • Scott Phillips

    Stick to the plan, grind it out. Feel the feelings of loss, update your trade records. Next trade.

    Curiously I usually find a very strong subconscious pull not to keep trade records updated in a drawdown

  • Scott Phillips

    Lot of energy expended in that big up day yesterday. Bear case still has a shot.

  • newbfxtrader

    Check Nikkei, ftse, France, DAX …

  • newbfxtrader

    Curiously?! Lol.

  • Skynard

    Have my bear suit on today:)

  • newbfxtrader

    You been having too much fun lately 🙂

  • Scott Phillips

    Well I am super anal about keeping trade records done, since that is the number one predictor of trading success. Any time I don’t want to fill out trade records is a canary in the coalmine

  • Skynard

    Ya, better slow down:)

  • tradingmom

    I think the zero has performed extremely well during this whole new phase of higher vol. In particular, the hourly panel showed a clear positive divergence both at the previous low, and at yesterday’s low, and paused right at a support line and reversed yesterday.

  • newbfxtrader
  • newbfxtrader

    Posted a chart a few days ago. Wanna see how the Russell closes the week.

  • Skynard

    Nice fakeout /SB

  • wandering196

    How right you are!

  • http://www.ProfitFromPatterns.com/ Ivan K

    Seems your correlation bogie is still alive and kicking … on both sides.

  • newbfxtrader

    The Nikkei correlates well with usd/jpy. First support gone. Next around 106.50 or so. Aim for a bounce there.

  • newbfxtrader

    Commodities are oversold bunch. If the dollar pulls back we could see a relief rally in most.

  • Scott Phillips

    Actually I’m trading really well the last few weeks, I can’t control the markets only what I do

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • Scott Phillips

    Yep – inherent in the system unfortunately. out of 8 positions 3 were positive yesterday

  • BobbyLow

    Hey Scott thanks for the post.

    All yesterday proved to me was how fortunate I was for not having an equity position. This is because of how much I hate to trade equities in the first place. I was fortunate to reaffirm my decision to clear all Forex positions just prior to Major US Fed Stuff. I’ve also added clearing AUD Positions just prior to Major Announcements from Down Under. It is not worth the angst and becomes too much of a gamble to hold through these things. I’ve also decided to go back to clearing all Forex Positions prior to the COB on Fridays. The Sunday night fuckery can be fine within a Daily System but IMO raises havoc with shorter term systems.

    I mentioned yesterday how I had screwed up by holding on to a small Long Oil position beyond my stop. I now have this position surrounded by Options which is something I hate to do. The reasons why I held on to it were all bad. Failure to accept the initial pain, Stubborness and having to be right, and above all my familiarity with the behavior of the Oil market created a Bias. On September 30th I had a full position when Oil had that $4 one day drop. My system told me to sell all and flip to Short. Instead, I only closed 1/2 and held onto 1/2 Long.

    Needless to say this was a major mistake. I’m confident that I can trade my way out of this positional mess in oil and will probably be able to get it back to BE. However, if I had done what my system had told me to do, I would have already more than made up for my original losses because Oil has dropped another $4.47 since September 30th. This is a case where I failed to practice what I preached about following my own rules and it bit me on the ass.

    Other positions opened earlier this morning are Long AUD/USD and Short GBP/JPY

  • http://www.ProfitFromPatterns.com/ Ivan K

    Hence by design ?

  • Skynard

    /ES support gone, next stop 1930

  • Scott Phillips

    Yeah I’m totally cool with it. No way to shoot for the moon otherwise that I can see

  • Scott Phillips

    Both your currency trades look good 🙂 The important thing is to trade your system correctly after the emotional hammer blow of a mistake.

    If you can avoid a cascade of mistakes that is very very good trading

  • http://www.ProfitFromPatterns.com/ Ivan K

    Or are you aiming for the stars and happy to settle for the moon ?

  • SS_JJ

    Ataboy!
    😉

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    watch the 50% of the main candle yesterday.

    SPX 1952.25….

  • Billabong

    Along with NQ and YM already heading down this morning

  • Scott Phillips

    Either or, objectively I’m achieving world class performance right now, I can’t ask for much better. I have a system, I execute that system, I examine my results in the cold light of the day.

    Nothing else to do really. Grind it out 🙂

  • http://www.ProfitFromPatterns.com/ Ivan K

    A sprint or a marathon … congrats on your progress in any case.

  • tradingmom

    also the area of closing vwap from yesterday

  • ridingwaves

    VIX scalping is fun…if you get the turn right

  • Scott Phillips

    A little of both to be honest. It’s an exciting time for me (and Daniel your student who trades the system with me)

  • http://www.ProfitFromPatterns.com/ Ivan K

    Ditto from my side … with another student whose results over the last 79 days I shared in the previous post (as well as earlier [posts]).

  • Scott Phillips

    Except that world class trading is not superhuman like that. Every person who reads this blog is capable of it, just very few will surrender to the process.

    1) A system with an edge that suits your personality and market beliefs
    2) A business plan treating trading as a business
    3) Near perfect execution of that system
    4) Accurate and timely records
    5) Time spent away from the markets reviewing records and monitoring the system

    Any time spent jerking off about analysis or wondering what is coming next has very very little do to with those elements of world class trading. I’d urge everyone here to read that list and honestly ask themselves how many of those are being done.

  • Scott Phillips

    Remarkable results indeed 100R is the big one! I didn’t quite get there last year, but will this year for sure.

    What timeframe is he trading?

  • Scott Phillips

    If you read that and don’t do any of those things, Ivan’s (paid) service will certainly instill the proper procedures.

    Ivan and I differ (a lot) on system design principles, but on the actual mechanics of trading as a process with skills that can be practiced and learned, there is NOBODY better in the whole world.

  • http://www.ProfitFromPatterns.com/ Ivan K

    From my side 100R is just one of the many milestones … seen as ‘big’ … to achieve ‘remarkable’ results a number of factors come into play … the match between the market, the timeframe, the RBT … and the operator … take any one away and the result will not be ‘remarkable’.

    Given that the results are not ‘my’ RBT, but that of a student … (who ‘put up with me for over a year) … the exact timeframe I cannot divulge … suffice it to say that it is a road less travelled.

  • http://www.ProfitFromPatterns.com/ Ivan K

    ‘Nice’ addition [edit] to your previous comment.

  • Skynard

    Flipped /ZC (495), /ZW (344) to long

  • Scott Phillips

    Welcome 🙂

  • Skynard

    Dollar is done correcting

  • ridingwaves

    I’m 20% closer…..80% off the mark….thus green pea status has been achieved…..

  • mugabe

    I think we can all relate to that last comment!

  • http://www.ProfitFromPatterns.com/ Ivan K

    I am sure there are Scott … tho noted and appreciated.

  • https://evilspeculator.com molecool

    Ah great – now he’s making up new words…

    “This is a daily equity fluxuation histogram”

    Unless you were talking about my secret pre-emptive market analysis project…

    http://ihwr.org/wp/wp-content/uploads/2014/04/Drawing+of+a+working+model+of+flux+capacitor.jpg

  • https://evilspeculator.com molecool

    How are you ladies holding up?

  • https://evilspeculator.com molecool

    And please – both of you, quit sending me those photos!!

  • Skynard

    Except for /LE, holding up well. Think it will tank:)

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    price is everything. but I don’t see the Fear in the ratio today.
    [SPX:TLT]
    http://stockcharts.com/h-sc/ui?s=$SPX:TLT&p=D&yr=0&mn=3&dy=0&id=p77974451480

  • Skynard

    Will be out of /SB @ 16.7 for 2R

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • wandering196

    Great, working the plan ( and working on the plan). Took one of your set ups from yesterday.
    It is turkey weekend for us Canadians, maybe Scott will get a great Thanksgiving dinner while he is here.

  • wandering196

    come on who else am I going to send them too

  • Scott Phillips

    Here’s my witty rebuttal – FUCK YOU 😉

  • Scott Phillips

    Yeah I’m actually here for Canadian thanksgiving

  • wandering196

    enjoy it, then you can head to the US for their thanksgiving in November:)

  • Skynard

    Double bagger on the puts

  • SerenityNow

    Nice trade.. how’d you define a stop to stay in the position, given today made the highest high in over a month?

  • Skynard

    Long /SB 16.67

  • dragan ilic

    No mercy tape. Love it 🙂

  • ridingwaves

    Man on fire last week… VIX has to be easy to play with with Zero….this will be R city when Jan. comes…

  • ridingwaves

    a week ago I was leaning on bull thrust, C carrot made me look deeper on just a comment….second look made me dig deeper….the 360 line of death has worked on all symbols for me before…very hard to come back above it when 50 crashes thru…which is taking place soon…bulls are in trouble…

    930 on RUT looks inevitable…before December

    http://s18.postimg.org/40esjlh61/rut_oh_3.jpg

  • dragan ilic

    First SPX target will be 1905. MA 200. That will be the magic line. If bulls fail to hold it there will be a visit down to SPX 1800. I wonder how they will name next market crash?

  • Skynard

    Added on the fakeout, and set stop

  • Skynard

    Don’t bitch me out, one more spike low and long /NQ

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    don’t use targets in a trend.
    right Scott?

  • dragan ilic

    This may sound unhuman, but there is no money like bear money

  • Skynard

    Filled @ 3987, div on the 5 min and we are at support dammit.

  • ridingwaves
  • Billabong

    Lot of downward pressure today

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    okay, today is starting to look like August 2011.
    remember those big back to back candle days?

    http://stockcharts.com/h-sc/ui?s=$SPX&p=D&st=2011-08-01&en=2011-08-31&id=p57438632766

    comments?

  • ridingwaves

    don’t go back to previous setups via last 4 years….things are much different today in a non qe world….the big boys are not churning treasuries to push more 10-1 leverage into the system…..to get more qe the market needs to melt….

  • tradem4alpha

    in the 2011 correction, at the point in that chart, the market was down over 15% (from yearly highs); now it is 4% below all time highs…

  • ridingwaves

    also be wary of 18.00+ on Vix….if it explodes above gandolf line which just held again….it will get messy…the pressure is building to blow thru it..

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    Wary!? the S&P is swinging 30pts every freaking day!
    Wary!! (grin)

  • Skynard

    To VWAP or bust:)

  • newbfxtrader

    Now thats a bearish zero.

  • ridingwaves

    anyone notice corn might have put in bottom…

  • Skynard

    Taking profit /SB 16.8

  • newbfxtrader

    Ahem … low probability of a downtrend day….

  • Skynard

    Long /LE 166.8

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    Hey, Bobby – under 10.
    (it could stay down there for weeks, but whatever…salut!)
    http://stockcharts.com/h-sc/ui?s=$BPENER&p=D&yr=3&mn=0&dy=0&id=p26807001795

  • newbfxtrader

    You gonna flip below 165?

  • BobbyLow

    Gotcha. I’m beyond the point “calling uncle”. I cleared out my long Puts and short Calls . I held onto a few long Calls along with my UCO. I hate fucking options and I don’t want to hold on to them any longer than I believe I have to. You should be in a lot better position than I am because I still have a lot of ground to make up.

  • ridingwaves

    one of Moles ads seems to be crashing chrome….

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    I hear you on the options.

    The UCO is 2%, no more. Yes, I know 1%. But I’m a verrrry small retail guy.

    Big XOM broke the 300, but it’s happened a few times. I have some dry powder. 😉

    http://stockcharts.com/h-sc/ui?s=XOM&p=D&yr=3&mn=0&dy=0&id=p72935839582

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    I’m running Chrome.
    *adblock* {cough}

  • Skynard

    Long till 168

  • ridingwaves

    hammering the vix after getting it went above gandolf do not pass line.,.damn arbitrage instruments

  • SS_JJ

    where is the troll that stated “bears are toast??

  • ridingwaves

    spreading some jelly on himself

  • BobbyLow

    FWIW and IMO, 2% is fine on a longer term trade.

    I’m small pebble in the quarry myself and this Oil trade is making me smaller. 🙂

  • BobbyLow

    Could be the picture of the former movie star after plastic surgery.

  • mugabe

    I’d had the same thought. Has to be said, though, that the market had gone down a lot more then. Whatever, this is an area of massive indecision, but the uptrend going back almost 2.5 years on SPY has not been broken- yet.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • https://evilspeculator.com molecool

    Honestly I’m close to pulling ads from this site. They are paying jack and they annoy the readers.

    FWIW – subs do not see any ads, so you could always sign up for Gold at least ;0)

  • https://evilspeculator.com molecool

    LOL

  • https://evilspeculator.com molecool

    That’s the spirit! 🙂

  • mugabe

    Sorry, but for a minute I thought I was at the Slope

  • Skynard

    To VWAP and short again

  • https://evilspeculator.com molecool

    Hehe – let’s all relax about this. All that matters to us is whether or not we get to book profits. Unfortunately today’s tape redeems anyone looking down yesterday but that is inconsequential.

  • https://evilspeculator.com molecool

    Skynard is playing it like a fiddle today.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    in percentages, yes – you have a point.
    good to see you around. it’s been a while.

    thanks.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    The big boys are moving these swings.
    some entity is buying big, and some entity is selling big. perhaps the same entity!
    thanks.

  • SS_JJ

    yeah.It is either forming a bottom (i.e. retest of the low) or we’ll see more free fall.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    never say never.

    the PnF says zero. but we knew that.
    delisting begins at what < $1.00 ?

  • BobbyLow

    Ads themselves are not bad at all. But what I can’t understand is why the ads for the most part (but not today for some reason) have been pictures of things like tape worms, and that scary looking plastic surgery lady. If the advertisers want someone to click on something perhaps they should make the visuals somewhat appealing. But WTFDIK? 🙂

  • ridingwaves

    surprised your not using google adwords…

  • tradem4alpha

    one of the things that made me not to close my shorts, and add some today on the European open (on the DAX, European indices have all been weaker) was the fact that the bullish percentages on the SPX and NDX were down over 3% yesterday…so we had a big up day (over 1.5%), but more stocks were registering bearish price objectives; thank to Gold Gerb for mentioning this element over the years here at evilspeculator.

  • SS_JJ

    It all depends what bucky does in the next few sessions. Yellen talked down the dollar in the minutes, and I am not ready to fight the FED. For the time being , I see today’s down move as “shake the tree” before take-off.

  • ridingwaves

    starting to smell some fear…..vix do not pass is now in rear view mirror….unless they turn this around….no qe until 14th….and its a small … or maybe this is just large caps catching up to small caps as RUT is holding that support line thru all of this…1070-2 is sticky…

  • ridingwaves
  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    ah gee, thanks.
    just an FYI – the Bullish Percent lags terribly sometimes. so I miss the party, and then I miss the pain too.
    IMO, you really need Mole’s tools to make coin.

    http://stockcharts.com/h-sc/ui?s=$BPSPX&p=D&yr=0&mn=4&dy=0&id=p61511725933

    The BP never turned up yesterday, in hindsight – it’s a beautiful thing.

    -GG

  • wandering196
  • Scott Phillips

    Motherfucker CAN catch a reversal

  • Scott Phillips

    As soon as I read that I knew the fix was in. Hey dumbass, you reading shit for brains?

  • Scott Phillips

    Classic thing is for central banks to talk one way and do the opposite. “It is axiomatic to fade central bank announcements” – Soros

  • Scott Phillips

    Doesn’t pay shit

  • Scott Phillips

    Yes, I’m right back in the game today and my biggest problem is which setups to take

  • Scott Phillips

    For counter trend its actually a good idea, trading with the trend it’s not.

  • Scott Phillips

    How many of the above 5 do you do consistently?

  • ridingwaves

    yes..I have 40+ vix showing up in Nov. Dec. time frame

    such huge blocks getting pushed out on SPY the bid/ask price is all over the place, sometimes off by .20c

  • ridingwaves

    depends on the vertical your site caters too..

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    Come on Bears, got to do better than that.
    40 pts? Tomorrow is Friday.
    big thursday, small Friday.

    push push push.

    [Magic Keltner]
    http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=6&dy=15&id=p19346033939

  • ridingwaves

    whoa 1.5 million spy shares bought a minute ago…

  • BobbyLow

    S&P down almost 40 Points and Oil is only down around $1.60 come on is that all you got?

    AUD/USD crapped out and at this point of the day, the GBP/JPY is the only thing helping to make my day only semi-shitty. 🙂

  • SS_JJ

    I am always suspicious of first time posters with strong opinions

  • Scott Phillips

    Last time I check google pays out a whopping 11% of what they charge

  • Scott Phillips

    AUDUSD is looking tasty – only problem is I have at least 10 setups I could take and they are all correlated

  • Xan

    S&P was up 40 points yesterday and oil was still down. not much of a correlation there for now. AUDJPY and GBPJPY far better proxys for S&P. Best of luck matey 🙂

  • Skynard

    Bulls showing up, SPX 1930 saved for now. Should see some wild action, small signal range.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    big boys. follow through?

  • SS_JJ

    ZL says Meh! FYI 😉

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    yeah, I’m looking at volume now.
    6 to 8 Mill on the peak 5 min candles.
    1.5 is nothing, even a minutely.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    that’s his thing. range/reverse trading.
    very good at it.
    I smell a guest post. Dam, he’s part of the boat by now.

  • Scott Phillips

    Mole got a beauty of an offensive email from someone yesterday, always worth paying attention to

  • SS_JJ

    ZL still (-) in a downtrend day. I am staying short.

  • CorporalCarrot

    Double outside days……..this is like a flash crash, there will be repercussions lasting days if not weeks from it. Both sides fucked, but the path in these cases as things resolves will be downwards. Sell the rips for the foreseeable.

  • BobbyLow

    I was just being a smart ass on Oil/S&P correlation. Believe me, I know what happened yesterday. 🙂

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    yep.

    “In those situations it is oh so tempting to get cute and thereby fuck it up. This is NOT a time to buy the dip.”

  • Skynard

    Good plan, dip buyers area. Choppy price action from here me thinks.

  • newbfxtrader

    Hes got a good eye. I cant see what he sees. Like last week he was calling euro long. I was like WTF.

  • newbfxtrader

    You should have taken the lumber short see!

  • SS_JJ

    One would expect to see dip buyers at this level, but not the clever kind IMHO.

  • SS_JJ

    Agree, until yesterday’s low is taken out.

  • newbfxtrader

    Try this one. Easy long. Clearly you know when to flip short.

  • newbfxtrader

    Offer you a cup of Jo! Easy to know when breakout fails…..

  • Skynard

    Ya, playing the range until broken.

  • newbfxtrader

    Book some bro. You had a good day I am sure!

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    about an hour to go..

    when stuff is moving on the plate, I ask myself – what am I NOT watching.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • Skynard

    15.5 R on all trades today

  • newbfxtrader

    Dayum!

  • Billabong

    Oil is almost down 21% or $22 … ouch. XLE RSI scraping the bottom at 15.

  • BobbyLow

    Since August 29th there has been a 14.5% Haircut on the average Stock Price the Integrated Oilers.

  • ridingwaves

    here comes bull move….guess the close

  • Skynard

    Bulls can easily return the favor to the top of the range

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    ouch. I suppose 20% is in store.

    on the bright side, cheap gas for all!

    http://stockcharts.com/h-sc/ui?s=$GASO&p=W&yr=3&mn=0&dy=0&id=p74082368604

  • Billabong

    There will be an investment opportunity there with a 10% dividend before this is over. I went into the Bakkan and Marcellus regions last year to get a feel for what was going on. In six months, I’m heading down to Eagle Ford. For anyone that’s interested, it’s very interesting to see this operations in action and to see the local area impact.

  • Skynard

    Great FN trading today, cheers to whoever shorted crude:)

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    I’m no good at this.

    {nudge, nudge, all right}

    1941.

    http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=3&dy=0&id=p28964907271

  • ridingwaves

    weak so far….need to head into office, get to miss the phone, that press on vix long yesterday paid off well today…

  • Skynard

    ZL fully divergent here.

  • Skynard

    Lol, hang on bears:)

  • SirDagonet

    “There will be an investment opportunity there with a 10% dividend before this is over”

    tell us more…

    “For anyone that’s interested, it’s very interesting to see this operations in action and to see the local area impact.”
    and expand upon this as well, and your time permits…

  • BobbyLow

    Yes, Gas prices are down about 20 Cents per gallon over the past month. I am jumping for joy with excitement. 🙂

  • SirDagonet

    you *are* integrating his musical RBT methods into FractalMonger, right?

  • SerenityNow

    Daily Silver looks spicy for tomorrow… failed above Tuesday’s high and a SS

  • Skynard

    Do not think the bulls will allow a break of that TL yet. Lol, bears are salovating:)

  • SS_JJ

    I can see that, you can see that, and the rest of the trading world can see that.

  • SirDagonet

    “when” the breakout fails? You’re sure it’s not “if”?

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    *time check*

    177 comments, Wow.

  • newbfxtrader

    Oops. I meant long unless breakout fails. Looks like the retest held where I have that line.

  • SS_JJ

    I’m looking forward to tomorrow already.

  • Ronebadger

    over 90% down volume day…as far as I can tell

    VIX Step One…again

    Anyone concur with this?

  • Scott Phillips

    Has anyone ever run the numbers on this, or is this something we’ve been counting for years without knowing how well it works?

  • Scott Phillips

    That would be me! And I’m exiting on close for a 2R win

  • newbfxtrader

    I remember someone posted something on this a while back. The VIX buy works fine in bull markets and VIX sell doesnt.

  • BobbyLow

    Personally I think VIX Buy/Sell signals are an illusion. When they work it can be said “see it works” but when it doesn’t work not much is said about it. And of course they work in a Bull Market, why wouldn’t they? Everything is supposed to work in a Bull Market isn’t it?

  • CorporalCarrot

    I’ve never been convinced. I think its one of those things that people hail as a sign (like currency correlations) when it works, and sort of forget about it when it doesn’t.

    And most signs/signals/indicators are worth jack shit when volatility increases dramatically. The last time I can recall conditions like this was 2011.

  • Scott Phillips

    I don’t have an opinion either way, except that if nobody has a set of numbers on it, for our own integrity we should stop quoting it. Human brains are useless for noticing this stuff, we just remember what happened last time and not the real odds.

    As a group we should be making the switch to evidence based technical analysis rather than chicken entrails

  • Scott Phillips

    Numbers?

  • Scott Phillips

    I agree, also similar trade in GC and PL. From a technical perspective GC has a better protected stop and PL is a nicer trend

  • SerenityNow

    True… nobody ever said it had to be complicated.

    What I see is a simple setup with high odds… Any late buyers in the last two days are sweating,. and those who stopped out above Tuesday’s high are pissed and thinking of chasing with new shorts if we break down.

  • dragan ilic

    Same here Scott… Kill em all 🙂

  • newbfxtrader

    It was in the comment section. Maybe someone can remember where it was.

  • newbfxtrader

    Can you do a search in the comments?

  • newbfxtrader

    http://www.munknee.com/using-vix-buy-freaking-dips/

    not the same but something like this.

  • newbfxtrader
  • newbfxtrader

    Ookay…got one day to fix it…

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    http://www.benzinga.com/trading-ideas/long-ideas/14/03/4408941/a-vix-buy-signal-worth-watching

    Yes?

    “The Stats

    Since 2011, there have been 21 “initial” buy signals given. Note this indicator often produces “double-barreled” buys — as the VIX oftentimes spikes, retreats and then spikes again. For our purposes, we are using only the first buy signal.

    Of those 21 buy signals, 17 have led to higher prices in the ensuing weeks on the S&P 500. If my calculator is correct, this means when our VIX Buy Signal occurs, the odds of success are 81 percent. Not bad, eh?

    Looking at the stats back to 1995, fuve days after an initial buy signal the average gain on the S&P is +0.27 percent, which is exactly 50 percent better than the average gain of +0.18 percent for all five-day periods.

    Two weeks after the buy signal, the gains in the market are again about 50 percent better than average (+0.53 percent vs. +0.35%). And four weeks later, the S&P’s average gain has been +1.11 percent, which is 61 percent better than the average gain of 0.69 percent for all 20-day periods.

    When eye-balling the chart of this indicator, it is clear that this indicator has been quite good over the past two years. In short, the buy signals have consistently provided investors with very good opportunities to BTFD’s.

    if this is legit, you guys really need to cough up the ‘likes’.
    I don’t get paid for Quant reguritation.
    -GG

  • Scott Phillips

    Agree, to have NO follow through after yesterday is a stunning, jaw dropping fail. The sort of thing the bears usually do

  • Scott Phillips

    That’s the buy signal in a bull market sounds about right

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    OK.
    (we’ll leave it up).

  • mothwhoflysbackwards

    The first article lost me at the last paragraph. Maybe a long term Bull will compress the BB bands making a spike through the top more likely on short sharp pull backs.

    The second confuses me on the second point under “our VIX buy signal”. What is this use google to determine 2 standard deviations? Isn’t the top BB (if set at 2) by definition 2 deviations? But it does seem to work most of the time over the sample period, then most go long signals probably work best in the context of a mega up trend.

    I guess the only thing to do is pull up about 10 years of VIX and pick out all the buy and sell signals by hand (unless you are some computer backtesting guy) and see what happened. Surprised no stats on this.

  • http://www.ProfitFromPatterns.com/ Ivan K

    Perhaps ‘evidence-based’ pattern recognition is the go … sans ‘analysis’ … after all that is at the core of any RBT !

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    buy vs sell difference.
    it was a long time ago. I know Mole mentioned it.

  • Scott Phillips

    I fucking hate all that useless jerking off. Evidence based all the way!

  • Scott Phillips

    Anyone willing to take one for the team? I’d trust our own data over someone elses?

  • Scott Phillips

    amazing setups for tomorrow, everyfuckingwhere

  • Scott Phillips

    I’d want to be long that 🙂 Unfortunately my risk tolerances wont let me trade that market as well

  • Dave

    Scott/Mole, have a question regarding Thor. Back on 9/10 there was a long setup on ES or YM, can’t remember exactly and I asked why not NQ? Your answer was that there wasn’t enough distance to the upper band. Today I see Thor picked EURAUD but it does not meet that same rule. Question is: is it okay to bend the rules sometimes based on experience and if so, how does one back test that for historical results?

    Also, which data provider are you using to set the entry and exit prices. I’m using IB and my numbers don’t match. For EURAUD I show a high of 1.44713 and a low of 1.43474. Given one tick above for the trigger price I get 1.4472 and 1.4346 for the ISL. My entry based on the high is 2 ticks higher than yours and 2 ticks higher for my ISL. Was thinking you used IB also – why the discrepancy and is it important or not?

  • Scott Phillips

    Yeah often I see his trades and think thats stupid I see the opposite. To his credit he sticks to HIS method, and posts his trades in advance for all to see. There is a lot of integrity in that

  • Scott Phillips

    EURAUD is not a thor setup today, could you take this to email please 888rewards at gmail dot com and ill get you sorted out 🙂

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    Found it. (the difference, that is)

    Once you get those 3 events a major reversal usually occurs within the next week. The sell signals are far more accurate than the buy signals.

    https://evilspeculator.com/?p=14149

    -GG

  • http://www.ProfitFromPatterns.com/ Ivan K

    IB charts (for FX) are based on the ‘mid-price’ … as opposed to actual ‘traded’ price.

  • newbfxtrader

    The buys worked but not the sells. Heh thats why they call it a bull market…

  • The Fib Trader

    short AUDUSD!!!!

  • Dave

    How would one determine the actual traded price? The mid price without the spread could result in a variety of values for the traded price. Is this important or splitting hairs? New to FX and still learning. I do know that the bids and asks are quite different between the three brokers I use.

  • strider

    I got one for it at 4:59 pm.

  • mothwhoflysbackwards

    If I have time this weekend i can pick out the signals by hand, give the dates they happened and determine how often they work. Unless somebody beats me to it and saves me. Any ideas for criteria to determine if they work?

    So long as the SPX make goes higher on the buy signal and lower on the sell I would consider it as worked. But higher lower on intraday spikes or on the close?

  • Scott Phillips

    Basically a certain amount of time you are gonna get fucked by data discrepancies in FX. Best to pick one method and stick to it, doesn’t matter which one

  • Scott Phillips

    she-eeet disregard

  • Scott Phillips

    I like it a lot

  • Scott Phillips

    Well my post was about 180 degrees w=from what actually happened so I can’t really crow about that one

  • Scott Phillips

    He is very good at what he does. I don’t think it’s a smart method because of the potential to turn into an idiot and start trading badly, but I admit he is extremely good at it.

  • Scott Phillips

    Boy that’s a stunning fail on every level

  • Billabong

    LOL … you probably know more than I do. Local area impact is the same in both regions. Money is flowing. If I was 20 years younger, I would be in one of the regions partnering with the locals and becoming the Levi Strauss of the frackers … sell’em what they need to get the job done. As a visitor, you keep your mouth shut and listen to what people have to say. North Dakota is probably having its first boom since the gold rush in the Badlands of South Dakota. And the locals are excited to have the business. The energy/excitement level is very high. It’s a wild west environment, especially up towards Williston, ND. Folks renting out their yards for those 20 ft trailers. Motel rooms going for a premium if you can find one. The downside is the uncapped, abandoned wells littering Montana with a taxpayer bill insight. Around the Marcellus region there are these convoys driving around both the PA and WV area. Water tanker trucks going one way and watertanker trucks with skull and crossbones or signs with “do not use for water”. Must be the hazardous waste … NIMBY.

  • Scott Phillips

    Most FX brokers will not give you traded price, only bid or ask

  • Scott Phillips

    It people start only believing things which have an objective edge in the market things would change overnight!

    Dr Steenbarger postulated on his blog recently “I wonder why there are no books on the mental game of brain surgery?” He concludes that 90% of trading psychology comes down to actually trading like a professional

  • Skynard

    Very cool alerts btw, the reminders are a nice touch:)

  • Scott Phillips

    Sky ignore EURAUD its a mistake, and there are correlation issues today (with everything) hit me up on skype if you want the scoop

  • Skynard

    K, thanks

  • CorporalCarrot

    Ok the only other two are GBPAUD and AuDJPY. Those good?

  • Billabong

    Right now you can go from 3% div with XOM to 10.28% for E. The big three European players are averaging 5.40%. It will depend on how much risk you’re willing to take on for a dividend play. About three years ago you could have picked up the same players paying a little more than they are paying out in dividends now.

  • Scott Phillips

    AUDJPY you should still be short from a long way up, mole is tweaking the specs of the setup and this one is very borderline. Id skip it.

    GBPAUD is a fucking BEAUTY

  • Scott Phillips

    Its already triggered but you can get in at the proper price still

  • Scott Phillips

    As far as Thor alerts go, there is a certain amount of teething issues (it’s a beta after all). If you have problems or queries feel free to hit me up on gchat my email address is 888rewards at gmail dot com or hit mole up on skype during euro hours. One of us can sort you out.

  • Scott Phillips

    EXACTLY! And even if it “works” ie the market is up a week later, could you have made money on that? It might be a useful exercise to see if you can build a small system around it (if its viable) hit me up on email I’ll show you how

  • Scott Phillips

    In downtrends the optimal thing to do is to sell 2 legged pullbacks.

    I don’t care what system you design for trends when you pull all the crap out of it that’s what you are doing.

    Is it a trend? – check
    Is it a 2 legged pullback? – check

    Personally I wait for confirmation by waiting for the breakdown to START rather than trusting my opinion, trading a little bit of win for an increased win rate. Even if only 1 trade in 10 like this dow not break down, waiting for the breakdown is the difference between 50:50 and 60:40

  • Scott Phillips

    Thor win 1.94R boom in the bank

  • CorporalCarrot

    I’m actually long both the EurAud and GBPAUD because I put in the alert orders when received. By the time you pointed out the Eur was a mistake they’ve both already hit and running so I’m just moving my stop on the EurAud to a few pips into profit and see where it runs.

  • Scott Phillips

    What I would do with EURAUD is leave the stop where it is supposed to be but bank enough of the trade at the upper bollinger that you can have a free ride on the remainder. Probably half at the upper bollinger eyeballing it.

  • Scott Phillips

    Don’t stress too much it looks good, just not as good as GBPAUD and obviously correlated

  • RUFCrazy2

    Scott your stay the course don’t be a wuss advice for yesterday worked for me well today, had all 4 models triggers sells today and took the 1st one around 1950 and held strong during that BS mid day retracement, looking really good now. Thx. Yesterday I got whipsawed like you but did not have a BE stop (you hate my stops, but my 7+ yrs of walkforwards shows they don’t limit DD’s nor improve profits) so never covered yesterday’s short, so now it’s up $1500 ish along with the short today $3K on 2 contracts – I’ll take it. Nice gap down after mkts. That would be around 1.2 R each.

  • https://evilspeculator.com molecool

    Whoever calls me on skype goes on the blacklist.

  • https://evilspeculator.com molecool

    The long signals only have been reliable since 2009.

  • https://evilspeculator.com molecool

    I posted stats and charts a few years ago but I’m going to sleep now.

  • Skynard

    /NQ, trying to save 3950. Will long above after a retest. Range, Range, Range:)

    Edit: It does theoretically have a LLow and HHigh. Wonder if the bulls are aware:)

  • newbfxtrader

    Long to 1960 then short worked like a charm 🙂

  • Skynard

    Very nice, BTW have you thought of a more appropriate code name?

  • newbfxtrader

    heh

  • newbfxtrader

    Lol you sound like Bobby low!

  • Skynard

    Hehe, that’s very cool!

  • newbfxtrader

    Bobby was like I am not taking setups from a newb! Not seeing much support for the /ES until 1890 or so. /NQ a bit better. on support now.

  • Skynard

    Open positions:
    Short /ES
    Long /NQ (ST), /DX, /LE (ST), /ZC, /ZW

  • SS_JJ

    suffering from insomnia?

  • Ronebadger

    I must say, I first got to this board a few years ago as the VIX signals were mentioned on another site I was following. I just mentioned VIX Step One today as an FYI, that the VIX popped above the upper BB.

    Maybe even more foretelling is the 91% Down Volume day we had on the NYSE. Anyone have stats on that?

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    250 comments, double wow.

    guess I’ll throw up a chart.
    let me step out of my Bounder RV for a second and take off my apron.

    http://s29.postimg.org/e0vqtcinr/OCT_09.png

    -GG

  • Kidd Cudi

    Shorted SPY @ 195.96 and covered @ 193.96, a very easy 1R in 1 day. All while I was at work, too, hee hee.

  • Kidd Cudi

    real jobs are the worst… (started one on monday)

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • Bernie

    short NZD

  • Bernie

    A market dip is when you notice the drop in your portfolio. A market correction is when your wife does. – Just thought this quote is hilarious. Am sure this does not apply here in this forum 🙂

  • Scott Phillips

    Yeah but my point is that the way we remember things isn’t anything like the reality

  • Scott Phillips

    Beauty!

  • Scott Phillips

    WOW!

  • CorporalCarrot

    Just got a Thor NZDUSD trade alert but there was no pre-alert last night. Is it a valid setup?

  • Bernie

    Long JPY against the recent low

  • Bernie

    Long JPY against the recent low

  • Bernie

    Short Soybean oil against 33.69?

  • https://evilspeculator.com molecool

    My condolences.

  • Skynard

    That was a hell of a ride, only thing to look for here is a back test:)

  • saltwaterdog

    Crop report at noon EST

  • Ronebadger

    Out of shorts yesterday…I’m with you on the backtest…but I’m always early .. ask my wife (about trading, that is…)

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    Big Thursday, little Friday.
    besides price closed right at the S&P 40 boundary.

    http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=3&dy=0&id=p22713163326

    (watch this will turn out to be the Black Friday of the 21st century.)
    😉

  • https://evilspeculator.com molecool

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    ¨°º¤ø„¸F R E S H „ø¤º°¨

    ¸„ø¤º°¨ M E A T“°º¤ø„¸

    ¸„ø¤º°¨¤ø„¸¸„ø¤º°º¤ø„¸

  • Skynard

    Thats it, backtest complete:)