26 May How did I trade today? 20210526
Summary: Mean Reversion to Single Print Fade (developing H4 Inside Bar)
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Every trading day I recap my trades, including more than entries and exits. Why did I take the trade? How did I manage the trade, my emotions and cognitive function? All the good stuff as well as all the ugly of being a day trader. As always, feel free to reach out to me.
My weekly goal:
- Min. 3 times hitting the gym + mandatory cardio
- Trading rules
- M15/M30 entries and exits at 1st DTTZ, M5 entries and exits at 2nd DTTZ
- Only price-action based exit rules (or if hit time stop comes earlier)
- Otherwise a Bart Simpson exercise
Good Pre-market routines
Bad Session PECS
Fair Trade selection
Good Trade sizing or SL placement
Bad Trade Execution & Mgmt.
Good Risk Adjusted Returns
Yes Daily review
Muppet meter (1 being best — 5 being worst): 3
- 1st DTTZ
- A traded down with B forming an Inside Bar. IBR is only 0.3xASR.
- Although C TPO formed a Three Outside Up this has happened a few times over in premarket but was followed by a continuation down. If D extends below IB it will trigger my Sell Stop Order in case this trend persists. An extension above with the current huge imbalance at the open might be a fake out before continuing down as H4 closed almost on its low in premarket. Going short is a bit risky as price is trading above H4 QLo but as D1 QHi got rejected there could be a move to D1 QLo but another contrary fact is that the trend is still up. I’ll let PA and orderflow guide me.
- Although price might be reacting off H4 QLo
- So it looks like I was not aligned with the market narrative and the mean reversion trade is well on its way and trading at 1.5R now. And it looks like price is too far away from IB edge to jump in on a late-sustained auction entry. Unless perhaps some TPO structure can be build above IB high
- E left a selling tail and currently F is testing Single Prints in D and even took out one. Although I find it a bit suspicious to go short here as there is not much of a TPO structure
- M15 closed as literally the tiniest doji ever after that Bear Engulf.
- Profile started taking more single prints in D and I went short
- Short 1.93842, SL 1.94142, TP 1.93647 (IB high)
- 2nd DTTZ
- F closed as an Inside Bar. possible Base.
- G proceeded down taking out single prints and I took the trade off at 0.2R
- Price proceeded to move down to IB high, missing it by one TPO which would have made me 0.5R.
- G closed down as M30 DBD
- 1st DTTZ
- Which hypo played out and how did I hypothesize it playing out? How did it actually play out? What did the profile and price action show?
- Hypo 3 — Mean Reversion
- Narrative: Open Sentiment
- Preferred: Strong Bullish PA with IB extension up sustained auction to VAL
- Con: H4 Phase 4
- 90% correct although possible later in the session there could be a continuation higher
- Hypo 4 — Return to Value
- Narrative: variation to Hypo 3
- Preferred: Strong Bearish Reversal at VAL, TPO structure, fading the auction or SPF.
- 90% correct
What happened around the 1st DTTZ? Which Hypo played out (if any)?
C TPO formed a Three Outside Up and D burst above IB. A trade off IB extension would have netted 2R easily.
What happened around the 2nd DTTZ? Which Hypo played out (if any)?
Then E close as a Inside Bar with longer selling wick. Then F started taking out Single Prints in D very slowly and closed as a possible Base after which G formed a DBD missing a move back to IB high by one TPO.
What was the play of the day?
Was I right on the outcome? Which Hypo played out and why was it not Hypo 1 (if any)?
I was initially very wrong about what I thought would be more likely. The fact that the open was at a 2.1xASR huge imbalance after exhausting ADR. Plus H4 closing near its low made me think there could be a continuation to the move as it looks like it might have strength.
However, with price reaching H4 QLo after having rejected QHi and with the trend being UP. Some reaction could have been more probable. I will review this more.
Was there an opportunity and did I take it?
There were two opportunities of which I missed the first. The first was the mean reversion trade followed by a Single Print Fade after price moved higher to M30 VWAP in DT and formed a ‘stronger’ hammer.
DTTZ: 2nd (F)
Entry: Single Print Fade
Profit Margin (ADR or congestion): 0.5R at IB high
What would a price action exit rule have done?
How was SL placement and Sizing?
Not too bad although cutting through the wick
What would time-based have done?
There is no time-based exit rule for SPF
What could I have done better?
I could have let the trade go on further. Although, I felt quite uneasy about being in the trade due to the momentum first part of the session and not having a TPO structure before going against the move. I did well to take it though and at least banks a little for the buffer bank.
How did I feel before, during, and after the trade?
I felt good having taking the trade followed by a bit of jumpiness thinking I could have just sold the ‘low of the TPO structure’ and price is going to move higher from here. I started lifting the dumbbells I have next to my desk and decided I had committed to the trade and let’s see what it does.
How well did I manage my physical, emotional and cognitive states?
I started to get jumpy but I did okay lifting some weights.
What did I learn today?
That an initial burst of momentum can start faltering and turn around. It’s all in the price action and order flow reading.
What’s one thing I need to do more often?
What’s one thing I need to do less often?
Worry about missing a trade. When that first mean reversion went off without me. I visualized a potential pullback for a late-sustained auction entry. When it just moved above from IB I let it go. Which was good and I did not chase it.
Under the circumstances, did I perform at my best?
I did okay
For my trade plan(s) on this particular day, go here: