Turning point study

4/17/2024 we started out with:

since the market provided for erratic moves and even more there was a certain disconnect within inter market relationships that makes me sit on my cash

my system approach focus is on risk and the overall risk component has increased

as such to my personal preference: but once opportunity arose on low risk the following transcript in real time to real trading transpired: real time entries on two time frames posted:

with that second attempt on stops below 60k, risk got manageable and i stepped in

this is a good example on risk evaluations here looking at the chart the early most attractive round of entries had a near 1k stop risk on entry and would have been financed for 700p

the second overshoot entry with entries below 60k had a 400p risk and we got financed for 1k

so while the first entry might have seemed tempting from a action reaction perspective it had what i call negative r/r for financing where i expect always something better than 1:1

the second entry allowed for a r/r grander than 1:2 on the financing part and is homogenous for larger sample size thinking

it is this aspect that has my most focus on-

how to maximize risk control

this is especially needed when you are stepping up to the plate of fading in this case a trend down day

look at the proportions

we had a over 4k down move on momentum looking from a 60 min time frame perspective and barley bounced 1k here

with a second attempt here on 60 k and a significant trendline break on daily you need to approach even large number bounces on momentum this risk sensible or you get creamed over larger sample sizes

by the way not being in this trade is just fine

it can easily be classified as a class B trade and should we indeed turn there will be less emotional difficult reload opportunities along the road

may be two more aspects for this trade example:

one would be that it is absolute counterintuitive that trading 60k as a value isn't risk averse but that stacking of time frame pulses as i call em which is going to your lower entry time frame and trading as i did this second stab at lows rather than a price level (something i often mention that my approach does not focus on horizontal price levels and here is one example why)

and secondly on how execution has changed for the last 5 weeks am sure you noticed in regards to slippage and overall fills

while I am not quite sure about the underlying reasoning, I am very aware about the consistency that throughout various exchanges slippage has increased unnatural for us trading in higher denominations now

this has significantly changed my approach to financing r/r ratio approaches throughout since the pure entry risk is what i focus on most and which dominates I am sure most smaller time frame players

I recently mentioned that I see system rotation already be in place, meaning the market is a reflection of its time and times are changing more rapidly and as such ones approach to markets needs to adopt.

With this said, these fact conflicting with the principle of me also having mentioned that when markets expand, the market participant needs to contract and vise versa, there is this time in-between where the only way to keep in control of risk is to scrutinize this focus on risk and trade more conservatively, both in regards to exposure size, frequency and overall risk awareness all the way down to commission relationships and things like liquidity and slippage and here was the confirmed 60 min double bottom entry with the smaller stop:

clearer here:

this also works with a

60150 entry

a 59550 stop

and a 60950

= risk 600p

and fin 800p

this is a bit tighter than my previous stab but still very well in the doable

it of course requires for the market to make that deep a retracement for you to get in so not so hot for the FOMO tendency players since you have to expect to also mi9ss some of these plays and your act react feels a lot less pronounced

well this that or the other we are exposed with a full position (two time frames daily and 60 with each half a lot)

and right when I wrote that i realized I need to take some more off

target exit for the second exit here on the 60 min chart is based on the beauty principle marked in red circles here on the 15 min chart

now it feels right with the total exposure of .75 of a whole position and we have nicely mitigated risk, made some handy profits on top of it and have good size still exposed for whatever the market might still provide

if you look on daily from a resistance perspective, VWAP, directional TL and horizontal previous wicks, the bulls have plenty of thick grass to overcome

+ bonus round: (real time entry earlier posted)

today is a good example how a very conservative stance of keeping the powder dry and rather holding back to good opportunities need to pull you into the market provides for weeding through mostly nervous market moves into small but profitable exposure with few trades (all trades were on half size from a capital exposure perspective) and our oil short is doing well also (second target filled)