Thursday, April 16, 2009

ES Trading - 16 Apr 2009

Dear fellow traders :

Just recovered from a bad flu. I could hardly stand up straight for more than 5 mins. during the worst days of my flu. Now that I've recovered, I'm back to practice my ES trading.

Shorted the ES when the S&P500 10 min. stochastic was trending downwards. The position whip-sawed a while but once I saw ES touched the base of a probable double bottom & that I already had the 2.50 points profit ($125) in hand, I closed the ES trade.



Regards,

Tony Chai

6 comments:

Currency Futures said...

why do you use 3 and 10 minute charts? are they only for ES?

Tony Chai said...

Hi :

The time frames for the slow stochastic of the S&P500 were taught by Michael so I just stick to them. For the ES, I've also stick to the 3 min. chart too.

I do look at the daily chart of the S&P500 and ES for the support & resistance levels.

Regards,

Tony Chai

daytrader233 said...

Tony,
Do you start your charts to coincide with the 9:30 am New York open time?
I really like the look of your chart setups...with the 3m and 10m. I think you are very close.

Tony Chai said...

Dear daytrader233 :

It's more like we were taught to trade the ES during US market trading hours.

But if you've noticed my recent trades, I don't trade during the 1st 30 mins when the US market opened (ie. at 9.30am EST) unless I have a clear indication from the S&P500 10 mins. stochastic where the ES has high probability in trending.

I'm not very sure what you meant by "you're very close", you mind elaborating?

I realized when you don't switch between too many time-frames, you'll be able to focus on how the stochastic behave in the time-frames that you stick to & you'll realize you'll be able determine to whether it has provided a good signal for a high probability entry or when the signals are not clear, you'll be cautious not to enter positions recklessly.

Regards,

Tony Chai

daytrader233 said...

Tony,
I start my charts at 8:00am EST to "reset" my indicators.
When I say "I think you are very close", I mean that your plan of attack is very good and you should see many winning trades. Using a longer time frame to define the trend and a shorter time frame for entries is wise.
While I have no idea what criteria you use to enter a trade, I see many excellent trade setups within the charts you have posted.
I would like to offer some advice to perhaps consider in the future. Work on you 3m chart entries. Once you get that 10m stoch signal turn to the 3m and look for a break of the 5 ema for a possible entry. Or wait for a pullback on the 3m and a breakout of that flag. Or wait for a breakout of a previous swing H/L on the 3m within this current new trend move.
Just a couple ideas to consider.

Tony Chai said...

Hi daytrader233 :

Thanks for your input. I didn't know you study those charts in great detail :) Was just trying to share what I was looking at when I made my trading decision. Did not want to leave out "something" which might confuse you folks.

By the way, I didn't invent these trading parameters myself. They were taught by Mr Michael Woo, and I think I should give due credit to him if you think his "plan of attack" is good. Nevertheless, I put in a lot of practice in what he taught. I felt the more you're familiar you are with your plan of attack, the better & sharper you are in making the next trading decision; or the decision of not making the next trade.

I understand what you're trying to tell me about timing my entry based on the 3 min. chart. I would try to experiment what you've suggested. From my experiences, sometimes the 3 min. indicator(s) might be either too late or too pre-mature for entries. My current strategy is to enter only when the 10 min. stochastic reveal a good pattern for a high probability winning trade. Mind you this don't happen everyday. But I believe a good trader should be patient to wait for a good trading setup, even if it takes days (or weeks) to happen, and that's what I'm training myself to do. You don't have to trade everyday or every hour just to be branded as a "day trader". You might even lose more money trading that way since you want to "try your luck" to see how trading each & every day goes.

Regards,

Tony Chai