Thu. 11_29

Today's trade:

A key for the above chart to define the horizontal lines and dots.  For further explanation, see this link:  

3 trades. Blue arrows = etries, Black arrows = exits First long entry, I wasn't expecting much from it. Second Long entry, Got whipped out. Was quite happy with how I was managing the trade at the time, but SO got suckered out of it, so I lost that mental battle. Ended up getting back into it for the same price of the original entry 15-minutes prior (before the official "trigger).
MAE for the (12-noon) trade was "only?" a point and a half and got out with a point and a quarter loss :/
Getting back long on the snap-back profits were taken with +2.75 points and then again at +2.5 points, for an average +2.5 points.  Exits were based on a confluence of a Fib. projection (not pictured), resistance (in the form of a prior breakdown point) and the overnight highs (pictured in the 3m chart above).
Unfortunately I didn't take the short entry that is marked with an "X".  The setup being a price pullback, indicated by the "2b" criteria on the 15-min 3/10macd.

The underlying "criteria" of the day was anticipation of the 2c-2d turning into 2a (and possibly 1a, which didn't happen. 1a would have likely been the result of price (momentum) breaking the highs of the day).

On the higher time frame I wanted to make a clarification.  Going into Wednesday I was leaning with a short bias and the trade failed, but I wanted to run through the bias process.
My premise was as follows:
- We were due for a pullback off of the most recent momentum on the Daily chart.
- On the smaller time frame I was looking for either:
      - the fast line turning red, OR
      - the fast line turning red, pulling back to the slow line and then turning back down in the fast line.
(essentially an XYZ zig-zag pattern in the fast line).  Shorting the initial negative reading of the faster time frame's fast line is always a higher risk trade in my opininion, while entering after a pullback has ocurred in the fast line is more favorable.  So...
  The distance between the initial short entry (blue down-arrow on the 65m chart) and the lows of the move was $1.42 or about 14.25 points on the e-mini.  The official stop-out trigger (Second black down-arrow) was $1.04, or about 10 points on the E-mini.
So, here's the thing; if I know this short entry to be higher risk (because eventually I'm going to be anticipating a pullback in the fast line before getting a higher probability trade) the trade should have been lightened as price comes into support.  So if I took half of the position off at support and took a loss on a stop out, damages could have been paired.  The approach I use is not meant to be a "system" as exits are more discretionary in nature.

Notice, that in the daily chart price has been increasing while the fast line on the 3/10macd is decreasing.  A typical sign of a short squeeze environment and an important lesson in using an indicator, price can still increase while the indicator is decreasing.
From here we could see:
- The daily chart fast line pull back more, where we would look for the 65m fast line to turn red and/or turn red, pull back then tick down again.
- Otherwise, we could see the daily chart fast line tick up, which would trigger on the 65 min chart with an up-tick of its fast line (which would in all likelihood be a price bar close greater than today's highs).