Happy Friday fellow Hivers,
Today, I had a strong feeling that the market would be bullish.. up, up, up and away! Things looked good.. one way to look at it. Sure, the market dropped big in the morning, but price tends to seek balance and usually ends back at the 100 period MA (moving average). Plus, on Fridays, people seem to always want to trade UP.. or maybe it's the weekly traders closing their sells, which also makes price go UP.
Here's what the hourly looked like..
It looks like the market was waiting for this news to come out, and it was NOT good.. thus, the big drop all morning..
See how the market was basically stalling and waiting for the news to point the direction to go..
Things looked the same on the 15-minute, but I felt like price should move back up to center..
I jumped to the 5-minute and price was trying to move up, but hit a wall. I wanted to wait a little and see if it starts up again.
I wanted to sell a PCS at delta 10 or lower.. mathematically this works to a 90% (100 minus the delta) POP (probability of profit). (also, because I use a stop, this minuses another 10% from the POP, making it a 80% chance of trade success) I had to re-adjust my order several times before there was a big enough pullback in price to trigger my trade.
Here's what it looked like on the 5m. See how I couldn't get filled till price dropped a good amount?
Everything was working fine. My trade got down almost halfway to its stop, but I would also see times when it was positive a little. The 1 hour mark was approaching and I would decide then, according to my trade's delta at that time and a few other things, if I would let it run till power hour or not. It's happened to me only 2 times, but it's horrible to see a trade that was winning 90% of time go down and lose within minutes.. and it always happens that the market gets wiped out by one HUGE drop in price. Maybe a few billionares or a country or someone like that decides to sell big time, then usually they will buy back a minute later. (of course, raking in profits at getting a much lower price)
I took this snap about 30 minutes into the trade. You can see that all is looking good. It even dropped a little in delta, which means I have a better chance of winning now. BUT NO! I think an hour of shoving finally turned into a fight and the bears took a big swing..
It sucks to lose, but I'm glad my stop worked so nicely. It got me out at at just the right time, before things continue to move against u.. before u finally admit defeat, you've lost a month's worth of profit. That's how I used to trade. If u just go manual and think 'I can just be super disciplined and will just exit the trade manually when it hits a certain loss' :P sure, the stuff we humans tell ourselves..
This week was 2 losses and 1 break even. Not so good. :( but, next week is the comeback!