3 for 4 today in the futures

I made 4 trades this morning, one was a 1/4 point loss (that would have turned positive if I had waited) and 3 winners. Gross of $87. I'm done for the day because I need to get back to my day work. Why not double, triple, quadruple the size and do this full time? That's the goal, but it takes time to build confidence. I could easily multiply these results by 20 but that's too much too fast. I have to build confidence with days, weeks, months of success and slow, incremental increase in trading size.

One of the charts I'm using is the 2 minute chart of the SPY, and it contains a very useful 'tell', in that there seems to be a correlation between short term highs and lows and volume spikes. They aren't large spikes but there is more volume around the ends of small moves. This is a good confirmation signal, as the chart here shows.



I was also more relaxed today when things were moving against me in the shorter term, although it still produces some alertness. The truth is that I'm not setting hard stops here because its so easy for the trade to meander for a while.

Overall I think the market is headed down in the near term, I'm mostly in cash in my swing account, so short is a direction I can rest in, even though 3 out of the 4 trades were long today. Short term there can be strong movement in any direction.

Solid night last night and solid day today in the futures

It may seem like I'm skipping around some with different securities, and I am. I'm trying to find the right fit. I'm about to give up on forex because the pricing on this platform is so 'loose', the currency will range around quite a bit but the bid/offer doesn't move quickly. What this means is that I need a larger move to profit, which makes scalping harder. Add to that the fact that the wide range of an individual move makes it easy to get spooked out, and I think I'll hold on that for a while.

I like the futures because they are the purest form of the market. The market follows the futures. When you trade a stock you are trading something within a group or industry, and within that you are trading based on how the market is doing, so you are attenuated twice. Trading the market is trading the market. That doesn't mean that there aren't opportunities day trading, there are, especially around round level arguments.

Trading the SPY ETF is also trading the market, and has the added benefit of being able to take advantage of smaller moves.

Last night, Sunday night, I did 3 trades and netted about $30. Today I made 5 trades and grossed $125. I had one trade last night and today where I got out where I got in so it was a loss of commissions, but I had no losing trades. Today I was 4 for 5 profit and 1 even. The 10 minute/2 minute setup worked again and again, and I was very disciplined about not getting in unless the conditions were right. One trade was in the middle of a choppy range and went against me for 2 points, but I held on and it came back in for a small profit. Other than that one trade I executed very well.

I left money on the table several times, and that is something for more confidence to help with. I was getting out with 1/2 point on average. It worked, and I need that foundation, but I also need to learn to loosen up. The goal is not all of a move, but I'm leaving money on the table. This isn't greed, its needing to make sure I get wins to counteract the inevitable losses.

I could feel myself have the urge to go for it several times and I would look at the setup and just say 'stay out, the setup isn't right'. When you get wins it gets easy to get fancy and believe that you can predict what's going to happen or that you've 'got it'. The setup says 'stay out' or 'you may pass'. Before lunch things settled into a choppy range and I stayed out. I also correctly identified that the futures were forming a pennant and would likely go higher later, and that turned out to be correct. I was watching very basic stuff, higher highs and higher lows or lower highs and lower lows, moving averages and the setups of the stochastics and the MACD. I've also noticed that, on the 2 minute chart of the SPY, that there are frequently volume spikes around times when a short term move is close to an end. So, like the airplane pilot I cycle through the instruments.

I feel very good about my discipline today, and I had an up day of $125. I was right 4 times and I was lucky once. My day trading account is $40 away from needing another deposit, and I don't want to have it go under 25K again just now. I think I'll stick with the futures for a bit. I can make real profit and there are real moves, and its pure -- I'm trading the absolute market.

A choppy week in the markets

For the week I'm down $150 day trading, down $100 or so in the futures, and down a little on forex.

For the month of November I'm down $400, or 1.6%. Still paying tuition, but its starting to feel tighter, and I am making good decisions. I think the turning point will happen soon. My sins are getting spooked out and occasionally fighting the trend.

The swing account is down as well, the markets are trying to figure out what the next move is and I got into some commodity trades too soon -- a peak and burst in the markets that I did successfully avoid but then got in too soon afterwords.

In terms of day trading I'm really focusing on good execution and I'm pretty much only trading the SPY using 10 minute/2 minute setup. This setup provides good opportunities and forces me to be disciplined about not getting in if the setup isn't right. When I ignore it bad things happen. When I follow it I sometimes get spooked out but am rarely ever just plain wrong. Its about discipline, more discipline, and not experimenting. Its getting better.

Forex is a tough place to trade, there really needs to be a 20 pip move before I can profit because of the way that the bid/offer moves, or doesn't move. The platform adjusts it every few seconds but is slow to do that and doesn't offer me trading opportunities that appear to happen on the charts.

I've noticed that the USD/AUS (Australian dollar) is quite active in the evenings when the Euro slows down, which is consistent with it being morning in Australia. I got chopped up some on a few trades the other day, they were briefly profitable but I was fighting the trend. The thing about forex is that it can move a long way before it corrects, so seeing something that looks like an attractive 'reversion to the mean' type setup can trip you up.

The mystery part of trading is that I don't know what opportunities I'll have, or whether I'll have many. What I have to hold close is the discipline and willingness to sit it out if its not right as well as a trading plan that will let me ride the winners. On Friday I had more winning trades than losing trades but the losers cost more.

I'm starting to trade 200 share blocks of the SPY, and my trading plan must include selling a partial as soon as I get a nickel or so. At that point I can feel safe that I can't lose money on the trade because I can set a stop behind the purchase price and feel better about letting it ride. And ride it must, I can't take a nickel profit on these trades and be happy because the losers all cost more than that. I have to be in a position to have something on the trade at the time that there is movement.

I had a very sloppy day with futures the other day, I was getting in too late or at the end of a move. It was very sloppy.

I'm also paying more attention to the first few bars of a trade. Winners tend to win fairly quickly, and especially in the case of the 10 minute bars if it doesn't start to move the chances are good that its not going to, and I need to get out. I did get out in time on my final trade of the day shortly before there was a 5 point plunge in the futures. I managed to get 2 points of that plunge so that the day overall was a break-even.

I can see my thin body

I think I'm down 8 pounds from the start of the meds but down 16 from the start of the year. At the beginning of the year I was about 250 and lost 8 pounds up to about September, then started on the new meds for another 8. I'm 234 at last weigh in and I think I've dropped another pound since then (a week and a half). I'm not feeling as speedy and there are fewer nights when I'm awake for an hour in the middle of the night. The appetite suppressant quality of this is still as effective. I crave proteins.

I'm a full 50+ pounds overweight, if I were 180 (50 pounds south) an argument could be made that I was carrying extra weight, but I don't think I'll see college weight of 160, nor do I think that's a good goal. When you're that thin at this age you look gaunt.

This weight is still firmly in 'fat guy' territory for my height (5'10") but I can really start to see my body differently, especially in profile.

For the first time I can look down and see the thin guy inside, and I can feel him in there. Someone meeting me for the first time would still think 'fat guy' because of the bulk in my gut. That won't change until I get to around 210 or so. At that point I'll be out of 'fat' territory because my belly won't be so prominent. I'll still bulge a little but no more than almost every other guy I know, most of whom are in 'paunch' territory.

When I get to that point I will become essentially invisible. From a perspective of how I want to perceive myself that's a big milestone -- just one of the crowd in terms of size, nothing remarkable. There is a good chance I'll end up weighing less than the peers that I am heavier than now, and I would have to admit to a certain ego pride if that happened.

That attitude is probably not very enlightened, and I've never, ever been made to feel unaccepted by my peers, but I've noticed, and I don't like it. Having this weight is a result of the bad choices that I made and the lifestyle that I lived for many years, which was about gratification.

I'm embarrassed about that now, but its the past and we learn as quickly as we can learn. I've done the best I can and I'm making progress, which is the best any of us can ever do. The arrow is pointing in the right direction and there is forward movement.

I'm very satisfied with how walking is going, I'm up to 2.5 miles on a walk and doing that multiple times per week.

18 pips in EUR/USD on a Sunday evening

Currencies and the futures start trading Sunday night, so its fun to check in and do some trading. I made two trades tonight for 18 pips. I was using my 2 minute/10 minute setup, trading on the 2 minute but in the direction of the 10 minute.

It looks like the Euro is going higher and both of my trades were long since that seems to be the natural direction.

In this case I made a whopping $37 because I was only trading $20,000 worth of currency, but that's almost a 10% return; $400 to purchase $20,000 worth. Not bad for an evening's work! I had the TV on watching Iron Chef and would just check in on it. However, the main point is that I've advanced from 10,000 to 20,000. This is how it works, tiny little steps to incrementally be comfortable with a tiny bit more risk.

Its tough trading small swings when there isn't a lot of volatility. Although the spread on the platform I trade on (TDAmeritrade) is pretty tight, 2 pips or so, if movements are only in the 10 pip range it can be difficult to get much, because you never get in at the bottom or the top. In this case I traded on the 10 minute ranges, which were larger, using 2 minute entry points, and did ok.

I wonder, though, if I shouldn't be focusing on longer term time frames with currency and go with trading over spans of days and get comfortable with those. The mechanics of the technical analysis work the same, and if I can get comfortable with longer time frames the potential money is much larger, 500 pip swings over the course of a week. The key is being able to comfortably deal with the losses from the stops. Right now it looks like the Euro is in an uptrend over the last few days. A buy signal on the stochastic was generated 2 days ago and its up 100 pips from then, although the stop was 120 pips down. Am I ready to lose 120 to gain, well, 100 at this point. The last sell cycle gave 350 pips during its run with a stop at 250 pips above.

It looks like the current run has longer to go. The thing is if I start swinging currencies I can't trade the one I'm swinging because I'll have a position, although I could trade one and swing another -- you can have multiple positions on in different currencies.

I think maybe I'll just gradually increase the time frames, that would be a good incremental approach. Trade on 10 minute time frames, then 30 minute, etc.

Official weigh in down 5 pounds this last month

I go in monthly to see the nurse managing me in the clinical trial. She takes blood pressure, pulse, gets my weight and they take blood samples. This morning I weighed in at 234, which is down 5 pounds in the month since I was there last. Its 8 pounds total over the two months on the new med, or about a pound a week -- solid weight loss that's not too fast. I just want this to keep working. I can tell that I've taken some weight off but I also am really seeing how big I am, and that's not a happy place.

I'm also adjusting to the meds, I'm sleeping better and my irritability has diminished. I don't feel 'speedy' anymore, but the appetite suppressant quality is still working. Yesterday I was more hungry than usual, which bothered me some, but then I remembered that I had a few drinks on Monday. Alcohol will definitely increase my appetite the next day so I'm really trying to keep it down to once or twice a month.

down $40 on Forex today

I had some good solid trades and broke the rules a couple of times and got shaken out prematurely once. The thing about forex is that there is a lot of up and down, the same price gets revisited again and again over a short time frame so its better for staying in.

I got a little more comfortable today with it. More discipline!