Several months ago I presented an article titled "How to Make a Strategy Your Own" which discussed the need to take your learning and development through a graduated process from post-session learning to simulation to live environment (minimum size) and then a gradual increase in risk.
I presented an email and charts from a YTC Price Action Trader (YTC PAT) reader who was progressing well through this journey, in particular demonstrating his great work in post-session reviews.
You can see that article here: http://yourtradingcoach.com/trading-process-and-strategy/how-to-make-a-strategy-your-own/
Today I'd like to present another email from a student of the YTC PAT which also demonstrates another aspect of making a strategy your own.
You'll note that RV has made a number of significant changes to how I trade. This is EXACTLY what is necessary; and what I expect people to do. Not everyone seems to understand that.
Making a strategy your own involves blending the new approach with your prior knowledge and skills, in order to create a new enhanced approach to trading the markets. This will necessitate a process of test and evaluation, along with a process of identifying challenges and implementing solutions to avoid them or overcome them.
RV has done exactly that. And the end result is… well he's now trading for a living! That is so great.
In particular you'll see this as it relates to timeframes, as RV has reduced my triple timeframe approach down to just one. Just because I use three timeframes does not mean that is the best way for you. One of the most common pieces of advice I give people who are overwhelmed, is to remove the lower timeframe and trade solely off the trading timeframe. And as to the higher timeframe, well I can personally operate quite comfortably without that. I think most traders once they get a little experience, can see the higher timeframe S/R within their trading timeframe chart.
So if you prefer one timeframe only, I fully support that idea. Simplicity is always the best.
Anyway… enough from me. Here's an extract of RV's email (personal details removed):
Firstly forgive me for this rather long email but it's been 2 years since I first purchased your course on its launch and I thought I'd take this opportunity to update you on my progress.
Due to my full-time job until recently I've been trading US stocks on weekly timeframe for obvious reasons with good results.
Anywhoo I've now moved to full time trading mainly focusing on ES (Emini S&P) which trades at 9.30pm here in my timezone, which gives me plenty of time to groove my golf swing and spend quality time with my daughter.
There have been some challenges that I faced along the way but these were mainly due to my personality rather than the method, thus I made some adjustments. Some of these include:
1. Like you I love the CPB setup and every time I scratch a PB setup I'd be rubbing my hands for a CPB setup. In most cases I'd benefit from the trapped orderflow but sometimes the 2nd swing wouldn't quite make it to the prior swing low in an uptrend and vice versa, to get the trap setup, and price would move on without me. This led to 1st change – get on board with 2nd entry if a trap is not set. Al Brooks has mentioned this in his book. Alternatively leave the initial stop where it was, but I couldn't watch the drawdown.
2. Second change I had to make was getting rid of the lower timeframe chart as my attention was getting too focused on this timeframe and I was jumping in on every possible spring or upthrust setup leading to a string of losses.
3. Because I now had to focus on the trading timeframe, time based charts were getting me in too late into a trade so I replaced it with tick charts. So a 5min chart would be 1500 ticks and 60 mins would be around 15000 ticks. This worked like a charm as overnight data was compressed and S/R could be used next day. With a little experience the higher timeframe had to go too. My trading was getting better and why wouldn't it, I gave my brain very little to focus on.
4. My attention was now toward my exits and to try to balance my emotions of greed and fear. I changed my OSO orders to 3 targets and a stop. 1st exit – 6 ticks for a scalp, stop moves to breakeven plus one automatically. 2nd exit – swing high/low and 3rd exit- runner with trailing stop. However market conditions dictate whether I'd take my runner off at the swing high too. This works incredibly well with my personality as I've fed all the monkeys on my shoulder.
I was loving this adaptation to the beast, however the nature of the game is that sometimes the trapper gets trapped so I added failed PB, CPB, TST, BOF and BPB to my arsenal. They say its not a game of perfect – my response is – why not? If my search for perfection leads me to more time staring at charts then I've already been rewarded. As for the trading journal I've setup a workspace on my platform just for notes and trades taken or missed, so I just scroll back to review whenever I'm out of sync, and this happens every now and then. The review quickly jolts back my confidence and rhythm.
Anywhoo this is becoming an essay. In closing I want you to know how grateful I am for your unselfish contribution to the trading community. God bless, and if you're ever in the country be sure to hook up for a drink and a game of golf. I'll re-phrase that – a game of golf followed by a few drinks. Wink!
PS. I've attached 2 sessions of e-mini to highlight some of the changes.
'Cos I'd rather be trading for a living'
Click on the images to open a larger version in your browser