Tag Archives: Setup

Choose YOUR Playing Field

 

One of the most obvious changes in my own trading over the last decade is a willingness to take fewer trades.

It used to be that if there was a price swing… I wanted to trade it.

On the plus side this meant that I was there for everything that did move to good profits. But it also meant that I had to suffer through many sequences where the market went nowhere and the best I could hope for was to grind out a breakeven result.

Now, I'm quite content to let the market play without me. If I miss opportunity, so be it.

I don't need to trade everything that moves.

Instead, I aim to stick to the easier sequences. The times in the market that typically have greater range. And the places within the structure that are more likely to offer favourable conditions.

I choose MY playing field. And I play MY game. What the market does outside of this game, is of no concern at all.

Let's start by looking at a Higher Timeframe chart to get some context:

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

<image: Choose YOUR playing field>

You don't have to trade every price sequence.

Choose YOUR playing field.

And make sure you're playing YOUR game, not the markets.

Happy trading,

Lance Beggs

 


 

Higher Quality Breakout Failure Trades

 

One of the aims of your journaling process is to build a collection of near textbook-perfect examples of each of your trade setups.

And from these, develop awareness of the factors which lead to increased odds of success.

Friday, 21st June, offered an absolutely beautiful Breakout Failure setup.

Let's start with a 5 minute chart to get some context:

<image: Higher Quality Breakout Failure Trades>

The important factor that I wish to highlight today is not where the trade occurred.

But rather – how price got there.

One of the key features I like to see, which suggests potentially increased odds of success, is price not only having to travel a long way to reach the level, but to have also STRETCHED to do so.

<image: Higher Quality Breakout Failure Trades>

Looking at the 1 minute chart (my preferred Trading Timeframe in this market):

<image: Higher Quality Breakout Failure Trades>

This is a Breakout Failure that I DO NOT want to miss.

Additional study for those with the YTC Price Action Trader:

<image: Higher Quality Breakout Failure Trades>

<image: Higher Quality Breakout Failure Trades>

<image: Higher Quality Breakout Failure Trades>

Happy trading,

Lance Beggs

 


 

The Hardest Trade

 

<image: The hardest trade>

<image: The hardest trade>

<image: The hardest trade>

<image: The hardest trade>

<image: The hardest trade>

<image: The hardest trade>

<image: The hardest trade>

What do we do here?

Well there's not a lot we can do. It's missed opportunity.

And yes, I know that with hindsight we can look at the lower timeframes and find ways we "could" have got in. But we're not hindsight traders!

It's missed opportunity. It's gone. And our job is now to get on with the business of being a trader.

We've covered this scenario before.

See here for example, where we discussed an effective mindset hack through affirming – "It was never mine to take. If it was, I would have taken it. Let it go!"

So I did this.

I let it go.

I took a quick walk and cleared my head. And came back to the screens.

But let's be realistic here.

This next trade… is NOT going to be easy.

The first trade after missed opportunity can be one of the hardest trades.

The last thing I want to do is get smashed twice. Following up the missed opportunity with a losing trade.

I know… this shouldn't be any concern… every trade is independent and our edge plays out over a series of trades!

But I'm human… and even having carried out my regroup & focus routines… I recognised residual emotion.

So what to do?

Here were my actions:

1. Extend the break – NO TRADING. Let this whole price swing play out with no intentions to trade.

2. Use this time to absorb myself in the price movement. Watch and feel the bullish and bearish pressure play out within each candle.

3. When this price swing is complete AND I feel in sync with the price movement, it's GAME ON. Define the new trend structure. Project it forward. And seek the next trade opportunity.

The intent here is to get myself "out of my own head" and focused back on the price movement.

<image: The hardest trade>

Be careful in the pullback from here. Initial strength in the rally was news driven. But note how it weakened into the top of the swing. YTC PAT readers – this is a Second Principle scenario. Not First Principle. Be patient here.

And if it goes too deep, consider the possibility of this eventually transitioning into a sideways trend.

Until then though, I'm still looking for buy opportunity for continuation higher.

<image: The hardest trade>

<image: The hardest trade>

<image: The hardest trade>

<image: The hardest trade>

<image: The hardest trade>

<image: The hardest trade>

Well done to anyone who might have traded something like an opening range breakout strategy, off the first 5 minute candle. You got a home run trade today.

For me though – it's one of those days with missed opportunity.

That happens. It's part of the game.

What is important though, is how we respond.

Take a break. Remind yourself – "Let it go. It wasn't mine to catch. If it was, I would have caught it."

And if there is still residual emotion, just watch and wait and let the next swing (or two or three) play out. There is no hurry to trade. Absorb yourself in the price movement. And then… when the structure becomes clear and you feel in sync with the price movement… only then is it time to trade.

Happy trading,

Lance Beggs

 


 

When your Trap Radar needs Recalibration!

 

Let's start with the daily chart for a bit of context…

I know right! When was the last time we looked at a daily chart?

No need to panic. Oxygen masks have not dropped from the ceiling. And we'll only spend a short time at these heights.

<image: When your Trap Radar needs Recalibration>

You know those days where you've got a feeling in your gut that tells you the market is DEFINITELY setting up a trap?

Well my Trap Radar had activated and the alarm was deafening.

My gut feel was "It's a trap! Fade the market!"

<image: When your Trap Radar needs Recalibration>

So let's step down from these heights and get back to the more comfortable Trading Timeframe and watch the opening sequence play out…

<image: When your Trap Radar needs Recalibration>

<image: When your Trap Radar needs Recalibration>

<image: When your Trap Radar needs Recalibration>

Here's the thing…

Way back in the early days I would have shorted this thing at every swing high, grinding my way towards the session stop.

But not now.

I recognise that it's normal to have these strong gut feelings from time to time.

Some people say to ignore them. I don't think we can. Nor do I think we should. Sometimes they're right.

I listen to it. I consider what it's saying. And I plan my trading in case it's right.

BUT… I also have a plan for those times it's wrong.

Having a gut feeling about market bias is fine.

But alongside that you must know the following:

(a) What price action would confirm this bias. And how you will trade it.

(b) What price action would indicate that the bias is wrong. And how you will trade it.

Let's step back to the open:

<image: When your Trap Radar needs Recalibration>

<image: When your Trap Radar needs Recalibration>

So having pre-accepted the potential for my gut feeling to be invalid, I was easily able to drop it and reassess the market structure.

<image: When your Trap Radar needs Recalibration>

For PB and CPB descriptions, see here.

<image: When your Trap Radar needs Recalibration>

<image: When your Trap Radar needs Recalibration> 

<image: When your Trap Radar needs Recalibration> 

Repeating the key points:

Having a gut feeling about market bias is fine.

But alongside that you must know the following:

(a) What price action would confirm this bias. And how you will trade it.

(b) What price action would indicate that the bias is wrong. And how you will trade it.

One of the greatest habits you can get into is always considering, "What if I'm wrong?" 

You are NOT smarter than the market. If it's not confirming your gut feeling, then YOU are wrong. Drop that bias and realign with what is actually happening.

Happy trading,

Lance Beggs

 


 

Traps at the Open – 2

 

I had no plans to continue the recent article series but the market had different ideas, so here we are!

First, if you missed the prior articles then see here – http://yourtradingcoach.com/trading-process-and-strategy/traps-just-before-rth-open/

And here – http://yourtradingcoach.com/trading-process-and-strategy/traps-at-the-open/

And that brings us to today's sequence…

We'll start with a quick look at the prior day and overnight session, for a bit of "bigger picture" context.

<image: Traps at the Open>

<image: Traps at the Open>

<image: Traps at the Open>

<image: Traps at the Open>

<image: Traps at the Open>

<image: Traps at the Open>

<image: Traps at the Open>

<image: Traps at the Open>

<image: Traps at the Open>

<image: Traps at the Open>

I hesitated to show this example, as it's really a very quick and small trap. And a difficult entry based on a very minor lower-timeframe stall.

But sometimes that is all the market offers. And given the potential for a trap at the open to provide a nice momentum drive, it's one that I had to take.

Part of me wonders whether I'd take this entry anyway even if there had not been a trap. I had a bullish bias due to the pre-session action holding above the prior day's range. Plus the fact that I expected some range expansion on the open following a narrow range holiday session.

We'll never know for sure. Perhaps I would have taken it. I suspect not though. The lower timeframe trigger pattern was a little "smaller" and less defined than I would perhaps have liked. It really was the presence of the trap, albeit small, that provided the confidence to go for it.

For me… a trap entry prior to or right on the open is something that will often have me taking the quick early trade. Without that, I prefer to sit and wait. Let any opening congestion clear itself. Let the structure develop. And then trade once I have some clarity regarding the bias and market conditions.

Happy trading,

Lance Beggs

 


 

Traps at the Open

 

Our last article discussed one of the times when I show no patience at the open. One of the times when I'm keen to get a trade on as soon as I can.

No patience. No delays. It's game on!

You can see it here if you missed it – http://yourtradingcoach.com/trading-process-and-strategy/traps-just-before-rth-open/

That article dealt with a trap in the market structure JUST BEFORE the RTH open. (RTH = Regular Trading Hours)

Today let's look at a situation very closely related to that. It's a trap IMMEDIATELY AFTER the RTH open. It's another situation in which I don't wait for the market to establish a clear trend structure.

Here was the concept from last week:

<image: Traps JUST BEFORE the Open>

But what if the open comes… and the market hasn't provided that trap?

<image: Traps JUST AFTER the Open>

That's fine.

If it's a good level, I prepare myself for for a trap anyway in the opening few price bars. If the market is nice enough to offer that, I'll be ready to get in on the first available opportunity.

<image: Traps JUST AFTER the Open>

Let's look at an example…

<image: Traps JUST AFTER the Open>

<image: Traps JUST AFTER the Open>

<image: Traps JUST AFTER the Open>

<image: Traps JUST AFTER the Open>

<image: Traps JUST AFTER the Open>

Personal preference – I don't just hit BUY MARKET. I prefer to find a way to better control risk through certain TTF/LTF patterns, as outlined in the YTC Price Action Trader.

If I miss the move, so be it. Let it go. It wasn't mine to catch.

But otherwise, remain patient and watch for a retest of the range highs.

<image: Traps JUST AFTER the Open>

If ever in doubt about the structure of the market, don't rush to trade. There is no hurry. Let the market open and complete the first swing or two. Let the structure develop and then trade once you have some clarity.

But sometimes, when the pre-market sets up just right, there will be opportunity available within that opening sequence.

One of my favourites is a trap in the market structure, setting up just before, or just after the market open.

Keep an eye out for this concept, in your market and your timeframes.

Happy trading,

Lance Beggs

 


 

Traps just before RTH Open

 

I've written a lot about displaying patience at the open. About waiting till the bias is clear and trading conditions are favourable.

But there are some situations where I don't display patience.

Where I'm keen to get a trade on as soon as I can.

No patience. No delays. It's game on!

One of these situations is when the market sets up a trap just before or just after the RTH Open. (RTH = Regular Trading Hours).

Today we'll look at an example which sets up just before the open.

Here's the general concept:

<image: Traps just before RTH Open>

<image: Traps just before RTH Open>

This concept can be applied in any market which offers pre-session trading leading into a clearly defined "regular" day session. Spot forex traders might apply it at the UK open, or the US open.

This example set up a break of the overnight low. Here's what I was seeing:

<image: Traps just before RTH Open>

<image: Traps just before RTH Open>

(YTC PAT FTC Ref: Vol 2, Ch 3, P143))

<image: Traps just before RTH Open>

<image: Traps just before RTH Open>

<image: Traps just before RTH Open>

<image: Traps just before RTH Open>

<image: Traps just before RTH Open>

<image: Traps just before RTH Open>

Happy trading,

Lance Beggs

 


 

First Pullback in a NEW Directional Trend

 

<image: First Pullback in a NEW Directional Trend>

<image: First Pullback in a NEW Directional Trend>

REFERENCE: Definition of a sideways trend – Vol 2, Ch 3, Pages 99-102

<image: First Pullback in a NEW Directional Trend>

<image: First Pullback in a NEW Directional Trend>

<image: First Pullback in a NEW Directional Trend>

<image: First Pullback in a NEW Directional Trend>

<image: First Pullback in a NEW Directional Trend>

<image: First Pullback in a NEW Directional Trend>

<image: First Pullback in a NEW Directional Trend>

<image: First Pullback in a NEW Directional Trend>

<image: First Pullback in a NEW Directional Trend>

Not all trade setups are equal.

You need to collect and review your stats to determine which setups provide your A+ MUST-NOT-MISS potential opportunity of the day.

For me, the first pullback in a NEW directional trend is one of these MUST-NOT-MISS setups.

No, they do not always profit. And sometimes they offer profits, but I mismanage the opportunity.

But when they do run and I perform well enough to catch them, the profits can more than make up for any other failed attempts. As always, we profit over a series of trades. Individual trades are irrelevant.

Check your own charts, in your own market and timeframes. Note any sideways trend environments. Find a breakout which occurs with some strength, which holds the break. And see if you can also find edge on the first pullback into this new directional trend.

Happy trading,

Lance Beggs

 


 

First Pullback after Significant Structural Change

 

I don't often trade after midday Eastern Time. It's the middle of the night here and I'd much prefer to get some sleep.

But from time to time I'm alert and awake and there is no chance I'd be able to sleep even if I tried.

So I'll complete some of my post-session review and then go on with other work, while keeping an eye on the markets.

The default intent is to NOT trade… unless it's screaming out to be traded.

What does that look like?

Here's one example. A trade that is so damn obvious I would have been kicking myself if I missed it.

It's a YTC PB trade. But what is important is not so much the trade itself, but WHERE it happens in the "bigger picture" market structure.

<image: First Pullback after Significant Structural Change>

<image: First Pullback after Significant Structural Change>

<image: First Pullback after Significant Structural Change>

<image: First Pullback after Significant Structural Change>

Dropping down to the Trading Timeframe to see the outcome:

<image: First Pullback after Significant Structural Change>

<image: First Pullback after Significant Structural Change>

1. Structure!!!

2. Break of structure.

3. First pullback against the break of structure.

It's no Holy Grail. Sometimes there will be losses. And sometimes you'll miss the trade.

But it's opportunity I do NOT want to miss.

Happy trading, 

Lance Beggs

 


 

Traps on a Retest of a Level

 

My normal trading times are between 09:30am and 12:00 midday US Eastern Time. You won't see many trades after midday because in my timezone that is 3:00am. It's time to complete my post-trading routine before getting some well deserved rest.

But occasionally circumstances allow me to push a little beyond this midday (3:00am) time limit.

This occurs ONLY in those times when (a) I'm feeling wide awake and alert, (b) the market is directional with smooth price flow, and (c) something is screaming out to be traded.

So that raises a good question. What exactly is something that is screaming out to be traded? Unfortunately that's difficult to define. Essentially it's a feeling. Let me explain.

The default option is to stand aside. Most setups I just leave alone. I'd rather get on with my post-trading routine.

But from time to time the market sets up in such a way that I just KNOW… I have to be in this trade. This one is so good. It's an A+ trade. An edge that is so obvious that I'd be a fool to miss it.

A trade which I'd rather enter and take a loss than miss the opportunity entirely.

Think carefully about that last statement if you're new to trading!

From a technical perspective though, they will almost always involve a trap of some kind.

You need to sense the blood in the water. Someone, somewhere, has got themselves caught. There is pain. There is emotion. And for me… there is opportunity.

Today… we get to see one of these trades.

A trap on a retest of a level. A setup that was screaming out to be traded.

<image: Traps on a Retest of a Level>

<image: Traps on a Retest of a Level>

<image: Traps on a Retest of a Level>

<image: Traps on a Retest of a Level>

<image: Traps on a Retest of a Level>

<image: Traps on a Retest of a Level>

<image: Traps on a Retest of a Level>

<image: Traps on a Retest of a Level>

NOTE: Complex pullbacks plus the strength/weakness analysis used in this example are all covered in the YTC Price Action Trader.

Happy trading,

Lance Beggs