20180507
Short 2 YM 24345, 24341, -10, -15
Short 3 ES 2678.0, 2678.0, 2678.0, +1.25, +1.25, -0.25
Short 1 YM 24400, -7
Short 2 RTY 1575.9, 1575.9, +1.0, -1.1
Short 2 RTY 1577.1, 1577.1, -0.8, -0.8
Long 1 NQ 6821.0, +10.0
Short 2 RTY 1577.8, 1577.8, +1.0, -0.9
Short 2 NQ 6843.25, 6842.75, +4.0, +13.0
Short 2 RT 1579.8, 1580.1, +4.7, +1.0
Total ES +2.25
Total YM -32
Total NQ +27.0
Total RTY +4.1
Sometimes the strength of the underlying trend can produce surprising resurgence. And the appearance of such resurgent thrusts can also lend itself to more shallow pullbacks to the trend than would normally be desired for in-trend pullback entries. Since peaks in momentum show up on your instrument panel with those strong resurgent trend thrusts, you are even more hesitant to get into a pullback opportunity too early, for fear the over-extended trend has not had time to full correct itself. One method of accommodating this situation is to use a small initial size when these shallow, early pullback opportunities present themselves.
Use a stop order to enter in-trend for small lots when a larger pullback is otherwise expected. This will allow you to be stopped into the resurgent direction even though a better pullback level was not reached. Once in, trail the position with a stop loss order slowly, watching first for a new extreme to the prevailing trend that has been so surprising. That new price extreme might also provide surprising results. Milk your small position with a low trailing stop until it has reached extremes in momentum again, thus providing a 'double tap' on your momentum instrument panel. With these new profits in hand as cushion, you will be better position to attempt fading the trend again.
But this time, be sure to gather sufficient evidence of WorkDone, as early and shallow pullbacks that provide resurgent price extremes to the original trend of the frame are an early sign of a Persistent Trend Day, and thus all 1st Frame fading could be peppered with stop-outs until a more complex, 1st Chance Texaco pullback arrives for a larger, in-trend position to be risked. "Position yourself to be surprised," or so did my mentor have to frequently remind me. And trust this: that is what the market is really all about, the achievement of surprise. Cue the sage Heraclitus: "Expect the unexpected." And just how can such a paradox as that be incorporated into a Trade Plan? 'If this ________, then _________that is what I will do.' Accept the outcome, regardless of whether it is a surprise to your initial entries. Your contingencies kick in, and positions can then be taken that you might actually disagree with emotionally. "This can't be true", your head may be saying. But the Trader is commissioned to follow his plan. Quit thinking. It's all in the Plan. Follow the Plan. Thinking is for the Analyst. ...and the Analyst is NOT allowed in the live trading room.
