Mon May 21 2021 Trade Signals & Journal

20210503
 
 
Short 1 RTY 2284.5, -1.5
Short 1 RTY 2286.7, +5.5
Short 5 MNQ  13884.0, 13884.0, 13884.0, 13884.0, 13884.0, -5.25, -5.25, -5.25, -5.25, -5.25, 
Short 5 MNQ 13891.50, 13891.50, 13891.50, 13891.50,  +20.0, +20.0, +20.0, +20.0, +20.0, 
Short 5 MNQ 13908.0, 13908.0, 13908.0, 13908.0, 13908.0, -5.25, -5.25, -5.25, -5.25, -5.25,
Short 5 MNQ 13921.0, 13921.0, 13921.0, 13921.0, 13921.0, -4.0, -4.0, -4.0, -4.0, -4.0,
Short 5 MNQ 13924.25, 13924.25, 13924.25, 13924.25, 13924.25, +12.25, +12.25, +12.25, +12.25, +12.25,
Short 5 MNQ 13925.0, 13925.0, 13925.0, 13925.0, 13925.0, -5.50, -5.50, -5.50, -5.50, -5.50,
Short 5 MNQ 13946.25, 13946.25, 13946.25, 13946.25, 13946.25, +21.5, +21.5, +21.5, +21.5, +21.5,
 Long 5 MNQ 13889.25, 13889.25, 13889.25, 13889.25, 13889.25, -2.75, -2.75, -2.75, -2.75, -2.75, 
Long 5 MNQ 13883.25, 13883.25, 13883.25, 13883.25, 13883.25, -1.25,  -1.25, -1.25, -1.25, -1.25,
Long 5 MNQ 13864.0, 13864.0, 13864.0, 13864.0, 13864.0, -5.25, -5.25, -5.25, -5.25, -5.25, 
Long 5 MNQ 13850.0, 13850.0, 13850.0, 13850.0, 13850.0, -3.25, -3.25, -3.25, -3.25, -3.25,
Long 5 MNQ 13844.25, 13844.25, 13844.25, 13844.25,  -0.5, -0.5, -0.5, -0.5, -0.5, 
Long 5 MNQ 13791.5,  13791.5, 13791.5, 13791.5, 13791.5, -1.5, -1.5, -1.5, -1.5, -1.5,
Long 5 MNQ 13785.0, 13785.0, 13785.0, 13785.0, 13785.0, -2.25, -2.25, -2.25, -2.25, -2.25,
 Long 5 MNQ 13780.25, 13780.25, 13780.25, 13780.25, 13780.25, +20.0, +20.0, +20.0, +20.0, +20.0, 
 
Total RTY +4.0
Total MNQ +142.75
 
The dreaded Two-Side Test-n-Reject Day Model...       Usually, the first trend of the day is false, and the second is true.  That makes the high percentage game of fading the first trend in order to position for the more likely bound.  But what if can't find the turn of the first trend?   And you put no profits under your belt, and find yourself unpositioned for the ensuing bounce, as I was today?   

Hungry for a trade is how you find yourself mentally.   ...not a good place to be.     That 2nd trend is often accompanied by surprises as it extends beyond resistances.   Initially, I got caught trying to short that trend because there was no signal to buy as the first selling trend in the Nasdaq developed below the ORB.   As a trader that leaves you looking for trades as price works back up.   And with the observation that there was insufficient WorkDone accomplished in that first low, your expectations are that the rise in price is merely a pullback, and should be shorted.    
 
But as price developed into that rise, the MNQ exploded through a bevy of resistance numbers otherwise ideal to have reversed that bounce back into the bear.    Now the bull and the surprise 2nd trend seems to have been confirmed.    And what does this do to your psychology and trend prejudice?    
 
If positioned successfully as that 2nd trend reaches a short term climax, you see no harm in taking a short with the expectations that it is at least worthy of a scalp.   And as it does indeed begin to relax, you begin to look for the buying opportunities to get in sync with that 2nd trend that failed to materialize at the lows of the 1st trend sell-off.    So naturally, you cover your successful short position and begin to watch for that buy opportunity....   
 
Only it doesn't materialize, and presented with a new "2nd trend" back in the direction of the orignal 1st trend, which you mistakenly learned was 'false', you naturally step in to longs too soon, only to be further surprised, at the extent to which this selling wipes through every support level NQ had established for the last month.   
 
It is no comfort in the meantime, that the rest of the market, having ignored the huge rally advance, now was mostly ignoring the selling too, making the NQ the only game in town to stay with.
   
What do you do?    Sure, you'd like again to sell a bounce, believing this time the down trend is true...   but they give you no bounces to short into... just more selling breaks against extreme climax readings that prior experiences with more 'normal' days have taught you to avoid.    
 
You keep your head, keep an eye on the exhaustion levels, buy-stop the market as those exhaustion levels are breached, and when the expected vacuum is filled post-stop runs, you move your own stops in tight, and suffer minimal losses until a more complex bounce can finally afford you a decent enough target to make up for losses and produce decent net gains.    
 
You could also stay out on days like this and wait for tomorrow...    but what would be the fun in that....          cya manana