Transcription
So what exactly, uh, is your approach to the market and what are you trading?
So right now, I'm trading, uh, indices. I'm trading, I'm still, I still trade CFDs, trading a little bit of commodities. I trade futures, and I actually just recently started trading options a little bit, um, as well. Which, throughout all of the different markets and instruments that I trade, my approach is essentially the same. The only thing that may actually change is what time frames I'm actually trading. So with options and futures, I'm trading smaller time frames, like trading stock options, uh, yeah, stock options. And then with, uh, commodities, I'm trading a little bit larger time frames.
So essentially, every single day, I'll approach the markets after my fundamental analysis. If there's any economic data supposed to come out that day, uh, let's say it's a clear day, then I'll just continue to trade as normal. So I mean, there's a few different rules, but overall, the approach is, I'd start off with a top-down analysis, look at what the daily time frame is doing and what the daily time frame has done over the last few days, and analyze like the most recent trading days' candlesticks. Then I'll break it down to a lower time frame, like the 4-hour time frame, look at the market structure, look at the price action, look what happened overnight, what happened in the pre-market, and then also what could potentially happen in this specific session. Then I just start breaking it down to like an hour time frame, then 15 minute, then a 30 minute time frame, and a five time frame, time frame, time frame, time frame, time frame, just every, every single time frame.
So like, I'll mark up my main key levels on the day. I'll also look at the market profile, uh, and TPL charts as well to see like where my main levels of interest are also going to be, as, as well. And I'll just literally take it from there. So after I mark up where my main levels of the day are going to be based off the market profile chart, or based off of just regular key levels and, uh, support resistance or supply and demand, I'll start to plan what levels I'm going to look to take trades from. So if the overall trend is bullish, but the lower time frames are bearish, I may actually wait for some form of a bullish signal to potentially buy that market. Or if maybe we're at a high and we start having like bearish confirmation on the lower time frames, then I'll start to plan on how I'm going to potentially look to take shorts. And if I am going to be taking counter-trends on shorts, then it's like, okay, well, I'm going to lower my size on this type of setup, and I'm not going to be looking to marry this trade versus like if it's a trend continuation trade, I may increase my size and I may actually look to hold that trade for a little bit longer.
So this is all done in the pre-market, so that way when the market actually does open, all I have to do is just simply wait for price to get to my area, my level, and then I'll just take the play that I initially set out to take on that specific level. So initially, like on the day, I'll have maybe like two levels where I may look for continuations, and then one level where I'll look for some form of a, of a reversal. And then based off of those two levels, I'll either look for a balance play or breaking retest, or maybe like a breakout setup. It just, it really just depends. But the, the, the system itself and the plays that I'm taking on a daily basis are the same, and my approach is always going to be the same. It's just, again, you know, price action is not always going to be the same day in and day out.
Yeah, yeah. And what kind of, like, holding time are we looking at here for your trades?
So long-term for me, right now, is like two hours. Yeah, that's like long-term for me. Um, on average, it's about maybe like 15 minutes. It depends. Like, if I'm trading futures, 15 to 30 minutes is, is, is pretty average. Um, with, with, with stock options, it's maybe like, probably like 15 to 20 minutes. Still kind of around the same, except, you know, just it moves like crazy when there is volume. So I'm in and out very quickly too. And I also don't want to hold trades for too long there. But I'm a lot more confident with holding certain positions. And also depends if I'm trading prop or personal too. Like, if I'm trying to go for a prop challenge, because I want to see how this company is building out their business model, then, you know, I mean, there's so many different approaches, you know, with like the future friends, they all have so many different rules. But when it comes to like my own personal main trading accounts, it's really just trying to let my winners run for as long as possible. Because now I feel like, especially with Trump in office and the moves that we've seen, are pretty much going to be moves that we're going to see over the next few years. So instead of, you know, going from like that, like quick scalping where like maybe a year, a year and a half ago, my positions maybe be like 10 minutes, 15 minutes, you know, looking for quick two R multiples, two and a half R multiples, sometimes now I'm really trying to shoot for bigger R multiple trades and really try and let my winners run for as long as possible. Because I was going over my data over like this last year, and one thing that I was doing horribly on was holding my winners. There's so many trades where I cut it out at two R, three R, and it could have ran to like six, seven, eight R. And I mean, I'd be so much profitable, so much more profitable in the year.
Yeah, so how are you going to combat that? Just use trailing stops or take partial TP and then let the rest run?
Or trailing stops. So the thing I don't like about partial TPs, really, is like you're taking a lot off early on. So for me to like remove 50% of my position at like a two R and then remove like another 10% or a 20% at like a three R, I would much rather hold the position for longer and just trail my stop loss based off of R multiple. But the tricky part about it is depending on the market conditions, whether we're in a ranging market or whether we're in like a really good trending market, would determine the results on moving my, on how I move my, um, my R multiple. So if I trail my R multiple by, or if I trail my stops by R multiple, then in those situations, I'm going to find that I'm going to get stopped out pretty quickly because my stop losses typically are pretty small. They're not, I don't really trade very large stops. My take profits also pretty small as well. But that increases the probability where if I move my stops to break even at like a one R, then I'm going to get tapped out more than not versus if I maybe move it to like, if I move my stop down 50% of where my original stop is at like a one R, it leaves me a little bit more room and a little bit more chance for me to really try and let that win run. So I'm still kind of in the process of how I want to do that. But the way I'm currently trailing my stop loss now is based off of my targets. So if, let's call it like ES is pushing into a major level of resistance, let's call it where there's a lot of resting liquidity on the heat map, and you know, we've tapped into that area, and that's one of my main targets where I'm like at a three R, then if I don't see like an immediate breakout and a break through that specific level, then that's when I'm just going to close and cut the position. Versus if price breaks right through that level and instead of being up three R for my main target, so I'm up four R, then I'll move my stop loss to that level. So then that way, at least I secured what I set out to actually secure, and anything else is just like icing on the cake.
Yeah, and are you using like volume profiles like Bookmap and stuff to analyze your trades?
I'm getting more into it, but honestly, like the, I don't really use the Bookmap too much. I'm a little bit more into the footprint charts compared to the Bookmap because I feel like there's a lot of noise on the Bookmap. Like there would just be like a ton of liquidity resting. I used to use it for a bit, but I just, it got noisy and conflicting signals, and I was like, yeah. And I'm like, so like, I'll look at it now to really just see how many orders are actually coming in, and you see, you can also see that on the footprint as well. But to be honest with you, like I wouldn't really say like I'm super deep into order flow. I'll look for like certain confirmations on the footprint charts, but I'm way, way better of a price action trader than.
Are you mostly to supply and demand, or what's your?
Yeah, I would say my foundation is supply and demand. Yeah, yeah. I think that's anybody who's trading price action and supply and demand is just the, the basics. So yeah, to me, it's what makes the most sense. Yeah, yeah. It is. It's like basically the core truth of how price moves.