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I would greatly appreciate your advice and feedback on my trading approach, particularly with regards to my thought process, stop loss placement, and trading hours. To facilitate this discussion, I have attached two images that provide insights into my trading day.
Image 1: Real-Time Notes
Yellow dialog box: Entries/exits
Blue dialog box: Scaling in/out of trades
White dialog box: Real-time thoughts during the trading day
Red dialog box: Corrections/mistakes noticed after a few bars
Yellow dotted lines: Wedges
Orange dotted lines: MM (Market Maker) targets
Dark orange dotted lines: DTs (Double Tops)/DBs (Double Bottoms)
Stop Loss Placement and Thought Process
Today, I only took one trade shortly after I came online. At that time, I had doubts about using the DT (Double Top) as my stop loss, wondering if it was too tight. I'd appreciate your insights on whether I should have used a wider stop instead.
I refrained from taking more trades because I initially thought the market was in a trading range from 10:45 am to around 2 pm. I kept expecting the range breakout to fail (80% rule). By the time I realized it was a strong breakout/trend, I felt that the stop loss would be too far away for me to achieve a 1:1 risk/reward ratio for a with-trend trade. Consequently, I faded the entire trend.
There was another potential setup at around 3 pm, where I considered selling due to a DT and a L2 below the moving average. However, I was concerned that the move had become parabolic and wouldn't sustain, making it difficult to achieve my 1:1 profit target if I used the recent major high as my stop loss. Using the DT as a stop loss seemed more feasible, but I hesitated, fearing it might be too tight. I'd appreciate your thoughts on my thought process and how I can enter more trades and/or trade effectively.
Trading Hours
Currently, I primarily trade cryptocurrencies as they are within my comfort zone. My time zone is GMT+8, and I typically start trading at 12 pm and end at around 6 - 6:30 pm. I do this to maximize my screen time and gain more experience.
I'm aware that many traders begin their trading day when the market officially opens. However, since cryptocurrency markets operate 24/7, there isn't an official opening hour. Should I consider adjusting my trading hours to align with traditional market hours, or is my approach reasonable given the continuous nature of crypto trading?
Image 2: End-of-Day Review
In this image, I've outlined what I believe would have been ideal trades, stop loss placements, and profit targets. I would like to seek advice primarily on stop loss placements.
Please share your thoughts on how I can improve my trading strategy based on my end-of-day review and whether my stop loss placements and reasoning were appropriate.
Thank you for your insights, and I apologize in advance if I begin to post frequently (I hope you guys do not feel that I am being spammy). Writing this post has already helped me better understand my thought process, and I plan to make it a regular habit.
I would greatly appreciate your advice and feedback on my trading approach, particularly with regards to my thought process, stop loss placement, and trading hours.
You say you want feedback on your trading approach. I think you should define exactly what your trading approach is in written words. Define exactly what you're trying to do when you come to the market. This should include information about the setups you take, signals, stop placement, management, time frame etc. It's much easier for people to help you then.
And why not trade your home market (like the SP500, DAX etc.) instead of crypto?
You say you want feedback on your trading approach. I think you should define exactly what your trading approach is in written words. Define exactly what you're trying to do when you come to the market. This should include information about the setups you take, signals, stop placement, management, time frame etc. It's much easier for people to help you then.
I included my reasons, SL and PT in the images attached in my first post. For example, for the 1st trade marked in the yellow dialog box here :
Is that what you mean? Or do you mean what my rules/edge are?
And why not trade your home market (like the SP500, DAX etc.) instead of crypto?
To be very honest, I started with crypto because I already have an account with Binance and at the moment, I thought that since I already have my money in there, I'll just use that as a learning platform and till I am able to grow my account size or reach a level that I am confident that I am consistently profitable before switching over to SP500, DAX. That said, I acknowledge that this topic has been brought up a few times and I should probably start exploring going into that earlier than my initial plan.
I included my reasons, SL and PT in the images attached in my first post. For example, for the 1st trade marked in the yellow dialog box here :
Is that what you mean? Or do you mean what my rules/edge are?
Examples of trades you have made is not the same as a trading plan. You don't simply short just because you see a chart that you think is probably going down. A trading plan ensures you have a systematic approach to the market, and that you keep doing reasonable things. You would only do reasonable things, right? So you want to describe every single part of how you are trading, what your edge is, how you manage positions, what setups, signals etc. Everything in the trading plan is well-researched by yourself, otherwise you are not acting professionally since you are relying on other people's work. If you decide to trade 2-legged pullbacks to the MA in strong trends, you have to research every bit of how to do that (also old charts). That includes defining exactly what the setup is, what the signal to enter is, how to manage the position but also what to do about losses, emotions, how to progress etc. This is a document(s) you create that you use to align your mind to the markets every day.
Examples of trades you have made is not the same as a trading plan. You don't simply short just because you see a chart that you think is probably going down. A trading plan ensures you have a systematic approach to the market, and that you keep doing reasonable things. You would only do reasonable things, right? So you want to describe every single part of how you are trading, what your edge is, how you manage positions, what setups, signals etc.
I will have a look and see what you mean. This is something new to me as Al hasn't mentioned that in his books nor the videos, and I've only been following his methods and in his Trading Ranges (Book 2, chapter 26), he mentions that to need 2 reasons to enter a trade. I may have missed the part of where he shared about trading plans and will run through the chapters again
