DAX: second losing day in a row

DAX opened with another bearish gap, pressing the channel support of the 1h regression channel

Bar1: entered long for a continuation trade on a bullish trend bar following a 3-bar consolidation.
Bar2: full position stopped at trailing stop with 7.50 pts loss and I reversed the position on the same bar selling short. Trapped out and trapped in. Big mistake. It was a failed break of the micro trendline. Bar3: short stopped with 10.60 pts loss.
Bar4: short entry at trendline resistance.
Bar5: stopped with 12.50 pts loss.

Doesn’t look good so far. Both my short entries were micro trendline failed breakouts. Bar6: short entry on lower high

Bar7: stop with 11.70pts loss
Bar8: H2 short entry
Bar9: stopped out 11.20 pts loss

Dreadful day. I was clearly on the wrong side of the market. Average loss was 10.59 pts without a single winning trade.

Position management

I still have the tendency to close my winning position too early therefore I start trading two lots. I will exit one lot with my discretion and I will set a trailing stop for the other half of the position. With this method I try to stay with the winning trades that has a good run and hopefully can achieve bigger gains.

DAX: range day with small gain

DAX had a bearish gap at the open after the Asian markets started the week with heavy losses. The 1h trend is clearly bearish while the German index trades at the liner regression channel support.

Bar1: long entry just above the S2 level on a long legged doji rejecting the low of the bearish trend bar
Bar2: trailing stop was hit with 5.80 pts profit
Bar3: I did’t enter long on the break above a micro trendline after the second bullish pin bar as I was looking for a second entry (break above a lower high) which didn’t happen and saved me from a losing trade.
After this point the index were ranging with a Barb Wire pattern from 11:30 to 14:00. Later there were two tradeable trendline breakouts at Bar4 and Bar7 and two failed dowside breakouts at Bar5 and Bar6. I decided not to trades any of these setups since there was no sign of conviction on neither side of the market.
Bar8: breakout pullback long entry
Bar9: trailing stop was hit with 2.50 pts loss
The DAX ended the day in a tight range with repeated failed breakouts on both ends. To sum it up we had a range day which I always find hard to trade however today I managed to escape with a tiny 3.30 pts gain.

dax 20110523 5m

dax 20110523 1h

DAX: Friday’s rundown

I will change my daily rundowns to a more ‘to-the-point’ style so it will be less time consuming to write (and read).

Bar1: short entry at the R1 level just below the previous session’s high Bar2: profit taking 22.50 pts
Bar3: short entry on a bearish engulfing line at the EMA20
Bar4: profit taking 12.30 pts at the bullish trendline and daily pivot level Bar5: missed inside bar entry after a break below the pivot level Bar6: long entry on a bullish 1-2-3 reversal
Bar7: stop-loss -15.00 pts
Bar8: long entry on a bullish pin which turned out to be a breakdown of a small correction
Bar9: stop-loss: -15.00 pts

I stopped trading for the day after the second loss. Closed the day with 4.80 pts profit. I still close my winners too early. I was quite satisfied with the first too trades but missed most of the day’s potential. All in all not a bad day for a Friday.

dax 20110520 5m

dax 20110520 5m2

DAX trading: 19.8 pts gain with 3:1

Another solid day in my DAX trading but I still leave too much profit on the table. The index has extended its upmove from yesterday’s low with a bullish gap at the open then pulled back well into the gap testing the late swing high of the previous session. I entered long at Bar1 and closed the trade at Bar2 for 8.0 pts profit at the primary resistance R1.
I missed a perfect setup for the second part of the upleg. Bar3 was as bullish inside bar setup for a breakout-pullback entry after a consolidation of about ten bars.
My second entry was for a short trade when the index reached the regression channel resistance on the 1h chart. I entered short at Bar4 and scratched the trade with a 3.30 pts gain at the EMA20 at Bar5. It looked liket the market will show a Barb Wire (tight trading range near the EMA with small body bars that overlap) ahead of the US macro data so it was reasonable to exit. There was a bullish gap after the US jobless data but the upmove failed at the session high and I entered short again at Bar6 on a trendline break but covered the short at Bar7 as there was no follow through selling. I lost 5.50 pts on this trade.
The upmove failed at the same level again with a bearish gap followed by a wide ranging bar with a long lower shadow. I was looking for a second entry but the price action was not decisive so I skipped the break lower. I saw the S&P500 index coming lower so I entered short on an inside bar breakout at Bar8 and booked a profit of 14.0 pts at the opening level which proved to be an early exit again.
Nonetheless I closed the day with a 19.80 pts profit which is all right with me.

DAX: 3 trades, 21 pts profit

I was still playing the short side in DAX today after the strong bearish close yesterday. Entered short at Bar1 on a break below a bearish pin bar rejecting the 1st pivot resistance. I covered the short at Bar2 on a bullish pin at the EMA20 with a 16.30 pts gain. I missed a good singal after two failed breakouts (up&down) from the morning’s range. The missed signal was a bearish engulfing bar following a bearish pin bar. The second short was at Bar3 on the retest of the pivot point level after a break lower. Exit was at Bar4 after a bullish pin violating the channel line from the morning high, result was 9.20 pts profit. Both exits were on good timing and were followed by sharp snapback rallies.
The third trade however was a long trade, a breakout- pullback entry after an upside breakout from the bearish channel that contained most of the day’s price action up to that point. But the exit was poor. I held the long after the low of a small bearish harami was violated as I was expecting a fake break to the downside trapping the bears. On the next bar I was trapped out as well just to see the index run to a new high. I was uncomfortable to trade against the 1h trend and jumped the trigger. The usual mistake with the excuse of a counter-trend position and a loss of 4.50 pts. All in all it was a good day with 21 pts profit and 2:1 win gain ratio.

DAX trading wrap-up

The 1h DAX chart is showing a downtrend therefore I was playing the short side today. Entered the first short at Bar1 on a bearish pin just below the bearish opening gap. Closed the short with 14.3 pts gain at Bar2. I missed a second chance which was a double top but entered another short at Bar3 when the index has bounced back again to the pivot point level. Closed the short with 15.0 pts profit at Bar4 when a bullish pin was forming then re-entered the short three bars later at Bar5 when the bearish momentum was picking up again taking out the low of the previous bullish pin. Closed the position on a bullish inside bar at Bar6 with a small 5.50 pts profit and sure enough the price started to consolidate. After this I missed two sharp selloffs. The first didn’t show a good entry bar and I didn’t chase the breakout. The second move was after a clear bearish signal with a bearish engulfing line just below the 1st pivot support (green horizontal line). I saw the DAX underperforming its European peers and thought it was oversold. Quite a mistake. I shouldn’t judge a signal if the setup is valid. Nonetheless I closed the day with three profitable trades.