July 28

Two green weeks. Time for a third.

I will write out my justification. It will be a slow, well thought out thesis based on higher probability phase and ATR levels. Last Friday I took a counter trend scalp - which totally did the job - but the easier trade was to wait longer and take the trend caspar entry and hold longer. It's all about having a real thesis and then having the patience to wait for it. Also, last Friday I said the direction was up but I was annoyed we were closer to resistance so started looking for signs of a countertrend reversal. That's fine, and I should size appropriately, while also knowing the better thing to do in that situation is just wait wait wait until we're at support and go with the trend.

Always comes down to exerting enough patience. I will, as always, do that today.

I also need to acknowledge my risk amount and accept the loss. Let the probabilities play out.

Daily

Still stupid bullish. Currently extended from the ribbon hanging out at PDH. Quarterly call trigger hit signaling a move higher. Approaching the previous PO level where we started to pullback to the ribbon.

4hour

Kissed resistance at the monthly 618 and rejected. Moving back down to the ribbon, currently 4h21 and swing 500 acting as support. Trying to put in a second reversion dot on the PO.. SPX however, very bullish. Currently extended with the swing 500 holding. PO is starting to stall. So, we'll see.

General theme at the highest level is very bullish but less upside to enter calls here. That does not mean seek out reversal scalps, but it does mean to be very clearly at support before considering calls.

Hourly

SPX made a new high right at key psych of 6400. H13 is support with PWH as resistance. Very tight range so far today... 17 points only. Potentially signaling a mean reversion on PO which would take us to 6375ish. SPY is finding support at the H48 and PWC but the H21 is not acting as resistance.

Hourly conclusion is we're bullish and at support of PWC / H48. But plenty of reasons to be bearish as well...

10m

Very very clear downtrend. Moves to the 21e have all been rejected and great entry points. PDH resistance now, PWC support. Potentially forming an IHS but for now its puts at resistance. Hourly and 10m SPY pointing down. SPX H up, 10m sideways. Puts at resistance only for now. Proper 10m ivom can wait for a 3m flip of the 21e bias.

Despite the hourly with a bullish ribbon, the 10m down trend was simply too hard to ignore.

1240pm is where I first started feeling fomo. I didn't like the idea of getting in after the 1230 candle because we were very clearly at support. And, we could have simply ripped from there. That is what started happening at 1240, which ultimately wicked off and we broke the PDC down. It closed below and that's where I scaled into puts. Fully accepting a loss. I knew I was in early. I knew my stop loss wasn't until far higher. I knew that it would require a 10m closed in the ribbon and back above the PDC to really signal a reversal up. That is where I added with size...

That size however made it harder to hold until I wanted to. Which was first the LOD and then the put trigger. The size would've been easier to hold with a more ideal entry.

My initial was the first 3m pullback after showing some momentum down. Of course we pulled back to the supply zone that was just created. We pulled back to the PDC 10m8e and 3m21e. Once we rejected that's where I sized into puts. Of course on the 3m time frame that was a resistance turned support. The real resistance was the supply zone ahead. So, when price rose from my entry, and because of the size, I was very reluctant to hold to the LOD as planned. Instead I took off 80% of the position at the cost basis of my original entry. So, a large profit. Then I took off most at the most recent support instead of the LOD. And therefore I was all out by the time the put trigger hit. The moral of the story is 1. scaling in first helped me get a feel for the PA. It was entirely easier to hold through the ups and downs with smaller size, and to truly see the PA.

I correctly added to the position, but I went overboard and that ultimately hurt more than it helped. If I had added the amount I may have held the whole position longer and profited equally on a dollar standpoint.

I am happy I held to my original thesis which was the LOD. My scaled in entry was amazing for my mindset. The additional entry was warranted. But, the confidence to add more should coincide with the confidence to hold to the original target.

Interestingly enough the ideal entry ended up being premium support...

My entry on the premium chart was with the consistent holds of the 3m21e. I added after we reclaimed the 21e. The added size left me uncomfortable with taking a drawdown to premium support. So, once we pushed off of premium support I made the impulsive decision to exit quickly and let a smaller position run. Ironically if I never added to the position and held the full position to the initial target, I'd have profited almost the same amount as I ended up with 20% of the size!

The added size did nothing to my bottom line, yet added an incredibly amount of FUD. I'm simply not there yet.

The easy lesson is to slowly scale and stay true to the plan.

Now, I don't need to. But, I'm looking into what would be the appropriate technical stop for a runner down to the put trigger. A break even stop on the premium would've clipped me at the bottom. So, if I traded it perfectly...

3m21e + 10m8e continuing to reject. That was the ideal entry with the PDC as extra confirmation for entry. Exit at LOD. 4.5 to 8.5. Then hold runners until a close above the entry requirement - break above the 3m21e. Exit runners at the put trigger at 10+ (max 15). 10 cons was MORE than enough.

The most important thing to take away from today... SCALE IN. ACCEPT THE LOSS. It ultimately was totally okay for me to be early - as I always am. But, not only did it not crush me because I fully accepted the loss, but I felt more confident in the thesis because I was in the position for almost 20 minutes before the setup played out. This is what it takes. A 10m thesis. Scaling in at CasPar. Waiting for CasPar entry to break or target to hit.

Great, great day!

It felt effortless because I scaled in small. And, it was actually only 'small' because I had totally accepted the loss. I knew that it was easily overcome with a proper trade.

Size small. Scale in. Accept it.