August 5th, Weekly Summary - Real Money Account Loss -$4 / Sim Account Profit $949

The Week in Review

With the market going mostly sideways this week, nothing changed and we ended the week were we started, with 8 contracts short at an average price of 2440.00.

All the near term cycle and intermarket analysis that we follow  are still pointing to a near term correction. We could expect this correction to take us back to the 2400 levels.

We will continue to monitor this trade, and possibly take additional positions should we see some definitive sell signals in the daily charts next week.

When we successfully close this short position we will go back to Day Trading with a daily target of $350.

Real Money Account

We ended the week holding 8 contracts short.

We took a small loss on the week of $4.00 due to commission and the carry costs on the contracts.
Our net paper position at the end of the week was negative $12,800.

Our current break even point is 2440.00 which is just below the 50% Fibonacci retracement level.

We did not make a new high this week.
The market went sideways in a fairly tight trading range.
Attempts to break higher failed, but there was no significant selling pressure to push the market lower.
We are still anticipating a near term correction based on market cycles and inter-market analysis.
The end of July and early August is the expected timing of this correction.

Real Money Account Charts

This trade has no impact on our account value until we close it out.
But the ROR is going down because we are out of the market.

We are getting behind the curve.
We will have some catching up to do when we get back to Day Trading.

Bonds Trading Day of the Month (TDOM) Simulation Trading

We closed out 2 bond trades this week for a profit of $1,780.

We are currently holding 1 long position @ 155 4/32 from 04/08/17.
This position currently negative $968.
Stop is @ 153 16/32
1st exit day is 08/08/17

S&P 500 E-mini Sim Account

I used the modified Flipping Strategy this week and ended the week with a profit of $949.
I am not satisfied with this technique as it can create a string of big losses.

With this strategy we automatically take 5 offset contracts on any trade that does not follow through.
For example;
1st trade is entered with 1 contract, it does not follow through.
We flip the position with 6 contracts, 1 to cover the open position and 5 for recovery.
If this position does not follow through we then flip with 10 contracts, 5 to cover the open position and 5 for recovery.
We continue this until a trade follow through then we go back to the start with 1 contract.

This strategy works fine if the first flip follows through.
Profits actually increase in this case.

However, if we have a second or third trade that does not follow through we dig a deep hole really fast.

The conclusion is that this Strategy's weakness creates to much downside risk and we needs an adjustment.
To make this adjustment we go back to the core objective of the Flipping Strategy, to recover losses and get us back to a flat position.
We will make the following adjustment to the Flipping Strategy.

When a trade does not follow through we will flip taking 5 offset contracts.
Or exit target will be the profit required to recover the losses on the previous trade.

For example;
1st trade is entered with 1 contract, it does not follow through.
We flip the position with 6 contracts, 1 to cover the open position and 5 for recovery.
We set the exit target at the level necessary to recover the losses on the previous trade.

The logic here is that our first trade will loss approximately $100 or 2 points.
With 5 contracts on the flip trade we only need a move of  1/2 point to recover that loss.
The statistical probability of hitting a 1/2 point target are higher than a 1 point target.

We will try this for a week or two and see what happens.

Sim Account Chart

The flipping strategy used in the last 2 weeks has created a shallower and more choppy equity growth curve.

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