# Summary This month saw initial success, followed by severe difficulty in adapting to extreme market conditions. I let "predictions" and biases get in the way of objective, reactive trading of one setup. # [2025-01-31](2025-01-31) Setting Ground Rules Going forward, I will create some rules to prevent losing trades and account blowups. - no sizing up on drawdown. # 1 killer of accounts. - 10 pt stop maximum. - when a flush begins, recognize when bears have gained control. There is a change in price action character. “Sell the bounce” - Always be mindful of where the dynamic CL is using levels. - analyze multiple time frames before taking a trade. - Most importantly: follow the plan. Don’t enter failed breakdowns blindly at major levels because it “looks like its going to reverse.” The higher the level, the more likely it is to fail. - Anything can happen at any time, as long as the market is open. Be vigilant, not complacent. It occurred to me: what if I accept the loss? Trading is not a perfect endeavor. Losses will happen. # [2025-02-01](2025-02-01) Understanding Context When are failed breakdowns most likely to succeed? When are failed breakdowns most likely to fail? When price breaks down a key support (the CL), bears take control. We go elevator down, ignoring all supports and bouncing along the way. I think failed breakdowns are most likely to succeed after a large elevator down move, and price builds out some structure. In order to prevent a big losing trade, the problem is still fundamentally the CL/bears control. The issue was that I wasnt aware that the CL given would shift upwards. If i had been aware of the bear control, I would not have rushed to go long and instead would have looked to short the bounces. To learn the shifts initially and get a feel for it, be aware of the current day’s structure and also pay attention to Mancini’s tweets, where he might tweet out new levels as they change. Make note of when new supports are made, marked by a V. The levels change in real time. To summarize: the reason why I lost on 1/31 was because I was unaware of the shifting dynamics of levels throughout the day. New major supports can be made intraday, which becomes the new CL and thus “become ripe for a breakdown short.” This means bears can also take over control higher than where you expected, if higher supports are made. Furthermore, the higher/closer price gets to major resistances (where mancini provides resistance shorts), the lower probability of the long winning. The best trades come after a huge red flush that loses multiple supports, after which price reclaims a major support and short squeezes. Ive made a major realization. Just as price squeezes when we reclaim a major support, price breaks down when we lose a major support. Same concept, different sides. Thus, The reason why I struggled is actually because I didn’t fully understand the theory behind the levels, how they shift, and specific nuances of how they are evaluated and utilized. I believe that it will take at least a week to gain a deep understanding of this topic. Documentation from now on must include market structure and analysis pre-trade, along with context and planned trades. > When bears take control at a breakdown of the Control Level (CL), price tends to elevator down while ignoring supports along the way. CL = major support level. Failed breakdowns are most likely to succeed after a large drop once price builds new structure, but are risky near major resistance levels or when bears are in control. The key is recognizing that the CL shifts dynamically throughout the day as new supports form, requiring traders to adapt their strategy from longing failed breakdowns to selling bounces when bears gain control.​​​​​​​​​​​​​​​​ # [2025-02-01](2025-02-01) How Support Shifts On uptrend rally days, support can shift upwards as price rallies and breaks major resistances, tests them, and goes up. During this process, the short trigger for a breakdown short also moves upwards. Does the same thing happen on elevator down? We typically melt down through multiple supports. There can be bounces at high conviction levels. All of this represents a major paradigm shift. It explains everything about the losing trade on 1/31. It also means that the loss was not dud to a lack of discipline, but rather a lack of skill It amazes me that every time i think ive mastered the methodology, there’s always something major that I’ve missed. However, this is natural. # [2025-02-01](2025-02-01) Failed breakdown Long at 101, 338 (BTC)  Bitcoin is untradable. The price jumps around randomly, and there is a lot of noise. Price action is messy, noisy, and meaningless, in contrast to SPX. Price can create a reversal candle multiple times before continuing in the same direction. # [2025-02-02](2025-02-02) Failed Breakdown Long at 5957 (x2)  Price tagged 40 and reclaimed 57, where I went long and took profits. at around 70 ish. I re entered this level twice and took profits twice. # [2025-02-02](2025-02-02) Breakdown Short at 5957 Price had a failed breakdown at 5957, tagged 5970, bounced on 5957 again 2 more times before approaching 5957 and breaking down all the way to 5934. I took the short at 5957 with 3MES, TP1 at 5950, and TP2 at 5935. Next, looking for acceptance of the 5949 level. # [2025-02-03](2025-02-03) Account management I now have 4 XFA. How can i guarantee a payout? - be aware of the worst case: price rejects and continues to flush. I DCA. happens very easily, and is always catastrophic with poor management. - keep in mind that a proper entry results in quick follow through. anything else is subpar and should be CUT. - proper entries typically require patience. - This month, I am focusing on CUTTING LOSERS. cutting losers will result in some missed reversals. However, you can likely just get back in after taking a small loss. It will, however, prevent massive account blowups. Then the game becomes making sure that your winners outweigh the losers. - think about it: most of the time, follow thru occurs at around a 70% rate. When a follow through is subpar, this is about 30%. Of those 30%, perhaps 5/30 will still follow through. It's not worth it to hold losers for those cases. I will simply have to accept that some losing trades will follow through. - Most novice traders have the mindset of “hoping” the trade comes back. While this works sometimes, the mindset essentially guarantees that you will hold through the worst > Position size: 4 MES for FBD, 1MES for BDS. No DCA. Cut subpar trades. My intuition tells me that when im focused on cutting losers and preserving capital, my edge is able to shine because the possibility of blowing up is minimized. I will make sure to document every single loser cut, as well as whether or not they reversed and turned out to be winners. This will give me data to analyze and potentially iterate on a better process Also be aware of the mindset that i have to make money today. Its incredibly naive and not how the game works. # [2025-02-03](2025-02-03) Failed Breakdown Long at 5961 Shelf  I went long at the dip of the 5961 shelf. I went in too early. I should have waited for the recovery of the low of the shelf, and entered long with conviction. I also sized up too large. - Patience + Small Size are the key themes for Feb 2025 - don't forget. Furthermore, context is important. The news can be reflected within the price even before the news notification pops up on my phone. This is why technical analysis is King. Despite these mistakes, I had a successful trade and am completely out of the position, closing out my last 1MES runner for ~70 points. # [2025-02-04](2025-02-04) Failed Breakdown Long at 6004 Price flushed rapidly due to China’s retaliatory tariffs on the US.   Some thoughts and minor changes to trading style and acct management: - practice the habit of not sizing up in drawdown and entering later, when acceptance has been established. Patience is key - Limit position size to 4 MES. No adding. - Cut the trade at 10 points max. Set the stop loss. I dont care if price makes a reversal. At that point, you already fucked it up and need to make better entries. - 200x5 as a good first goal. Achieve this first and lockout at 200 profit for the first 5 days, then the next goal is getting out of the -2000 trailing dd. After that is 200x30. - I also need some kind of mental process to evaluate the strength of a setup in real time. - Price flushing on significant news (deepseek, retaliatory tariffs) could require much more prudence than normal # [2025-02-05](2025-02-05) Reclaim at 6037   Took the 6037 FBD twice today. First time, on both xfa's and personal. Locked out XFAs, and took it again on my personal. Left 1 MES runner, now up 25+ points. Will hold this. I am feeling a very strong urge to sell the runner. I am up over 200 dollars on this single Micro ES contract. I am "worried" that it will chop back, perhaps due to some tape bomb. The first thing to realize here is that 200 dollars is not a lot. The second thing to realize is that closing out the runner would mean I am more focused on PnL as opposed to process, and process should always rule. Even if price - currently at 6076 - chops back and stops me out at around 6030, I haven't "lost" anything. Despite being able to close out the trade and pocket the 200 dollars, following a process means that this is illusory. Don't get attached to unrealized profits. > The urge to close the runner is exactly the kind of emotional response that separates amateur from professional traders. Stay mechanical with your process - if you have a system for trailing your stop, stick to it and let the market take you out if it's going to reverse, rather than cutting the trade early based on worry or speculation about what might happen. > You have a risk-free runner. There is literally no downside here - you can't lose money. The only "risk" is giving back unrealized profits, which aren't really yours until you close anyway. The other philosophy would be to just close it out whenever it feels right. At 35-40 points, it seems like it would be a good profit take as it has already doubled my initial profit from the level to level move. Runner closed out at 6076 for 40 points. Focus on the XFA accounts. I will hold runners more often when the profit is negligible. # [2025-02-06](2025-02-06) How long will low vol last? Recall that in the past we have gone many days without any vol whatsoever, ie low vol grind up. With trump in office, its unlikely that we go an entire week without vol. # [2025-02-06](2025-02-06) Failed Breakdown of 6987  Entered long at the FBD of 6087. 3x 200 complete, 2 more to go. I waited all day for this one shot, one kill (OSOK) setup. As you can see in the chart, there was zero vol all day within a 15-20 point range. We finally got the dip down (backtest of the breakout line) to around 66-70, after which 87 was an A+ long setup. I took this and logged by 3rd winning day for the XFA's. I did a good job avoiding FOMO, and am now fully in control and aware of when an entry is a "coin flip." I avoid these like entries like the plague, as they are nothing more than money destroyers. I demonstrated understanding of Chop today - the proof is that I didn't trade until 3pm. Overall, a great trading day despite most of it being low vol and chop. Going forward: we had an FBD of 87 around 3pm. Ideally I'd have a runner, but I don't. This structure is coiled tightly and ready to make a break for ATH's. If it does, there might be nothing to do except to sit and watch, so be ready for that possibility. There might be another failed breakdown of the 87 level tomorrow at 8:30 NFP. # [2025-02-07](2025-02-07) Failed Breakdown Long at 6094  Took the failed breakdown of the 94 overnight low and took profits at 200. 1 more day to go before requesting a payout. # [2025-02-07](2025-02-07) Bad Trade - Premature FBD I entered a premature FBD at a level I expected to hold (87) but didn't because a trump tariff tape bomb. This is a stark reminder to avoid buying levels in the upper stratosphere. # [2025-02-07](2025-02-07) Failed Breakdown Long at 6066  Went long with size (4ES) at 66 and sniped the TP at 84. Near perfect trade by all accounts (still early/impatient, however), and price collapsed soon afterwards. # [2025-02-07](2025-02-07) Failed Breakdown Long at 6066  Entered too early. Didn't wait for acceptance, was in huge drawdown. Doubling down and martingale - BAD. Wait for acceptance next time and take profits religiously - next time you will be run over flat by bears. However, still made money. # [2025-02-08](2025-02-08) Progress Report This month, I've made around 11 trades, with 1 trade being bad (but was later recovered in full). This is a 91% win rate for the first week of February, which is off to a great start. Notably, I am able to wait and sit on my hands all day long if no setup presents, as demonstrated on 2/06. Going forward, I aim to not over-leverage for the entire month and stick to my pre-approved plan of 1 MES per 1000-2500 dollars of account value. This keeps risk strictly to between 2% - 5% per trade, with a risk reward ratio of between 0.7-1.3 on average and >80% win rate, this comes out to 1% to 6% account growth per trade depending on how strong bulls are at the moment. Over time, the strategy can repeatedly compound "conservative" base hits to accumulate staggering wealth. PnL: my new personal account, which started at $2000 at the beginning of the year, is now worth $12,500. In the first 3 months, I lost money trading emotionally and impulsively, along with over-leveraging. By thinking extensively about the Mancini methodology, I have developed strong discipline in avoiding FOMO, recognizing the bread and butter "failed breakdown" setup. Over-leveraging in the moment impulsively remains a problem. In TopStep prop firm accounts, I have acquired 4 funded accounts, which copy trade each other. This means that I have effectively 8000 dollars of capital, with current "profits" at around 800x4 = $3200 total. The goal for February is to keep these accounts **alive** ($2000 trailing drawdown) and validate my success by getting moved to a **live funded account**. The long term objective will be 30 days of $200 profits. Achieving this would be monumental for my trading career in multiple ways, demonstrating multifactorial. This will be done by focusing exclusively on preventing account blowups, massive drawdowns, limiting risk in a disciplined manner. Furthermore, since the strategy has a win rate of over 80% when executed properly, I found that passing prop firm combines has begun to feel quite effortless. Psychologically, I am noticing that the newfound success has led to changes in my mind. Firstly, it is psychologically challenging to make the "same % risk" trade on a $2000 dollar account vs a $12,500 account. Initially, I had risked 500 dollars, a relatively small amount, which is 25% of the account. The same trade on a $12,500 account would risk $3125, which is a hefty sum of money. Despite following the same high-percentage setup, I found myself experiencing anxiety during the trade. Symptoms include adrenaline rush, shaking hands, and nervousness. Going forward, I will keep my risk to 5% of the account to prevent psychological pressure. I also aim to keep my performance in that sweet spot everyone has experienced between greed and fear. I believe this can be done through regular meditation and removal of the "self" or ego from the picture. However, this needs more research. # [2025-02-10](2025-02-10) Support Hold Long at 6070 I entered long after market opened and flushed from 6087 to 6070. Price stabilized and failed to breakdown below the critical 6070 support level.  Today marks the 5th winning day in a row across my 4 copy-traded XFA accounts. If I were to have no edge (50% win rate, 1.00 profit factor), we know that the probability of achieving such a feat would be $(1/2)^5=1/32$, which is highly unlikely. However, we must be mindful of market conditions, which have been **prime volatility for day trading.** # [2025-02-11](2025-02-11) Failed Breakdown Long at 6063    Escape velocity has been reached - we have finally escaped the -2000 drawdown. Going forward, it will take a few days of prudent risk management to fully escape the drawdown, and then we can start scaling up. It's CRITICAL to continue treating this like a 2000 dollar account. Take care of the day, and the weeks, months, and years will take care of themselves. If I can achieve just 200 per day on 4 XFA accounts of 30 days, that is 26 more days of 200 equalling 24x200x4=19,200. combined with the 8k on the current account, this would be eligible for a $27,200 payout. The rough time estimate for this would be 5 more weeks, which would be March 18th. **If the account isn't blown** the amount at the end of this period would likely far exceed this amount. I expect to be able to be moved to a live account by next month, if I focus on risk management. The psychological trap here would be to scoff at a mere $200 dollars daily, when in reality this is 1) a highly achievable goal and 2) is multiplied 4x ($800) and each win is another $800 gain to my war-chest. Eventually, with 50k of profit, I can trade 16-50 MES at a time and still only limit my risk to 2-5% of the account. Keep doing what you're doing for now, the time to scale up will come. # [2025-02-12](2025-02-12) Breakdown Short at 6036  # [2025-02-12](2025-02-12) Long at 6030 # [2025-02-12](2025-02-12) Backtest (?) Short at 6058  # [2025-02-12](2025-02-12) Alternate Scaling Plan - Doubling Is there a way to reliably double your account size every x weeks? Say initial is 10,000. Goal is 20,000 The time between each doubling stays constant - Only problem is psychologically scaling. If you have 10k, 2-5% risk is between 4 and 10 contracts. $\pm$ 10 points per trade is between 200 to 500 dollars per trade. So it would take anywhere from 20 to 50 trades to double. So ~2 months. # [2025-02-12](2025-02-12) Game Plan My patience is being test here. I am so close, and I just need to sit back and let the process work instead of doing things because I "Feel like it." 1) net worth breakeven mark serves as a psychological barrier. This shouldn't matter, but i cant let this cloud my judgement. Best to forget about it. 2) want to "get rich faster" instead of letting the process compound. I need to realize that by being patient, I get to my goals much faster than I think. Remember where you started. On Jan 1, 2025, I had a 2000 personal dollar account with no funded accounts. Now, I have turned that 2k into 13k, and I have 4 XFA accounts that are worth a total of 8800. This is already **staggering growth at a break-neck pace.** 3) I need to practice gratitude and learn how to be happy with my progress. It makes sense now why people engage in gratitude practice in daily life, as it prevents you from becoming too greedy or unhappy. > A great trader isn’t swinging for home runs every day; they’re stacking reliable, repeatable edges while avoiding unnecessary risks. All of these fall under the category of "How to win" rather than "how to lose." After 4 months of learning how to lose, I am experiencing a change in stride and need to learn how to psychologically handle these new events. # [2025-02-13](2025-02-13) Finalizing Scaling Plan Mancini says he uses 10-15% of the available margin on the account. So for a 10000 dollar account this would be 1000 - 1500 of margin which is 10-15 microlots. If i were following my 1000-2500 plan, it would essentially risk more than 5% of the account, between 5-7.5%. As a middle ground id suggest risking 5%. This also means that risking 10% on the xfa isnt outrageous. This also means that im undersized for my personal account, which should use a position size of 13 microlots. For my xfa, which is technically 2200, it should be 3MES but since the targets are 200, it makes sense to make an exception and go to 4. Thus, final scaling plan: 1 micro per 1k is normal size, use quarter or half size as needed. Minimum of 4 micros. # [2025-02-13](2025-02-13) Failed Breakdown Long at 6070  Target did not hit, but I closed the trade out at 6084.25 because the momentum was so sluggish. Initially got trapped short for -55, but then closed it out quickly once I realized it was a trap and flipped long. pnl: +273 x 4 = 1092. I think we'll see more entries because Trump is signing tariffs today. update: tariffs were delayed and price rallied from 87 to 113 high. Likely nothing left for the day. # [2025-02-14](2025-02-14) Contrarian Results = Promising Browsing r/futurestrading I realize that on mode 1 trend days like today, a lot of other traders do well and make alot of money. It's on these days where I sit on hands and tend to miss most of the move. That's the secret of the strategy - when others lose money (which is 90% of trading days), I make money. And when others make money (10% of the time) I sit out of the market. This indirectly confirms that this trading strategy is elite and that it is indeed profitable - all it asks in return is to master the emotion of FOMO. Think about it - instead of thinking "I missed out today" think "if I changed my system to catch days like today, I'd become unprofitable." You don't have to win everyday. Furthermore despite it being a trend day, I still got my piece in the morning. Trend days are for dumb money - ranges are where smart money operates. # [2025-02-15](2025-02-15) Progress Report This week, I made 1 small error, realized it was a bad trade, and cut it off before any damage was done. The rest of the trades were wins. I took 8 trades this week, with 1 tiny loser, which is a win rate of 87.5%. 100% of days were wins, besides Tuesday in which one of my runners on my personal account gave back a bit of profits. On TS, this marks the 2nd week of 4/5 wins. I have escaped the -2000 drawdown, and need another week to begin scaling up. Thus, this marks the "beginning" of the account. # [2025-02-17](2025-02-17) Failed Breakdown at 6139  Failed breakdown of the overnight 3am low. Only captured 1.5 points due to extremely low vol. However, a win is a win. Price ended up going to 6143.75, but it was moving so slowly due to holiday session that i decided to cut the trade earlier.# [2025-02-17](2025-02-17) Failed Breakdown at 6139  Failed breakdown of the overnight 3am low. Only captured 1.5 points due to extremely low vol. However, a win is a win. Price ended up going to 6143.75, but it was moving so slowly due to holiday session that i decided to cut the trade earlier. Usually it takes 1-5 minutes to hit the TP, but on slow vol I didn't want to stay in the trade for 1.5 hours. This would have been a better setup on a normal day, but on a low vol chop day it is no longer. # [2025-02-18](2025-02-18) Failed breakdown at 6136  I have been trapped in this trade by low volatility, chop, and severely range bound trading. I entered the trade at around 10am and am still in it 3 hours later. 138 needs to be accepted to squeeze, and it looks like acceptance is potentially underway. Thus, I will hold this position until either 43 or 48. I strongly dislike being trapped in a trade due to choppy conditions. There was a real risk today of getting trapped in a big losing position. I still have to learn how to be more patient and cut losers more quickly. I ended up holding all the way down to 20, where I added to my position. I should have cut the loser much earlier. Chop = bearish, because price needs to spike to increase vol. I was successful on my personal account because I took profits level to level every single time. On my topstep, I did not, which caused extra stress. I should have held a runner into the close to have exposure post failed-breakdown.  Despite making money, today was a poor trading day. Habits to work on: - cutting losers much earlier. - recognizing when to get out of a position: price should follow through within 10-30 minutes. - find the spot that will prove the trade to be wrong. its ok if it takes you out and then reverses - that means that it was too choppy anyway. and you can enter again later on. - hold a runner into the close for MOC on candidate days. Despite making money, I'm quite disappointed in myself for sizing up, using martingale, and nearly blowing the account. I need to limit my TOTAL margin used for the 4x XFAs to 15% maximum, which is currently like 4 micro ES contracts if copy trading. THIS IS CRITICAL. Today I should have taken a 4MES trade in the morning, and then I should have taken profits. If I was somehow an idiot and didn't take profits at 43, then I should have cut the trade when price moved rapidly against me. **It was clear that it wasn't an A+ setup.** Cut the fucking loser, find a new entry. However, it's promising that I am still disappointed in myself for breaking rules despite profiting. It's a promising sign. The fact that my XFA's are still alive are a gift from the universe, and I will not let this warning go to waste by sizing up again. I WILL LIMIT MY SIZE TO 4-5 MES PER TRADE FOR THE FORSEEABLE FUTURE. Today was an example of how I don't like to win, whereas the rest of the month were examples of exactly how I like to win. > Today was a win on the PnL but a failure in execution. You got lucky, but luck won’t always be on your side. Take this warning seriously, reinforce your discipline, and move forward with a clear head. # [2025-02-19](2025-02-19) 2 Habits - cut losers quickly. Use stops that make technical sense. - Size appropriately. Its time to stop gambling with high leverage in search of a “high” and start trading like a professional. - My plan was 1 mes per 1000-2500 - mancini uses 10-15% margin of account. This comes out to 1 mes per 1000 if 10%, of 1 mes per 667 if 15%. This is much more aggro than the typical rules, but it works with a high win rate. - with a bal of 2800, this would mean 4 contracts is still within bounds. Any more would be quite risky as its already 15%. - With a bal of 15300, 23 mes is the upper limit. > The 667 Rule: Scaling by 667 per contract keeps progress fast, engaging, and disciplined. Unlike larger milestones like 2500, which feel slow and lead to impatience, 667 provides constant, achievable levels to chase, preventing reckless impulses. This approach allows for steady compounding without forcing oversized trades, keeping the focus on execution rather than gambling. By respecting the rule - leveling up when the balance grows and down when needed - I ensure long-term sustainability while rapidly increasing size. With consistency, this system will compound into massive gains over time. The other part of it is sizing up in drawdown. This is where the stops come in the stops must make technical sense and not be moved or negotiated. If stops are being hit, the stops arent the problem - the entries are. Furthermore, sizing up in drawdown self selects for having huge leveraged exposure in subpar trades, since optimal trades wouldnt be in drawdown in the first place. Placing your largest bets on your most subpar setups is a recipe for blowing up. # [2025-02-19](2025-02-19) Topstep goal Goal for topstep: prove that i can build these two habits cleanly and execute them with discipline. 20x200 days remaining before 30 day goal achieved. Great opportunity to practice following my scaling rules. # [2025-02-19](2025-02-19) Trend Continuation Long at 6138  I took a trade that deviated from the FBD plan. Price spiked on news, and held a level. It then flushed and reclaimed that level. Deviated from the plan, but was a nice trade. # [2025-02-20](2025-02-20) Idea Record a+ setup / trade and save it. Watch it to refresh your memory of what an a+ setup looks like. # [2025-02-20](2025-02-20) Failed Breakdown Long(s) at 6109   Complex, trap-filled day. Price looked like it was going to break 109 multiple times. It held and tagged 116 multiple times. Sold with discipline on my topstep, but executed less perfectly on my webull. Great trading day. Today was my first 5-figure day in my 6 month trading career and thus my first 5-figure day in my 6 month trading career and thus a record breaker, marking the biggest profit I have made in a single day. However, it's only a taste of what's to come. I aim to maintain full focus on execution only, ignoring useless noise like pnl. # [2025-02-21](2025-02-21) Massive Blowup mistake 1: not waiting for acceptance → in the worst case, repeated failed knife catches during strong downtrends + doubling down = blowup. perhaps 80% of the time you will be fine, but you will inevitably blow up when a strong downtrend occurs. mistake 2: doubling down → over-leveraging. mistake 3: didn't note the rejection of the CL → downtrend. There is a fundamental tradeoff between early entries and risk of resistance rejection. The earlier you enter, the more you expose yourself to a rejection of the intended level. For example, say the level is 6000. I see a dip down to 5990, and it goes back up to 5995. I enter long at 5995, expecting a reclaim and acceptance of 6000. This might work 9 out of 10 times, but it leaves you exposed to repeatedly losing trades on strong downtrend days. Combined with over leveraging, this is practically guaranteed to blow up accounts. There are two ways to fix this problem. First, you can be more patient with entries, but this will mean that each trade will capture fewer points due to later entry. Second, you can keep entering early, but you must be extremely aware of the worst case (rejection). What's the solution? I would recommend limiting greed and WAITING for acceptance. Reflecting upon my recent trading, many times I would enter and then need to double down on the "real" entry later at a support level below my entry. This means that on normal trading sessions (8:30-11am) you need to exercise much more patience than you currently are. The fundamental question is whether my trade win depends on a reclaim+acceptance TO COME rather than reacting to a reclaim + acceptance. If I enter longs based on reclaim + acceptance, I have a roughly 70% chance of winning the trade. Price could reject and go lower. RR is higher. If I enter longs reacting to reclaim + acceptance, I have a 90% chance of winning the trade. only in 10% of scenarios does the price reject and go lower. RR is lower. Furthermore, I did not cut the loss. You must cut at 10 maximum, regardless of whether you feel it will bounce back or not. Thus, the goal for February has been failed. I wrote the following last month: > Thus, the theme and objective of February 2024 (and beyond) will be to cultivate good habits and psychological guardrails to reduce the probability of a blowup to 0. If I can implement these changes, I have no doubt that February 2025 will be the inflection point of my trading career. I failed to achieve this goal and broke my rules, thus combined with an inevitable downtrend day, caused a massive blowup. This means that I will have to restart from scratch. If you have to take away one thing, its this: don't get too overconfident that a support will hold. # Compounding Simulation average difference between levels: 7 points stop loss: 10 points start at 666. size: 1 MES / 666. profit per trade at first level: size x avg diff x 5 1 * 5 * 7 = 35 666 / 35 = 19 trades 666 / 70 = 10 trades 666/105 = 7 trades $\Sigma_i \frac{666}{35i}=19\Sigma_{i=1}^{i=100} \frac{1}{i}=19\cdot 5.2 = 100$ This means it takes roughly 100 net positive trades to be able to trade 100 MES, which corresponds to a port value of 66000. # [2025-02-21](2025-02-21) Deriving my own CL & Zooming Out I am going to make a habit of deriving my own control line. It can be thought of as a "macro support" line that moves up when there is a bounce at a major support. By looking at the 4 hour chart, the rationale for the spots that mancini picks suddenly make much more sense. The real reason for today's failure was not really understanding where the trade plan levels come from. By zooming out and using the 4H chart, it becomes much more clear. I believe that by incorporating this, I will be able to have my own sense of where the CL is and thus eliminate the possibility of blowing up on an elevator down day. # [2025-02-21](2025-02-21) Issues: - zoomed in too far - unaware of macro structure and levels (especially CL) - entry too early. in anticipation of a reclaim, instead of in response to a reclaim - averaging down → overleveraging. works 99% of the time, until it doesn't. Psychologically: - losses and blowing up is normal in this line of business. To derive the CL - CL is essentially “macro support” - To find the CL, ZOOM OUT and look on the 4h chart for the first support down. Its likely some previous day’s low, a support shelf, or a new significant low. However it is not a science. - to always know the CL, I will test my intuition by comparing my best guess with Mancini’s newsletter. Now that i know how to derive the control line, there should be no excuse for blowing up an account on knife catch longs. There are simply too many sloppy errors that are okay “most of the time” until they arent ok. However, winning while being sloppy reinforces bad habits in such a way that they leave you exposed to the worst case. Systems that succeed 99% of the time and fail catastrophically appear successful, but are doomed to fail. This is because the 1% represents a fat tailed risk. If the system has a risk of ruin, it is doomed. See: LTCM # [2025-02-22](2025-02-22) Macro Progress Report Initially, I started off my trading career using a failed moving average crossover strategy that clearly had negative E[V]. It showed no promise, except on rare days with clean follow through and high volatility. This went on for 2-3 months. I also attempted a martingale-like strategy that resulted in a massive blowup. These were the first "intuitive" trading strategies that I tried, and were a catastrophic failure. I then discovered the Mancini methodology. This strategy is robust and brilliant, but requires high skill to execute properly. My mistake in following this strategy was combining it with martingale-like elements. The issue is that martingale serves as a crutch for poor execution of a valid strategy - the core of martingale is doubling down, which implies the inability to take a loss, and it works until it doesn't. In fact, any strategy that incorporates martingale-like characteristics (not necessarily inherent to the strategy) is destined to fail from the beginning. Martingale-like characteristics essentially involves the inability to take a loss, opting to instead double down. Habits include adding to a loser, resulting in an over leveraged position. Removing martingale characteristics is the first step to consistent profitability. I am proposing the following habit fixes: always trade with an **un-negotiable** stop loss that makes technical sense. Work on the entries rather than crutching with martingale. Divide my trades into a few categories: - A/A+/S entry. No drawdown. Quick level-to-level move and TP1. - B entry. Some drawdown, but <10 points. Level-to-level move and TP1. - C/D entry. Barely taps TP1 and rejects - F entry. Doesn't tap TP1. Rejects the entry level. Of course, these tiers are overly simplistic but represent the mental model I work with when "judging" FBD trades in hindsight. There are other factors that affect the grade of the setup, like the quality significant low that is reclaimed, the speed of reclaim (rubber band effect), how long I waited for acceptance, etc. Moving on to the point: with martingale, you typically don't double down on B+ entries. By definition, martingale is only applied to C/D/F entries. However, martingale adds leverage and exposure. See the problem? The highest leveraged trades are placed on the worst quality trades, while the lowest leveraged trades are placed on the best quality trades. The only logical conclusion is that martingale leaves you open to a fat tail risk - strong downtrend days - that wipe out weeks of progress in a single day. Martingale elements also "mask" poor entries, giving the appearance of stable success over a short period. C/D/F entries can be "saved" by a mean reverting market for an extended period of time (say 4 weeks). This gives the illusion of an extremely high win rate, but the structure has a critical vulnerability to "gray swan" events (or rare events that aren't unforeseen) The core of the psychological trap is this: despite initially not wanting to over leverage, the natural tendency to want to 'save' trades (perfectionism trait, focus on WR%) results in a martingale doubling down, which results in excessive leverage size on the poorest trades. By eliminating martingale elements, cutting C/D/F entries out entirely, I believe I can achieve consistent profitability. However, this is challenging and will require nuanced, iterative improvement and insights over the following weeks. The critical question here is whether removing martingale elements removes the short term positive E[V] and turns it into negative or neutral. This is the fundamental tradeoff in question. My lean is that it does not, but I'm willing to be proven wrong. Keywords: risk of ruin, taleb distribution, defensive trading, martingale, gray swan, black swan, expected value, antifragile --- The first time i blew up, reading others made me feel better but i didnt understand why or the logic behind risk. This time, i read it and i truly understand why they blew up. They didnt respect tail risk. # [2025-02-23](2025-02-23) Failed Breakdown at 6042  I entered long. Price gapped up to 45, put in a failed breakdown of 38-42. I was asleep for 38-42. I entered long at 47 full size, took 80% profits at 52, and took more 90% of the runner at 59. With this, the combine is essentially passed. Its important to remember that this is the EASY part, relatively. Failed breakdowns when executed correctly are high probability and no drawdown. The tricky part is maintaining a defensive mindset and be willing to take losses. Each losing trade has the capability to become the one that blows you up. So even if price stops out and then rallies, you still won because you *protected against the tail risk*. Regarding attitude towards running up accounts and then blowing up: the blowup hurts, but its inevitable. If it happens again, no matter how high it was, it just means that my tail risk was still uncontrolled. I never intended to quit the game early. Following this mindset, i will strictly follow the 1 MES rule per 666 account value rule. I will not aim to make 200 per day from the beginning. If account value drops to 1200, i will trade 2 until it comes back to 1800. This will prove my edge can survive and thrive through tail risks. # Progression  Embrace the concept of “defensive trading” that always prepares for the worst case in mind Difference and relationship between sizing and entries Both trade management and sizing can each be defensive independently. Or you can have aggressive sizing but defensive management, which is what i think I prefer. Psychologically, learned heuristics trump system 1 instincts. Heuristics are an extension of system 1 thinking through analysis of mistakes. Thus, if no heuristic has been learned, the mind defaults to system 1 thinking. For example, “protect against tail risk” is a heuristic that can chnge the game. To prevent overtrading, i used the heuristic of only making 1-2 trades per day and avoiding “coin flip” trades where no edge exists. # Mindset Shifts: --- **Before:** _“I lost money on that trade, but if I held, I would have made it back!”_ **After:** _“I lost money on that trade, but I followed my plan and protected against tail risk.”_ --- **Before:** _“I don’t want to close my position because it might still go my way.”_ **After:** _“If my trade was going to work, it would have worked already.”_ --- **Before:** _“I’ll just add to my position here, it should bounce back.”_ **After:** _“If I have to add, my entry was bad. I need to cut and wait for a clean re-entry.”_ > Every trade is made with the best information and process available at the time, so blaming individual decisions is pointless. Instead of focusing on whether a single trade was “good” or “bad” based on its outcome, the real work is refining the **process** that generates those trades. The goal isn’t to eliminate losses but to ensure they happen within a controlled, repeatable system. If a trade followed the plan but lost, it’s just variance; if not, the process needs adjustment. Success comes from optimizing **decision-making frameworks**, not obsessing over individual results. # [2025-02-24](2025-02-24) Reflection The fact that I am not traumatized by the market is promising. I have nothing left to lose, and the market cannot make me feel worse than I already generally do. I am 100% ready to jump back in and create a resilient, robust system that protects against tail risk and maintains positive expectancy. I believe this is the final hurdle to overcome before consistent profitability. # [2025-02-25](2025-02-25) Before i blew up, i became very paranoid but i wasn't sure why. My system 2 mind couldn’t identify a proper target or reason, so it ignored it. Now, after i win, i know where to focus that energy: being wary of the 1% risk. Deferring to my intern, claude sonnet 3.7: > # Key Trading Insights > > • Protecting against tail risk through rigid stop placement and position sizing is the foundation of trading survival—no edge can overcome poor risk management. > > • Success can be more dangerous than failure as it can breed overconfidence and deviation from protective rules. > > • The discomfort of hitting stops is what triggers harmful doubling down behavior—learn to tolerate this discomfort rather than avoid it. > > • Trading success requires flipping natural instincts: defense before offense, embracing uncertainty, and respecting randomness. > > • Emotional trauma from blowups fades faster than expected—convert these temporary lessons into permanent structural safeguards. > > • Your brain generates many signals that must be filtered—develop systems to distinguish between noise and valuable risk warnings. > > • A positive expectancy system with appropriate risk controls allows consistent compounding over time, but requires patience. > > • Implement the "666 Rule" (1 MES per $666) to ensure position sizing remains appropriate as your account grows or shrinks. > > • Focus on process-oriented metrics rather than outcome-focused results—judge trades by execution quality, not profitability. > > • Trading isn't about eliminating discomfort but developing the ability to act correctly despite it.​​​​​​​​​​​​​​​​ > Trading is essentially a rogue lite where a player can expect to restart many times before beating the game. Failed runs are expected, not unusual. # [2025-02-25](2025-02-25) Analysis and Trade Log  Price is now at 5959. We sold and broke down at 5982, sold all the way to 5934, where we relief bounced to 5958 or so. I was originally looking for a flush and recovery below 5934 to go long. However, it didnt play out that way as price bounced directly off the level. Now I'm wondering if we see chop. IF we build out structure sideways, theres a chance I could get the FBD at 5934 (enter above). If we pop to 5982, we could squeeze above there. So longs would work at either spot. Price seems to have rejected off the 61 and is now at 5945. No reclaim and acceptance there (at 61) so far. Seems likely to have chop in this 61-34 range. 34 would be a "knife catch fbd long" while 82 would be a reclaim of the CL. aside: every single day needs a clear-headed thought process like this to protect against unexpected moves. Failure to think clearly results in sloppy execution, which exposes the trader to tail risks. # [2025-02-25](2025-02-25) Failed Breakdown Long at 5935  Perfect, A+ setup. Enough said. # [2025-02-26](2025-02-26) Failed Breakdown Long at 5990  I entered a size of 4 MES at 5994 for the failed breakdown of the overnight shelf. Due to momentum, I took profits at the next MAJOR rather than the next level.  I took a FBD of 58-62, securing profits at 70. I lost control here and averaged down instead of closing the losing trade. It worked this time, but it's like going all in in front of a steam roller. I took a retest of the 55 area, but this doesn't fall under any trade category or setup. Risk-off at 65 or so. Even tho today was a winning day, i am highly concerned with my poor risk management skills today that also cut my profits somewhat short. I bought a level before i confirmed it was safe to buy. New Algorithm to prevent buying unsafe levels: Map out 3 major supports for the day. Note the CL **First support down is risky.** Gauge the reaction at a level before entering. Lean risk averse Risk of ruin is not baked into the strategy, but rather my execution. # [2025-02-27](2025-02-27) Blowup Became tilted after I realized copy-trading caused all of my follower accounts to become ineligible while my main account stayed alive. TopStepX is too unreliable to copy-trade and I will avoid it for now. I have found that TopStep teaches poor habits. I will create a $1000 WeBull account and be disciplined. Compounding Plan: 1MES / 666. Current goal: $1332 without falling under 666 on any single day. If I never fall under the previous threshold in any given day, it's impossible to blow up. Trading 1 MES will net roughly 40 dollars per trade. To get to 1332, it will take around 8 trades. Starting small and slowly increasing, while sticking to my scaling plan, will rebuild confidence without any prop firm bullshit. # [2025-02-28](2025-02-28) Plan From now on, I will be writing a plan daily. If I don't have a plan, I will spend 1 hour creating a plan. I want to execute the next 10 trades with perfect discipline. Daily Template: - Control Line: 5849 - 1st support down: 5875-5880 → flush and recover - 2nd support down: 5850 - 3rd support down: 5794-98 - 1st resistance up: 5938-42 reclaim → squeeze - Long Setups: - Short Setups: - Do nothing: Observations. Adam’s levels work well in bull markets because support levels tend to hold. But if the market is in free-fall and supports keep breaking, relying on them can be disastrous. So, how can you determine whether a support level will actually hold? I’m genuinely at a loss. Mancini’s levels rely heavily on how price “reacts” to them, and he emphasizes “no predictions.” But in reality, you’re still making a statistical inference about price direction based on that reaction—which, at its core, is basically a prediction. Lately, I feel like failed breakdowns (FBDs) have a higher chance of failing because the broader market is trending down. When that happens, I need to be extra cautious to protect my accounts from blowing up by sizing down overall. I made the mistake of having too much confidence in FBDs, assuming they wouldn’t fail just because I had a near 100% win rate for five weeks. Because of this, I started over-leveraging. FBD's work better in bullish contexts. It’s also possible that the reaction at support levels was weak, and I just didn’t stick to the plan of reacting to price hitting the supports. Instead of blaming myself, I need to ask some tough questions about the strategy itself. It’s not really my “fault”—I’m just doing my best and putting in the effort. I’m trying my hardest, and if something isn’t working, I need to figure out why rather than just taking the blame. I’ll use the **Supertrend indicator** as a filter—when it turns **down**, I’ll be more selective with FBDs, only taking high-quality setups with strong reactions to avoid catching knives in bearish conditions. The **Supertrend indicator** doesn’t predict future price movement, but it effectively describes the **current market trend**. Its value lies in helping me interpret whether we are in an **uptrend, downtrend, or consolidation**, which allows me to make **probability-based inferences** about the success rate of **failed breakdowns (FBDs)** and the likelihood of **support levels holding**. In a **strong downtrend**, supports are more likely to break, making FBDs higher risk. In a **neutral or uptrend**, FBDs have a greater chance of success. By using Supertrend as a **context filter**, I can avoid lower-probability setups and focus on trades that align with the broader market direction. # Supertrend Indicator - Using the supertrend indicator on the 4h chart shows the 4 hour macro trend and can inform bull or bear bias. Execution: - always enter 1 MES. If the trade starts going your way with momentum, add max size. - If it dips and recovers, and starts going ur way, add max size. - If the support is lost, close the trade with minimal loss. Losses will come from price faking an upward move and rejecting. If this happens, close the trade. This is in stark contrast with my current execution, where losers get added to and winners are normal size. This makes a dynamic where a single bad day can wipe me out. Also, so far ive been keeping runners regardless of trend. I think its best to do full profit takes in downtrends and only runners when supertrend is bullish. At first, i had the problem of overtrading chop. I solved this through changing the process of pretty much only going long on failed breakdowns. This eliminated flipping from long to short repeatedly. I also incorporated ATR to see if there is any vol. This generally works, but it becomes very difficult to flip to bear bias which results in repeatedly knife catching. I believe that supertrend + ADX may solve the “knife catch” problem. Why ADX? Because supertrend always gives a signal, but a smooth adx confirms that its not just noisy chop. # [2025-02-28](2025-02-28) identifying the problem Execution: - adding to losers and not adding to winners - Not cutting losers and doubling down - Buying supports that fail repeatedly. - Not adapting to market context-we are in the middle of the largest and strongest downtrend in recent memory, yet i am still bullish biased. Risk management - Breaking rules repeatedly Solutions: - always keep track of the current trend (or lack thereof), its strength, and direction. Don’t trade against it, it will kill you. - add to winners, cut losers entirely. - If i buy a support that fails, i would cut it as soon as a new low is made. What should i be looking for in a chart? - trend direction and strength, Chop level - Supertrend, adx, atr - Vwap reactions, Level reactions - Note any wicks. - if bears control: level reclaim to squeeze or supports to buy - If bulls control: supports to buy, tested/weak supports # [2025-02-28](2025-02-28) Failed Breakdown Long at 5860  I took a long at 5860. Price had failed to break below the 5865, 5875-5880 level. When market opened, price wicked below the overnight low before reversing dramatically. Price rallied from 60 to 5910, 50 points. The overall context is bearish with a possible relief bounce, based on the 4 hour chart. there is a 2x failed breakdown after a large downtrend that lasted 3 days. However, bears still remain in control. Despite this, bulls can attempt a short squeeze here, which would mean recovering the 5938-5942 level. I will be holding a runner, aiming for the 5938 level as a price target. Supertrend: still in downtrend mode. possible sell the bounce coming. RVOL: elevated Support was 5875-5880. We FBD'd here, and now we are sticking to the 5902 level. Later on, I entered short 1 MES ready to close if the breakdown failed. I added and scalped around 2 points, closing the remaining when FBD was confirmed. I then entered long at 63 and took profits at 69 and 75. FBD's work best at the beginning of the bullish supertrend. However, some FBD's occur at the end of a bearish supertrend, when the trend hasn't officially turned bullish yet. However, this can cause "bottom picking" in a downtrend. Supports have to be carefully picked in a downtrend. In an uptrend, dips can get bought repeatedly. The trickiest part is recognizing when a bullish trend has turned bearish - when a major support fails. This also explains why in uptrends or sideways consolidations, you can typically blindly buy the first support down and make money. However, doing this is disastrous in downtrends, because supports and get knifed through like theyre butter. Supports failing typically takes much longer (and more bounces) than a downtrend turning bullish (short squeeze). For all trading days: identify 3 supports and 1 resistance. Support for dips in uptrend, resistance for reclaims in downtrend Identify the current macro trend direction, strength, and choppiness. Trading against the trend will kill you. Bears in control = downtrend. Bulls in control = uptrend Identify vol - need vol to trade + follow through on moves identify reactions to vwap and supports/resistances