created: 2024-12-31T16:55:39-05:00 --- # Summary This trading month was a huge step in the right direction and a significant improvement over December 2024. After 3 months of following the Mancini methodology, I am finally becoming moderately adept at identifying and managing failed breakdown trades level to level, and learning the many nuances of this setup. Furthermore, I am quite impressed of the effectiveness of the strategy as I had previously been somewhat skeptical. Market conditions this month were ripe for trading. On Dec 18, 2020, we saw the biggest single red day in SPX/ES of 2024. What follows massive breakdowns like these are typically profit taking, short squeezes, increased VIX and high vol/ATR, which led to a gold mine of intraday opportunities and entries. Failed breakdowns typically had great reversal momentum and strong follow through. Off the top of my head, I can remember multiple 20-50 point swings and reversals which led to hugely profitable days. I am exploring the concepts of risk management, prop firm account scaling and management, long term profit goals, realistic expectations, compounding, and learning to holding runners. These need to be explored more in depth and mathematically verified. I am also acutely (and painfully) aware of the conditions for the “worst case,” aka the only condition that can blow up my account: not being able to recognize support failing during unusually bearish conditions. I am also slow to recognize when bears have gained control which is when I should switch gears to a short bias. This lack of skill cost me my hard earned XFA account. I wrote on January 1st: > **Success for this month** would look like this: I pass the 50k combine through "small" consistent wins. If i assume 2 trades per week with 70% win rate, this would take 4 weeks exactly. Did i achieve this goal? Not exactly. I currently have 3 XFA accounts, two of which are being copy traded, one of which is left on hold. These were not won through small consistent wins, but all of the trades taken were valid, high conviction setups and the trades taken on the funded account afterwards were reasonably sized. It would do me well to stick to my sizing rules religiously, with the goal of $200 per day initially. I would have liked to claim that I am now a reformed disciplined trader, but the facts show that I fall a bit short. Although it is debatable whether the conditions under which i blew my first XFA account were due to discipline or skill, the only thing I can say is that the the trader I’d like to be would NOT have blown up the account on that day (1/26). I am committed to this ideal of a trader, and swear that I will do everything in my power to foresee & prevent blow ups from fading strong trends. In terms of PnL: I was not inclined to talk about PnL, as I want to be a process oriented trader who does not fixate on profits. However, PnL is an objective measure of success, so I will documented it here. Personal account: this month, I set aside $2,000 for my personal account, committing to making small trades. As I grew more and more confident in the failed breakdown trade, I began to take high conviction trades with extremely high win rate. My account is now worth $5900, which is almost a 200% increase from the initial starting size. However, it is unsustainable growth as small accounts are less psychologically taxing to trade than large accounts if over-leveraged. I have concluded mathematically that the ideal sizing for mes/es would be anywhere between 1 microlot per $1000 to 1 microlot per $2500, which risks between 2-5% per trade with a 10 point stop loss. For funded accounts: I was able to obtain an XFA account, which I grew from a balance if $0 to a balance of $1300. However, I made grave mistakes on the huge unexpected downtrend on 1/26 which cost me the account, as it hit the MLL of -600. I now have two new XFA accounts, each currently with a balance of $1000. These are copytraded. Though I have not taken a payout yet, I expect to do so very soon and have made far greater progress on my XFA than ever before. This month I also experienced, with this strategy, a flow state in which greed and fear were perfectly balanced. Greed can be defined as some reckless combination of overleveraging and overtrading, while fear can be seen as paralysis at the thought of losing money, leading to a failure to take planned trades. I have experienced a perfectly balanced mental state in which i was not reckless, but also did took trades fearlessly. Overall, this month saw significant progress and many insights and lessons learned. I feel much more confident in my ability to stay sidelined when no setups are present, and to take trades fearlessly when the time comes. I have also inadvertently overcome the first sin of trading: overtrading low vol chop by sticking to the pre-planned trades, which was a huge problem for me when I first began trading. After seeing the strategy in action during ideal market conditions, I am actually quite confident that the strategy is robust enough to adapt to all market conditions, besides for perhaps a handful of extremely challenging and unique conditions with violent whippy price action. I expect there to be a slight learning curve if market conditions become unusually bearish. Finally, I’ve realized that the next major hurdle will be preventing the “worst case scenario” and blow ups. Account blow ups should not happen, period, and no disciplined, professional trader would ever blow up any account, whether it’s a personal or a funded sim. It is simply unacceptable. Most people can make good trades, but only a very small percentage are able to avoid blowups entirely to keep their profits. In fact, survivability and guarding against catastrophic losses is what separates mediocrity from greatness. 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. --- %% # [2025-01-01](2025-01-01) Plan and Notes longs: - 5917 failed breakdown - 5951 reclaim short: - 5923 breakdown knife catches: - 5870-75 - 5838, recover 5846 %% # [2025-01-01](2025-01-01) Success Criteria and Risk Management What does success in trading look like for me this month? what does it look like this week? today? this hour? this minute? Lets dive deeper Immediate steps: - transfer all money out of personal account - a personal account must be earned. - configure risk settings on combine. - in a 150k combine, I need to make 9000 dollars, with a 4500 drawdown within 30 days. - i will not risk more than 10% per trade. this is 450 dollars. - Based on this, I can trade 9 MES with a 10 point stop. This is 9 x 5 x 10 = 450. This should be a hard stop - no moving it around. - If i trade what I want to trade - 4 ES, with a 10 point stop, this would be 4 x 50 x 10 = 2000 dollars. Can you really take this magnitude of loss? the answer is a resounding no. - size must be earned. - If I trade 9 MES, then I would have to take 10 losses in a row before blowing up the account. This is highly unlikely, given that I follow the plan. However, it is possible if I repeatedly attempt knife catches thinking they are fbds, when theyre not. - if i trade a normal 50k combine, what would be the position size? if i go with 10% again, 10% of 2000 is 200 dollars. trading 4 MES with a stop loss of 10 points is 4x5x10 = 200. - Honestly, 50k combines are much better than 150k. they have a better dd:target ratio. - 150k needs 9000 dollars with 4500dd. 50k needs 3000 with 2000dd. so youre allowed to lose an extra 500 on the 50k. - like i said before once, I need to prove myself on the prop firm. The prop firm teaches me to trade systematically. it seems that there needs to be new rules written for risk management: an algorithm to follow without question and second-guessing. The strategy says: I take 2 trades in a day max, The less the better. Trading should be a boring job. One in the morning, between 830 -11, one in the afternoon between 2-4. Sometimes in the evenings. What will I do if i Lose that trade? Well, the strategy says that I will stop trading. In practice, this is harder to do due to emotions and revenge trading. What will I do if I win that trade? Heres what I will do: document each trade extensively. Every trade, either a win or a loss, should be screenshotted and pasted into this log. **Daily success** looks like making 2 trades maximum, with proper profit taking and stop loss along with precise pre-planned entries. Trades are documented extensively in this log. **Weekly success** looks like following the daily plan consistently. Win rate over a week should be around 80-90%. Profit and loss should look something like this If i win 70% of trades, and i take 2 trade per day, that would be 10 trades total in a week with 7 wins and 3 losses. 7 wins x 200 per win = 1400. 3 losses x 200 per loss = 600. Total pnl = 1400-600 = 800. so if a 100% win rate for 10 trades leads to 2000 dollars profit and 0 losses, 50% win rate leads to 1000 profit and 1000 losses which is 0 net profit. This means that success isn't easy. It's a constant battle of edges and losses will be regular. This also means that if you break your rules, the cycle of revenge trading pretty much dictates that you will dilute your good trades with poor 50/50 trades. This means that your edge will be completely eroded. No wonder why its so hard to make money when you break your rules. **Success for this month** would look like this: I pass the 50k combine through "small" consistent wins. If i assume 2 trades per week with 70% win rate, this would take 4 weeks exactly. Of course, If i manage to do better than expected with a winrate of 80 or even 90%, this would mean that I make 1200 or even 1600, which would mean the combine would be passed in 2-3 weeks. So it all depends. Now that we know what success looks like, we have something to compare our performance to. What should be done about "runner methodology"? A few observations: sometimes the tp1 is really close, sometimes its very far away. It's probably best to take off the entire position at TP1, but this would mean struggling with FOMO when price inevitably rallies after I sell. Another way to do it would be to increase size to 5 mes, and leave 1 runner. but this would mean that my risk per trade is too great, at 12.5% per trade. I will stick to 4 MES and take off full profits at TP1, aiming to make small consistent wins that compound over time as per the methodology. # [2025-01-01](2025-01-01) Failed Breakdown Long at 5917 I took a trade in the evening at 7:25 PM. Initially, I thought we would be looking at a breakdown short. Price was flushing rapidly below both the 5917-5923 low from Tues. But price tagged 5912 and reclaimed 5917. I went short at 5917 but price was flushing so rapidly that i actually entered -4 MES short at 5915. I reversed my position at 5917 and exited at 5927 on my little account. In my big account, I entered 2 ES 5918.75 and exited at 5925. On my personal account, I entered 1 MES 5918.5 and exited 5927.   As you can see, most of the move was "missed." After I exited all positions at around 5925-5927, I did not hold any runners. This was a conscious decision to not hold any runners. As stated in the methodology, and as stated by Mancini himself, a consistent couple point gain over time compounded leads to staggering gains. Even though price went to 5953 after I sold, this kind of move is not common and most moves are only a couple levels. However, I need to document this and see if there is a pattern of multi-level moves that can be exploited repeatedly. Even if there are, sticking to a 10 point gain would probably be wise to be consistent. I thought there was a breakdown short, but I forgot that breakdown shorts require a final bounce. Price was "flushing too quickly" for it to not be a trap, because shorts require a bounce. Price is now above 5951. I am fairly sure that I wouldn't add on strength after a failed breakdown of the 5917 low. I think the reclaim of 5951 would only work if price went to 5951 without a failed breakdown, since we would just hold a runner if it hits 5951 in this scenario (after a fbd). > Every trader has those moments where System 1 takes the wheel and decides to go on a joy ride with the account balance. -Claude It's important to prime myself for the next trade. I must make the trade with the knowledge that it could be a losing trade. This means that I would give back my current profits. However, this is not outside my expectations - each individual trade doesn't matter. My only purpose in life is to execute. Key insight: TRYING TO CATCH BIGGER MOVES IS WHAT BLOWS ACCOUNTS. System 1 is the main driver of these emotional thoughts to seeing price move much higher than my sell. But think about it: I would much rather catch <10 points consistently with a normal, risk-managed position size than try to catch 30 points on an overleveraged position and end up blowing up the account. Just think about the alternative any time S1 starts getting greedy. In terms of larger market structure, we seem to be building structure between 5923 and 5987. This could be a “coiling” range which inevitably ends in a breakout - either up or down. 5923 is probably the magnet? # [2025-01-02](2025-01-02) Bad Trade(s) Taken at 5886 Price fell rapidly towards 5923-5917 and broke down below the support. I did not catch this short. One issue is that I have too many accounts. Either copy trade same accounts, or only trade one account. I recommend only one account for now to stay focused. The individual trades taken during this time period are not that important, but I lost control due to missing the breakdown short and feeling FOMO. After feeling FOMO, I went long at a level that was not pre-planned. In fact, I did feel that something was off when I took this trade - it felt like a coin flip. This is definitely a sign of improvement, but I did not exercise the restraint necessary to stay out of the bad trades. Because of this, I hit my daily loss limit of -400 on my 50k and ended up +1.8k on my 150k. This is essentially letting my account be controlled by a random number generator, and I don't recommend it in the future. Thus, even though my account balance is up on my 150k, this is due to random luck. See the 50k drawdown for proof of this. Next up, I will take a long if we reclaim 5917-5923 for a short squeeze. # [2025-01-02](2025-01-02) Reclaim Long at 5917 I went long as planned at the 5917 reclaim on my personal account with 1MES. Actual entry price is 5915. Will be holding this through the evening and night, most likely. Sell at next shelf. Volatility is high, so set a 20 point stop loss. Sell at 40 points no matter what. ATR = 17.68. Update: price tried to climb past 5917 and tagged 5923, but rejected and is now at 5908. I sold my position at 5921.25 for a 6.25 point gain. This is solid. However, I didn't wait long enough for acceptance # [2025-01-02](2025-01-02) Reflection I made several errors today and only got lucky. In the first trade, I chased short instead of watching for a bounce. However, I was quick to realize this. In the second trade, I entered without waiting for a setup. This is an extremely bad habit, akin to flipping a coin on my account balance. Either focus more for the breakdown short next time, or don't make a trade. In the third trade, I didn't wait long enough for acceptance. This was also partially lucky. For tomorrow, don't overtrade. Price has the potential now to squeeze now that we've reclaimed 5917-5923. Patiently wait for acceptance to enter long, and take profits at around 7-10 points. # [2025-01-02](2025-01-02) Reclaim Long at 5823 Entered long 1 MES personal and 4 MES 50k. Entries were a little above, at 5925.75 and 5924.25. ATR is at 10.29. Exited on personal personal account. Still holding on little, and looking for a fbd entry long on big. looking for a fbd entry long on big. # [2025-01-03](2025-01-03) Plan and Notes For tomorrow, I had been biased towards longs as we had reclaimed the critical 5923 level. However, it's possible that we flush again before we squeeze for a rally. Long: 5901 or 5901:5907, 5870:5875, 5844, 5828-5831. Short: 6004, 6049, 5973 (risky), Breakdown short: 5901 # [2025-01-03](2025-01-03) Reclaim Long at 5921 After flagging all night above 5923, we squeezed and tagged 5964 before falling back down to 5939 and "reclaiming" 5951. However, in hindsight this was just chop. I entered at around 48 and exited at 55 and 59 for a nice profit. Before we tagged 5951 initially, I entered long on my 50k as well and made a good trade. Thus, I am finished for the day.   In hindsight, this is chasing behavior. The proper play would be to position before the move, but I was worried about another flush before we squeezed. If i had woken up earlier, I would have positioned long before the move upwards. I think that professionals have the mindset where they recognize that they "may" make money if they chase, but they don't end up making the trade because they understand the statistical law of large numbers. This brings my little account to 50,497 and my big account to 153,453. # [2025-01-03](2025-01-03) Reflection Though it is 3PM, I am done for the day. Today I did well in following the daily success criteria. To reiterate: >**Daily success** looks like making 2 trades maximum, with proper profit taking and stop loss along with precise pre-planned entries. Trades are documented extensively in this log. Today I took 1 trade with proper profit taking and stop loss. I did not get greedy and took profits. I caught only a couple of points out of a 70 point rally, but I am very happy. Greed and FOMO did not conquer me today. Trades were documented well. Although the setup wasn't A+, it worked out well given the context. Trading requires contextual nuance, and I leveraged my experience watching charts to profit nicely and consistently. I also followed a strict, non-greedy exit strategy which prevented my account from being chopped by violent whipsaws. Position sizing needs work, however. I must remind myself of the proper sizing: 4 MES for small account, 1 ES for big account. I sized up yet again which led to large gains, but this is extremely risky. For Monday, please refer to the proper size. > [!warning] > ## 🚨 CRITICAL MONDAY RULE: NO EXCEPTIONS ON SIZE 🚨 > > **4 MES MAX** on 50K account > **1 ES MAX** on 150K account > > **STOP. READ THIS BEFORE YOUR FIRST TRADE.** > > Remember December 13th: *"Huge blow up today."* > Remember December 31st: *"The biggest account blowups are from overleveraging."* > > Do not let today's profits trick you into gambling tomorrow. Your edge comes from your system, not your size. > > **Size = Survival > Survival = Success** > > This is not a suggestion. This is your lifeline. # [2025-01-05](2025-01-05) Bad Trade Taken - Exited Rapidly Entered Long impulsively. Realized this was a bad trade and exited at breakeven. Good use of metacognition - S1 entered, S2 realized this was an error and that there was no setup, and reversed the trade with discipline. I saw price tag 5982 and reclaim 5986. This is not an A+ setup, however. # [2025-01-06](2025-01-06) Bad Trade Taken - Shorting Strength I tried to short a rally to time the top. I was about 10 points too early. Luckily, I did not blow the 150k though I hit my 400 DLL on my 50k. I walked away with relatively minimal losses on my accounts. These were impulse trades taken shortly after waking up. The correct actions today were to stay out of the market. Yesterday there may have been a good long trade at the 5982-5986 bull flag. This implies that bull flagging during a rally during a bullish context (like the current short squeeze) is actionable. For the rest of the day, I will not take any more trades. This is a horrible time to enter a position and although price is moving sometimes, volatility is extremely low (ATR=7.68) and there are no A+ setups here. We should wait to build out more structure before making the next move. I also ended up ignoring the warning above and sized up. This is highly concerning and needs an urgent fix. There's a fallacy that I have that always costs me a lot of money. I keep thinking price "cannot" go further because it "already" went x. This is an example of where S1 intuition is gravely wrong - it is trained on choppy price action and does not generalize to trend legs. This means that 90% trend legs will likely be missed when making random impulsive trades, because I think "it cant go much further." It is wholly a fallacy and also represents the wrong type of thinking - this kind of opinion only comes from attempting to predict price. Instead, ask the question: where do I want to buy and sell? And then ride the runners on the trend legs without thinking at all. > The "it can't go further" fallacy is exactly the kind of thinking that makes traders become liquidity for larger players during trends. People who think they are smart and try to time the top are, in fact, the main source of "fuel" for a trend, since someone needs to take the losing side. Don't predict - react and plan. # [2025-01-06](2025-01-06) Long Reclaim 6016 Quick 1 ES long on the tagging of 6009 and 6016. Entered at 6017.25, sold at 6021, before price collapsed again. Breakeven for the day (-$1.5). # [2025-01-06](2025-01-06) Long FBD/bounce 6006 Quick 4 MES Long on the bounce of 6006. Entered at 6011.25, exited at 6015. # [2025-01-06](2025-01-06) Reflection Here's what I should have done today. This morning I woke up at 9 and saw that price had slowly grinded higher with zero volatility. Upon seeing a flush down to 6016 and recovery to around 6024, I should have considered entering long as there is clear demand there. I should have took left runners at around 50-60. Anything would have worked. This runner would have gotten stopped out later in the day. At the close, I should have entered long on the bounce and took off profits at a level up and left a runner. At the start of each trading session, orient yourself to the CL. **Longs only above the line.** %% # [2025-01-07](2025-01-07) Plan long: 5997:6004, 5965 or 5965:5973, 5941 short: 6066, 6087 (A+) technical no mans land, as we just had fbd + ss. possible long add at 6027-33 base watch 5997 carefully. if flag, add 25%. bds bounce 5997. %% # [2025-01-06](2025-01-06) Observations extremely low volatility: 3.80. Price mostly flat, slightly sloping down (-4.25 pts). I will wait for price to flush the nearest supports and watch for potential entries for level moves. It's also possible that we lose the nearest supports for a BDS. We're in an active fbd still, so price can rally. However, px seems to show that its unlikely. # [2025-01-07](2025-01-07) Resistance Short at 6043 I went short on my 50k and brought it back to 50.5k at the 6043 resistance. This aligns with my intuition that overnight moves *tend* to get faded at open. Not an A+ setup. Account is now up 500. Now, i will wait for an A+ setup. # [2025-01-07](2025-01-07) Bad Knife-catch Trades Taken - 6004 Thought there was an FBD at the 6004 level. Repeatedly knife-caught, which blew up both my 50k and 150k. I caught the 5969:5973 bounce on my personal account with size 8MES, which now has one runner remaining. The runner was stopped out at 5980 for a total gain of 450. Giving back profits on a runner is perfectly ok. I am still massively green for the day (+446). If I locked in gains at the next level up from where I bought, I'd be up on my sims. I am too fearful on the good setups and too reckless on the bad setups. Sometimes, I notice that it appears to be an FBD at a major level. If you take this FBD, you MUST exit at the next level above because it can very likely reject and head lower. This is the mistake that cost my be combine today. But it's not a big deal overall. Starting a new 50k combine - make sure to trade this properly. Don't be greedy or biased. # [2025-01-07](2025-01-07) Long Bounce at 5965:5973  There is another kind of bias that does not involve price prediction: it involves the bias that price 'WILL DO SOMETHING' at a particular level, or that a certain level will hold. Actually, on second thought this is also a price prediction. Runner got stopped out. This is NORMAL. Don't complain about not catching bigger moves if you aren't willing to get stopped out on runners most of the time. # [2025-01-07](2025-01-07) Failed Breakdown Long at 5938 I went long with 8 MES after price tagged 5935 and recovered 5939.5 rapidly. Exited all positions methodologically (6, 1, 1) due to account rules of no positions past 4:15pm. Good trade  # [2025-01-07](2025-01-07) Reflection Today I went short initially for a winning trade. Afterwards, I made a serious error in not waiting long enough for FBD/reclaim of 6004, which caused the trade to repeatedly fail. Here, i should have went short instead, or sat it out. This led to my sims being blown. I took a long at the planned area 5965:5973 on a personal account, which was a huge success - runner got stopped out. I went long again at 5939.5, which was also a huge success. I exited the runner soon after due to account rules and the imminent closing time. Overall, I am getting better at recognizing good entries. Today was a gold mine of good setups. However, I made one mistake which resulted in blown sims. This is okay however, as sims are basically training wheel accounts for a developing trader. Next time, I will wait longer for acceptance at a level. I believe that near or above the CL requires more patience as opposed to "knife catches" for bounces below the CL. The reason why the bad trade resulted in a blown account was because of over-leveraging. If I had not over-leveraged, I would still have the account. Thus, going forward I will only have one 50k combine at a time, with 8 MES size positions. %% Plan Long: 5928:5935, x:5918, 5875-5880, 5866:5875, Short: <5935:5927, <5875 %% # [2025-01-08](2025-01-08) Bad Trades Taken - Chop I blew sims overtrading chop at the 5935 level. # [2025-01-08](2025-01-08) Short Trade at 5935 Unaware that the CL had moved down to 5928 instead of 5935, I made a very quick short but had to get out immediately on my personal account. It wasn't the correct trade as I wasn't aware that the CL had moved. In the future, i can infer that the CL has moved by looking at a recent low that is made below the CL that led to a reversal above the original CL. This can move the CL to a lower point. # [2025-01-08](2025-01-08) Long 5935 Long 2 ES at 5938.5. Sold 1 at 5944.5, in 1 ES runner. Unsure how this will work with a 50% runner, but will try it. # [2025-01-08](2025-01-08) Bad Trade Taken - Follow Through Long I took a long expecting the failed breakdown to follow through. I entered 2 ES at 5946.75 and exited around 57-60. This worked out. I expected the price to follow through because I "felt" the character of price action shift to slow accumulation mode. Not sure if this is an edge. # [2025-01-08](2025-01-08) Failed Breakdown Long at 5928 Entered 4 MES on my personal account at the tag of 5917 and reclaim of 5928. Exited 75% at 5934. Exited 25 at 5945. A+ trade overall. Note: where the price ended up afterwards isn't relevant. # [2025-01-09](2025-01-09) Failed breakdown Long at 5928 4 MES on 50k, entered at 5929 and exited 75% at 5936. In a runner now.  This is now the fourth FDB at the 5928 level. Tomorrow, be careful as NFP can throw a wrench in things. There could be extremely trappy whipsaws that can blow an account! # [2025-01-11](2025-01-11) Flow as a function of Position Size Is it possible that position size can be a determinant of flow? Furthermore, position size should be a function of account size. # [2025-01-13](2025-01-13) Bad Trades Taken I took poor trades - a long at the 42 level, a poor knife catch, and then a long that worked out later on. PnL is flat. However, these entries were highly advanced and pretty difficult. Price action is unusual and price is down -0.5% in the evening, which I did not expect. The reason for the strong selling pressure is unclear. Next time, to catch this move, make sure you plan which levels you would direct buy. I would say a good tule of thumb is the major level below the major level that you wouldnt direct buy, but would buy if there was an FBD. there was an FBD. # [2025-01-13](2025-01-13) FBD/Reclaim of 5828-5830 I took a reclaim ahead of ppi release. I am bullish biased, but Im wondering if this fails when data is released. Extremely muted reaction upon data release. back up to 28.5 after a dip to 25.5. likely acceptance. The Theorem: More often than not, a level reclaim or failed breakdown of a major level results in a level to level move. Note: i realized a day later that i PPI had in fact not released today. Check the calendar more carefully next time. # [2025-01-13](2025-01-13) Long at 5822 I took a long at 5822 that worked out well. I was in drawdown down to 5815, but held until i could sell at 5830 and 5836. Held runners, but they got stopped out before price squeezed from 20 to 50. No FOMO, just wait for the next fat pitch setup.  However, i had some poor entries before the actual winning entry on my prop account. what happened? I thought price accepted at 32, but price ended up flushing again after PPI was released. This might be a common thing - price flushing after PPI, despite being bullish. This was also in pre-market, so things might be different there. If this hadn't occurred, I wouldn't have been in drawdown and would have made pure profits. I think for the future, pre-market + data release can expect another flush, especially if combined with long upside rejection wicks at a key level. # [2025-01-13](2025-01-13) Failed Breakdown at 5830 I took a 4 MES long upon the flush and recovery at 5830. Acceptance looked like this: price flushed below the level, recovered to the level, dipped again by 5 points and recovered. ATR at 12-14, high volatility. Shouldn't have closed the runner out, as we ran another 15 points after that. This would have been 75 dollars on 1 MES. This adds up and justifies the loss of 90% of runners, so either keep the runner or don't, don't flip flop on this. # [2025-01-14](2025-01-14) Bad Trade Taken at 5858 I took a long at 5858 expecting price to recover above the major level of 60. This was premature, and I should have waited for the reclaim and acceptance. I took a loss on my 50k of about 200, and admittedly sized up using 1 ES contract. I ended up making a huge profit and had confidence that the level near my entry would hold. This worked out today, but ONLY works when timed well and if there is high confidence in later entry. However, it is very risky in the case that the less likely outcome occurs, i.e. reject and head lower.  # [2025-01-14](2025-01-14) Failed Breakdown Long at 5850 I held my previous small position and added long at 5850. This worked out really well, and price squeezed all the way up to 5900. I didn't hold a runner, but its fine. # [2025-01-14](2025-01-14) Reflection Today I passed my 50k combine with a 71% win rate and high profit factor.  This is the result of conquering FOMO, waiting for price to come to me, and planning my trades beforehand. I also brought a $2000 account to $3770 for an 88% increase. Level to Level trading, when done correctly and with risk managed, results in a very high win rate with very little drawdown. Now that I have an XFA, it's important to basically treat it like a 2000 dollar account. It is not 50k, advertised, but essentially gives you 50,000 of futures margin while only having 2000 dollars of cash, which is a recipe for over-leveraging. Accounts can be blown in minutes or seconds. # [2025-01-15](2025-01-15) Plan CPI - Dangerous. Size down. Accounts are blown. In fact, it might not even be worth it to trade CPI day. Ideally, i will not trade at all before 9:30. From my experience, I expect a violent move when the data is dropped, possibly in both directions but also possibly unidirectional. At 9:30 we will likely see another violent move, slightly less so than the first. I will attempt longs tomorrow if we flush and recover levels. Max size: 2 MES. Aside: something that really caught my attention was the fact that after browsing r/futurestrading, many were complaining of es markets being too choppy and volatile. We can likely assume that most lost money on es recently. In contrast, i have had the best week or two of my entire career. I am likely on the side that is profiting off these trapped and chopped up traders now, rather than previously being in their position and donating my life savings to hedge funds. Psychological observations: mind is messier and more impulsive. Metacognition slightly dampened. Feeling confident in my trading, perhaps overconfident. Biased towards long tomorrow. But anything can happen. New found risk aversion near major data releases, after careful analysis. Focus on setups, plan out trades, wait for setup, avoid CPI, Dont chase or fomo tomorrow even if price goes up by 100 points. No setup, no trade. alot. # [2025-01-15](2025-01-15) No Trades Taken Price popped instantaneously from from 5900 to 5960 or so. Missed the trade, no FOMO. No trades taken today, and likely will not take any trades until price fades/flushes. I thought about going short before the CPI was released. But this would have been catastrophic, and just goes to show how much of a coin flip CPI can be. Furthermore, even if I was correct, price could have trapped and taken me out before rebounding upwards. Reflection on monthly progress: I was able to pass the 50k with consistently winning trades. I now have an XFA. I chose to not gamble on CPI today, as I didn't hold a runner. I will trade my XFA with the same rigor and caution as I traded my combine, with rigor defined as adherence to the strategy. Success for this month was defined as follows: > **Success for this month** would look like this: I pass the 50k combine through "small" consistent wins. If i assume 2 trades per week with 70% win rate, this would take 4 weeks exactly. I have now passed a 50k combine, but not exactly in the way I defined the success criteria. However, it is not far from it. I did make small consistent wins, but a large chunk of the profits came from calculated risks taken by sizing up. In addition, the first 1500 was made through a high risk play. Due to these factors, I have obtained an XFA by [2025-01-15](2025-01-15). I blew up combines in the process and those mistakes were caused by poor adherence to the setup entries and over-leveraging. **Success criteria for the XFA**: 1. Obtain 5 winning days with $200 profit/day. 2. Make $2000 profit without hitting -$2000 MLL 3. Take out initial investment payout of $200 I'm not perfect yet, and no one is, but I can feel a strong and newfound reluctance to enter a position that isn't my setup, because i know from experience that they are coin flips. I'm simply not willing to make that gamble. What are some psychological obstacles that I can foresee? A few big ones: - Taking an inch, then a mile. Bending the rules slightly, then blowing a hole in the account. - Extreme boredom. - Overconfidence, which leads to recklessness and divergence from the rules/setup. - Fear of losing money. I can feel a strong psychological wall that tells me that I will never be profitable. This actually is a self-fulfilling prophecy because it leads to biased/cloudy thinking and potentially poor entries. Another reason as to why I am nervous about the XFA is because I know how easily 50k accounts can be blown from experience. It's time to set some hard rules that will prevent the loss of the account. I realized something: just as its important to correct biases that cause you to enter positions without a setup, its almost as important to correct biases that prevented you from entering a good setup. A fee examples: not entering the final fbd on Tuesday because i wanted to be green for the day. This caused my to miss out on the cpi runner. Not entering on the flag due to a fear of another flush or stop grab. This cost me a lot of profits that could have been made with CPI release. The first sin is greed, the second sin is fear. Greed destroys accounts, fear reduces profits. # [2025-01-16](2025-01-16) Failed Breakdown Long at 5984 Made a very strong and disciplined trade at the 5984 failed breakdown. One shot, one kill. Entered at 83, took first profits at 92. Likely done for the day, but watch for the last 30 minutes for a late-day add.  What's particularly noteworthy is that initially, there was a bug with TopStepX where it loaded in my blown account and allowed me to trade. I thought this was on my XFA, but it wasn't. I was disappointed but kept my cool, waiting for another entry. I took this entry confidently and without hesitation, and most importantly without overtrading the choppy range. Here, I have to make a decision based on the presented scenario: Suppose the trade makes roughly 200 in profit in an XFA. One of the criteria for receiving a payout is > 1. Obtain 5 winning days with $200 profit/day. However, there is a setup later in the day. Should the trade take the setup? There are two approaches to this problem. The first would be to ignore the criteria and trade as you normally do, without fear of losing profits. This means that the setup would be taken as they present themselves, with P&L as an after thought. The second would be to prioritize the 5 days of $200 profit first, then trade normally after that. Deferring to Claude: > My Analysis: Given this specific situation, Approach 2 makes more sense. Here's why: > > 1. The qualification requirement is a finite, achievable goal > 2. Once achieved, you can return to normal trading without constraint > 3. The opportunity cost of missed trades during this period is worth the certainty of qualification > 4. It's a temporary adjustment to achieve a specific goal, not a permanent change to trading strategy This analysis makes sense, because after achieving the goal you can simply go back to trading normally. Furthermore, its worth it to qualify for the 5 days, take out the initial investment, and then go back to normal trading. This is basically equivalent of taking profits, and moving the stop up. We can call this "account management skills" as opposed to "trade management skills." If i can take out 400 dollars, then i've doubled my initial investment of 200 for the prop accounts. The flip side is choosing when to take the payout, as taking out 400 dollars without a 400 dollar buffer (i.e. BAL = 2400, MLL = 0) makes trading on the account more difficult. Once again, there are two ways to handle this. You can forget about the initial investment, and just trade as you normally do without handicapping yourself for the sake of protecting capital. Or, you can protect capital and make it slightly harder to trade, which makes sense if you have faith in the system. Furthermore, remember the secondary target for the XFA account: > **You can access 100% of your profits after accumulating 30 winning trading days**. Traders can request a payout of up to $5,000 or 50% of their account balance after accumulating five winning trading days per payout request. A winning trading day is counted when a day's Net PNL is $200 or more. A disciplined trader should be able to achieve those winning days without blowing up by following strong processes > A blow-up suggests fundamental issues with trading approach that need to be addressed - whether psychological, strategic, or risk management related. The targets themselves aren't the problem - they're quite reasonable for a disciplined trader. Avoid summit fever: > Summit fever is the dangerous tendency to abandon good judgment and take increased risks when a goal seems close at hand. Risk management reminder: to trade 4ES, you need 100k to follow the 2% rule. Ideally, 200k. With 2000 dollars, the size is actually 1 micro. but this is of course, too slow for most, so they size up. At smaller account sizes, one typically risks 10% of the account per trade. # [2025-01-16](2025-01-16) Failed Breakdown Long at 5973 I entered a 25% size position at 5973. This worked out extremely well and I will likely just treat this as a runner, given that price could squeeze up to 6200+ in the coming days.  One issue I'm having is that every time I try holding a runner, it's a horrible experience. Something unexpected happened with this trade. Since I treated it as a runner, I didn't sell when it was up 10 points or so. Price rapidly flushed down to 5965 and is now sitting at 5967 or so. I added another MES at 5966, and my position is now 2 MES. This might not have been smart, since price can theoretically and very possibly flush lower. I'm not certain what to do with this trade. I decided to close the trade. Theres no use gambling here when i could just wait for a better setup during peak hours. There ended up being a valid failed breakdown at the 73 low, but i missed it because i was closing a poor trade and it didnt occur to me to re enter on the failed breakdown. I should have closed the “runner” at break even and looked for the next opportunity, which presented soon after. This was after market reopened at 6pm. The flush at close admittedly caught me off guard, thus I highly uncertain of what to do in this situation. What caught me even more off guard was the squeeze that followed, all the way up to 5988. Upon the reclaim of 73-74 or so. What i did wrong: i should have entered full size, taken profits at the next level, then moved my stop loss below BE. I deviated from this plan, and suffered for it. This would have allowed me to lock in roughly $100 of profit and kept my mind clear for the next trade at 6-7pm. Thus, the deviation from the plan is what caused confusion in the first place. However, the reason why i only did 25% was because i was already green for the day. I would argue that there is no reason to size down if all the criteria are met, and being green for the day should have no bearing on taking a setup. I feel that entries should be taken as they present themselves. However, its possible that one might become reckless after already having a green trade, but this is up to me to have the metacognition necessary to identify recklessness in the first place. # [2025-01-17](2025-01-17) Missed Trade I missed the failed breakdown yesterday at around 6-7 pm, and did not make any trades today. # [2025-01-18](2025-01-18) (MEME) $TRUMP on SOL Took a strange trade after hours on a friday. Noticed trump tweeted about a memecoin. Position: 25 coins @ $3.50 - Sold 12.5 @ $8 - Sold 6.25 @ $15 - Holding 6.25, current price $13.60 Total realized: $193.75 Current unrealized: $85 A proposed disciplined system for memes: strong catalyst, like trump account tweet. Take out initial (50%) at 100% profit (2X). Take out 25% at TP2. Let 25% ride. Biggest challenge is actually avoiding scams - it's was very possible that Trump's account was compromised. However, his truth social account had the same tweet, so i thought it was unlikely. Key factor in a meme entry: no bad actors involved (excluding "legit" bad actors) I also noted that most of the traders in the "top traders" tab were people who had an explicit entry and exit, which decreases the risk of a scam. The bubblemap was suspicious at first, but this aligned with the "vesting" token schedule listed by trumps website. update: price now at 30. still holding 6.25 coins at 3.5 cost basis. it might be better to use time-based stops in strong momentum memes. There's two thought processes here: holding a "legitimate" crypto is vastly different than holding a scam token. A legit memecoin like $TRUMP lasts much longer than a scam token by nature, so exiting quickly might not be enough reward for the risk taken. Another key lesson here was to not let bias prevent a good trade. Though I view trump unfavorably, I did not hesitate to trade his new token. Political views don't matter in the market - only supply and demand. Another key theory: an asset devoid of intrinsic value can still generate massive returns. # [2025-01-18](2025-01-18) Thoughts on Compounding I grew a $2000 to $3900. Is this sustainable? My trade sizes varied between two options: 4MES and 8MES. 4MES with 10pt SL risks 200 per trade. 8MES with 10pt SL risks 400 per trade. Thus, initially with $2000, I was risking 20% of the account with 8MES and 10% of the account with 4MES. Is this sustainable? Traditional risk management advice would say that this is way too large. With a $4000 account and 4 MES size, I would be risking 5% of the account. This is manageable, and risk is much more tolerable (20 losses in a row to blow up, 10 to do serious damage). But growth is much slower. However, the aim right now should be to execute the system with discipline, rather than focusing on PnL which is an extension of account growth. However, the question of position sizing and when to increase size is still important. We can refer to this as a "scaling plan." > - Maintain 4 MES size with the $4000 account > - Focus entirely on perfect execution for at least 3-6 months Increase or decrease MES accordingly to keep risk per trade between 2.5% - 5%. Currently, this is 2MES - 4MES. The other thing to consider is that trades like these typically don't hit the full 10 point stop loss. My entries rely heavily on patience and timing of failure tests. Sometimes, price will test a level, fail to break it, then test it again more deeply. In fact, this can even happen 3x. Ideally, I would have entered after the final test, which requires screen time. I have noticed that most of my winning trades have extremely little drawdown as price rapidly squeezes / bounces upwards. A perfectly timed trade should have nearly no drawdown and hit TP1 quickly. # [2025-01-19](2025-01-19) Update on Memecoins Update on meme coins: sold 3.125 trump at 69. Holding 3.125 as a runner past the top, until it trails out. Good work managing this trade with discipline, but next time consider a time based stop for once in a life time events. Entered 5000 @ 1.5c $BARRON, exited [email protected]. A few observations about memes: with slippage settings it can be difficult to sell requiring multiple tried which may explain why price tends to crash all at oncd Furthermore, ing multiple tried which may explain why price tends to crash all at oncd 11:25 Barron - 41.87k holders USA - 69.83k holders $1 - 68.3k holders Profits: 75 into barron. sold half at 225. 112.5 realized. 41 left. 75 → 150. elon at 3.5. took out 30, left the rest to run. took out another 20, now at 16. in total, 35 profits. 40 into usa coin. now at 115. 90 profits. 90 + 150 + 35 = 225 roughly. i would hold these positions, they are risk free. american coin has 10x potential. barron and elon might have another pop left. hold for a few days and monitor. # [2025-01-19](2025-01-19) Tracking Melania Coin Holders | date & time | holders | Net buy 24h | t100 avg cost | t100 avg sold | | ------------------------------ | ------- | ----------- | ------------- | ------------- | | [2025-01-19](2025-01-19) 20:13 | 281.8k | +317M | 4.53055 | 8.21886 | | 20:42 | 298k | | | | | 20:49 | 301k | | | | | 20:51 | 304k | | | | | [2025-01-20](2025-01-20) 07:54 | 445k | | | | | [2025-01-20](2025-01-20) 12:24 | 443k | +173M | 5.7 | 9.12 | | 12:38 | | +160M | | | | 12:42 | | +144M | | | | 12:53 | | +153M | | | | 13:11 | 423k | | | | Plan: Time based stop. Hold for one day, then sell 50%. Hold for another 4 hours. sell 25%. This was an opportunity created for free. If the coin goes to zero, i will still be happy. If it skyrockets, i will also be happy. # [2025-01-20](2025-01-20) Failed Breakdown Long at 6006 Price flushed rapidly from a Trump tape bomb. Tape bomb: enact 25% tariffs on each of mexico and canada. price flushed rapidly from 6060 all the way down to 5994, recovered to 6006. I entered initially wrongly at 5929, expecting a recovery to 5932. Price kept dumping and I was down 600. At 6006, I entered an additional 1ES long and sold it at 6016. Total profit: 600 realized, 100 unrealized. In a runner now, 1MES. Textbook tapebomb failed breakdown, good trade overall. Sized up strategically, which is risky but effective here.    # [2025-01-21](2025-01-21) Scaling Plan Assume 10points per winner, no runners. 2% risk would mean increasing 1 micro lot for every 2500 balance Each win is about 50 dollars It would take 2500/50=50 trades to advance to the next stage From 5000-7500, youd need 2500/100 trades to advance to the next stage. The formula for the num trades per threshold seems to be: $2500/(50*n)$ Or 50/n trades to get to the next stage, where n is the number of lots traded. > To go from $10,000 to $100,000: It takes 122 winning trades. > To go from $100,000 to $1,000,000: It takes 117 winning trades. If we trade 4 lots at any size under 10k, each 2500 would take 12.5 trades, which means roughly 40 trades from 2500 to 10000. For the prop firm, i would just continue trading 4 MES until 10k balance. Then scale up every 2500. The prop firm balance will then be withdrawn to a personal account, which will be scaled up accordingly. There was a mistake in the formula. To advance to any next stage, make 2500: 2500/n/5/x=500/nx, where n is lots and x is net points per trade Aim to make 100,000 (after tax) from topstep funded account. This can be done with copytrading multiple accounts Todo: find some way to tick off winning trades from a list or whiteboard, so that you dont get impatient > [!Goal] Milestone 1: 1k → 10k > Position size: 4 MES. > # [2025-01-21](2025-01-21) Runner Update Price is now at 6082. Still holding my runner from the 6016 failed breakdown.  this is now the longest runner I have ever held. However, i'm not sure where to place the stop loss. I have moved my stop to 6040, as there is an obvious V shaped low there.  Since topstep doesn't allow holding past 4:15, i have transferred my 1 MES runner to my persona webull account. The main risk factor for this action would be that if I blow up the xfa, then I have lost real money without gaining anything. Im not sure about this, but I want to adhere to the strategy as best as possible. I've decided to close all runners and not feel FOMO if price pops to all time highs. There will likely be setups tomorrow to take. I will not feel FOMO when price moves, I've already caught 900 dollars. Be happy. %% Next, I am hoping for another flush. The key level to watch here would be 6043. A flush and recovery of 6043 WILL be actionable. %% # [2025-01-22](2025-01-22) The Worst Case The highest risk of a blow up occurs in the following scenario. Imagine this: price flushes down to a key level you are watching. You enter impatiently, before acceptance is confirmed. Price continues to flush until the next major level. You think “this is it!”, and enter double size as per martingale. Price continues to flush, hard. Though unlikely, this scenario will certainly occur. Why do most people end up sizing up on the second level? Its due to recency bias and priors conditioning, as well as the unwillingness to be wrong. To reduce the risk, wait longer for acceptance can help. However, sometimes a reversal can fake you out. Price looks like its bouncing off the failure test level, then it reverses again and flushes even harder. Indeed this is a nightmare, 1/50 scenario. Luckily, a few rules can essentially eliminate the possibility of blowing an account in this scenario. First, realize when you have been double trapped by the double reversal price action. A successful fbd/bounce will squeeze violently and quickly, and we can label anything else as subpar. This means that you should exit the trade quickly. This would likely be a loss of around 60-200 dollars, depending on vol. however just because it double reverses doesnt mean it will flush again, as it could just be a double failure test. If it is, we can re-enter upon confirming acceptance on the second time. If we flush again to the next level down, it will be violent and extreme, but could be delayed. The important thing is to CUT LOSERS IF THE SETUP IS SUBPAR. this is key to preventing account blow ups, and not cutting losers can lead to the worse case scenario. Even if the probability of that is 1%, it will occur eventually, which means the account will be blown eventually. That would be entirely unacceptable. As a disciplined trader, measures must be taken to reduce the probability of a blowup to 0%. Furthermore, if you think about the action of sizing up while in drawdown: youre essentially betting that the trade that went sough is going to be a double failure test rather than another flush. THIS IS A 50/50 COINFLIP. The three outcomes are: acceptance + violent squeeze, double/triple failure test then squeeze, or continue flushing. Thus, its never a good idea to add size while in drawdown, firstly because you can always re-enter if price accepts, and secondly because you literally have no idea if the support will hold or not, contrary to shat your system 1 might convince you of otherwise. This, to tackle this: cut the long in all subpar cases with no exceptions. Inly when youve confirmed the acceptance and squeeze can you re-enter long. You can even re-enter it with size if you wish, since there is a tipping point where risk is essentially gone and the squeeze is inevitable. You cannot re-enter in any other condition, and doing so is gambling and will blow the account. To put it another way, in all successful failed breakdowns there is a tipping point of 1-2 minutes where the squeeze is inevitable and imminent. That is where the first entry should be. # [2025-01-22](2025-01-22) Bad Trades Taken - Short at 6115, 6118 I took small sized shorts at 6115 and 6118. First one was planned, second one was trapped (likely from some data release). In total, I'm not down too much, but I will wait for a vol spike before entering again, rather than losing everything on a bad short. Price action is awful, zero volatility. Lowest it's been in a while. ATR = 4.6. An observation about the "tilt" which is shows the following:  This number isn't really meaningful, because Topstep traders have no edge. When price goes up, they go long. When price goes down, they go short. I've watched this happen many times already, and it just shows that most traders on this platform flip every 5 seconds. Although I entered 3 poor shorts today, I kept the losses to a minimum by using a small position size on the low probability short plays and not increasing size, which is definitely a silver lining. Two possibilities from here: either we stay on low vol the entire day and grind up slowly, which means there will be zero opportunities to enter if not in a runner already, or just watch for volatility to spike so that setups show themselves. Even if price flushes now, and I'm not in the short, that is perfectly fine because the trade was shoddy to begin with. If I had kept the position, I would be down another 100 right now. It was good to cut the loss. As mancini notes contratrends are provided in the NL, but they probably shouldn't be taken.  However, it's not a good idea to enter long either, as the flush can happen any time with around a 20% probability. The best move is truly to stay out until vol spikes. Few possibilities: - price builds out sideways structure - price flushes down to 87 and recovers - price grinds higher A good rule here would be: NEVER SHORT STRENGTH. In fact, shorting is extremely dangerous and it might be good to get rid of it altogether. # [2025-01-23](2025-01-23) Reclaim Long at 6115 I took a long when price reclaimed 6115 after hitting a low of 6101.5.  I took a position size of 5 MES and left a small runner of 1 MES. I sold the runner when my realized profits exceeded 200 dollars, locking in a profitable day out of 5 for the first payout. Overall, another great "1 shot 1 kill" trade, and I will be shutting it down for the day. Throughout the trade, I was also watching a livestream where someone lost 1500 on 6ES contracts, it helped me understand microstructure better and put a face to the competition. Market price isn't just a price, its the cumulative sum of market participants. # [2025-01-24](2025-01-24) Under-level FBD entry at 6128.5  I took a long at the 6128 level, expecting price to squeeze to 6135 and then hit the real entry tp1 of 6143. This was once again to be proven risky. I was 1 tick away from being stopped out and was saved by a bullish MOC. This means that this was a lucky win. Next time, stick to the plan as you could have made a losing trade here as there is no clear edge. If price reclaims 6135 an add wouldve made sense. But price is hovering just below at 6132. The real entry here would have been the failed breakdown of 6135, and then take profit at 6143. This never played out, so I should have never entered this trade. # [2025-01-26](2025-01-26) Bad Trades Taken at 6104 The worst case scenario played out and I blew my XFA repeatedly entering a "failed breakdown" prematurely. I attempted the failed breakdown of 6101.5, which failed. After this, I should have watched for a flush down to 6070, to which we got there. Instead, I sized up and entered again right after. Note that this is a low probability "hail mary" trade. It's extremely important to cut the loss as soon as the bounce fails and even possibly flip short, since we are in bear territory. The mentality of "catching the bottom" can result in failed breakdowns. Instead, I need to define and plan potential trades, and then determine when they become invalidated. For today, when the bounce reached underneath the low made at 6099, The trade should have been cut and losses minimized. Then I should have stayed out until 6070, where a bounce occurred. The reason I was unwilling to cut the trade was due to a combination of stubbornness and hope. However, in all fairness, today's result occurred also due to a lack of experience dealing with strong downtrends. The most important change I can make to my trading is to always acknowledge where the CL is, and get out of "dip buying" mode as soon as the CL is lost. Prior to making my trades today, I was fuzzy on where the CL is and over-fixated on the reclaim of 6134, which disoriented me after we gapped down 30 points to around 6105. In fact, I'm still currently unsure of where the CL is. After checking, the CL was at 6135, and another one at 6115. If I had followed this rule today, I would not have been in "dip buying" mode at all and would have looked for a failed bounce to go short. Also, next time a gap down should immediately trigger alarm bells in your head. Gap downs and strong downtrends are really the only thing that can blow my accounts. I had a bad feeling before entering the first trade. Why? because squeezes typically occur quickly. If the price rejects the level and heads lower, your trade is likely screwed. One thing to realize about shorts: when the CL fails, you don't have to enter right when it fails. You can actually still enter if there's a bounce that takes place entirely the CL, and then the low of that bounce breaks down. This was the entry that Mancini took on 12/18 FOMC breakdown, and a similar entry presented itself today at 6098 today. Since the CL Failed, shorts would have worked perfectly even though we were roughly 17 points below the CL. It's not "too late" because you have the bounce, then that bounce's failure that offers a high probability setup. "distance from CL" is not a reliable metric in any way. Being far below the CL doesn't mean price will reverse soon, either. Its a fatal cognitive bias. 1. I was thrown off entirely by the price gapping down below the CL, and have never experienced this before. 2. The gap down caused a lapse in judgement, and it hadn't registered that the CL was lost. 3. I took an entry attempting the failed breakdown of the 6101.5 low, which failed. 4. This led to revenge trading, which were reinforced by bad risky habits that "worked before." 5. The most dangerous kind of day for a FBD trader is strong mode 1 downtrend combined with not being aware of the control line. 6. I was also thrown off by the strength of the selloff on a Sunday evening. 7. To prevent this from happening again: always be aware of the bear/bull control line. ALWAYS. 8. A gap down represents a loss of the CL, which should turn off the failed breakdown mode and cause you to turn short and take profits level to level downward. 9. If one can avoid overtrading chop through planning trades and avoiding noise, the one remaining "worst case scenario" is a strong downtrend day. It just so happened that the gap down threw me off totally, and led to a spiral of knife catches. Though it is somewhat unlucky, I will take full responsibility for not being aware of the CL. Psychological trap: - stuck in dip buying mode and unaware of control shift to bears - Once control shifts to bears, switch gears to "short failed bounce under lows" mode. Late entries are ok, as elevator downs are typically extreme. - If unaware of control shift, when it happens I will always make the wrong decision and blow up eventually. - today's blow up could've been replaced with a single high-conviction short at 6098, rather than repeatedly knife catching longs. - It also could've been avoided if I didn't martingale. - in other words: today's failure was partially due to faulty systems, and partially due to poor habits of overleveraging. However, overleveraging only leads to blown accounts if mistakes are made - in other words, overleveraging with the correct decision (long shott) wouldn't blow the account. - Priority: fix the system. My system is how I choose to execute the given methodology. I need to be more clear that I am not trading "bounces," I am trading failed breakdowns of a level. The level must reclaim and accept for an entry to occur. I developed a poor habit of entering prematurely, which works 90% of the time. However, it counts as predicting and not reacting, and in strong downtrends will result in a blown account as you expect price to "bounce" repeatedly. It's the mirror version of trying to catch the top. Now do you understand why it's so bad to "predict" a squeeze? - once you lose the cl: create an ultimatum. Bulls MUST push quickly and accept to level x for a squeeze / failed breakdown to occur. Otherwise, I will go short below y. The alternative of always expecting a squeeze is the very definition of a gamble. The final piece is the gap fill: after a gap down, expecting the gap to fill shouldn't take priority over the actual price action. Today, I went long expecting gap to fill. I'm not sure why I was so convinced that the gap would fill. I think it's best to forget "gap fills" entirely. If price is below the CL, go long or short depending on price action. In a breakdown short, price will reject the level and we will lose the low. In a failed breakdown, we will accept the level. Do not claim acceptance too early. Seeing how I blew up on 12/18 and 1/27, both of which were breakdown downtrend days, a natural goal for the next month (February 2025) is to successfully trade the mode 2 ranges using failed breakdowns and runners and focus on creating a robust system to prevent blowing up when the mode 1 day comes. You have two options: don't trade if lose the CL, or go short. If we break above, either hold runners or go long. With this framework, going short should be runner size only. Do not go long below the cl. At the very least, following these rules should prevent a blow up next time there's a trend. Go to sleep and think on it Next up; from what I know, es always has a violent short squeeze after elevator down days. I expect us to squeeze, then backtest short either 6115 or 6135. Which is where we broke down from # [2025-01-27](2025-01-27) Reclaim Long at 6000 I took an over-leveraged long on my personal account before market open at 6002, based on the 5997 setup. I entered 2ES and 6 MES. I took 1ES off at 6018, another 1ES off at 6025, and another 3MES off at 6044. Price is now 6026, and my stop loss for my 10% runner is at 5998. I am looking for a gap fill and back test to the upside. Open P&L is $317, with $2400 locked in. My intuition tells me to hold the runner.  I also made the same trade on my 2 50k combines, which are now at 1500. I will now take it slow for the next few trades on these 2 accounts and hit the 3000 target in a consistent manner. # [2025-01-27](2025-01-27) Runner Update Exited the runner after a tariff tape bomb seemingly looked to flush the price. However, the price didn't materialize, and price is already recovering. However, I will not re-enter the trade. Next, I will look for a flush and recovery of the 6016-6020 level. However, I'm expecting a squeeze to fill the gap before FOMC to the upside. # [2025-01-28](2025-01-28) Failed Breakdown at 6042 I took a long at the failed breakdown / reversal of the 6031 shelf low. I used a size of 8MES on my personal account at 6030, took off 6 MES at 6040 for a nice 10 point gain, and another 1MES at 6050 for a 20 point gain. I held a runner to 6075 and intend to hold this runner into FOMC.  # [2025-01-28](2025-01-28) Test Trade: Trend Pullback Entry at 6065  Started a new test combine to test a trend continuation trade at VWAP. VWAP was at 6060. I noticed that vwap was holding support, and decided to long a little above for a trend continuation play. This actually played out quite nicely. However, the setup is quite niche and likely doesn't present itself more than 2 times per week. I will keep track of these setups for the future. Measured move objective aims for a gap fill to the upside before FOMC at around 6115 # [2025-01-29](2025-01-29) Overtraded Chop around 6087-6073 I thought there was a failed breakdown of 6087. I overtraded the chop near this levelists here is “predicting p # [2025-01-29](2025-01-29) Holding a runner into FOMC 3 MES on the 6066 FBD. Took off 5/8 already at 6073. 6066 level holding for now. FOMC in 2 minutes. Risking about 30 points. 30 points on 3 mes is 3 x 5 x 30 = 450. Mental stop at around 6030. Stop out at 6030 no matter what. Screen recorded session.  Update: Since vol was so low and price wasn't going down further, I DCA'd 4 extra MES contracts on the way down. 56, 49. I have 3 contracts left at an average of 49.5. # [2025-01-29](2025-01-29) Failed Breakdown at 6049 I had an average of 7 contracts at 6057.25 average. I took off 4 at 6069.5, 2 at 6085.5, and kept a single runner as a lotto for all time high. The close here looks good, we had a failed breakdown of the 6066 level. I would think an add back to 25% wouldve been a good idea. However, I'm not going to take it. Total profit for the day: 350 realized, 100 running.  I was right about 66 being a good buy. Price rallied to 74, which would have been a good place to take profit. Next goal: 16k Size: # [2025-01-30](2025-01-30) Runner Update Still holding my 1 MES runner on my personal account from 6049. No change until we lose a major support in the coming days. 15:28 This runner is incredible and it's my longest runner ever. I am now 64.5 points up from my 6050 entry, at 6115. I believe the stop loss should be trailed soon. # [2025-01-30](2025-01-30) Failed Breakdown at 6080 (XFA) I entered 4 MES on the failed breakdown of 8080, and exited fully at 6086. No runners # [2025-01-30](2025-01-30) Failed Breakdown at 6066 (XFA) I entered initially 4 MES at 6066 FBD. Price flushed down to 5056.75, and I added another 4 MES at 6060. I added another 4 MES at the reclaim of 6066. No runners  I am most likely done for the day. I am now up 750 on both copytraded xfas. I have an extra xfa now ready to go as well. Long term game plan: - focus on the 2x XFA first, stop trading the personal account. - goal 1: take a 2000 dollar payout to bring my personal account to 10k - goal 2: take a 15k payout to bring account to 25k - goal 3: get moved to a live funded account Ideas: - time the # minutes it takes from price hitting level to price squeezing from the level. - exercise a fourth option, in addition to "buy, do nothing, sell": STOP TRADING. like do nothing, but stronger. # [2025-01-30](2025-01-30) Failed Breakdown Long at 6080 After trump stated on live tv that he will tariff Mexico and Canada 25% each, price flushed from 6116 to 6068 before reclaiming 6080. I entered on the reclaim with 9 MES. This was a profitable trade that I didn’t expect to occur, as it was caused by an unexpected tape bomb. # [2025-01-31](2025-01-31) Bad Knife catch at 6115, 6075 Once again, I entered prematurely and sized up prematurely as well. Took a loss on my personal account and XFAs. How can I prevent this situation from occurring? A few thoughts: - CL line was at 6056. Bears had not yet gained control, despite melting down fast - However, it felt as if bears had gained control. Every single bounce was sold, despite being above the CL. - End of day selloff was unexpected. It was a really inconvenient time to initiate a selloff, just as sunday evening was. Examine the prior belief that most moves - To counter this, we can mark both the CL, previous day's low, and current day's low. If we lose the current day's low very quickly, it might be a sign that bears have gained control if we are melting down hard, and we have a bounce below the day's low that gets sold again. - For example, in the following chart:  - We sold directly to 6099, had a failed breakdown, bounced, and then sold the bounce. - Here the problem actually is twofold: after rallying a significant amount in 2 days, its best to be highly wary of failed breakdowns as they are less likely to work. I had made a decision to not trade today, but when price flushed, I entered a failed breakdown trade prematurely. To prevent this: - On days where I'm not trading, I should still have a plan in the low probability case that we flush hard and hit a level that I would trade at. This would prevent impulsive, premature FBDs. - Gauge the volatility of the meltdown and take note of two key levels: today's low, and yesterday's low. You can get short above the CL, or far below the CL (20-30 points). - I believe that the CL has proven itself to be quite unreliable. There have been great breakdown shorts above the CL as well as far below the CL. - I am having serious second thoughts about the CL. I used to think that longs above the CL = safe, but it's not that simple. We could be melting down extremely hard, and bears could have gained control before we lost the CL. Basically, the CL isn't a hard science and I had a false confidence going long above and short below. - Not all longs above CL are safe. - I will try to begin trading on the 30min / 1 day chart. I believe that entering prematurely could be because I am using the 15 minute chart, which is too zoomed in. Using the 30 minute chart should remove noise and help prevent premature entries. - When in drawdown, I think it's best to just take profits at break even instead of hoping to turn a profit. The likelihood of turning a profit after being in 10pts of drawdown is extremely slim. - Currently, I am simply entering mindlessly every flush and reclaim of a major level, no matter where it is. This means that I will catch all the good trades, and I will also catch all the bad trades - Going forward, I will limit my entires to FBD of yesterday's low or overnight lows, and a handful of spots below. - Possible entries: - Failed breakdown of yesterday's low or overnight low - idea: - set an alert for the overnight low, as it might be actionable. If i entered on the failed breakdown of the overnight low, I would have been able to take it level to level before it broke down. # [2025-01-31](2025-01-31) Cutting the Loss I need to be strict about cutting the loss. What does this mean? Suppose 6000 is my level. Price flushes to 5995 and reclaims 6000. Typically, I would enter a size of 4MES straight away, without thinking. Most of the time, we get a level to level move. However, there is a "failed fbd" type of situation. Whether or not a failed breakdown works or not is typically a binary outcome - either it squeezes to the next level or it doesn't. If price attempts to squeeze and gets sold # [2025-01-31](2025-01-31) The Plan **Found the culprit:** the CL actually CHANGED from the time Mancini sent out the NL vs when the tape bomb hit. It moved up from 6056 to 6115. This would explain why I felt that bears gained control above the CL. The CL changed dynamically based on the intraday bounces and structure.  During the day, we saw the nearest support move up from 6156, to 6100, to 6115, to 6127. I'm honestly very not sure what I could've done here. A few things: - recognize when the CL has changed from the NL - wasn't aware that this could happen. - pay attention to the following levels: V shaped lows, overnight shelves, overnight low, yesterday's high, yesterday's low. - waiting (?) longer to enter a failed breakdown - pre-planning failed breakdown entries with more nuance. Recognize where in the "rhythm cycle" ES is and recognize which days are A+ setups, and which days are not. Today wasn't, as we had already rallied - Key question here is how to distinguish between failed breakdowns and downtrends. I would watch the reaction at each support and log it. The key focus of Feb 2025 will be to distinguish between winning FBD entries, and failed FBD entries, with a secondary focus on cutting losses. Cutting losses will keep my account alive as I learn to distinguish the nuances of the setup.