Friday - Fool Me Once ...

3:55am Thought I'd post this early chart combination of the DAX market which reflects one of my favorite entries that stopped.

The trade is an early-day pullback entry in the direction of the prior day's closing trend support or most recent signifcant range break, and I've seen this pay nicely more times than not over the years. In this case, I shorted around the 6570 level with decent size, albeit I was still somewhat cautious since the 1 min 3 Line Break trend on the left never turned down. At my end, I do fade the market without confirmation on the lesser timeframe at times, especially on the 15 min charts. Yet the smaller timeframe still provides a caution light.

Anyway, the trade sequence of course didn't work out this time ... I stopped the probing short sequences at 6577 at 3:34am and have been doing some light scalping since to adjust to try to adjust to the subsequent action. Recovered about 1/2 the stop cost thus far, but not yet in my best rhythm this early in the day.

A good reminder that we can try to skew probability in our favor, yet that's all it is -- probability -- and as Grace will tell you, nicks and dings are going to happen when taking the car out of the garage.

Depending on how the U.S. opens, I may try a similar sequence there on the approach toward 1275, but will be ultra cautious as Europe may provide a clue.

4:35am Nap time.

6:23am Pretty sloppy Globex session. ES traded to 1274, but no clean shot. I suspect there may be only one shot post-open on the first sharp move either way.

10:22am Yup ... monkey see, monkey do. Complete carbon copy. Altered strategy again on the fly, this time thanks to a dress rehearsal. Want the first hard pullback long. 1277 area would be a gift ... doubt we'll get it. One this is clear ... there are a ton of stuck shorts that will have to cover on the first move down.

11:13am Not bad. Did pretty well adjusting and going with the flow. Pullbacks up here have been shallow, so been nibbling only. Funny, looking back at my 6:23am comment ... talk about another stampede 5 mins after open. Very little reaction time. Yea, it would have been nice to load the boat and ride the moonshot all the way ... then again, I'd like to win a bracelet at the World Series of Poker. Just trying to grind away like Michael Mizrachi.

11:22am Back in the midday summer nothing doin' mode.

12:07pm One interesting observation is that both of the planned DAX and ES pullback shorts would have worked for decent gains, but in their respective pre-market sessions (2am-3am ET for the DAX). The normal session simply didn't pay.

1:53pm Finally felt like shorting on that last spike on strong 1 min TICK vs. price divergence at 1:42pm. Had been sitting on the sidelines. Averaged into short to 9475 and covered into the TICK drop to zero.

Got a decent bite on that one.

2:03pm OK; major day and week income preservation mode now. Considering the cost of early short probing and stops, I'm OK with today's performance +$7K. A bit more scrambling over the last two days than I'd like, and I'll need to take a look at that. Keeping sizes relatively small in these whipsaws has kept me out of major trouble even when wrong ... and I've been wrong a lot this week.

I'll share some more thoughts on that last point over the weekend in terms of dealing with being far less than perfect and often downright wrong during parts of every day. Duh, today was a good example.

Lots of work left and miles to go before we sleep. Target remains 12/31/08.