For those of you not familiar with my general style of trading. Please read my other post where I introduced myself and my methods to the FIO community. I will try to keep this journal as brief as possible, while still giving my rationale behind each trade.
This past Friday, my standard "2 week trade" resolved (reference my post in general hideout >> es emini to understand the general logic of my 2 week "bread and butter" trade. It turns out that price closed the 2 week period roughly 70 ES points below my entry point of the trade 2 weeks ago. I was able to reduce my cost basis by 100%, and even make a small profit for the 2 week period (4%+) using shorts on correlated futures (NQ, YM) and SPX long put verticals.
While price was pulled back over the past few weeks, I entered a long /YM trade (several contracts of the "back month" expiring in 118 days, hedging this trade with long dated long DIA put options and some long /ES put options around the 3850 level. This trade has moved around 200 points in my favor so far, and I will put on (on Monday) a small sized SPX option long vertical put spread near to ATM expiring this coming Wednesday.
If price breaks beneath the 4050 level in /ES, i will be shorting /ES contracts in the front month, to hedge against decrements in price of my /YM position. That trade will be closed for a profit every 100 points, and half the profit will be used for 30% prob of profit OTM long put verticals in SPX. The rationale behind this trade is for every one correlated /ES contract I am short, if the market continues to move agianst my long YM trade, I will make 2500$ per /ES per 100 points, with the other 2500 $ put towards a long vertical put spread that pays out roughly 4:1 (10,500 ish $ for the 2500 at risk). Therefore, if price moves against my YM's and continues to fall more PAST that first 100 points in the next 2 weeks, in any significant way, I will net a minimum of 13,000 dollars per original short /ES.
That is my plan for this upcoming week. Remember to always find a way to make money when price moves against you. If you can hold "back month" futures contracts open, and wait out/profit while price heads down, then you can be tremendously successful as a trader.