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@mastercraft29 my only hesitation with going with fxcm is that I will have to pay for NinjaTrader, unless you have experience with the free version. The commissions at TD are ridiculous but I picked them because I could paper trade on their free platform which also functions pretty well. If the free version of NT is good enought then I will look into switching over.
For the scalping stuff, I agree with you that that strategy is pretty risky and wouldn't work. The only reason I brought it up is because I noticed that with my strategy and the charts I use, when I get a signal to enter the market it seems that every time price will go in my direction at least 2 full ticks up to the bid within a short period of time. I wont do this in the sim for at least a month while I track the movement in my sheet, but the idea would be to take a quick 2-3 tick profit with 1 contract to take some overall risk off the other contract. But if the market goes the other way then I'm screwed in terms of risk. And when I'm live the fills will be much different so this will be even harder. I will probably never do this but thought it would be interesting to ask. I'm still going to track it.
My average winning trade right now is 1.64 points. So the first contract would go for 2-3 ticks, 2nd would remain the same strategy as right now. I would also set a 2 tick stop for that first contract, so RR would be about 1. Not sure if this makes a difference.
In ticks
Risk(2) x Prob(.4)= .8
Reward(2) x Prob(.6)= 1.2
This equation still wouldn't work out and would tell me not to do this trade. The only way for this to work is if the probability of a win was huge, and I guess that's what I'll be tracking in my sheet. To be clear, I wouldn't start considering doing this type of thing live for a long time.
You dont have to use Ninja trader, i do but if you dont want to pay for it the FXCM platform is fine. I dont use it regularly, but i do have it on my computer and phone and have before. I think its actually probably better than some of the charting software out there from what i have seen, but i only have experience with NT.
As for your scalping idea, it does sound logical and the traders equation you posted is better, but mathematically it is very difficult to do (to use a 2 tick stop is nearly impossible). However there are traders out there who do trade like this (Paul Rotter for example), but understand these are the exception and not the rule. Also, most of them i would assume are using algorithms and not discretionary traders. Watch these documentaries on HFT firms, very interesting stuff; and it will show you what you are up against when you try to do what they do. It is part of a series, i think there are 3 total.
2 big problems with scalping in that time frame, fills and commissions. The big institutions have parked orders all up and down the order book and they get the first fills. Generally for them a loss is an exit at break even minus commissions which for them is pennies. A win is a tick or two, $12.50 or $25.00. So when they win they get $12.50 and when the lose they lose pennies. You can survive for a long time with that structure even with a terrible win rate.
The fact is that you won't get those fills on either side of the order. You'll be at the back of the queue to get in and the back of the queue to get out. You'll be bleeding ticks on either side. You add that slippage in with the cost of your round trips, $3.50 or $4.00 or whatever and you'll just end up dying a slow death by a thousand paper cuts.
It might be possible to scalp for ticks as a mouse trader in some futures markets but you'll need deeper pockets, a big appetite for risk and you'll need to do it somewhere other than the ES.
Thanks for the replys, guys. Interesting stuff. I'll check those videos out asap.
All of that makes sense. It's not worth the trouble and risk. Interesting to think and learn about the inner workings of the markets.
Was traveling Friday so wasn't able to trade. I start classes Tuesday so won't be as active here but will do my best and develop a schedule as I get a routine going.
Wasn't able to trade today, but after going through the markets, it looks like today could have been a very profitable day. Very trendy with minimal chop.. Might have some time in the morning tomorrow, but most likely will not. Thursday should be wide open.
Too busy today. Looks like it was a huge day. S and P and Dow knocking on the door. Today would have been a HUGE day for my strategy. Big sustained up trend. Hopefully I can get some action like this on thursday.
Got a quick hour in today. US markets were banging higher so I wanted to get in on the action.
Trade 1: Long 2289, out at 87.75. -1.25
Trade 2: Long 2288.50, cover @ 91.25. +1.75. Should've trusted my gut here and went for more of a swing trade with higher target, but hindsight is 20/20. Missed out on another 2 points. Can't get them all. +1.75
Got some time to trade this morning from the US open until about 12 ET. Unfortunately it was a range day with only a 6 point range, so it was tough. Was expecting some chop today since the last couple of days have been huge up trends. Won't have any time tomorrow so looking forward to get some good time in next week to really get a good sample size of different types of days for this strategy. Was able to pull out above B/E but this is obviously not good enough.
Trade 1: Short at 2292, puked at 2293.50. Thought support was failing so got in. Was a lower probability trade but was willing to take it. Follows my rules but didn't work out. About a 1R trade. -1.5
Trade 2: Bought at 93.25 right after I saw the reversal. Fit my strategy perfectly. Unfortunately I cut it short and moved my target up because I got nervous of losing 2 trades in a row. I can't be doing this if I want to be consistently profitable. Ended up running another 2 points. a .83R trade. +1.25
Trade 3: Went short at 93 and barely got stopped out. Set the stop at the previous swing high instead of a tick above. Fit my strategy and really liked the set up and would've worked out. 1.42R. -1.75
Trade 4: Trusted the set up and got short again after I got stopped out. Got in a little later than I would've liked but fit my risk parameters at 93.25. Ended up being a 2.16R trade because I saw the market breaking down and truly trusted myself. I am gaining a little more confidence in that way every day, even on some losing trades. Great decision and great profit target. set it at 90, it hit, ran 2 ticks through and reversed for the rest of the day. On the screenshot of the chart you can see the green arrow just under that low of the day, but the price and size isn't coming into the picture. I'll zoom out to show it in a different shot. +3.25
End of day: +1.25
Overall decent day for such a tight range day. Trade at the end made up for it. Glad I had confidence in myself. When I made the trade I set the target and stop order and just left it. Closed the screen and walked around so I wouldn't touch it. I have to get better at not messing with my targets and just letting it ride. The confidence is coming, but is not even close still. Still learning a ton and appreciate the help from all of you guys!
Was able to get in front of my computer for a little under an hour at 10 AM. Would've been a great day to be able to fully trade, but had class all day.
Market gapped down after coming off new highs right at that 2300 level. Probably some consolidation going on and some concerns by the recent Trump news.
Trade 1: Short at 67.75. Cover at 66. Could sense that the market was getting to the bottom of its range but thought it had more room to go down. Wanted to ride the trend a little more. Got in and out 2 minutes. Good trade. 66 was a key level for the past week+ so set my target there. + 1.75
Trade 2: Just a dumb trade based off the movement of the market and not really on strategy. Only risked 3 ticks. -.75
Trade 3: I was leaving for the day and wanted to let something run as I thought we were at a key support area. Set 2 different buy orders with stops and target brackets. Bought at 68.75 and 65.50. Sold at 67.25 and 71. Not completely a part of my active strategy but wanted to get a longer term trade in to see how it would go without my interference. THis one helped boost my confidence with identifying good swing trade areas. +4
+5 on the day. These trend days will be very good with this strategy once I can trade a full day.