$2,000 to $200,000 in 2020 at 2.00% per day.

Morning preparation:

Here is the relevant news for today for Econoday with the USA filter on.
https://global-premium.econoday.com/byweek.asp?cust=global-premium&cty=US&lid=0

upload_2020-2-12_6-17-3.png


Here are the pivots for the day, which I get for free with a free account from the Swing Trader page on ShadowTrader.net. https://www.shadowtrader.net/newsletter-category/swing-trader/

upload_2020-2-12_6-19-48.png
 
Morning prep continued:

Pivots put on ES chart. I just watch the ES chart during the day. It is too much work for my lazy butt to put them on the NQ chart too. Even though they don't move in tandem, they do "rhyme," and the ES has 4x or more of the volume of the NQ, so it is the king of the indices.

upload_2020-2-12_6-24-19.png


ONH/Purple = Overnight High/High of Day (HOD) from yesterday and Low of the Day (LOD)
Gold = Value Area High (VAH) and Value Area Low (VAL)
Green = Pivot/Point of Control (POC)
Squigly line is the VWAP line.
 
Morning Prep continued

The teal line is the Cumulative Delta graph. This tells me that the more aggressive traders are NOT aggressively buying, but are selling. And they like the 3360 ES area. The "aggression" is determined by the trader hitting the buy market (ask) or the sell market (bid).

(The On Balance Volume (OBV) is an indicator that is very similar to CDelta. But I prefer CDelta.)

Just because the "Big Boys" are not pushing higher here, but the move is mainly by retail traders, doesn't mean that the retail traders are wrong. The big boys are wrong about 30% of the time in my opinion in my review of the CDelta success rate.

upload_2020-2-12_6-45-5.png
 
Morning Prep continued.

This is my daily volume delta ES chart. A volume delta chart may be green even if the close was lower than the high (or red even if the close was higher than the low). It shows the buying or selling pressure just like the cumulative delta.

The yellow hash tag is the Point of Control (POC) for the day.

upload_2020-2-12_7-3-14.png


I have marked all of the significant levels which act as support or resistance: Open, Close, High, Low, POC.

The 1, 2, 3 are the Taylor 3-day cycle numbers. I will discuss these later.

The bands are a 7 day Keltner channel.
 
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First trade of the day update.

Total bust. -$20.

upload_2020-2-12_7-7-19.png


I got in at the low end of a range expecting a breakdown. I should have waited for a penetration and retest of the low of the range at 3368.

We were still in an uptrend, as determined by the larger GREEN 250 sma

We were still in an uptrend, as evidenced by being above the up-sloping trend line.

We are still in a very bullish market being at All Time Highs (ATH).

I should have been more patient on the short or gone long with the trend.

I often get out right away when a trade goes against me, but this one played with my mind. Being in a range, I was hoping that at the top of the range I would find some sellers.

I journal very few of my trades, because I take so many (up to 20 per day). But you have now seen some of my thought processes.

Maybe next time I will journal about a winner...
 
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sstheo said:
As I alluded to up higher, I TRIED to trade with one E-mini contract on a $1000 account MANY times with a $500 margin requirement. Guess what happened? 100% of the time I eventually got a margin call. I only had $500 of wiggle room. DUMB.

Now, with a $2000 account, I was able to trade 4 micros with $500 allocated for each for margin. That is like a $20,000 account for E-minis and trading 4 with $5000 for each position.

So with the micros, I have 10x the wiggle room. I can have a few bad days and still be alive to trade the next day.

At $20 max loss per micro, my risk profile is 1% risk per trade. And as recently stated, I have a 4% max loss per day. One a $3000 account, this is just $120. So, I can lose for 20+ days before worrying about a margin call.

Now lets talk about expectancy. Here is a great article:
https://samuraitradingacademy.com/trading-expectancy/

Expectancy = (Win Rate * Average Win) - (Loss Rate * Average Loss)

I am at an 84% win rate with an average winning trade of about $8. My loss rate is 16% and my average loss is about $20 after commissions.

.84 * $8 - .16 * $20 = $6.72-$3.20 = $3.52 expected average profit per micro contract traded.

Sounds pretty low, but it is correct. So when I get up to the full E-mini once I reach $5000 in the account, with no changes, I should be able to expect and average of $35 per trade, which is about my historic norm (when I follow my rules and don't get too aggressive or careless).

So how can I, and any trader improve?
  1. Increase win rate
  2. Increase average win
  3. Decrease lose rate
  4. Decrease average loser size
Since my win/loss rate is already good, I am trying to (#2) increase my average winner by letting my winners run when in a trend. I am working hard on this with some help from a good friend.

Regarding reducing the average loser size (#4), I have done poorly in this highly volatile environment of "getting out immediately" the moment the market proves me wrong. In other words, I don't want to wait for my stop to get hit, but flatten as soon as I realize the probability of success drops below 50%. (OR if the market is just sitting there doing nothing, I give it about a 3 minute window to come my way.) My stop really should be an "emergency stop," so my goal is to never let the emergency stop get hit. But in a fast moving market like this, I have just been letting the stops take me out.
More...
 
sstheo said:
Morning Prep continued

The teal line is the Cumulative Delta graph. This tells me that the more aggressive traders are NOT aggressively buying, but are selling. And they like the 3360 ES area. The "aggression" is determined by the trader hitting the buy market (ask) or the sell market (bid).

(The On Balance Volume (OBV) is an indicator that is very similar to CDelta. But I prefer CDelta.)

Just because the "Big Boys" are not pushing higher here, but the move is mainly by retail traders, doesn't mean that the retail traders are wrong. The big boys are wrong about 30% of the time in my opinion in my review of the CDelta success rate.

View attachment 219152
More...

How is cumulative delta calculated? Is it using time sales data? Orders filled on bid or ask?
 
With your initial risk capital of $2,000 for 4 micro contracts ($500/contract),and your your $20 (40 Tick) initial stop loss per contract on MNQ,MYM,and M2K,don't you think you're risking at least 4% per trade (if not even per contract)? But if your initial stop loss is 10 ticks ($5) per contract then you're risking less than 4% for those 4 contracts.Please confirm if you're not risking more per trade than you think.
 
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