A scalper invitation to scalpers

[TYtrader]

I haven't short term traded the equity index futures much, but have in the TYs. Trading for a couple of ticks here and there is tempting because, with the leverage, you can make nice income if you are right a lot of the time. The problem is that, it's not easy to it.

The biggest dilemma, how much are you willing to risk for one or two ticks? Are you willing to risk one or two? If so, you're going to get stopped out a lot, especially in choppy markets. If you risk more than that, say 5, then one bad trade wipes out three or four good ones.

I agree that the best way to make money intra day trading is knowing when to let the winners run and getting some bigger winners at times. If you are limiting yourself to one or two ticks, you might have some good winning streaks, but you are also going to have some losing ones and it's going to feel like one step forward and two steps back some of the time.

that's just my experience. but, i'm sure that are some traders out there trading for ticks and making okay money at it. i just haven't met them personally.

 

[Btruck]

Quote from Joe Doaks:

Incognito, welcome to ET! I encourage you to start a thread in Journals. Magna does a magna-ficent job of moderating, and that's where the more serious and long-running efforts are located. I scalp NQ when I am not on assignment and will be happy to join in the commentary. I already occasionally post execution reports just for fun without explanation in a thread there. And I know from PMs and prior NQ threads that there are several other NQ traders here. Best regards.

I second that! I am an NQ scalper/trader and would enjoy participating in an intelligent Journal/discussion of the faster trading style.

Best Regards

 

[kelloggs100]

I live in europe and trade mostly european stocks. I use to scalp but found that I did not net enough from pure scalping, (buy on the bid sell on the offer) approx 500 USD a day 96% of the time. I have graduated over to statistical and semi arbitrage, although my profits have increased the percentage of down days has done so to and my losing days are bigger than before (something I work constantly on). When you find something that works for you no matter what it is stick to it!
Anyway my experience with scaping is that you should trade stocks with as low nominal value as possible since there is a 1% difference in a stock that goes from 1 usd to 1.01, for this to be profitable it is important that the commissions you pay are calculated as a % of the turnover (as in europe) if you pay per share as many of you do then the opposite applies. Also it is really difficult to make profits scalping derivaties, always use the underlying instrument (only applies to scalping.)

 

[osorico]

Quote from Cutten:

*Sigh* more narrow-mindedness. Why do people have to automatically dismiss things that don't suit them? Trading for ticks can make a very high income with minimal risk, if you find the right market or stock for it. Something which can make healthy 6 or even low 7 figures per annum, with 90%+ winning days and small drawdowns, cannot be dismissed so flippantly.

Very well said Cutten.
But surely you'll agree... if you are making heathly per annum income, regardless of trade style or instrument, unless you use IB as your broker, you are destined to fail.

Nicely done trade setup commentary as well, Cutten.

Thanks,
Osorico

 

[increasenow]

okay pro scalpers...please explain how you can make $ scalping with the NQ...how many NQ contracts must you trade as opposed to 1 FTSE or DAX or CL contract...lets discuss this please..thanks

 

[Lucrum]

Quote from bighog:

Cutten You are as bad as any new poster. Scalpeing in the true definition of the term as used in the mkts does not mean retail customers can BUY the BID and SELL the ASK and make the spread. It just makes sense that any trader that just trades for a tick here or a tick there is a loser because he/she has not developed a winning way to trade for the intraday "RUNS". To trade for a few ticks here or there is really nothing but throwing darts and hoping for the best because MOST of the price action intraday is simple "NOISE". trading "NOISE"is a losing strategy, plain and simple. Commission costs and the slightest lapse in discipline or a FAST mkt move against the trader and he/she is toast for the day.

Even professional mkt makers get chewed to bits on one-way days. Tick buffing is a flawed strategy. -last post on the subject, because i know what i am saying.

http://www.investopedia.com/terms/s/scalpers.asp

05-21-08 08:48 PM

Quote from bighog:


...Thats it, no more posts about trading ... So long guys, it was a blast. DONE..

You weren't gone long. Did you even leave?

 

[osorico]

Quote from increasenow:

okay pro scalpers...please explain how you can make $ scalping with the NQ...how many NQ contracts must you trade as opposed to 1 FTSE or DAX or CL contract...lets discuss this please..thanks

I see you are still stuck in the same place you've been for a long time Increasenow. geez! ....

You asked "how you can make $ scalping NQ... How many contracts must you trade"

Without knowing how YOU define "make $" heres a simple formula to NET $600 scalping NQ...

100 RT x 2 tics = $1000
minus commission and fees of $4 per RT =$600 NET (EBITA)

It doesn't matter if it takes 1 trade with 100 contracts on, 100 trades with 1 contract on, or any variation therein... The goal of this example is to capture a (minimum) total of 200 tics by the closing bell. Using a LOPSIDED (due to commissions) 2-tic risk, 30 CONSECUTIVE losing RTs would place you at breakeven, commissions INCLUDED. (assumes 100 RTs total)

Successful scalping is not about trade size.
It is about the accumulation of realized (aka actually booked) tics.

Osorico

 

[Instynct]

Here is an example of how I analyze the highs and lows

http://i32.tinypic.com/2z8vuk6.jpg

 

[Instynct]

Here is how use previous days price action to establish S/R

http://i27.tinypic.com/30ndbwh.jpg

 

[increasenow]

Quote from osorico:

I see you are still stuck in the same place you've been for a long time Increasenow. geez! ....

You asked "how you can make $ scalping NQ... How many contracts must you trade"

Without knowing how YOU define "make $" heres a simple formula to NET $600 scalping NQ...

100 RT x 2 tics = $1000
minus commission and fees of $4 per RT =$600 NET (EBITA)

It doesn't matter if it takes 1 trade with 100 contracts on, 100 trades with 1 contract on, or any variation therein... The goal of this example is to capture a (minimum) total of 200 tics by the closing bell. Using a LOPSIDED (due to commissions) 2-tic risk, 30 CONSECUTIVE losing RTs would place you at breakeven, commissions INCLUDED. (assumes 100 RTs total)

Successful scalping is not about trade size.
It is about the accumulation of realized (aka actually booked) tics.

Osorico

thanks Osorico..once again a very insightful post...I guess I am projecting my thinking which is...1 trade with 1 contract for 1 trade per day for a net profit of $200 to $1,000 after the 1 commision..to me,the DAX,CL or FTSE offer the greatest possibilitiy to reach that goal with only 1 contract...all agree?...it be hard to net that amount trading only 1 NQ contract...