Average points in the ES
- Thread starter TTT
- Start date
This is based entirely on your total exposure. A good starting place is the Kelly Criterion. It sounds like you are overlevered. Personally, I define success as closing a +EV trade. "I almost had it" only counts in horseshoes and hand grenades. You gotta know when to cut your losses or take your profits in the markets.
If you don't have an empirically, historically, derived expectation for your trades, you are placing your capital at the whim of the market and yourself for each and every trade.
Actual entry signals is 1% of a system, sounds like you missing the other 99% which is risk management. If you knew charting much better, to left of now might be showing you when not to get in, perhaps you went long and trendline off the 60 minute is 3 ticks away, might be better to not take signal or one of a dozen chart patterns developed before now which probabilities show less chances of being profitable. There is also ATR, when volatility goes up, risk and therefore targets must go up. At how many points of risk do most trades fail to be profitable? There is average swing lengths that are needed to be kept as well and taking the mean to determine at what juncture you are entering, low in trend or too high in trend, knowing mean wave ranges of recent trading allows you to guesstimate best areas for entry on retracements, there is MAE and MFE which show best risk and targets for recent volatility. There is also time of profitable trades, at end of this time, if not at breakeven stops, your target is now breakeven plus 1 tick.
Most won't have a clue when they start day trading how difficult this really is. Better IMHO to learn how to do swing or long term trading before day trading, gives you time to learn more than the masses. Am not saying to quit, but unless you can compete with the big dawgs, you are going to remain bait.
If your avg win is 5 points, what would your avg loss be?