Agreed. At least use simulator to learn trading platform. You don't want to be fumbling for buttons when you're short even a few micro contracts and the market's running against you.
Beautiful Scalper
- Thread starter BeautifulStranger
- Start date
Agreed. At least use simulator to learn trading platform. You don't want to be fumbling for buttons when you're short even a few micro contracts and the market's running against you.
theres absolutely no emotion when trading paper... at least for me. I could never “act” as if it was real and not a simulation.
skin in the game is true risk.
why do you have to test it, when you can see all the Bids on LVL2 Insight? are you testing beyond the lowest Bid? Because it sounds as if you were testing beyond the last price in order to get an idea of the book/all bids available. If the latter is true, you should look into getting access to LVL2 book.
Rather than than randomly trying to make the spread, I would rather try to find out if one side of the market is stronger than the other and joining the stronger side.
In the scenario I provided, the posted bid had been hit and the level 2 showed transactions taking place below the current posted offer. By placing a test offer, I can determine how aggressive one side is. In my scenario, a seller kept matching my offer as I continued to lowered it until $425.17, where I received a hypothetical fill for a short position. I stepped in front of the seller where a prior trade took place as $425.00. I know there is still an active seller behind me, providing some price protection. How much protection, I don't really know unless I see the current offer decrement in the amount I am filled. In other words, the seller is using an algo or an order that has flexible execution parameters. By now placing a new bid in front of the best bid, I can benefit make the spread if a market sell order comes in or the known seller becomes more aggressive. There are some nuances and other practical considerations to this strategy, but anyone interested in actively trading this style would need to gain live experience or ask someone who is more experienced than I am.
For my purposes, I merely am looking to get a little better timing for my equity trades and better execution for my equity orders.
Today I got up late because I had a rough night. (long story). Anyhow, I realized I'm not a superscalper in the sense I constantly trade. I'm more of an opportunistic scalper. I get in with size and scalp here and there.
Today even with being tired and not to full form, I still bang out $1,006. Lower than my recent daily P&L average. But not bad a day considering that I'm not at my optimal condition.
The amazing thing was that profit was 1-2 cents per trade(obviously with size)! Yep, you read that correctly. Year ago when I first started trading I dreamt about capturing huge moves and making tons. But the reality has evolved to be quite different! lol. What seems to work well so far is extracting pennies from stocks with high volume and plenty of liquidity. Quite different what I thought would work when I first started trading! LOL.
I mean I still try to capture the occasional $1+ moves. To be honest, today is unique. My usual target is 10cents - 50 cents.
Something to think about as you progress in your trading journey.
Starting NAV will be $29,755.11 for this journal. I will post screenshots of cash and performance reports at the end of the month.
I will provide my rationale for entering, exiting, setting targets, and setting stops for each trade I make. In addition, I will note activity changes in the DOM in absolute terms and in relative terms to ES price action.
I will start out with micro futures contracts and equities.
There will not be many trades taken this week, simply because I will be too busy working at my primary source of income.
I am trying to figure out how much supporting inputs should I require to take a trade. For example, Sunday night I thought it was odd how much the Mexican Peso was down. Sure crude was down big, and looking to buy the weakest performing asset from a risk seeking perspective is usually a fools play, but for some reason, the move seemed like capitulation to me. I considered buying a breakout of the high of the low bar on a 30 minute chart, putting a stop at a new low, and using just below unchanged as a target. As it turned, this trade would have worked nicely. So in this example, nothing was really needed for the decision other than a strong feeling, some momentum, and a stop. I let other things enter my mind, though. Such as not wanting to take more than the stated risk levels and "clearing the books" for accounting purposes. I also remember feeling uncomfortable over the weekend with my bearish ES butterfly spread. I wish I could get in touch with my subconscious and figure out what was bothering me. Did it seem too easy to get short on Friday? Was the decline in ES a little too orderly? A little too orderly as in "Loading the boat", as it were? Were too many in the media and blogs excessively negative? I was using an iPad Friday, so I was not able to look at the DOM to get a sense of how "resilient" the bids were to selling pressure. Did it take a relatively high number of hits to clear the bids on Friday? Were there an entity(ies) accumulating contracts against the selling pressure in "anticipation" of a strong opening on Sunday / Monday? I was looking to buy MES on the opening on ideas if the were no sellers coming in after the weekend, ES could only go up. But 30 points in one minute? Damn. What I should have appreciated at that point was the shorts were in trouble and most of them were still in their positions after that one minute run up. At least I know enough not to try to fade that kind of price action. The next step for me is to reduce my time scale on a day like Sunday/Monday and wait for a reasonable consoldation before entering an order to go with the trend.
I will provide my rationale for entering, exiting, setting targets, and setting stops for each trade I make. In addition, I will note activity changes in the DOM in absolute terms and in relative terms to ES price action.
I will start out with micro futures contracts and equities.
There will not be many trades taken this week, simply because I will be too busy working at my primary source of income.
I am trying to figure out how much supporting inputs should I require to take a trade. For example, Sunday night I thought it was odd how much the Mexican Peso was down. Sure crude was down big, and looking to buy the weakest performing asset from a risk seeking perspective is usually a fools play, but for some reason, the move seemed like capitulation to me. I considered buying a breakout of the high of the low bar on a 30 minute chart, putting a stop at a new low, and using just below unchanged as a target. As it turned, this trade would have worked nicely. So in this example, nothing was really needed for the decision other than a strong feeling, some momentum, and a stop. I let other things enter my mind, though. Such as not wanting to take more than the stated risk levels and "clearing the books" for accounting purposes. I also remember feeling uncomfortable over the weekend with my bearish ES butterfly spread. I wish I could get in touch with my subconscious and figure out what was bothering me. Did it seem too easy to get short on Friday? Was the decline in ES a little too orderly? A little too orderly as in "Loading the boat", as it were? Were too many in the media and blogs excessively negative? I was using an iPad Friday, so I was not able to look at the DOM to get a sense of how "resilient" the bids were to selling pressure. Did it take a relatively high number of hits to clear the bids on Friday? Were there an entity(ies) accumulating contracts against the selling pressure in "anticipation" of a strong opening on Sunday / Monday? I was looking to buy MES on the opening on ideas if the were no sellers coming in after the weekend, ES could only go up. But 30 points in one minute? Damn. What I should have appreciated at that point was the shorts were in trouble and most of them were still in their positions after that one minute run up. At least I know enough not to try to fade that kind of price action. The next step for me is to reduce my time scale on a day like Sunday/Monday and wait for a reasonable consoldation before entering an order to go with the trend.
No trades today.
Made 4.75 points on a MES scalp after a correction in the European session after the trend finally reversed to the downside. Although I will show my entire trade history at the end of the month, I will post select trades as they happen.
Watched the index futures briefly yesterday and short side reversion to mean trades of 1 minute bars lasting from 1 to 3 minutes seemed to be working well. I am looking forward to trading this style, especially if the indexes continue to rally.
Could not help myself and I took a options spread trade that would benefit from market weakness next week. So much for keeping my scalping and option trades separate within IB.
Watched the index futures briefly yesterday and short side reversion to mean trades of 1 minute bars lasting from 1 to 3 minutes seemed to be working well. I am looking forward to trading this style, especially if the indexes continue to rally.
Could not help myself and I took a options spread trade that would benefit from market weakness next week. So much for keeping my scalping and option trades separate within IB.
Overnight.. you can’t be afraid of optionality forever...
convexity is your friend my friend!
Did some nice scalping Monday night. First off was a couple of reversion to mean trades where my marketable orders were not filled. It turned out that IB was updating my account, preventing my order from being released. Wish there was an indication of this beforehand. IB said logging out and back in between 2300 and 0100 may help with this. Had my orders been filled, I would have done slightly better than even, for a Profit% of 50 and a RR of 1.2:1 versus expected 80% and 1:1.
Next were 4 trend following scalps on the 1 minute time frame. The first two trades were small losers on a failed signal and an adverse event. The next two trades were profitable, yielding an net 6 points in MES. Profit% 50; R/R, 2.5:1 versus expected 50%; 2.0:1.
Even though I had a long day at work, I felt really good with my scalping. I felt I knew exactly where I wanted to execute trades and where my exits where, profitable or not. Several times I dynamically adjusted to changing conditions. Probably even more important were the trades I didn't take. Ambiguous signals were easily ignored. I have a clear idea what represents a solid signal and I am confident to say I can make persistently made money scalping the MES. From here, my plan is to rapidly increase size after each profitable session.
Hopefully, I will be able to squeeze in more trading sessions, maybe tonight. For fun, one of these days I'll mark up a chart and post it in real time, before I take a scalp, showing my planned entry point or area, profit target, and stop loss area. Heck, in time, I'll mark up a chart for each scalping strategy I do.
Next were 4 trend following scalps on the 1 minute time frame. The first two trades were small losers on a failed signal and an adverse event. The next two trades were profitable, yielding an net 6 points in MES. Profit% 50; R/R, 2.5:1 versus expected 50%; 2.0:1.
Even though I had a long day at work, I felt really good with my scalping. I felt I knew exactly where I wanted to execute trades and where my exits where, profitable or not. Several times I dynamically adjusted to changing conditions. Probably even more important were the trades I didn't take. Ambiguous signals were easily ignored. I have a clear idea what represents a solid signal and I am confident to say I can make persistently made money scalping the MES. From here, my plan is to rapidly increase size after each profitable session.
Hopefully, I will be able to squeeze in more trading sessions, maybe tonight. For fun, one of these days I'll mark up a chart and post it in real time, before I take a scalp, showing my planned entry point or area, profit target, and stop loss area. Heck, in time, I'll mark up a chart for each scalping strategy I do.