ES/NQ Trading - looking for solutions

[syswizard]

Syswizard,

You say 4 ES and 3 NQ...you talking about trades in both at the same time or that you're trade both in the same day while not simultaneously at the same time as in not two positions open at the same time ?

Never simultaneous positions.

Also, in the beginning of trading the Emini futures (you mentioned you only have 3 months real money trading experience in the Eminis)...you should be concentrating only on one of them and not both unless your trade method is dependent upon some kind'uv correlation between the two.

From my experience, I don't see a whole lot of difference between NQ and ES other than the volatility. Many times I for instance see ES starting to crater and then I see on my other screen NQ starting to fall.

Yet, if eventually you've gotten yourself into the position where you can only trade one of them...Emini NQ should have priority over Emini ES. The price action of Emini NQ is just better and a lot less games being played out with it than the Emini ES by the big boys.

I don't agree with this. I think the algos are prevalent in both which accounts for all of the stop gunning.

I think when you drop your position size down to 1 contract, you'll be able to reset and then make the appropriate adjustments...test it and then try again but this time with only 1 contract. Later if things are going well after several months on the 1 contract...gradually move back up the position size.
wrbtrader

Yeah, I think you are right. I discovered that with the 4/3 contract sizing, if I have 3 losing trades in a row....I could be down $1000 easily. Battling back from that drawdown is tough.

 

[syswizard]

That's what makes all the difference. If you created them based on your trading and observation, you know the "ingredients".

Thanks for that Matt. I'm a former IT engineer. I knew to even a chance in this game, I needed something "special". The standard indicators were not going to "cut" it.
Also, I've got a heck of a hardware set-up. Quad core processor, wired 1 gig internet connection (I would NEVER even consider wireless), 2 24"monitors, and most important is the Evoluent vertical mouse....it's the most comfortable mouse I have ever used.
On the software side I've got Multicharts with an interface to IQFeed for the data. My brokerage connection is to Interactive Brokers using their IB Gateway which handles all of the API calls from Multicharts.
Initially I was having API failures so when Multicharts made a trade, the gateway would fail to send it along to the exchange. So I created a start-up script that puts the gateway into high priority mode in Windows. Since then there have been no failures. Rock solid.
But as the flavor of this thread goes, all of this great tech"stuff" does not guarantee success.
The most important component is between your ears.

 

[Palindrome]

Trade small
Widen out stops - I'm 40 handles in the NQ's
Trade with trend (trend reversal is harder to learn in my opinion)
Trade less- I only find about 6 opportunities a month in Equity Indexes, but we all trade differently

 

[tiddlywinks]

From my experience, I don't see a whole lot of difference between NQ and ES other than the volatility. Many times I for instance see ES starting to crater and then I see on my other screen NQ starting to fall.

The NQ underlying is the NDX: Comprised of (only) 100 of the largest non-financial issues.
I would guess all 100 are included in the ES. Different constituent criteria is applicable however, so it is possible the guess is wrong.

The volatility is due to sector concentration, not so much a built-in correlation. The ES, due to weighting methodology is more correlated to YM, due to YM sector inclusion/diversity plus issue size, than NQ.

 

[Handle123]

No f*cking way...you would have pry my dead hands away from my 3 powerful indicators.
I've got a trend indicator, a momentum indicator, and a price volume indicator which is my crown jewel.
All of these are custom coded...by me. They're not the typical crap....RSI, MACD....those are all bullshit....and don't work.
You are right though....they are distracting and it requires a LOT of concentration to deal with them and the price action....especially at the speed of ES and NQ.

I use one indicator now, BB, really backed off them cause, well...been watching them so many years, I have memorized what the charting does to make indicator wiggle for a signal, I just use plain volume at bottom of chart, either increased volume or decreased can give signals. Gone back to more of stock entries, less day trading and higher percentages. I always thought momentum indicator waste of space, price rising fast I can see the slope of middle of the bars, mom or stochastics will lie of what is actually happening some of the time for me. Even scalping, cutting back number of trades. Concentrate on lower drawdowns so as to increase size.

Do you know what 90% of profitable trades time of being in the trade? So say at end of this time, what is your plan? You stick around and let stops take you out or make new target of breakeven plus a tick? Good trades normally for me allows me to get in and don't come back, if the size of the bars too large, I know they going to test some area so better to wait and get in better(lower) if long. Speed or lack of price most do not study, fast and slow seldom are good, one often reverses and other don't go anywhere.

Have you memorized what end of extremes(trends) do? As in charting and not indicators.
Do you have rule of when price goes positive by so much you go to breakeven stops?

I have used RSI and still use MACD for years, but don't use them as books show. I have learned RSI well and know what chart doing and what the RSI would be doing to give signals.

Size depends on knowledge increasing, drawdowns decreasing, but has nothing to do with size of the account. I have known some guys lose few million cause they did size when they had no clue how to trade.

Good luck to you SYS.

 

[nkhoi]

On ET since 2004 and only now starting to trade? What did you do all these years?
...

I have the same thought, I checked his name first to make sure it's not a guy with similar name.

 

[AAAintheBeltway]

I see a lot of red flags here. Go back and do some serious backtesting and if you must trade live, one lots only until you know what you're doing.

ps. The market doesn't care what kind of computer you have or how much money you "need" to make.

 

[RubiconTrading]

I use one indicator now, BB, really backed off them cause, well...been watching them so many years, I have memorized what the charting does to make indicator wiggle for a signal, I just use plain volume at bottom of chart, either increased volume or decreased can give signals. Gone back to more of stock entries, less day trading and higher percentages. I always thought momentum indicator waste of space, price rising fast I can see the slope of middle of the bars, mom or stochastics will lie of what is actually happening some of the time for me. Even scalping, cutting back number of trades. Concentrate on lower drawdowns so as to increase size.

Do you know what 90% of profitable trades time of being in the trade? So say at end of this time, what is your plan? You stick around and let stops take you out or make new target of breakeven plus a tick? Good trades normally for me allows me to get in and don't come back, if the size of the bars too large, I know they going to test some area so better to wait and get in better(lower) if long. Speed or lack of price most do not study, fast and slow seldom are good, one often reverses and other don't go anywhere.

Have you memorized what end of extremes(trends) do? As in charting and not indicators.
Do you have rule of when price goes positive by so much you go to breakeven stops?

I have used RSI and still use MACD for years, but don't use them as books show. I have learned RSI well and know what chart doing and what the RSI would be doing to give signals.

Size depends on knowledge increasing, drawdowns decreasing, but has nothing to do with size of the account. I have known some guys lose few million cause they did size when they had no clue how to trade.

Good luck to you SYS.

What do you recommend to detect "volume spikes" that translates well for automation?

 

[Overnight]

I concur with R1234, I think he was the first or second response to the thread...

Stop trading until May, and try with the micro index instruments. You can tailor yourself and learn the movement with much less loss while you are learning your journey.

(And stop with the 3-4 contracts per trade. That's suicide unless you know what yer doing.)

 

[syswizard]

Even scalping, cutting back number of trades. Concentrate on lower drawdowns so as to increase size.

I'd love to do that, but as we have discussed that depends on stop placement....a tough nut to crack. I need to incorporate volatility into the stop determination.

Do you know what 90% of profitable trades time of being in the trade?

Nope...I am sorely missing statistics....average time in winning trade, average time in losing trade (this could be seconds in my case !)
I need to work on this and create a post-mortem stat sheet...daily.

So say at end of this time, what is your plan?

I'm going to reduce size to 2 ES contracts and 1 NQ contract.

You stick around and let stops take you out or make new target of breakeven plus a tick?

That's another problem for me....I'm reluctant to take a breakeven trade. I gotta start doing that.

Good trades normally for me allows me to get in and don't come back,

Hah !! That's all about a great entry.....and that's another problem. I have too many trades entering long into resistance and short into support. That's gotta stop...or I'm done.

Do you have rule of when price goes positive by so much you go to breakeven stops?

Right now, I'm breakeven averse....I'd rather let the trade continue for a possible gain rather than scratch. That's another problem.

Size depends on knowledge increasing, drawdowns decreasing, but has nothing to do with size of the account. I have known some guys lose few million cause they did size when they had no clue how to trade.

Exactly. Here's a scary notion....I can move my account to Optimus futures and trade 20 lots. Interactive Brokers are ball-busters about margin....no favorable intraday margin.
Calculating...$1000 per S&P point. So on Friday I did 4 points...so that would be $4000 per day.
Now that's a great income !