es profit on 1/4 point can it be done?

[illiquid]

Quote from saxon22:

After examining the ES I have noticed that there is a lot of movement within 1/4 of a point. What I mean is that ES would jump with 1/2 point several times before moving on with the trend. SO, lets say ES is at 1333.50 uptick, I buy at 1333.50 100 lot, the ES wiggles going from 1333.50 to 1333.25 back to 133.50 and since I bought with the trend (uptick) it soon goes to 1334. Once it hits my target I get a fill and pocket 1250 less fees and taxes. I continue do that until ES hits resistance, then if it breaks through I wait for it to gather momentum and continue with the plan. If it does not penetrates and strat a downticks I short it until it hits support on its way back. Seems logical and doable from my angle. I can do it almost all day long as opposed to waiting for a set up to hit the market for a couple of points 3 maybe 4 times a day. Like I said before, I have not tried it yet with real $$$ so it is all one big ????? This is why in my original question I asked if it was doable.

Maybe the following will be more realistic?

From a show of strength you sense a possible break of resistance and buy 100 at the ask; immediately the bid is swept and we're offered 1/4 lower than your entry. You immediately smack the bid to exit -1/2. Once you are out the market quickly pops back up past your original entry and starts to move. We've broken through resistance as you've anticipated earlier, so you quickly jump back on board a full 2 points higher than your first entry. Yet once again, the exact moment you are filled at the ask the market reverses back below the resistance level. You note the technical failure so you sell 200 to take your loss and flip over short. The market stalls once more and just begins to grind back and forth; you start to feel hesitant about your instincts on the day's action and just decide to salvage the trade by bidding for a scratch. Yet the market just won't comply as you only get a fill for 10 contracts; we lift one tick higher, but there is size at the new ask so you just raise the remainder of your order to await your fill at bid. Suddenly the size at ask drops away while a 2K buyer joins you. Before you can react the new buyer sweeps at market with far more than 2k to buy and we've lifted a point and a half before you finally exit in disgust . . .

What do you think? Inconceivable? Why don't you try your idea with ONE contract before you start imagining how much you can make with 100?

 

[dottom]

Your odds of winning .25 points with a .25 stop, regardless of where you think the "trend" is going is not 50%. It is 25%.

When you figure out why this is true you will know this method will not work.

You can use similar rationale to determine your true expected win rate with a 1.00 stop.

 

[saxon22]

Quote from illiquid:

Maybe the following will be more realistic?

From a show of strength you sense a possible break of resistance and buy 100 at the ask; immediately the bid is swept and we're offered 1/4 lower than your entry. You immediately smack the bid to exit -1/2. Once you are out the market quickly pops back up past your original entry and starts to move. We've broken through resistance as you've anticipated earlier, so you quickly jump back on board a full 2 points higher than your first entry. Yet once again, the exact moment you are filled at the ask the market reverses back below the resistance level. You note the technical failure so you sell 200 to take your loss and flip over short. The market stalls once more and just begins to grind back and forth; you start to feel hesitant about your instincts on the day's action and just decide to salvage the trade by bidding for a scratch. Yet the market just won't comply as you only get a fill for 10 contracts; we lift one tick higher, but there is size at the new ask so you just raise the remainder of your order to await your fill at bid. Suddenly the size at ask drops away while a 2K buyer joins you. Before you can react the new buyer sweeps at market with far more than 2k to buy and we've lifted a point and a half before you finally exit in disgust . . .

What do you think? Inconceivable? Why don't you try your idea with ONE contract before you start imagining how much you can make with 100?

I must tell you just reading your post made me go and check if my $$$$$$ was still in my account.

One contract was all I was ever going to test this method with. I think I stated that before

 

[saxon22]

Quote from dottom:

Your odds of winning .25 points with a .25 stop, regardless of where you think the "trend" is going is not 50%. It is 25%.

When you figure out why this is true you will know this method will not work.

You can use similar rationale to determine your true expected win rate with a 1.00 stop.

Thanks for the puzzle. I feel like this is high school again and I am about to be educated by a teacher that knows more than me but it is not about to share the knowledge. No one ever said this was going to be easy. Btw. I never stated that on 1/4 my stop would be 1/4. Also no need to put trend in "".

 

[mwahal]

saxon,

save the entire read -- read it after 2yrs for chuckle.

this has been very entertainment thread. My guess is you are doing an experiment on traders that how far you can push your buttons !

congrats on success of your experiment

mudit

 

[saxon22]

Quote from mwahal:

saxon,

save the entire read -- read it after 2yrs for chuckle.

this has been very entertainment thread. My guess is you are doing an experiment on traders that how far you can push your buttons !

congrats on success of your experiment

mudit

I will put it im my archive eventually. There is no experiment as far as pushing other traders' buttons. How did you reach this conclusion?
On the side note I have difficulties understanding some of your your posts. Could you please be a bit more articulate in the future. (no disrespect of course)

 

[GTS]

saxon22, the last post by illiquid is spot on about how what it is like to chase ticks.

Have you tried signing up for a simulator account and doing what you are suggesting? If not (why not?) and you are basing this only based on looking at historical charts then I think you are in for a bit of a surprise once you try it live.

Seriously, try it, either with one contract in a real account or in a demo account - no need to guess about what it is like to do what you propose. The only way you can really understand is to do it, not ask others what it is like.

 

[nkhoi]

Quote from GTS:

saxon22, the last post by illiquid is spot on about how what it is like to chase ticks.

Have you tried signing up for a simulator account
..

since it is only 1 tick, there is no sim can do it, no matter how good it is.

 

[trader28]

Quote from saxon22:

Would it be possible to make a profit by scalping 1/4 of a point on ES??
Since 1/4 is $12 less $ 5 fees, that would still leave $7 on the table. Can it be done?

I've seen a guy named Jame that scalped like that but he didn't limit himself to a 1/4, sometimes 1/2 sometimes 3/4... 20 to 50 contracts depending on how confident of the move he was, I couldn't tell you how he did it, he was uncanny at knowing when the slightest reversal was about to occur and he guarded his method like it was his sisters virginity. I saw him 30K up before lunch one day, last I heard he was buying a seat on the exchange. He had a unique mindset, his indicators were his weapons and the rest of the market were an invading army trying to steal his kingdom, he was that gung ho.
So yes it can be done, but can it be done by you and me? probably not

 

[trader28]

Quote from dottom:

Your odds of winning .25 points with a .25 stop, regardless of where you think the "trend" is going is not 50%. It is 25%.

When you figure out why this is true you will know this method will not work.

If the price move (ie: chance of winning) was a coin toss (ie: 50%) you would still be faced with the prospect of slippage, price need only move one tick against you to be down 2 ticks plus commision ($32.50)... but you need price to move 2 ticks your way to make 1 tick minus commision ($7.50)...

So the chances of it moving a tick in your direction are 25% (ie: 50% of 50%) because it has to travel twice as far for a winner.... and the payout on a winner is only 18.75% and your loss if it goes against you is 81.25%.... so you even a 90% win rate may not make a profit

do I get the cigar?