Thanks for clarifying Wally. I'll look into it.
-Fast
-Fast
FastTrader Futures-Trading Journal
- Thread starter EMini-Player
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I actually agree with this. There are a few points I'd like to emphasize:
- Fast, get rid of the fiddle-diddle TA indicators. Not only will it clear up your charts (and thus brain), but it'll give you less opportunity to interpret your own bullshit into charts. The more TA, the more excuses to invent stuff or rationalize. Your brain is always looking for stuff to avoid responsibility - So don't give it that chance! Dump TA, get naked charts and volume. It'll make the world of difference - trust me!
- To further emphasize my point here, please read "Trading in the Zone" by Mark Douglas. Do not trade real money until you've read the book - all of it!
- Regarding issues : Fully agree. Don't jump into $50K futures to start with. The main reason I'm saying this is because you simply can't scale, that is take off partial profits and the like. You need at least 2-4 contracts to do that properly - And as a beginner, I strongly advice against that.
Fully go with dlm here - Start with a nice semi or software stock. You can scale as much as you like here, plus you can buy or sell 5, 10, 20, 50, 100 stocks at a time, no worries. Great for learning.
Take BRCM or MXIM, for example. MXIM is highly index-correlated, will track the futs almost to the tick! MXIM is hard enough to trade, almost as hard as the futs themselves, so you shouldn't feel deprived. But you still have that certain time lag to the futs and the "dummy factor" (lots of stupid / semi-semi-pro traders - only to be found on stocks!) on your side to get lots of happy fills and extra profits. Never on the futures! They're cut-throat, and there's always someone in before you are!
Sometimes, when I'm not feeling like an active day, I'll go into party atmosphere, put on great music and the smoke machine, load MXIM or the like into an extra chart (next to NQ and ES), plus a Naz Lv2 Screen, and just scalp the MM's socks off on low volume, like 2-5K shares, which ain't more than equal a couple of ES/NQ contracts. You have a clear, truth-telling tape, and truth-telling depth, no unpredictable arbitrage BS like on the futs! There are real, committed players on the stocks, and you can just read them and play them, shave iceberg orders etc.
It's (comparatively) an easy game. This is what I do if I wanna relax. It's my favorite video game.
The futures are a completely different story. To trade the futures, I need to do research, evaluate S/R levels, estimate retracements, pick the depth for all of arbing, fake and committed operations, get an idea of underlying volatility to calculate the intraday trading and scalping ranges, evaluate the strength of an array of chart patterns, analyze the P/V relationship, try to filter 'true' underlying bias etc etc etc and all this in my head. Of course similar applies for the stocks, but : You always have to be the first in & out the door, and if you aren't, you lose. In the stocks, you always have 'dummy-time', plus you have the 'lag' to the major indexes. On the futs, you are basically 'leading' the whole trading world, anything can happen and you'll be the first one to find out... It's a complete mind-f*ck.
Why don't I just trade stocks then? Because with any decent kind of size it becomes more difficult to 'move your stock', liquidity soon gets you. Plus the high taxation etc. But you're just learning, man! For the purpose of learning, large stocks are ideal.
You can do it, Fast. Your journals are good, your thinking is good and your approach is right. You're not gambling, you just need a little more practice. Do not despair. It would be silly to assume you're gonna learn this in a couple of months. This is a job that takes a long time to learn and longer time to master. How long does it take to become a 767 pilot? Long time. You can make more money as a trader - So would you expect it to work out for you quicker???
Sure, I might have jumped in pretty fast myself, but I have been looking at this stuff, position trading, developing systems etc for years before I started "actively" and then scalping.
You are far from being a successful scalper. You need to learn longer-swing trading first, because in order to scalp, you need maximum experience, fast reaction and evaluation skills and full control of your emotions. There's a subtle difference between flying a Sopwith Camel and an F-16 TomCat.
Let me put it sums: In the profession of trading, and particularly learning to trade, your lowest goal is to make more. Your main goal should be to last as long as you can. The longer you last, the better you'll get. If you last long enough, you'll eventually make it. But to last is the goal for now.
You can do it, Fast. Just take it slow.
Scientist.
Quote from Scientist:
I actually agree with this. There are a few points I'd like to emphasize:
- Fast, get rid of the fiddle-diddle TA indicators. Not only will it clear up your charts (and thus brain), but it'll give you less opportunity to interpret your own bullshit into charts. The more TA, the more excuses to invent stuff or rationalize. Your brain is always looking for stuff to avoid responsibility - So don't give it that chance! Dump TA, get naked charts and volume. It'll make the world of difference - trust me!
- To further emphasize my point here, please read "Trading in the Zone" by Mark Douglas. Do not trade real money until you've read the book - all of it!
- Regarding issues : Fully agree. Don't jump into $50K futures to start with. The main reason I'm saying this is because you simply can't scale, that is take off partial profits and the like. You need at least 2-4 contracts to do that properly - And as a beginner, I strongly advice against that.
Fully go with dlm here - Start with a nice semi or software stock. You can scale as much as you like here, plus you can buy or sell 5, 10, 20, 50, 100 stocks at a time, no worries. Great for learning.
Take BRCM or MXIM, for example. MXIM is highly index-correlated, will track the futs almost to the tick! MXIM is hard enough to trade, almost as hard as the futs themselves, so you shouldn't feel deprived. But you still have that certain time lag to the futs and the "dummy factor" (lots of stupid / semi-semi-pro traders - only to be found on stocks!) on your side to get lots of happy fills and extra profits. Never on the futures! They're cut-throat, and there's always someone in before you are!
Sometimes, when I'm not feeling like an active day, I'll go into party atmosphere, put on great music and the smoke machine, load MXIM or the like into an extra chart (next to NQ and ES), plus a Naz Lv2 Screen, and just scalp the MM's socks off on low volume, like 2-5K shares, which ain't more than equal a couple of ES/NQ contracts. You have a clear, truth-telling tape, and truth-telling depth, no unpredictable arbitrage BS like on the futs! There are real, committed players on the stocks, and you can just read them and play them, shave iceberg orders etc.
It's (comparatively) an easy game. This is what I do if I wanna relax. It's my favorite video game.
The futures are a completely different story. To trade the futures, I need to do research, evaluate S/R levels, estimate retracements, pick the depth for all of arbing, fake and committed operations, get an idea of underlying volatility to calculate the intraday trading and scalping ranges, evaluate the strength of an array of chart patterns, analyze the P/V relationship, try to filter 'true' underlying bias etc etc etc and all this in my head. Of course similar applies for the stocks, but : You always have to be the first in & out the door, and if you aren't, you lose. In the stocks, you always have 'dummy-time', plus you have the 'lag' to the major indexes. On the futs, you are basically 'leading' the whole trading world, anything can happen and you'll be the first one to find out... It's a complete mind-f*ck.
Why don't I just trade stocks then? Because with any decent kind of size it becomes more difficult to 'move your stock', liquidity soon gets you. Plus the high taxation etc. But you're just learning, man! For the purpose of learning, large stocks are ideal.
You can do it, Fast. Your journals are good, your thinking is good and your approach is right. You're not gambling, you just need a little more practice. Do not despair. It would be silly to assume you're gonna learn this in a couple of months. This is a job that takes a long time to learn and longer time to master. How long does it take to become a 767 pilot? Long time. You can make more money as a trader - So would you expect it to work out for you quicker???
Sure, I might have jumped in pretty fast myself, but I have been looking at this stuff, position trading, developing systems etc for years before I started "actively" and then scalping.
You are far from being a successful scalper. You need to learn longer-swing trading first, because in order to scalp, you need maximum experience, fast reaction and evaluation skills and full control of your emotions. There's a subtle difference between flying a Sopwith Camel and an F-16 TomCat.
Let me put it sums: In the profession of trading, and particularly learning to trade, your lowest goal is to make more. Your main goal should be to last as long as you can. The longer you last, the better you'll get. If you last long enough, you'll eventually make it. But to last is the goal for now.
You can do it, Fast. Just take it slow.
Scientist.
Great post. Just wondering how many years it took you to become a consistent money maker.
I think he got a hold of it pretty FAST
-Fast
FastTrader, you just said in another thread:
In fact, assuming you did ~5 RT/day, over 90% of that is commissions. Much more even if you've traded some stocks in the meantime. So it's only the commissions that are killing you.
And welcome to the club.
You're doing well, Fast. Just keep persevering, and you'll get there. Do your due diligence and work out a really good system. Forward-test it on charts and evaluate the figures in Excel to fine-tune, and you'll soon be able to build very powerful, high-hitrate, low-risk systems indeed. No indicators, no mechanical stuff. Just good discretionary systems that you can prove have worked well on charts. Be honest with yourself, and don't kid yourself into thinking that you can just learn to trade "from experience". You really need to do the maths and stats. I still do this every day. It's much easier than software development, and potentially much more profitable, too.
All this in the last paragraph is the best advice I can give you!
Warmest Regards,
Scientist.
Fast, seriously, if you've started actively trading every day 5 months ago, on top of that in ($50K) futures, and you're only down $2.6K, then I draw my hat to you, because you're doing seriously well.Quote from Fast_Trader:
I'll let you know once I'm profitable...so far, a little over 5 months and down $2.6K including commiss.
-Fast
In fact, assuming you did ~5 RT/day, over 90% of that is commissions. Much more even if you've traded some stocks in the meantime. So it's only the commissions that are killing you.
And welcome to the club.
You're doing well, Fast. Just keep persevering, and you'll get there. Do your due diligence and work out a really good system. Forward-test it on charts and evaluate the figures in Excel to fine-tune, and you'll soon be able to build very powerful, high-hitrate, low-risk systems indeed. No indicators, no mechanical stuff. Just good discretionary systems that you can prove have worked well on charts. Be honest with yourself, and don't kid yourself into thinking that you can just learn to trade "from experience". You really need to do the maths and stats. I still do this every day. It's much easier than software development, and potentially much more profitable, too.
All this in the last paragraph is the best advice I can give you!
Warmest Regards,
Scientist.
Quote from Scientist:
FastTrader, you just said in another thread:
Fast, seriously, if you've started actively trading every day 5 months ago, on top of that in ($50K) futures, and you're only down $2.6K, then I draw my hat to you, because you're doing seriously well.
Agree, $2600 over 5 month is a low fee to pay to learn the market. You are doing well for a 5 month old trader.
Scientist, as far as I can remember you use a trillion indicators on your charts...
TM Trader
Fast, I have looked at some of your trading logs and it appears that you never make or lose more than a few points per trade.
Have you worked at your edge (including transaction costs) to see if this style of trading is profitable? Eg risk 2 pts to make 2 pts, 0.25 slippage on stops, 60% profitable, $5 rt brokerage, edge would be:
.6 * 100 - .4*100 - .4*12.5 - 5 = $10 per trade.
A 60% win rate on a 1:1 strategy is not an easy feat IMHO, and the payoff of only $10 per trade does not seem worth it any case.
For arguments sake, if you were risking 5pts to make 5 with the same 60% strike rate, your edge would then be:
.6 * 250 - .4 * 250 -.4 *12.5 - 5 = $40 per trade.
This is more viable as the impact of transaction costs relative to average trade are greatly reduced. Maybe you could play around with win% and win:loss ratio in Excel to come up with some levels that you think are achievable. Eg, you might go for 50% winners, put your stop at 4 pts with a 6pt target.
Have you worked at your edge (including transaction costs) to see if this style of trading is profitable? Eg risk 2 pts to make 2 pts, 0.25 slippage on stops, 60% profitable, $5 rt brokerage, edge would be:
.6 * 100 - .4*100 - .4*12.5 - 5 = $10 per trade.
A 60% win rate on a 1:1 strategy is not an easy feat IMHO, and the payoff of only $10 per trade does not seem worth it any case.
For arguments sake, if you were risking 5pts to make 5 with the same 60% strike rate, your edge would then be:
.6 * 250 - .4 * 250 -.4 *12.5 - 5 = $40 per trade.
This is more viable as the impact of transaction costs relative to average trade are greatly reduced. Maybe you could play around with win% and win:loss ratio in Excel to come up with some levels that you think are achievable. Eg, you might go for 50% winners, put your stop at 4 pts with a 6pt target.
what is with 4 point stops...6 point target...??? will u make money doing that?? what if u don't see 6 pts, but u c 4 or 5...3 pts per day can make u rich...contracts r easier to capture than points..3 points X 4 contracts=$600/day.....it gets more serious with every tick..up or down..
there is a magic number for all markets. I have watched them stumble all over it on these forums...lurking to see if it is public knowledge....so far, no luck...discretionary traders always end up losing...scalpers get scalped...if u can add and subtract, u can find it. notice that same info is passed around and around..what goes around comes around..good night
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