How to lose little

Great thread, if I can add my 2 coins the best that worked for me was to understand volatility and stop-hunting events.

Order book (market depth), price action and basic risk management work well to make a decision on where to place a stop, imho.

From what I have back-tested and saw in live markets, stops must adapt to market events in the sense that should be automated. I don't see a static stop attached to the entry working well in most cases.

If you are going to have to change stop levels manually you are playing with a disadvantage, as the initial market conditions and analysis, that made you place the stop in the first place, might have changed at the time it is reached.
 
The value of Index or stock price has much to risk for my trading. When ES was half of the value it is today, I was able to risk 4-5 ticks with trend signals, as the value has increased and to retain same losing percentages, risk increased to 2-3 points in ES. Recently risk has increased to 5-6 points and target has not increased equally, it has doubled except for runners has dramatically increased, most of the contracts exit at target for consistent equity curve. For ever nine contracts that reach target, one left as runner, which seldom make large profits. 65% of my entries are counter trend, so only chances for large runner is next counter trend signal doesn't come for ten minutes. Have started back testing original counter trend reverses into another counter trend that becomes breakeven trade then to reverse back into original counter trend trade which really has became trend trade to gain larger swing profits.

Another factor that has been reduced, all trading stops at 14:15cdt, too many breakeven and losses occur more frequently after and not enough time left for recovery of a loss. When values were smaller would generate 70-80 signals in 390 one minute bars, now 40-50 signals in 345 bars.

When ES was under 1500, it was easier to risk 3 ticks to make 1-3 ticks, but scalping has changed where risk is insanely higher risk to keep losing percentages same and still profitable. Have turned off 6 scalping automation systems cause average per trade has gotten so low, they were not made for value of ES to be so large.
 
Handle123 said:
The value of Index or stock price has much to risk for my trading. When ES was half of the value it is today, I was able to risk 4-5 ticks with trend signals, as the value has increased and to retain same losing percentages, risk increased to 2-3 points in ES. Recently risk has increased to 5-6 points and target has not increased equally, it has doubled except for runners has dramatically increased, most of the contracts exit at target for consistent equity curve. For ever nine contracts that reach target, one left as runner, which seldom make large profits. 65% of my entries are counter trend, so only chances for large runner is next counter trend signal doesn't come for ten minutes. Have started back testing original counter trend reverses into another counter trend that becomes breakeven trade then to reverse back into original counter trend trade which really has became trend trade to gain larger swing profits.

Another factor that has been reduced, all trading stops at 14:15cdt, too many breakeven and losses occur more frequently after and not enough time left for recovery of a loss. When values were smaller would generate 70-80 signals in 390 one minute bars, now 40-50 signals in 345 bars.

When ES was under 1500, it was easier to risk 3 ticks to make 1-3 ticks, but scalping has changed where risk is insanely higher risk to keep losing percentages same and still profitable. Have turned off 6 scalping automation systems cause average per trade has gotten so low, they were not made for value of ES to be so large.
More...

This is a solid example of how things change. Which suggests all system need to have a "health check" so one can adjust BEFORE it becomes sub optimal.

Every instruments has a "feel" to it and it changes. The "locals" create the feel because they are the ones moving things around. Which suggests that people wanting to day trade, focus on a single instrument at first and "go around the block" ten times and get consistent.

Just another 2 ticks of free advice, while taking a break from reviewing Fridays 186 paper trades against some system improvements. No substitute for reviewing, after action, post mortem, etc. imo.:thumbsup:
 
It really is complicated.
Prices move? OR....
Someome moves them..
Rather it is the second Then..
The only way to operate is to know how to interpret the volume.
Otherwise you are lost and will never be able to intuit the next move.
Some people say..
Price action,
Yes that's correct, but in my opinion if you don't know how to interpret the volume you're just playing.
 
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