Quote from Simtrader:
THERE IS SOME SHITE DISCUSSED HERE! I see that we've got the 2 tick newbies out in force alongside the academics who don't even trade. Exellent BS to waste your time.
First off: trading Breakouts is the ONLY way to trade. All you buggers looking for the pullback are wasting your time. You just want to feel clever catching the turn. I bet you donât make any money. If itâs real, it ainât pulling back, Jack. As for the buggers who trade with 2-4 tick stop-losses: donât make me laugh!
You wanna make money? You gotta buy high (the higher the better) and sell even higher. You gotta sell at the bottom and buy even lower. The idea is the catch the momentum moves. Let everyone else scrap over the middle shit. And you gotta aim for enough profit to make it worthwhile. $200 a contract in the ES or forget it. You should attempt this only once (or max) twice a day. If you want to make more than $200, trade more contracts not more signals. The key is to know which breakouts. Hereâs the jist (not nec all my fine tuning):
5 min chart, standard Bollinger Bands with middle line a simple Mov Avg in place of the middle Boll line. Nothing else needed.
Buy Signal:
Wait for a bar whose high is sticking above the top Bollinger line and whose mov avg line is up compared to the last bar. Wait for a minimum of one bar that has a lower high (to generate a pivot high), and also wait for a bar whose low is lower than the pivot high bar. This can happen within 1 bar or 15 bars. I usually prefer to wait at least 2 bars after the bar high in order to create a proper pivot (this is discretionary). Buy 1 tick above the pivot high on a breakout. Sell automatically for $200 profit. Trail the stop behind any strong up bar (open at bottom, close at top, decent range) otherwise keep it $150-$200 away or behind a pivot low. Reverse logic for sells.
Now hereâs the key. Look for ONLY one trade from 09:40 â 11:30 EST and only one trade from 20:00 â 22:15 EST. Do not trade any other hours or any other signals no matter what. This is what is known as having patience and discipline. Make your $200 in the morning then piss off until the last 2 hours (or donât come back at all). Will you miss some moves in the middle of the day? Yes you will. The aim is not to be a clever arse. The aim is to make money by focusing on strong momentum moves. Let everyone else tear each otherâs hair out in the middle hours - while you go to the gym. You wanna trade when the institutions come into the market and drive it. That means the first two hours and the last two hours. It helps retain focus.
Best tip of all:
Apply the first trade to the DAX because you can make a shite load more money. Most Yankee Doodles donât even realise that the DAX and ESTX50 markets trade until 14:00 EST. Many yanks have probably never even heard of "Eurex" the worlds biggest (& 100% electronic) futures exchange. Yet these two symbols are fabulous markets to daytrade. Way better than ES and NQ. Theyâre electonic, liquid, and available through your existing US broker (if not, move your account). They are less choppy and less subject to false breakouts. DAX is for the big boys: it's a big grizzly bear (with c. 100,000 daily volume). ESTX50 (c. 500,000 daily volume) is the perfect ES substitute i.e. it moves about the same money. You don't have to live in Europe to trade these markets from 09:40 - 11:30 EST. Just make sure you collect the data overnight.
June 3rd attached: a day when neither target was hit in the ES. [Anyone can handpick a day to show how great their idea is]. I chose this day to show what happens in a less than perfect scenario. You still made money in the ES, but you would have made much more money taking the same signals in the DAX or ESTX50 because those targets WERE hit.
Now let's go back to the tick traders and academics for some more BS. After all, I've got so much free time between my trades to laugh at their nonsense
BTW, I didnt get where you put your initial stop.
pretzel