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I think I'm done trying to trade the ES
- Thread starter Audi_R8
- Start date
seems the big picture is being missed here.
trying to read price/volume purely on the intraday basis can only provide very little edge... just crank the puter and do a back test, any sort of set up you try will only give you minimal profit... or good profit over a short period of time.
here is thing, there is no short cut in trading..... you need a minimum of 5 years to get a feel.... you should be able to look at 1 year chart, 3 month chart of SPY and have a feel what the next week or so the market is likely to do.
This is your biggest weapon... once armed with it, time frame matters no more... slap on a swing trade, or leverage up during the intraday, it only becomes a matter of personal taste.
Stop looking at the wrong place. Looking at 5-min charts while losing sight of the big picture, is exactly why people goes nowhere.
trying to read price/volume purely on the intraday basis can only provide very little edge... just crank the puter and do a back test, any sort of set up you try will only give you minimal profit... or good profit over a short period of time.
here is thing, there is no short cut in trading..... you need a minimum of 5 years to get a feel.... you should be able to look at 1 year chart, 3 month chart of SPY and have a feel what the next week or so the market is likely to do.
This is your biggest weapon... once armed with it, time frame matters no more... slap on a swing trade, or leverage up during the intraday, it only becomes a matter of personal taste.
Stop looking at the wrong place. Looking at 5-min charts while losing sight of the big picture, is exactly why people goes nowhere.
ArcticTrader
Guest
Quote from dozu888:
seems the big picture is being missed here.
trying to read price/volume purely on the intraday basis can only provide very little edge... just crank the puter and do a back test, any sort of set up you try will only give you minimal profit... or good profit over a short period of time.
here is thing, there is no short cut in trading..... you need a minimum of 5 years to get a feel.... you should be able to look at 1 year chart, 3 month chart of SPY and have a feel what the next week or so the market is likely to do.
This is your biggest weapon... once armed with it, time frame matters no more... slap on a swing trade, or leverage up during the intraday, it only becomes a matter of personal taste.
Stop looking at the wrong place. Looking at 5-min charts while losing sight of the big picture, is exactly why people goes nowhere.
I agree. You should always be taking trades in the context of a larger trend, and have an idea of where the market is heading in the bigger picture.
For you uncertain or losing traders (including the original poster), you need to go and trade with a simulator until you know what you are doing. One of two things is going to happen: either you are going to "get it" on the simulator and start being consistently profitable, or you're not. If you never "get it" (meaning you learn how to profitably read price action every day), at least you won't lose any money in the process - only your time. If you do get it at some point, then you can graduate to real money. So how do you know when you are ready to trade real money? Easy. When you face the start of a week and are 100% certain that you will be trading properly and profitably that week on the simulator, you are ready for real money. If you ever find yourself "hoping" that the market is going to be good to you that day, you are most definitely not ready.
Finally, stop trading the ES - there are no style points in trading for degree of difficulty. Why so many small traders try to trade this terrible market is something I will never understand. You need to find a market that has a much better daily range in terms of ticks and slippage... CL for example (crude oil) regularly trades 150 to 200 ticks between the low and high of the day, and average slippage is around 1 to 2 ticks, plus .5 tick for commissions. Therefore, the total slippage cost to enter this market is around 2 ticks on average, or around 1% to 1.5% of the daily range. ES will trade somewhere around 40 ticks over that same time period, and the slippage cost to get in and out there (including commissions) is 2 ticks. That's 5% of the daily range, or around 3 times the round trip cost of getting in and out of CL. You really don't have to be a rocket scientist to figure out which market is going to give you a greater chance of success, if you think about it. Soybeans are also better than the ES in this regard, as is the Russell and the British Pound.
Anyways, your solution here is simple: practice, practice, practice on a simulator - preferably in a different market than the ES. You're not going to get it in one day, or one week, or even one month. It takes time. You'll know you're ready to trade real money when you feel absolutely no need to post any more questions on this forum, and then, and only then, should you fire up the live account.
You need to find a market that has a much better daily range in terms of ticks and slippage... CL for example (crude oil) regularly trades 150 to 200 ticks between the low and high of the day, and average slippage is around 1 to 2 ticks, plus .5 tick for commissions. Therefore, the total slippage cost to enter this market is around 2 ticks on average, or around 1% to 1.5% of the daily range. ES will trade somewhere around 40 ticks over that same time period, and the slippage cost to get in and out there (including commissions) is 2 ticks. That's 5% of the daily range, or around 3 times the round trip cost of getting in and out of CL. [/B][/QUOTE]
I have been using PA to trade a single contract NQ on five minute charts because I like the $5 tick size. I am shooting for trades that can produce two points + because I don't think it is the instrument to try for a one point scalp.
Suggestions?
I have been using PA to trade a single contract NQ on five minute charts because I like the $5 tick size. I am shooting for trades that can produce two points + because I don't think it is the instrument to try for a one point scalp.
Suggestions?
you cant trade your account, 1 tick, 2, stop losses, . Think of a yo-yo.it has a string and when the string is full out, your circle can never extend beyond that radius. You are stuck in a small circle in a big expanse. The mrkt doesnt even acknowledge your yo-yo. So trading your acct you are never really in the market , you are stuck in your own little world, it'll never work. Better to think of a barnacle in a lake or an ocean , and you migrate from ship to ship feeding off of it. At best ,anyone here on et is a barnacle on a ship,as small as that sounds, you see the whole ocean,and you have to adjust to survive,you are not just a yo-yo on your ring finger.
Have any of you guys had success kind of hedging your bets by going long in either ES or YM and shorting the other and having a stop on both assuming one will stop out and the other will run?
it worked in papertrading but i only attempted it 2 days.
during the day i really only have a chance to look at a chart every 30 minutes to an hour but not on a continual basis like i'd want to.
It'd take some work to get the stops right though to where you didnt get stopped out on both. Like the past couple of days i had the one that i thought would run the most with a really loose stop and the opposite direction was pretty tight so that worked out but it's hard to pick direction perfectly in this crazy market.
it worked in papertrading but i only attempted it 2 days.
during the day i really only have a chance to look at a chart every 30 minutes to an hour but not on a continual basis like i'd want to.
It'd take some work to get the stops right though to where you didnt get stopped out on both. Like the past couple of days i had the one that i thought would run the most with a really loose stop and the opposite direction was pretty tight so that worked out but it's hard to pick direction perfectly in this crazy market.
It seems like every few weeks a newbie is posting some variation of what audi posted. Experienced traders know just how hard this game is, so they tend to be discouraging. Other newbies who have made some money tend to underestimate how hard it is and volunteer advice that is well-meaning but useless.
If you are committed to trading, you will find a way. For example, have you researched all the advice given to other newbies on ET over the years? Have you studied the journals that are posted here? Have you researched the incredible posts by Acrary on system trading? Or are you just looking for someone to hand you the keys to the kingdom? People who have spent years and tens of thousands of dollars developing a methodology are not just going to hand it over because you ask. You have to do the work.
The first piece of advice I give in this situation is to get some backtesting s/w and spend weeks testing. People will say backtesting proves nothing, but how do you expect to make money in the future if you can't make money on historical data? You will quickly learn a few valuable lessons,eg popular indicators are not helpful, volume is not helpful, tight stops are not helpful, scalping for a tick or two is nearly impossible, systems that make money for a few weeks often then blow up.
The next piece of advice is to trade with the dominant trend of the next higher time frame. If you're daytrading, trade only in the direction of the 60 minute trend. That eliminates a lot of indecision right there because if the trend is up, you will not take a short trade for any reason. Will you miss the ocassional reversal? Yes, but that is the price you pay for having a methodology that keeps you out of a lot of bad trades.
Then you need to develop an entry trigger. It can be an oscillator divergence confirmed by the break of a moving average, a trend line break, a reversal bar, a break of a pivot level or other significant level,etc.
Then you learn to manage the trade. Take your mental stop to b/e after it has gone n points in your favor. Learn to spot failures, significant levels where price is drawn to, etc. This is the art part of trading, knowing when to exit.
Discipline is crucial because it is very easy to piss away a months worth of profits on one bad trade. Respect your disaster stop, never let a profit go to a loss(profit defined as b/e plus a noise zone), don't let more than half a big profit retrace. Expect to make a lot of mistakes and suboptimal decisions, always remembering the key to long term success is to avoid the big killing loss or string of losses.
Trading is not an everyday activity. Take time off, be aware of burnout. Keep in mind it is about making money, not being right or proving to the world how smart you are.
If you are committed to trading, you will find a way. For example, have you researched all the advice given to other newbies on ET over the years? Have you studied the journals that are posted here? Have you researched the incredible posts by Acrary on system trading? Or are you just looking for someone to hand you the keys to the kingdom? People who have spent years and tens of thousands of dollars developing a methodology are not just going to hand it over because you ask. You have to do the work.
The first piece of advice I give in this situation is to get some backtesting s/w and spend weeks testing. People will say backtesting proves nothing, but how do you expect to make money in the future if you can't make money on historical data? You will quickly learn a few valuable lessons,eg popular indicators are not helpful, volume is not helpful, tight stops are not helpful, scalping for a tick or two is nearly impossible, systems that make money for a few weeks often then blow up.
The next piece of advice is to trade with the dominant trend of the next higher time frame. If you're daytrading, trade only in the direction of the 60 minute trend. That eliminates a lot of indecision right there because if the trend is up, you will not take a short trade for any reason. Will you miss the ocassional reversal? Yes, but that is the price you pay for having a methodology that keeps you out of a lot of bad trades.
Then you need to develop an entry trigger. It can be an oscillator divergence confirmed by the break of a moving average, a trend line break, a reversal bar, a break of a pivot level or other significant level,etc.
Then you learn to manage the trade. Take your mental stop to b/e after it has gone n points in your favor. Learn to spot failures, significant levels where price is drawn to, etc. This is the art part of trading, knowing when to exit.
Discipline is crucial because it is very easy to piss away a months worth of profits on one bad trade. Respect your disaster stop, never let a profit go to a loss(profit defined as b/e plus a noise zone), don't let more than half a big profit retrace. Expect to make a lot of mistakes and suboptimal decisions, always remembering the key to long term success is to avoid the big killing loss or string of losses.
Trading is not an everyday activity. Take time off, be aware of burnout. Keep in mind it is about making money, not being right or proving to the world how smart you are.
What do you consider to be "greener pastures"???
Walt
Walt
Quote from Dustin:
Congratulations, you have just learned the valuable lesson that efficient markets are extremely difficult to trade. Now take what you've learned and move on to greener pastures.
Quote from Shazbatz30:
+1
Quote from jones247:
What do you consider to be "greener pastures"???
Walt
Stocks Walt, stocks.
Better movement, less efficient, more opportunity EVERY day, find your setup as opposed to waiting for it, spread your risk across number of positions, and a bunch of other things.
The ES is more of a size, liquidity, macro thingy.