Losing my edge

Although there are people that are capable of developing (and executing consistently) an edge , risk mgt and entry/exit strategies on short time frames such as 1min (and doing it on a manual basis— not with an auto trading algorithm) making money on short time frames on ES on a consistent week to week and month to month basis is not really do-able.

I would suggest to you that you go the opposite direction and start looking at the ES on larger timeframes with the smallest timeframe being 60 minutes

So:

Hourly Chart
4 hour Chart
Daily Chart
Weekly Chart

develop an edge based on larger time frames and major support resistance areas

you still have to create (and execute) a daily trade plan (entries, exits , risk mgt), be open to change based on real time MGI (market generated information) have an opinion but be open to change -dont be biased (right fighter) or married to any specific as market conditions can and will change on the fly (i.e have both a bearish and bullish plan each day on ES so you know where to enter and exit on either one and you also know where you are wrong on either one)

Keep detailed journal and notes on what you did right and wrong each day

strive to get better and learn from mistakes



Ernsuksathaporn said:
Hi guys, I know there are tons of experienced trading in here. I started day trading futures(Micro E-mini) this March. Although I had experience in trading other financial instruments for a year and a half now(stocks, forex, options). I was experimenting with different time frames and different instruments. I came to realize that I really like trading the shorter time frames like the 1min and 2min charts. I currently use the market profile and some order flow to give me confluence on trades.
I started my first month trading live with a 25% profit, probably beginner's luck. Now I have been in a losing streak for the past 2 weeks, wiping all the gains and losing even more.
I decreased my trading size and tried to make my losses as small as possible. I still can't find a way to come back and win again. I feel like I lost my edge and nothing seems to work...
What should I do? If any experienced trader can shed some wisdom, thank you.
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Beginners luck in trading is a killer. It instills false confidence

it happens a lot in options trading - people really have no edge , no plan , no risk mgt , no journaling

Just random Trades with random results

Luck is not repeatable edge to base a trading income off of. You can’t depend on Luck to pay your bills each month



southall said:
ES is hyper competitive. Will take you years to become good at trading it, if ever.

Yes, you experienced beginners luck, in this business when new traders start they are bold fearless and undamaged by any previous losses. They can take big risks, let losses run until they come back, and so make money over the short term..

Once a trader takes a few big losses (the loss didnt comeback but got bigger) and goes into the hole. They will never get that mindset back again. Not unless they are compulsive gamblers. Its like losing your trading virginity and innocence.
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Losses are part of the trading business. You have to know where you are wrong and be able to lose small and fast and not hang onto (or worse add onto as well) losing positions —hoping.......that they turn around.

Every now and then they do turn around and unfortunately that is where many traders beginning to develop a bad habit and false sense of security that they can keep doing that over and over when they feel like it - instead of robotically cutting losses consistently, quickly and often as part of a risk mgt plan.

There is always another trade , but there won’t be if you blow your account up hanging onto a losing trade. Many massive losses that blow up people’s accounts -especially in something like ES and NQ — started out as small or modest losses an mushroomed as time continued and the trader refused to get out looking for a turnaround —or worse— kept averaging down and adding to the Losing position hoping for a turn around that would at least get them out breakeven.

southall said:
ES is hyper competitive. Will take you years to become good at trading it, if ever.

Yes, you experienced beginners luck, in this business when new traders start they are bold fearless and undamaged by any previous losses. They can take big risks, let losses run until they come back, and so make money over the short term..

Once a trader takes a few big losses (the loss didnt comeback but got bigger) and goes into the hole. They will never get that mindset back again. Not unless they are compulsive gamblers. Its like losing your trading virginity and innocence.
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Being able to code just ain't the same as trading. A great trading system isn't written with codes but developed through years of experience. Just my worthless 2-cents.
 
Does your strategy have a statistical edge?

If not, other things don't matter, you'll still be losing in the long-run.

If yes, it's just part of the process, you'll be profitable if you done enough trades.
 
Buy1Sell2 said:
Folks, the only edge in successful trading is Prudent Risk Management and the utilization thereof.
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ironchef said:
Easy for you to say.

I tried to say the that and got shouted down: :banghead::vomit::mad::p:cool::confused:

https://www.elitetrader.com/et/thre...-the-only-true-edge-in-trading.292728/page-76
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In that thread, others posted, then I said,

userque said:
I don't have a dog in this fight, but let's suppose that in your same example, if you went with a random entry, rather than the strategy's entry, and the strategy also failed, even with the stop-loss. Would risk management still be the TRUE edge, in your opinion?
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ironchef said:
Like you I actually don't have a dog in this fight either, and I didn't say risk management is THE TRUE edge, I was asking could it be AN edge..

I have no opinion, just trying to understand risk management and what it really does.

What do you think?
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userque said:
Ok, gotcha.

Using a default Google definition of "edge", that I can agree with:

"a quality or factor that gives superiority over close rivals or competitors."

If everyone is doing it, or knows about it, it can't be 'an edge,' by definition, imo. This is so whether it's the entry or exit or hedging or risk management, or anything else, strategy.

So all of the usual suspects (kelly, etc.) can't be edges, imo. (Unless they are being utilized in some novel way.)

You can enter with a standard MA crossover; and have an edge with risk management and exit strategy,

Or you can enter with a strategy that has an edge regarding entries; and have basic kelly risk management with a typical exit strategy.

Edges aren't mutually exclusive, imo.
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As of this writing, no other comments followed.

So, @ironchef , what's your current position on the matter? I won't shout or debate, just curious. :)
 
the below is true but even with a statistical edge
that is also assuming that:

You practice consistent Risk Mgt across every trade

All trade entries to open a trade are done in a consistent fashion

All managing of live trades is done in a consistent fashion

All trade exits to close a trade are done in a consistent fashion

some people have an edge (I.e trading certain setups or trading VWAP or whatever the “edge” is) but having a statistical edge is not enough

even option traders who use only the most statistically advantageous trade entries and option order types can totally screw up the trades due to any number of factors including risk mgt , poor entries and poor mgt of trade while in it and poor exits,






Trader H.C. said:
Does your strategy have a statistical edge?

If not, other things don't matter, you'll still be losing in the long-run.

If yes, it's just part of the process, you'll be profitable if you done enough trades.
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