Me and the ES

Quote from Boib:

what is your average win and average loss?
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After commissions:

My average loss for these 2 days is $99 per trade (4 losers)

My average profit for these 2 days is $33.75 per trade. (13 winners)

My order goes in with a 2-point stop loss and a 1-point or 1.5 point take profit. If I don't see the trend moving how I want, I bring that take profit into 1 or 2 ticks from entry to at least break even.


Off the bat, an average $99 loss and $33 gain sounds scary to me. It means I need 3 wins for every loss just to break even. So far, I have been average exactly that - 3:1 winners/losers, but thats with a 92% successful day (not sustainable).


Some questions for anyone reading:

1 - How far off are my average loss/win $ figures from where they want to be?

2 - How far off is my attempt at a 3:1 win/loss ratio?

3 - What should I look at changing? Tighter stops? (not necessarily right?) Longer take profits (this could be true, I see myself missing out on a lot of action often, and I dont go green and then turn into the red too often, hmmm)


Really appreciate the dialogue, thanks guys.
 
Another good day today, mostly doing what I did on Tuesday. Am I trading well on the 2 of 3 winning days so far? Or am I just getting lucky with the market following my orders? We'll find out in a few more sessions.

Performance
- # of Trades: 8
- # of Winners: 7
- % Winning Trades: 87.5%
- # of ES ticks/points profit (after commisions): 19 (4.75)


Today's Trading
- I went back to what was working for me on Tuesday.. Paying attention to the MACRO direction - the MACRO (240 WMA) trend.. In this case, it was down. I came into the day with a short bias and shorted all day long.

- This meant that I was shorting on uptrends. The larger trend was down, but on a shorter timeline, price was trending up, I was not buying the bottoms, but I was shorting the tops.

- One of the other things I did today was to look out for any triangle patterns forming (lower highs OR higher lows). When I saw this happening, I stepped back and waited for price to get back into a wavy or range formation.


Average Retracement
- Average retracement on winners was 3 ticks. I did not get a whole lot of price moving against me after my entry. I am pretty sure the reason for this is because I am entering in a bit later. As I learned from yesterday's session, I can afford to wait an extra 30-90 seconds before making my entry to really confirm that I am on the trend down in my direction. I'm really happy with this change of technique so far so I will continue.


Average $ profit for winners
- I averaged $39.64 on each winner today. This is even with 3 of 7 winners being only $7.50. The other 4 were up between 60 and 90 dollars. My average loss (only 1 loss) was $42.50.

- What does this mean? It means I'm really happy with my trading today. My 'big' winners means I was letting my profits run when I could. My small winners was from getting stopped out 1-tick in the green to ensure profit. Today, none of these stops cost me from playing in a continued trend in my direction, so I am happy with that. That said, I feel like I got lucky with the stops today. I expect that this stopping will cost me some profits, and it may be a negative technique..



Tomorrow's Trading Plan
- 2 main lessons this week to take into tomorrow:
1) Find out the macro direction for the day and try to hold that bias through my trades all day. This means even shorting on an uptrend if the macro direction is down.

2) Wait for an extra candle or so before jumping in to confirm that price is really starting a move in my direction. I was jumping the gun before trying to call the 'top' of a wave.. I can afford to lose 2 or 3 ticks if it means ensuring the wave has topped and is coming back down.
 
Mixed bag today.. I started out in the red early on this morning but managed to dig myself out of it into profitability right before lunch (barely).

Performance
- # of Trades: 5
- # of Winners: 4
- % Winning Trades: 80%
- # of ES ticks/points profit (after commisions): 2 (0.5)


Today's Trading
- I traded entries on my system really well today. I followed my short bias, which gave me some difficulty on the way up but which brought me back on the way down from 11:00 --> 12:00. I'm particularly happy about not taking any trades in the first hour of trading because I didn't see any good entries. If I can get comfortable not being in a trade, and not trading even once for the entire day, then I know that I am not overtrading.

- I didn't like my stop discipline today. I had an inner conviction that my shorts would return while price was running away upwards on me, so I kept sliding my stop up to prevent the trade from closing. On one trade, I slipped 24 ticks (6 points) in the red. My stop loss start at 8 ticks.. This trade ended up coming back and being profitable. When these 'runaways' come back, i take profit at a single tick cause my trade failed, I don't want to let it run, I need a new trade.

- The same thing happened about 10 minutes later where I let my stop-loss slide 20 ticks before price came back and I took a 1 tick profit..

- Question for anyone reading: Letting my stops get away from me like this is really bad right? I need to be comfortable sticking to my stop and not allowing losses to grow right?

- My follow-up question then is, when *do* you allow yourself to slide your stops out so you can stay in the trade? What are some indicators other than 'gut feel' or 'prayer' that allow stop-slippage?


Average $ profit for winners
- Average profits for winners is $45, average loss for losers today (1 loss) is $155. I'm not happy with the loss that big, but I'm not sure if I should always 'stick to my stops' or allow slippage.. Hmm. Any web-literature on this?


Tomorrow's Trading Plan
- I will do a follow-up weekly review post tomorrow or Sunday with a weekly status / performance update, and a weekly plan moving forward (not so much a technical trading plan but more a discipline / strategy plan, I don't think out as far as a whole week).
 
when u have a stop in ,95% of time take it,say your short 1295, u have stop at 1297 it moves to 97 ,u r stopped out, it goes to 1300 and returns down to 94, u sell at 1300 and close at 94, u lost 2, u made 6, u will often have a feeling and act on it ,and u were right but early, so get stopped out and reenter at a better price. 2nd scenario, you ride the loser for 6 points then panic and get out and it comes back and u were right but u lost 6 points,now u have to try to trade with that nagging voice in the background calling yourself stupid, very distracting. 3rd scenario u get stopped out and it turns around and you would have made 6 but you lost 2 if u didn't reenter.. 1st scenario u made 4,2nd u lost 6 ,3rd u lost 2,,it's always about the numbers being right, if they look good trade, if not ,don't. I'm no methusala when it comes to trading but one of the hardest things to learn is to leave your emotions out of it,shake it off, it's business, never let it become personal.
 
Just curious about your chart setup since I too utilize Keltner bands in my trading. What are the parameters? Can you possibly post a chart or two illustrating how you're using the Keltner to your advantage?

Thanks in advance.
 
Quote from shortorlong:

- Question for anyone reading: Letting my stops get away from me like this is really bad right? I need to be comfortable sticking to my stop and not allowing losses to grow right?

- My follow-up question then is, when *do* you allow yourself to slide your stops out so you can stay in the trade? What are some indicators other than 'gut feel' or 'prayer' that allow stop-slippage?
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Yes, letting your stops to run away from you is bad. Although you might feel lucky to have captured 1 tick after a possible drawdown of 20 ticks, something just doesn't feel right about the whole thing. But, more importantly, your stop is placed too tight in my opinion. Unless your entry is a near perfection, 6-tick stop will get hit. Also note that no other market loves to gun down stops more than ES.

All in all, stops should NEVER be moved. When the stop is hit, it literally means that your analysis was off. You should review your trades to see how it could have been avoided.

Unlike others, however, I place more emphasis on the entry rather than the exit because if you made the correct entry there's no need to worry about stops. Well, yeah, that's easier said than done! :D
 
Yeah, I plan to switch to real money once I am reasonably consistently profitable. Probably 2 or 3 weeks I think.

To be clear though, I am not using simulated data. I am using a real-time data feed (IQ Feed) and placing orders in real-time. I'm just not using real dollars.


I will post some charts and answer the other questions tomorrow. Thanks everyone, great feedback, I'll address it tomorrow.
 
Quote from saliva:

Just curious about your chart setup since I too utilize Keltner bands in my trading. What are the parameters? Can you possibly post a chart or two illustrating how you're using the Keltner to your advantage?

Thanks in advance.
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I've attached a chart from a replay session I've been doing this afternoon. YM. I plan to switch to YM this week since I expect to start with real-money using the YM instead of ES at first.

The chart shows the wavy action that I look for. I've circled a few points where price clips top of Keltner band which is my short signal.

I've also got DMI and Stochastics on there but I'm really just looking at the price candles, and sometimes at volume but I havent worked volume into my strategy yet (I plan to).

Anything stick out on the chart that I am doing wrong? Could be doing better?
 

Attachments

-- Weekly Performance Summary - Tuesday March 4 - Friday March 7 --

# of trades - 30
# of winners - 24
% winning trades - 80%
# of ES ticks profit - 24


I'm pretty happy with the performance above for my first week. It was all done on the ES.. In order to have smaller swings, lower initial margin requirements, I am going to switch to the YM this week. Problem is - I've been simming the YM all weekend and not doing too hot. I find myself getting stopped out a lot more often.


Lessons from last week
1. Be careful if the trend is 4 or more waves in. Trends rarely last for more than 4 waves.

2. If price is not wavy like I like, do not trade. Even though its sim-money, I should not trade just to try/learn. More important is learning to follow my system (psychology).

3. Find the macro-trend / bias. Follow this bias almost exclusively.

4. Wait for a wave to top and then start heading down before jumping in short. Be sure to confirm the new trend that I am jumping on.

5. Look for triangles and other patterns that suggest a change in trend. If these are strong enough, don't trade, wait for new wavy trend.



Major themes for the week coming up
1. Try the YM. This is because I will probably be starting out with the YM with real money. Need to learn how this beast moves. Some things I've noted so far is that it seems more volatile. Perhaps need to open up stops or re-confirm entries..

2. Come up with a stop-placement system. I need a system that looks at daily volatiltiy, or the volatility trend for the last X minutes, and adjusts stop-placement based on that. Perhaps I can also have different stops depending on what # wave I am in on a particular trend. Perhaps I can also modify stop placement based on average retracement on entries for the day. Whatever it is, I need something formal so that I can stick to the system and not allow myself to push out my stops. If I can make a rule, I will follow it, right now there is not even a rule..


If anyone reading has tips on differences they've seen between YM and ES (volatility, 'feel'/'predictability', trend, etc) that would be great.


Hey thanks for reading, seeyas tomorrow.
 
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