MES starter question.

[Ivano]

@BKR88 thanks to put the effort to show the chart and go quantitative:

200-300 eu loss would be OK, putting on the plate more technical predictability, and the possibility to short getting filled without tick rule

@SunTrader :
Thank you to give me also a quantitative response, I think if I do trading outside news days, and when is quiet may manage the risk if is an high probability setup

@VEGASDESERT
The point is that I do not want to swing when the market is in ranges(the majority of the time, that is why i want to trade MES), and shorting SPY means in any case to run a margin account, whereas I am more comfortable with Cash, and want to get filled instantaneously, but indeed I could go long intraday with SPY, that I already do when technical are clear to me

@hilmy83

Please allow me to jump into and to add to your response to Scataphagos, because I like what you say, because is what was looking for confirmation: if I am near the screen with 1 mes lot, and I am open to 50 eu loss trading in a quiet moment, do not think can lose more than 200 eu so easy, and losing 200 eu is a good investment if this brings me near to add to my tools this fantastic MES Swiss knife tool.

After all, the paper trade MES I opened 5 hours ago now is -238$ now, and is not so bad compared to the 20k we were hypothesizing as outlier max loss for a black swan. I could have reached easy a 20 $ gain today, and would be enough for me for the next 5-6 months to familiarize.
I think there is in fact another advantage compared to swinging stocks/etf: A noob get caught by the change from bulls to range bounded or bear, instead in the futures you can have volatile or not volatile periods, but due to the intraday nature and the possibility to short so easy, paradoxically is more easy to get consistent even if the market changes!

 

[murray t turtle]

even the micros can give you big losses because you'll do dumb things
and "take advantage" of your leverage and average and do stupid shit like that..

if you have 25k id recommend trading like 10 or 20 shares of spy.

or if not, maybe trade the daily chart and swing.

i think you'll get more out of it even if you want to ultimately day trade.

%%
Good points;
SPY= start wisdom= liquidity leader.
May even want to trade 1 SPY until he knows answer if its wise ''to average down??''
Real dumb try to learn with leverage; but one poster that suggested that here would not even admit a bull or bear market was anything but'' random.''LOL
LOL Dont even trade anything if dont know the difference between a bull or bear market; nothing would be suitable for that trade ..................................
Even though buy every month/quarter for 40 years on SPY in bull uptrend or other directions could make millions.

 

[easymon1]

the paper trade MES I opened 5 hours ago

What triggered your buy or sell to enter that paper trade MES position?

 

[Snuskpelle]

Highly unusual, though. At least on ES.

As far as I know, the CPI news releases last year have been the only times in a market session in recent time where liquidity simply disappeared and you'd probably face a > 50 point slippage on a market order.

Agreed. But you can blow up just that one time if you decided to use a stupid amount of leverage.

the problem with options is that although i would lose only the premium, if one is not expert to put in place a multi leg strategy(And i am not), would just execute a put or call transaction, that does not help when(= the majority of the time) the market is range bounded because I am betting in a directional increase of volatility.

I don't do options either, precisely because it it's fairly complicated to use them correctly. It's better not to use something you have not made the effort it takes to learn properly. I just stay away from stupid amounts of leverage ever since I had an accident (not complete blow up) involving J Powell causing an intraday gap at the COVID through (and I was in CFDs on futures, which didn't help, might have been shoddy stop execution on Oanda's part or might not).

 

[Laissez Faire]

Agreed. But you can blow up just that one time if you decided to use a stupid amount of leverage.

Yes. I'm sure quite a few people actually did blow up that day since the action was so unusual.

It should be noted that it was a scheduled news release, though. It can be wise to stay flat during those anyway.

 

[schizo]

*** Is stop loss safe?
if I have a stop loss reasonably tight on the right daytrading setup ( I would reckon something between let's say 5-10 ticks) will be the SL have considerable slippage in period of black swan volatility?

If you have a "right daytrading setup", namely you perfectly timed your entry and got in at the exact bottom or the top, then you don't need to worry about stops. But that's nearly impossible in reality. Hence you need to use stops. In a typical bull market, 3 points (or 12 ticks) would be enough to absorb the shock. If you still get stopped out, that means your timing is off. In a bear market, however, 3-point stop will almost always get hit. You will need 10 point stop just to get by all the chops.

Will SL have considerable slippage in period of black swan volatility?

Let's just say you will NEVER be able to get out of your trade while the market is tumbling.

*** how much can be a bad loss on average in a day without SL?
In your experience in the worst day of the year how much can i lose for a single MES contract if hypothetically do not have SL?

This was the largest losing day of 2022. If you got in at the open and out at the close, you would have lost $921 per contract.

 

[Ivano]

To wrap up, thanks all:
A)Short term solution
B)Replying your quotes

A)Short term solution(almost there):
After exhaustive study and your feedback
My real motivation to use futures is not the possibility to use margin, but to have a valid tool to make money when trend following does not work so that can become trader for a living with the future advantages of :I) transparency, II) lack of dark pools, III)volume that say the truth, IV)less manipulation, V) easy and liquid filled short executions with small bid ask spread.

But considering the risks involved and my level of experience, an ETF is liquid enough and being usually based on London Stock exchange i can short with my De Giro account(not IBKR cash), if want leverage can use 3x ETF intraday, if want an inverse for long time can use $SPDN or VIX

Maybe I could also hedge an option with a future, but not expert and not a quick win, my focus is to be profitable and build the basis to do it for a living, making profit also in situations where the market is not bullish.


PS my experience btw is not is not so bad, actually average losses are lower than av. gains 2:1)


B)Replying to your quotes to me:
@murray t turtle
>May even want to trade 1 SPY until he knows answer if its wise ''to average down??''
>Real dumb try to learn with leverage;
LOL

@easymon1
well paper is not real money, I was not testing a setup but only if is true that the price oscillates intraday as few suggested, anyway was a good volume pattern with an high tight flag on 1 hour, even execution from 1 hour, of couirse in real llife would not be enough to trigger, for paper trade I do not care

@schizo
thank you very much to take all your time to reply me fully understanding my needs! Really appreciate. Although you helped me please allow me to move a small criticism, just for the sake of understanding: as far as I know a flash crash is not possible anymore with all the mechanism put in place, but indeed would be impossible to sell a position if a 1987 black monday would be in place with tudor jones pushing me down

 

[Ivano]

Sorry to bother you further, but just come across this miraculous discovery!

DJA and Nasdaq futures are 0.50 per tick that should be I guess 1$ per point for Nasdaq and only 0.5 for DJIA vs the dangerous 2.50$ MES, this would make as a much less risky playground considering the super strong correlation of the three indices, and Powell can speak as much as he want!

 

[VSTscalper]

Sorry to bother you further, but just come across this miraculous discovery!

DJA and Nasdaq futures are 0.50 per tick that should be I guess 1$ per point vs 2.50$ MES, this would make as a much less risky playground!

This is on AMP Futures website.

https://www.ampfutures.com/trading-info/contract-specifications

 

[rb7]

Sorry to bother you further, but just come across this miraculous discovery!

DJA and Nasdaq futures are 0.50 per tick that should be I guess 1$ per point for Nasdaq and only 0.5 for DJIA vs the dangerous 2.50$ MES, this would make as a much less risky playground considering the super strong correlation of the three indices, and Powell can speak as much as he want!

The SPY was down 42 pts yesterday, while the DJIA 336 and the NAZ 195. Do the math.