My journey to profitable trading: NQ price action journal

Yesterday's P/L was actually +$12.44.

Today didn't go all that well. I only placed one trade and was quickly stopped out for a 1 pt loss.

I did have some bad luck though. The trade that I was stopped out on hit my price exactly, then quickly reversed for what would have been a nice gain. I placed another order and had system trouble, my order stayed 'pending' rather than being sent. That trade would have been good.

I spent the rest of the morning trigger shy. I passed on a few more trades that would have been good. I ended up getting up and just went for a walk like I often do. These things happen in trading, but the important thing is that I kept my cool and kept my emotions out. Tomorrow is a new day.

Today's results:

1 Trade

1 Loss

-1pt

Net P/L -$47.56
 
No trades today.

I'm going to be trading just one contract from now on. I was trigger shy again today for some reason.

I tried to place one trade, but I sent the order and the market moved past my price, and that was it for the day.

We'll see what happens tomorrow.
 
Today was a better day. I didn't realize that I had my order still set for 2 contracts, so the first trade that was essentially a scratch was 2 contracts. After that I figured that I would just leave it. I know it may seem like I am changing my mind and jumping all over the place, but I'm just trying to find what works for me. Ideally I'm looking for .75-1pt or more for each trade, but this is just how things worked out today.



Today's results:

3 Trades:

1st trade: +0.25pts
2nd trade: +0.75pts
3rd trade: +0.50pts

Net P/L +$37.32
 
VV Cehpei said:
Today was a better day. I didn't realize that I had my order still set for 2 contracts, so the first trade that was essentially a scratch was 2 contracts. After that I figured that I would just leave it. I know it may seem like I am changing my mind and jumping all over the place, but I'm just trying to find what works for me. Ideally I'm looking for .75-1pt or more for each trade, but this is just how things worked out today.



Today's results:

3 Trades:

1st trade: +0.25pts
2nd trade: +0.75pts
3rd trade: +0.50pts

Net P/L +$37.32
More...

Quick question if I may. First, do you account for commissions? Mine are $2.02 per contract, so gaining 1 tick profit, hence $5 and then paying $4 is essentially a break even trade, so this isn't all that profitable. I notice you say the first trade caught you off guard though so I certainly understand why this was a quick exit.

Second, if you are going for 1 point profits, what is your stop? If it is also 1 point, then you would need to be right much more than 50% of the time for this to be profitable. I think I have read NoDoji say before that she knows scalpers who are right 90% of the time, so a 1:1 risk to reward ratio works well for a 90% win rate, but I'm just wondering what stats you're working with.

Hope this isn't asking too much, and I can certainly understand why you aren't going to be posting charts if you've got something really good here.
 
Hey, thanks for following along and sure, I don't mind questions.

I use Ninjatrader as my brokerage, and I also use their software. I bought the 6 month lease, so my commissions are $3.78 round trip per contract. All three trades today were for 2 contracts each. So today I paid $7.56 in commission for each trade. My gross today was $60, and after I paid the $22.68 in commission for 3 trades I was left with $37.32.

To be honest, I still don't have any really set in stone rules about stops yet for this style of trading. I'm undecided whether instead of having fairly tight stops and having them tagged often only to reverse, I might be better off to just use my judgement on a case by case basis while not letting anything get away from me too much. Things can and will change as I move forward though.

I had one point stops in 2 days ago, and I didn't use any stops today. I was just going to make the call and cover if I felt I had gotten in at a bad entry or things weren't working out.

I don't have nearly enough of these scalps yet (recently) to see what my win rate is, but the last time I was in the markets (2008) it was around 75% or maybe a bit more from what I can recall. But my problem then was I'd post 7 days in a row of gains ranging from $50 - $90, then on the 8th day I'd get a trade than ran away from me and I'd post a $400 loss. So in the end it was a wash.

But my method of scalping this time is also a bit different than before. From what i can remember my entries now are different compared to back then, so we'll have to see how it goes. It remains to be seen if I have anything or not, but what I'm doing would probably be described as counter-intuitive and perhaps contrarian, so the potential for things to get away from you is certainly there.

Now, I figure as long as I can keep the size of the losses under control, I have a fighting chance.

For my trades at the beginning of this journal, the 1:2 r/r trades, I would pick my entry, place my OCO order and walk away. That's what I did because it worked for me. Anything was better than sitting there sweating each bar. So I've found my preference to be that I tend to like to get in, and get out fairly quickly. But, if this method of scalping doesn't prove to be effective after awhile, I'll go back to the 1:2 trades.

But as long as I don't take any large losses, I have a lot of confidence that I can make this work.

One way that I look at it is this: If I posted a $20 gain, some may think "that's barely worth it", and to an extent they may have a point. But to me, if I can eke out 'only' $20 a day on average, that's 400 per month, and for an account the size of mine, it's about a 35% return. Now of course that's assuming a high win rate and controlled losses, but my point is that it is a good plan for me if I can make those numbers work. But if I stick to 2 contracts, I'd be ideally hoping to post more than that, but we'll see!

I read your journal too by the way, and I liked a post you made a few days ago comparing change in behaviour in pick-up to trading. I've also went on a similar journey myself, so I can relate. For trading, I have lots of my own ideas and advice, but until I can prove profitability myself, it would be like the blind leading the blind, so I keep my advice to myself! :)
 
LOL... blind leading the blind is exactly what this is cause as you can see.. I'm not exactly killing it with my wins. Like you, I sweat every bar, which is stupid. Its even more stupid because I know why I do this, and its because I don't actually have a well defined trading plan where I know exactly what I'm looking for and how often it works and at what point I have to get out.

Its funny how back when you made 60-90 for a few days in a row, if you just made the simple tweak of keeping your max daily loss to 90 you might still be in the game.

I like the idea of scalping because you know right away the outcome and just do it over and over again. Its easy to be on auto pilot without thinking too much and collect $20 bills along the way. Of course once you get good, if you trade 5 contracts, than collecting $100 bills is just as possible I think.

But I do think the right way to go forward is to know your setup so well that even if you are wrong 3 times in a wrong, it still doesn't phase you because you know the statistics are on your side. Even if you have a 75% win rate, having 3 losses in a row is not that statistically uncommon, although I don't know the exact math. Even with a coin toss that is 50/50, having 3 heads in a row happens more often than you would think, but after 100 you probably get quite close to 50/50.

So just make sure to look over tons of charts and find this setup where ever you can and see what happens. Maybe a tweak of going to 1.5 points profit or loss will make it that much better as opposed to 1 point... or perhaps even a 1.5 profit with only a 1 point stop loss will be the sweet spot that you only have to get right 50% of the time.

If I do as well with trading as I've learned to do with women I will be rich! ;) And of course being rich helps immensely with the women... hahahaha!
 
Haha yea, well a little money never hurt, that's for sure!

And lol, I don't mind any advice or critique of what I'm doing at all, I'm a fairly stubborn guy and will do things my way most of the time anyways!

Well my plan is to have most wins in the range of anywhere from .75 - 1.25pts, and then have a few here and there that work in my favor quickly and give me 2 - 2.5pts. But this is all just talk now really, it remains to be seen what actually happens once I have 20-30 trades with this method under my belt. I'm pretty sure I'll have a few new rules or ideas as a result of a trade or two not going my way.

One thing with me is that I may be stubborn, but I'm always open to new ideas and will change my plan on a dime if I truly believe I've found something that will work better or suit me better. Nothing is written in stone.

And with the scalping, I'm just trying to capture a small piece of predictable movement, that's pretty much it. I'll figure a way around it, but with me using stops will lower my win rate. Not using stops I will have a higher win rate but have the potential for fewer but larger losses. Although it's 'bad' in theory, sometimes I let a trade go against me a bit more than I should, and then have it return in my favor and go my way when I don't use a stop. The drawback of doing this, of course, is that sometimes you may let it go a bit too far and it doesn't come back. And with an account my size, I need to say 'uncle' at some point.

I suppose, like most things, the right balance is to be found somewhere, and again I think the right answer is up to the individual and what makes the most sense for them based on their personality and plan.
 
Yes.. all these things are individual choices which makes this trading journal such a personal yet fulfilling en-devour. In my experience though, each time I held on longer, it killed me. I think getting out when I know I should, but being aware of re-entering quickly if stopped out will probably work better for me going forward. Especially when it comes to scalping, my thoughts are that a 3 or 4 point loss when profits are only 1 point each would spell disaster. But good thing that you're stubborn!
 
Yea I agree, it's keeping the losses under control with what I'm doing that will determine success or not. I really think that things should be kept as simple as possible with trading, and being patient and disciplined enough to find something that works and repeating it consistently over time is key.
 
Just one trade today.

Today's results:

1 Trade

+2.25pts

Net P/L +$82.44

One thing that I noticed with the Ninjatrader stats that I'll post later is that on a couple of trades it reported a couple of my 2 contract orders as separate trades. And it also applied most of the commission to one contract where I only made +.25pts, so I have one long trade that shows a 0.67 loss. But the overall P/L is right, so that's the main thing.
 
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