My Scalping Journal

S

scalperX

Hello traders,

I've just started scalping index futures for a living with a proprietary trading firm. Over the next two years, I'll be posting my progress and would love to get different perspectives from other experienced traders.

Goal:

On a per contract basis, my daily target is to make 20 ticks with a maximum down limit of 15 ticks.

Sticking point:

I've been scalping the ES in the Asian session for 2 weeks now. And one of the problems I realized is that my risk:reward ratio is not very good. I'm always capturing 1 tick move, and giving it all back when the market moves against me by 2-3 ticks. Does any of you face this problem when you're scalping? I'd love to hear from fellow scalpers who have went through the stage that I'm going through now.

Looking forward to sharing my thoughts and learning from everyone on the forum. :)
 
Scalping is a losing proposition in the long run, even more so if done manually with subjective judgment involved. The answer to why you are giving back 2-3 ticks after making a tick profit: the tick movements are random. It's common sense. The sooner you accept that, the better. This thread won't last two years.
 
Quote from Bombardier:

Scalping is a losing proposition in the long run, even more so if done manually with subjective judgment involved. The answer to why you are giving back 2-3 ticks after making a tick profit: the tick movements are random. It's common sense. The sooner you accept that, the better. This thread won't last two years.
More...

Hi Bombardier,

thanks for writing your thoughts down. I wish i could accept that tick movement is random because I've seen with my own eyes that fellow traders in my firm who're consistently profitable scalping the market.
 
Quote from Bombardier:

Scalping is a losing proposition in the long run, even more so if done manually with subjective judgment involved. The answer to why you are giving back 2-3 ticks after making a tick profit: the tick movements are random. It's common sense. The sooner you accept that, the better. This thread won't last two years.
More...

Thanks for writing down your thoughts, Bombardier. I really appreciate it. I must say that maybe tick movement isn't really random ALL the time because my senior traders are consistent scalping the market.
 
Hi,

I am new on board also. I don't have any good advise to give you since i am new to trading but i'll be following your journal as i'll start scalping the Eurex very soon.

Good luck.
 
Quote from scalperX:

And one of the problems I realized is that my risk:reward ratio is not very good. I'm always capturing 1 tick move, and giving it all back when the market moves against me by 2-3 ticks. Does any of you face this problem when you're scalping? I'd love to hear from fellow scalpers who have went through the stage that I'm going through now.
More...

And that is exactly why I quickly gave up on scalping :) You need a very high win percentage to succeed and it is very stressful. I`m not saying it can`t be done, but the rewards are too small for me and with HFTs dominating that time frame, it is just not worth it for me.

Why not capture one or two larger intraday swings instead?

Not sure if scalping the ES during the Asian session is the best idea. The liquidity is rather low yes? Do the spreads remain as tight as during the US session?

Good "luck"! :)
 
Quote from OrderFlow:

Hi,

I am new on board also. I don't have any good advise to give you since i am new to trading but i'll be following your journal as i'll start scalping the Eurex very soon.

Good luck.
More...

That's good. Let's learn from each other. :)

Quote from Laissez Faire:

And that is exactly why I quickly gave up on scalping :) You need a very high win percentage to succeed and it is very stressful. I`m not saying it can`t be done, but the rewards are too small for me and with HFTs dominating that time frame, it is just not worth it for me.

Why not capture one or two larger intraday swings instead?

Not sure if scalping the ES during the Asian session is the best idea. The liquidity is rather low yes? Do the spreads remain as tight as during the US session?

Good "luck"! :)
More...

Hello Laissez Faire,

That's right. Scalping requires "perfect entry" and "perfect exit" in order to maximize our return. As my edge comes from technological edge, scalping does give me some advantage compared to retail trading since my commission cost is very much lower.

I agreed - could have scalped some other index futures. It's low in comparison to the U.S session but the spread is still pretty tight. So, it's fine.

Quote from Snowman75:

Gotta agree with Laissez on this. Why trade ES on Asian time? Find another futures contract with liquidity in your time zone.
More...

Thanks. I should be switching to some other Asian contracts soon.
 
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