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Oh No, NOT Another S&P EMini journal...
- Thread starter goodday
- Start date
Quote from JimmyJam:
all gaps are closed eventually ... emphasis on "eventually".
while i'm sure it's something to be aware of, i'm not sure that it's something to trade by
best,
jimmy
Hi Jimmy
Thanks for that observation. You are absolutely right. Timing is the big issue... not "if" the gap will be closed but "when". I have had reasonable success playing the gaps but I have also had really bad days precisely because I have been too stubborn to acknowledge that the market might not get there on that particular day. In my book, the jury is still out on whether the gaps are worth trading profitably and consistently, especially f you are a strict day trader like me and does not hold anything overnight.
SOmeone suggested that if an opening gap is not closed by 10.30 AM, it is not likely to close that day. I have found, however, this is not always true. SOmetimes afternoon trades will fade the morning gap. Do you have any observations in this regard?
Quote from goodday:
Do you have any observations in this regard?
Just that in Japanese trading (we all know how good they are at this game - actually, we don't even really know that, we just know what we've been told ...) GAPS are called WINDOWS and they are never faded until the market proves that they are not relevant (when the market trades at least halfway back through them).
I spend a lot of my time over at the S/R thread, and look to play the breakouts (like the one happening now), so, in general, I never fade a gap, but rather always look to trade in the direction of the established trend.
Best,
Jimmy
Quote from goodday:
Timing is the big issue... not "if" the gap will be closed but "when". I have had reasonable success playing the gaps but I have also had really bad days precisely because I have been too stubborn to acknowledge that the market might not get there on that particular day. In my book, the jury is still out on whether the gaps are worth trading profitably and consistently, especially f you are a strict day trader like me and does not hold anything overnight.
Something that just occured to me, if your thoughts on fading gaps can be proven with the stats, it may be a usefull methodology to fade them using options (no clue, just an idea that popped into my head).
Later,
JJ
Goodday it is interesting to observe your mindset as a trader unfolding. Even though you say you don't have an edge, I would say that "YOU" are your edge. Within your inner computer there are all sorts of calculations going on when focused on your market all based on implicit learning, or simple years of practice. So you are your own edge and that can never be bought or sold.
Do you study your records?
Based on figures posted here, you have a profit factor roughly of 4.18 on gross profits. However if you are paying $2 a side this drops to maybe 1.9 and $1 a side is 2.38. To stay above 2.0 I consider essential for a pro. Get above 3.0 and you definitely are the edge. The Lower your comms, better the PF.
Next you need to know your compound ratio. In my experience over some 20 years, if you have a good PF and CR you have arrived. Om Tat Sat.
Do you study your records?
Based on figures posted here, you have a profit factor roughly of 4.18 on gross profits. However if you are paying $2 a side this drops to maybe 1.9 and $1 a side is 2.38. To stay above 2.0 I consider essential for a pro. Get above 3.0 and you definitely are the edge. The Lower your comms, better the PF.
Next you need to know your compound ratio. In my experience over some 20 years, if you have a good PF and CR you have arrived. Om Tat Sat.
12 noon to 4 PM trades:
Short 208 contracts.
closed for a profit of $1925.
Very choppy action. I was stopped out once when the ES went past 1284.50 and lost $$$. Then I re-entered shorts when the down move stated again, and made a small profit. Lots of contracts traded but very small profit... need better execution and tighter stops.
Short 208 contracts.
closed for a profit of $1925.
Very choppy action. I was stopped out once when the ES went past 1284.50 and lost $$$. Then I re-entered shorts when the down move stated again, and made a small profit. Lots of contracts traded but very small profit... need better execution and tighter stops.