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Rule of 10 Journal
- Thread starter jagmot
- Start date
the problem with the rule of 10 concept has been the line in the sand has constantly changed. for instance some people have used a 24hr running period to take entries when it suites them and at other times the rule of 10 has been based on intraday or some type of reaction lows. the rules have changed constantly to make it always look right. if changing the rules works for one thats fine but then it becomes that persons own trading style and not a firm rule most can use. for instance few stay up 24 hrs a day so use 24 hr periods make it tougher to follow. and many times the rule of 10 might now work so then you move to rule of 20 and on and on. and what are ones stops off the rule of 10? 2 pts? 3 pts? are you doing this on market hrs are 24/7? what are your stops/ what are your profit targets? i'll be interested to see how this works out
Quote from joeyata1:
and what are ones stops off the rule of 10? 2 pts? 3 pts? are you doing this on market hrs are 24/7? what are your stops/ what are your profit targets?
Setting stops correctly is one of the simplest strategies in trading. Anything like "3pt stops" is ridiculous. If you are going with the Rule of 10, at least place them to the recent peak high. In yesterday's example it would be slightly above 1291.75. Setting a 3pt stop is entirely subjective and will lead to unnecessary losses.
Besides that, I'm looking forward to this journal. It requires practice and experience to interpret retracements and reactions accurately. Most of all PATIENCE to sit through the wiggles in between! Wish you success.
Quote from jagmot:
I'm bored of all the critics of Rule of 10...so I'm going to papertrade Rule of 10 to show it can be traded on a profitable basis. For journal/papertrading purposes, I will be using 1 contract.
Here are the rules I am going to use when trading
This journal is going nowhere because:
-If you are incorrect, everyone will say it doesn't work.
-Even if you are correct, you will most likely post your exit after the market has reversed and everyone will say it worked in hindsight and therefore doesn't work (See ES journal).
No scaling in/out is going to kill you when the market goes +9.5 points or you don't have a perfect entry. Also, the fact you are papertrading will probably skew the results.
If you can get this to work for you, who cares if other posters believe if it works or not? Good luck though.
Quote from trader_arb:
This journal is going nowhere because:
-If you are incorrect, everyone will say it doesn't work.
-Even if you are correct, you will most likely post your exit after the market has reversed and everyone will say it worked in hindsight and therefore doesn't work (See ES journal).
No scaling in/out is going to kill you when the market goes +9.5 points or you don't have a perfect entry. Also, the fact you are papertrading will probably skew the results.
If you can get this to work for you, who cares if other posters believe if it works or not? Good luck though.
I couldn't disagree more. I think this has the potential to be one of the great journals, and I say that as one who thinks r10 is a sack of b.s. If I turn out to be wrong, I'll be the first to admit it.
So, I'll bite...
We're at a reaction low right now, correct?
Ok, then...
Long 1279....3 handle stop. 6 handle target.
I picked 6 handles 'cuz 2:1 reward:risk seems baseline healthy for this kind of approach.
Let the games begin
Quote from MandelbrotSet:
Rule of Tend trades only happen intra-day, and usually are for 2pts ES for every 10pts it has moved.
I agree ... 10 point moves off ROT are the exception. You need a much smaller target for just 1 contract. If you are scaling out on multiples that's a different story.