Swing Trade Play 11/11/05
- Thread starter MacroEvent
- Start date
I wonder if this would work in intraday trading. You'll have to be real fast on the keys that's for sure ;-) .
I think it could work, but it will be a little less efficient because there is less opportunity for replacing etc. especially in tight range or runaway markets. I have to close all my positions overnight though at the firm I work for.
I think it could work, but it will be a little less efficient because there is less opportunity for replacing etc. especially in tight range or runaway markets. I have to close all my positions overnight though at the firm I work for.
i already have the long side covered 24/7 in a different trade --- "Ratio Trade"
http://www.elitetrader.com/vb/showthread.php?s=&threadid=51893&perpage=6&highlight=hft&pagenumber=5
this swing is a separate trade and only my 8th of the year (3 longs and 5 shorts} --- the whole purpose is to show how order replacement can work and to take a swing when everyone else {the herd} would not even think of it. most people think you have to wait for price to fall off to some point to initiate a swing trade --- i am not constrained by that limitation of thinking {well all the books say..........}.
or maybe all the threads here at ET should just be about how to make 1 tick a day --- because the thought of discussing any "other" ways of trading are just to difficult to try and comprehend. how dare i show some of the trading i do!!! :eek:
yes this is exactly what we do in the IOAMT chatroom everyday for intra-day scalping off market profile generated s/r levels --- works very good.
well i was out of town on friday {the day several weeks ago when the dow was up something like 178.00} and the following monday so i missed my chance for the entry long. still had 3 good "long" swing trades earlier in the year.
do you read??? i have covered 1/4 of my position {1/8th and a 1/8th} for roughly 20 points, and my position has a cost basis of 1271.00 and today we closed at 1266.00 -- so yes my remaining 3/4ths of the original position are in the money as of close today.
please do not ever try this --- you can't even follow what i am doing.
Quote from MacroEvent:
I have 40% of my ES position on from 1234.00/.25/.50 and i will scale in the remaining entries all the way to 1239.00 --- above 1239.00 i will have a 5 pt stop to 1244.00.
time to take a swing at this move.
at 1239 according to your plan you should have 100% positioned for short with 5 points stop.
ES closed at 1266 today.
Yet you still disagree that going long at 1239 would be a better call.
Stop wasting fancy words for your strategy. It should be called HOLD AND BIG HOPE with dollar cost averaging.
The problem is you do not follow your own discipline and you are convinced that you are right. Market doesn't care.
you are absolutely wrong --- i am in no way dollar cost averaging.
i am REPLACING orders from lower price levels at plus one tick {covering them --- NOT HOLDING!!!!!!!!!!!!!} while always holding ONLY the orders entered from the higher price levels to form the swing trade position.
at the end of each day my position is one size, it is not growing in size day after day accumulating more and more positions -- as price action allows the lower price levels entries are given back {covered} at one tick profit and the highest price level entries are then held as the "swing trade position" {the size of the swing trade at the close of each day stays the same --- only the highest price level entries are held up to the total amount of positions that i will use for the trade}.
just go back and keep doing what your books tell you --- do not try this!
i am REPLACING orders from lower price levels at plus one tick {covering them --- NOT HOLDING!!!!!!!!!!!!!} while always holding ONLY the orders entered from the higher price levels to form the swing trade position.
at the end of each day my position is one size, it is not growing in size day after day accumulating more and more positions -- as price action allows the lower price levels entries are given back {covered} at one tick profit and the highest price level entries are then held as the "swing trade position" {the size of the swing trade at the close of each day stays the same --- only the highest price level entries are held up to the total amount of positions that i will use for the trade}.
just go back and keep doing what your books tell you --- do not try this!
i do not have a clue when the market will have the next down leg {do you???} and i do not need any hope to be successful in a swing trade, but what do i need ----------
i need a trade entry management method that will give me the flexibility to be in the market on the day that it decides to start the next down leg -- that i have.
so lets look at probabilities --- when i started entering positions for the trade i had several prior ES peaks of resistance just above my initial entries {and the high of the year as resistance}. i also entered after a multi-week run up that had not completed any pull back {maybe one due -- you never know?}. so i entered the trade when there would be NUMEROUS resistance levels at "my back" to offer the ability for "order replacement" if the rally continued. this means that as price hit the several resistance levels in a continued rally it would have the probability of bounce downs {allowing order replacements} at these levels on the first test {not just blasting right up through the first time at a next resistance level}.
if you understand how the market really trades {auction theory and market profile} then you will know how to use s/r levels in combination with order entry management to be "in" the market at the time it decides to change course --- because if YOU already know "when" it will change course then what are you doing here {you should be a trillionaire by now}.
LEARN
DON'T GET ANGRY AND 
BURNCombining your strategy, minus the S/R lines, so you do a long version and a short version in the same account, you get the following:
Start out with no positions, just markers where the positions should have been. You have a long and short position at each of these markers, and thus no real position currently.
If the market goes up, "replace" the positions that would have been replaced if you were trading the short plan only. This means buying at those values a quarter point below the old markers, using a limit order, and afterward selling at the new higher marker level, also with a limit order.
If the market goes down, "replace" the positions that would have been replaced if you were trading the long plan only. This means selling at those values a quarter point above the old markers, using a limit order, and afterward buying at the new lower marker level, also with a limit order.
After running through this a few times you will see that this is really nothing more than the following: When the market goes up a bit, buy at limit a bit lower. If filled, sell at limit a bit higher. Vice versa is done if the market goes down a bit rather than up.
With the S/R lines removed and choosing not to bet on market direction, you basically have a scalping technique to capture small moves in the opposite direction of the most recent move. Could this be profitable? Possibly, but only if your commissions are very low. The profit per trade is tiny.
Could the S/R lines make this more profitable? Possibly, but I have yet to see any S/R related system consistently make money over the long term. You usually have many small gains that are offset by fewer large losses (for fade bets) or many small losses that are offset by fewer large gains (for breakout bets). The net is usually about break-even long term minus commissions.
Could the bet on market direction make this more profitable? Possibly, but if you are good at predicting market direction then you don't need any of the rest of this. Such an edge is sufficient by itself.
If I have misunderstood your strategy then I apologize. I am just trying to offer up some of my insight, albeit unsolicited.
-Raystonn
Start out with no positions, just markers where the positions should have been. You have a long and short position at each of these markers, and thus no real position currently.
If the market goes up, "replace" the positions that would have been replaced if you were trading the short plan only. This means buying at those values a quarter point below the old markers, using a limit order, and afterward selling at the new higher marker level, also with a limit order.
If the market goes down, "replace" the positions that would have been replaced if you were trading the long plan only. This means selling at those values a quarter point above the old markers, using a limit order, and afterward buying at the new lower marker level, also with a limit order.
After running through this a few times you will see that this is really nothing more than the following: When the market goes up a bit, buy at limit a bit lower. If filled, sell at limit a bit higher. Vice versa is done if the market goes down a bit rather than up.
With the S/R lines removed and choosing not to bet on market direction, you basically have a scalping technique to capture small moves in the opposite direction of the most recent move. Could this be profitable? Possibly, but only if your commissions are very low. The profit per trade is tiny.
Could the S/R lines make this more profitable? Possibly, but I have yet to see any S/R related system consistently make money over the long term. You usually have many small gains that are offset by fewer large losses (for fade bets) or many small losses that are offset by fewer large gains (for breakout bets). The net is usually about break-even long term minus commissions.
Could the bet on market direction make this more profitable? Possibly, but if you are good at predicting market direction then you don't need any of the rest of this. Such an edge is sufficient by itself.
If I have misunderstood your strategy then I apologize. I am just trying to offer up some of my insight, albeit unsolicited.
-Raystonn