Ok this is what happened while I was gone for breakfast. As can be seen still sideways action. Range has been going on for 40 or so bars. Price action hoovering mostly in the top 1/3 of the range. Certainly opportunity to average down in the top 1/3 and exit with profit at least two more times.
I have other things to do so I am stopping for today. Maybe if I get a chance in the afternoon I may make a trade or two. We will see.
This is 4 trades. Although I didn't draw colored lines for the first trade (can be seen better in post #448) it was one of the averaging down trades. All 4 trades profitable. All winners. Three were averaging down and one was just a two contract short scalp.
See averaging down can be profitable, in the right circumstances and senarios. But a trader should always have in place and in mind exactly where they will exit with a loss should price move against them. A trader CANNOT afford to hang onto an averaged down position that has moved against them enough to invalidate their original premise. Just take the loss and reverse doubling up or even tripling up is what I usually do. A trader should not just average down to be averaging down.
Remember this is little tiny MES and small positions. Never once did I have more than 6 contracts. But it would be no different if it was ES. Nor would it be any different had I traded large positions. ON MES I made $447.50 before commissions. If the same trades would have been ES with same position sizes the profit would have been...……...well you get the idea.
There is no point in me doing it with ES as it would seem to be so out of reach for the average retail trader on ET. So, I am just showing how one can use different tactics trading ranges in the MES. I have not yet covered all the tactics for range trading but learn these well and maybe practice them on a SIM. I will try to show some more in the coming days. Then we have to look at tactics trading BO's. And tactics trading channels and the latter we have covered to some degree.
Remember, the market goes sideways...then breaks out, then channels, then sideways again. That is the basic market cycle or phases. A trader just has to be able to identify and see these phases and employ tactics that work best in each phase. Even then, a really good trader, most of the time, has a 40% chance of getting it wrong so he has to know WHAT to do when he is wrong. How to take a loss and how to recuperate that loss quickly.
Folks can say or believe what they want about win rate but I had rather have a high win rate than a low one. Win rate, for me is one of the most important metrics in trading, especially in scalping. In scalping 1 to 8 or more points in say the ES it becomes almost imperative that a trader learn how to have a high win rate. And that he learns to take his profits as the market gives them to him. None of us can say with certainty what the market will do on the next 5 minute bar. But we can learn to capitalize on tendencies.
And remember in scalping (manual HFT I call it 1 to 8 points I don't care what you call scalping.. this is my definition of it), a bird in the hand is worth two in the bush. It simply doesn't matter what happens after a profitable entry and exit. Forget the "I should have held for more profit". Such declarations are "what if" concepts. But, "what is" concepts are what the market is ACTUALLY in real time giving you in profits, at this moment. Take it. There will be plenty of more opportunities for scalping all day long. Usually, 20 to 40 opportunities on a 5 min chart. What more can you ask for? To end the day profitable..and with a high win rate...and can take momma to Dillards instead of dollar general. The lady is happy and the trader is eating that ribeye instead of a 3.00 fast food Hamburger. Not to knock dollar general as they serve a needed purpose, but momma prefers Dillards.
Happy trading the rest of the day!
I have other things to do so I am stopping for today. Maybe if I get a chance in the afternoon I may make a trade or two. We will see.
This is 4 trades. Although I didn't draw colored lines for the first trade (can be seen better in post #448) it was one of the averaging down trades. All 4 trades profitable. All winners. Three were averaging down and one was just a two contract short scalp.
See averaging down can be profitable, in the right circumstances and senarios. But a trader should always have in place and in mind exactly where they will exit with a loss should price move against them. A trader CANNOT afford to hang onto an averaged down position that has moved against them enough to invalidate their original premise. Just take the loss and reverse doubling up or even tripling up is what I usually do. A trader should not just average down to be averaging down.
Remember this is little tiny MES and small positions. Never once did I have more than 6 contracts. But it would be no different if it was ES. Nor would it be any different had I traded large positions. ON MES I made $447.50 before commissions. If the same trades would have been ES with same position sizes the profit would have been...……...well you get the idea.
There is no point in me doing it with ES as it would seem to be so out of reach for the average retail trader on ET. So, I am just showing how one can use different tactics trading ranges in the MES. I have not yet covered all the tactics for range trading but learn these well and maybe practice them on a SIM. I will try to show some more in the coming days. Then we have to look at tactics trading BO's. And tactics trading channels and the latter we have covered to some degree.
Remember, the market goes sideways...then breaks out, then channels, then sideways again. That is the basic market cycle or phases. A trader just has to be able to identify and see these phases and employ tactics that work best in each phase. Even then, a really good trader, most of the time, has a 40% chance of getting it wrong so he has to know WHAT to do when he is wrong. How to take a loss and how to recuperate that loss quickly.
Folks can say or believe what they want about win rate but I had rather have a high win rate than a low one. Win rate, for me is one of the most important metrics in trading, especially in scalping. In scalping 1 to 8 or more points in say the ES it becomes almost imperative that a trader learn how to have a high win rate. And that he learns to take his profits as the market gives them to him. None of us can say with certainty what the market will do on the next 5 minute bar. But we can learn to capitalize on tendencies.
And remember in scalping (manual HFT I call it 1 to 8 points I don't care what you call scalping.. this is my definition of it), a bird in the hand is worth two in the bush. It simply doesn't matter what happens after a profitable entry and exit. Forget the "I should have held for more profit". Such declarations are "what if" concepts. But, "what is" concepts are what the market is ACTUALLY in real time giving you in profits, at this moment. Take it. There will be plenty of more opportunities for scalping all day long. Usually, 20 to 40 opportunities on a 5 min chart. What more can you ask for? To end the day profitable..and with a high win rate...and can take momma to Dillards instead of dollar general. The lady is happy and the trader is eating that ribeye instead of a 3.00 fast food Hamburger. Not to knock dollar general as they serve a needed purpose, but momma prefers Dillards.
Happy trading the rest of the day!
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