Techniques for Day Trading the ES, NQ, YM, MES, MNQ, and MYM

[volpri]

Nine scalps today, when I had time to do them. Could not trade the entire session. 8 winners. 1 loss. A scalper needs to maintain a high win rate. IMO.

I could not trade from around 9:00 a.m. till 13:10 as had other things to attend too but there were plenty of opportunity to trade during that time span.

Of the 81 5m bars in an ES session money can be made on most any bar using various tactics such a TR tactics and BO tactics and price probing by both bulls and bears. Bulls and bears always active in all sessions. All TF's.

This drives home the point that scalping renders many more scalping opportunities. A strictly trend trader wouldn't have had much to trade today except or maybe that opening BO south in first 30 minutes or so. I traded that BO with multiple scalps and then traded the sideways TR movement later in the session.

A repost of one of my posts in another thread. I think the chart of todays trading shows forth some of the salient points in that post:

"It is not more risky. It is actually safer. Scalping being more risky is a myth and mis-conception traders have had drilled into their brains..And it is based upon false viewpoints of “noise” in the market. And the extremely false concepts that they are random. Do we know why traders subscribe to the concept of “noise and “that markets are random?” It is easy to understand why if we just think through it. See, all this B.S. is deep wired.

Think about it. It is far easier to talk and forecast, possible, likely, probable, weather this afternoon than say weather a month from now. Can anyone guess why?

Think about it. Money is only at risk “when” it is IN THE MARKET. LOGICALLY what does that imply for scalping vs long term trading?

Think about it. Scalping increases trading opportunities for the session.

Think about it. Scalping enhances the opportunity for compounding.

Think about it. The market gives and the market takes away. Scalping lets one lock in profits. (Remember the story….bird done sh$t and gone).

Think about it. Scalping enhances profit potential. For instance, say the ES moves up 40 points. And a trader gets in when the move starts and he captures the entire 40 points. Successful scalping will render him much more in points because there will be many PB’s, many overlaps of bars that can be traded, many probings by bullish and bearish firms that can be traded…etc It isn’t likely the 40 point move will happen on one 5 min bar. It can but that would be abnormal.

Think about it. Why don’t more traders scalp?

I will qualify something. Scalping I see as 1 to 8 points in the ES on normal days, with most being in the 2 to 4 point range. On volatile days it can be bigger. I AM NOT TALKING ABOUT a one or two tick scalp."

 

[NoahA]

Looking at the chart, it looks like you had a bunch of longs on those first few bear bars that you probably bailed on for a loss. And then it looks like you went in the other direction and made up for the loss? I would love to see this on a 1 minute or faster chart if you don't mind. I'm curious at what point you decided to exit the failing longs and then went short.

 

[volpri]

This should explain.

 

[volpri]

It was a total off 9 trades. 6 in A.M. and 3 in P.M. 8 winners. One loss. See the double-up and reverse direction to short gets my previous loss back and gets me back in profit on a much smaller move (in distance traveled) that happened when the loss took place. That way I am not fighting the rest of the session just trying to recoup a loss. Hopefully that makes sense??? I can now go on to more profits and forget the loss. This is a scalpers world and he has to get back losses quickly or he may end the day BE and who wants to do that?

 

[volpri]

For the benefit of those wondering, if there be any; why did I exit those three longs in the circle with a loss and why did I averaged down in the first place.

First lets look at the open. We got a gap up open. The first bar closes as a bear doji. Remember a doji is a one bar trading range. When it took a little bounce back upon that second bar after the open I reasoned price would probe back down and I could get a scalp because the opening bar close as a one bar TR. It is reasonable to think the bottom of the trading 1 bar range would be tested. So I shorted multi-contracts on that second bar capturing a quick 2 point scalp.

Now for the averaged down losing trade. That second bar after the open closed low but also bearish. However, it's low did not fill the opening gap. I am thinking that since we had an opening gap (even though small) we would probably get another bounce back up as bulls and bears both exert pressures. So I entered long near bottom of this bar. The third bar after the open was also a bear bar closing near it's low. The gap is close to getting filled but not quite yet. So, I add more long averaging down still betting on a bounce back up to catch a scalp. But look at that 4th bar. It closed the gap. I added more long still betting on a push back up to test the opening high of the day. But guess what happens instead begins to drive down creating an even bigger bear bar. So count the bear bars. Counting the bear doji we now have 4 bear bars since the open with the last increasing in size over all the others. There are gaps between the low of one bar and the low of a previous bar. That indicates some urgency. We got tails on top of all 4 bear bars. That indicates selling. All bars are closing near their low. We got 4 consecutive bear bars. All these things indicate more weakness to come even if there is a PB.

As we are getting close to the close of the 4th bar I reason my premise is wrong. What was my premise? I was betting on the gap and going long betting we would get a bounce up towards the high of the day. But instead the gap closed. So that premise is denied.

In addition, then price keeps going down and the dynamic (as it is going down is, driving down with more force. The premise of a bounce
back up has evaporated the closes we got to the close of that 4th bar.

I can see I am betting in the wrong direction. Nothing to do but exit and take the loss and quit averaging down. Just get out and reverse, as now the MOM is down. Gap has closed. 4 consecutive bear bars. Increasing in size. Tails on top. A break below both MA's.

Now the BETTER bet is down. A bet that we will at least get enough of a move down that I can recoup my loss and probably make some profit. So, I double up on bar 5 after a slight implied PB of the low of bar 4. Once I get my entire loss back and a profit I GRAB it then revaluate. I then take 3 more trades adding to my profit locking each one in as price continues down. Why don't I just hold until the low of the exhaustion bar 8:55? Well mainly because it is in the making and has not finished yet so I don't know if price will reverse and head back up, or what. So, as that bar is being formed (i.e. the 6th bar) I am gonna enter and exit...enter and exit...enter and exit as price works it's way down. What is the principle here? I am locking in profits. I am not letting that bird fly away and leave me a handful of crap to grab. And I am winning over and over. I am maintaining a high win rate which in my belief, is necessary to be a successful scalper. I am following the MOM down which by the way can stop dead at any point and whip back up. If it does it won't whipsaw me out of paper profits cause I done locked them in. Jingle jingle. Big jingle if trading large size.

You can see the rectangle at the bottom right as the time goes by. That is TR behavior. I use another set of tactics for trading a TR once it expands out to 15 to 20 bars. I made those three afternoon trades in this TR using TR tactics.

Anyway, thought this my be useful if traders can see the thought processes and logic as price unfolds.

Notice lower right the range within a TR. Often price will do this and I will draw both in and trade off both of them. Although it is not drawn in the very first chart that I posted in my post 1681 above. The smaller range is shown there. But again the point to remember to start using TR tactics like fading the outer edges you want to first see 15 to 20 bars sideways motion. Does anyone know why?

 

[Overnight]

...But again the point to remember to start using TR tactics like fading the outer edges you want to first see 15 to 20 bars sideways motion. Does anyone know why?

View attachment 270897

Counter-question. Assuming the time stamps match, how would you see the play on unirenkos? The end of chart is where yours ends as well.

 

[volpri]

Counter-question. Assuming the time stamps match, how would you see the play on unirenkos? The end of chart is where yours ends as well.

View attachment 270905

Boy that is a good question. I have never traded unirenko charts. I am not sure how they work. I do see a trading range after that big push down from there to the end of your chart. I suppose that could be traded with TR tactics as it shows as as a range. Draw range in and fade outer limits until their is a BO????

What benefit do you see for using unirenko charts over time based charts. Do they tend to shows trends better? Reversals better? I know some people use heikin ashi charts.

 

[Overnight]

...

What benefit do you see for using unirenko charts over time based charts. Do they tend to shows trends better? Reversals better? I know some people use heikin ashi charts.

It is not that I see a benefit of using the unirenkos over other bar types...It is just that it is the only bar type I have ever traded since I started trading in 2014. My main question to you is...matching the timestamps, could you see a way to adapt your method to that bar type?

For the scalping/average-down method you use, it certainly seems easier to see on the time-based bars. But since I have never followed those bar types in real-time, I cannot fathom the action of them on a chart as the day progresses.

 

[NoahA]

But again the point to remember to start using TR tactics like fading the outer edges you want to first see 15 to 20 bars sideways motion. Does anyone know why?

I think you want to see an equal balance now between the bulls and the bears. Without waiting the 15 to 20 bars, it might still just be a pullback in a downtrend, so if you're going long at the bottom of what you think is a range, but isn't a range yet, you might get caught in a long that will fail because you were too quick to call it a range.

 

[volpri]

I think you want to see an equal balance now between the bulls and the bears. Without waiting the 15 to 20 bars, it might still just be a pullback in a downtrend, so if you're going long at the bottom of what you think is a range, but isn't a range yet, you might get caught in a long that will fail because you were too quick to call it a range.

Yes that is the basic concept. PB’s are traded differently. You want to make sure you are in substantial Trading range even though a PB could be called a very small TR.