The Day Trading Thread

[SimpleMeLike]

Hello Illini Trader,

Thanks for the response. Please be as critical as human possible, I can use the opinion and recommendations. This is why I post my chart for all to see so other make comments. I got nothing to hide. I am just here to make and keep money.

SML, Just curious as to why you found it necessary to let the trade go 40 ticks against you before you decided that it was a losing trade? Especially since it was a losing trade from the gitgo as you never had any open profit on the trade. You have said that you like to trade breakouts on the 3 minute and this chart quickly developed into a breakout on the long side.

Not being critical here as I have done this many times but the trading principle here is that you did not have in mind what it would take to prove you wrong on the short before you entered the trade. And, you stayed short longer than you wanted to because you did not want to be wrong --- did not want to take a loss --- and worst of all did not want to feel that regret if you closed the trade and it did go your way into a profit.

You are right, this mistake. I do not regret the trade entry, but I made bad mistakes as you mentioned : 1. Move inital stop upwards 2. Not wanting to be wrong 3. Thinking about price reversing in my favor after exit. I lost big money on this. Lesson learned.

As a result you missed your own upside entry because whatever your personal breakout rules are, the 3 min bar was green 5 bars in a row for 85 ticks so you would have hit an entry point.

Correct, due to the massive loss and mistake. I stop trading thinking about that loss.

This chart illustrates what OP Mark Brown said earlier that the 3 minute chart is an eternity when it comes to intra-day trading especially in CL when the action comes very swift and a move can start and end soooo quickly. Someone else also suggested tick charts and those give you a heads up on a move as it is based on activity not time

I agree with @[URL='https://www.elitetrader.com/et/members/markbrown.8890/']MarkBrown[/URL] with on trading intraday with time base chart versus activity chart such as range bars or tick charts. And for the past few weeks, I have been thinking of switching to 4 tick range bars. As you see from my charts my trading depends heavily on support and resistance levels, trendlines, channels and ranges, etc.

I will start keeping some 4 range bar vs 3 minute chart the next couple of weeks and see what I come up with. But I definetly see you and MarkBrown point and the oppurtunuties.

From the 3 minute chart below, after I loss $400 on one trade, 1 contract. I would not have had a chance to enter long on any breakout on the swing up because as you see, no 3 minute candle closed above any level I drew. So I would have been sitting waiting.

HOWEVER, evaluating the 4 range bar chart below for the same moment and lets see the oppurtunites to join long party after taking that loss compared to the 3 minute chart. Of course this is hindsight entries, but I see the point.

So you yes, trading CL for awhile now does provide those oppurtunitesbut have to be quick.

3 minute vs 4 Range bar

Even on the trade I made $100 I could , entered the short party at the break of 53.00 early for more profit.

Using the 4 range bar chart after price failed to make a lower high and reversing on the uppper channel there, I could have enter the breakout here and made about $300. That would bring me to about $400 on the day, and done trading in 40 minutes. lol

Where as on the 3 minute chart I would have not seen this or even take that trade cause that big bar closed near resistance.

You can see on my 3 minute chart below compared to the 4 range chart. After the -$400 loss, the 4 range bar would have gave me some oppurtunites identify with blue arrows to get with the long party.

 

[SimpleMeLike]

While I wasn't a profitable trader, I never let anything or anyone to distract me. My wealthy parents never gave me a dime cause they said I was gambling & throwing money away. That's fine cause I never asked financial support from them anyway. Whe my ex left me since I didn't make any money from tradind for years, I cried very hard to myself that day. That's fine cause I better off by myself to find ways to improve my skills. In between, I jerk off a lot lol...

Blah blah blah... I were by myself lonely for over a decade in order to become successful, but I want to be cleared with you is that more than half of my millions $$$ fortunes came from real estate investment which I mentioned here before.

The bottom line is that you have to completely focus on it with minimal distraction. Never give it up easily if this is your passion.

Thanks humbletrader2016,

I appreciate your humble beginnings back ground comments. That tuff beginnings paved the way for your sucess now. I am not giving up at all. I definetly not giving up, I enjoy trading, even though I am not as profitable yet.

 

[Illini Trader]

I am not giving up at all. I definetly not giving up, I enjoy trading, even though I am not as profitable yet.

I like your spirit. Resilience and Perseverance are two qualities that one has to have in this very difficult endeavor. One thing you are absolutely doing right is learning on the simulator. I tried the Gauntlet last summer and failed miserably and Ryan Madsen of Earn2Trade advised me to not take it again until things are automatic on my sim trading. I have spent most of a year in the trenches trading all the Futures with different strategies and I always kept coming back to CL as the best Future to intra-day trade.

Well things are not yet "automatic" but I felt I needed to put myself to the test so I started the Gauntlet again on June 4th. Lot of nerves the first week and trading not to lose (which actually causes losses). In spite of it all I ended the week with a net profit so I am ready to get back after it Monday morning. Like you, the only Future that I have allowed myself to trade in the Gauntlet is CL.

If you are not familiar with their program all questions are answered in the ET thread:
https://www.elitetrader.com/et/threads/earn-2-trade-the-gauntlet.322385/

 

[MarkBrown]

I definetly not giving up, I enjoy trading, even though I am not as profitable yet.

without realistic expectations that are statistically derived i would never enter into any endeavor least of all trading.

how to logically pick the size of the stop if used and how to logically gain confidence in the expected profit per trade. there is so much more to trading than support resistance, it's painful to watch a good guy get beat up and cling to hope based on random events of success.

i would ask myself if i am prepared to trade and to do so:

know the intrinsic noise level of the market you're trading for crude it's about .25 this is the minimum threshold to be exceeded to gain an expectation prices will continue to move in one direction.

know the expected profit range a market will move once the intrinsic noise level has been exceeded in the case of crude it is .75 it is at this point one could expect to take profits and expect the move to consolidate if not reverse.

time if using time based charts then any move in crude which exceeds .50 in movement in less than 5 minutes time can be expected to reverse.

Perry Kaufman "Smarter Trading" Page 132

btw i think crude is the wrong market for you to be trading - i don't trade it.

 

[Illini Trader]

Mark, thanks so much for this post. The statistics on CL noise and probable moves are very interesting and informing. Your comment to SML would probably apply to me as well but I believe I can make CL work. I will find out in the next 8 weeks of the Gauntlet.

 

[MarkBrown]

Mark, thanks so much for this post. The statistics on CL noise and probable moves are very interesting and informing. Your comment to SML would probably apply to me as well but I believe I can make CL work. I will find out in the next 8 weeks of the Gauntlet.

by contrast look at the emini sp it's noise level is 4 points and its profit level is 15 points. also note the duration period of the non-noise it's huge. this is because there are many more participants nothing can compete with liquidity.

most all trading done below the 4 point noise range in the es is performed by hft firms.

 

[humbletrader2016]

Hello Illini Trader,

Thanks for the response. Please be as critical as human possible, I can use the opinion and recommendations. This is why I post my chart for all to see so other make comments. I got nothing to hide. I am just here to make and keep money.



You are right, this mistake. I do not regret the trade entry, but I made bad mistakes as you mentioned : 1. Move inital stop upwards 2. Not wanting to be wrong 3. Thinking about price reversing in my favor after exit. I lost big money on this. Lesson learned.



Correct, due to the massive loss and mistake. I stop trading thinking about that loss.



I agree with @[URL='https://www.elitetrader.com/et/members/markbrown.8890/']MarkBrown[/URL] with on trading intraday with time base chart versus activity chart such as range bars or tick charts. And for the past few weeks, I have been thinking of switching to 4 tick range bars. As you see from my charts my trading depends heavily on support and resistance levels, trendlines, channels and ranges, etc.

I will start keeping some 4 range bar vs 3 minute chart the next couple of weeks and see what I come up with. But I definetly see you and MarkBrown point and the oppurtunuties.

From the 3 minute chart below, after I loss $400 on one trade, 1 contract. I would not have had a chance to enter long on any breakout on the swing up because as you see, no 3 minute candle closed above any level I drew. So I would have been sitting waiting.

HOWEVER, evaluating the 4 range bar chart below for the same moment and lets see the oppurtunites to join long party after taking that loss compared to the 3 minute chart. Of course this is hindsight entries, but I see the point.

So you yes, trading CL for awhile now does provide those oppurtunitesbut have to be quick.


View attachment 203881

3 minute vs 4 Range bar

Even on the trade I made $100 I could , entered the short party at the break of 53.00 early for more profit.

View attachment 203885

Using the 4 range bar chart after price failed to make a lower high and reversing on the uppper channel there, I could have enter the breakout here and made about $300. That would bring me to about $400 on the day, and done trading in 40 minutes. lol

Where as on the 3 minute chart I would have not seen this or even take that trade cause that big bar closed near resistance.

View attachment 203889

You can see on my 3 minute chart below compared to the 4 range chart. After the -$400 loss, the 4 range bar would have gave me some oppurtunites identify with blue arrows to get with the long party.

View attachment 203896


View attachment 203897

Before calling it a day and getting ready to go to airport, I scalped short ~1pm for 2.5 points of gain from double top pattern which added up to 3.5 points for the whole day. I skipped one scalp trade in the morning an hour before NFP came out (a really nice one) and there was another nice scalp trade ~3:30pm which I couldn't trade. For days like this when there weren't any setup for me to trade, scalping by using pattern recognitions could be quite profitable, but one must knows how to do it properly. For me, I never get it work by only using S/R & pattern recognitions.

My question for you is that by ONLY using S/R and pattern recognitions to trade like the way you having been doing, let's say you are quite comfortable and making it works eventually, how confident can you be if you decide to increase more lots to trade one day? How do you decide to hold it for 1-pt of gain to several or more? I know some traders use movement measurement for exit strategy, but I never this method in my trading. Maybe Volpi can answer this question.

I'm going to bed now. Just got back from airport & totally exhausted. Tomorrow is another day and my #1 rule like many other trading days is that I don't trade to lose. That's how I stay discipline and trade well.

 

[Sinbin]

I thought I had seen everything….what on earth are range bars

Probably has already been answered, but it’s a chart/bar that doesn’t use time as an interval.

A Renko Chart (an example) is a chart based on price movement which determines a candle. If you set/code price to move in $5 movements, if a stock went up $5- a green bar.

These candles can still have wicks as a downturn of $2 doesn’t move the candle as it can still go up $7 to create a new bar.

I like renko charts because they cancel out some of the noise.

 

[SimpleMeLike]

by contrast look at the emini sp it's noise level is 4 points and its profit level is 15 points. also note the duration period of the non-noise it's huge. this is because there are many more participants nothing can compete with liquidity.

most all trading done below the 4 point noise range in the es is performed by hft firms.

Thank you MarkBrown for recommending range bar to me, just made $130 in about 40 seconds

No way I make this trade using the 3 minute chart. I would be long now but, managaing a losing trade.

I am going to have to watch these range bars cause they move fast.

 

[MarkBrown]

I am going to have to watch these range bars cause they move fast.

yes they move very fast you can make them a little bigger maybe but they look good that size.

when i first starting g using them i just watched how fast they formed and kinda chased them. i did pretty good just trading them manually and had some fun, now i have a system that i follow. hope you continue to de well, for sure it makes things more clear than time based charts but you have to get them adjusted just right so they don't add too much new noise either.

Below is the TS and MC code for the Kaufman studies they are not for buying and selling just for discovering noise ranges and peak profitable ranges over time. This gives you an idea that the market is too choppy to trade and expect the move to follow though. Also if you are in a trade it gives you an idea of how much performance to expect from it. You can also note that there are times of the day that will reoccur with wide ranges which are better to trade than other times of the day.


Noise 2

Inputs:SigLen(1),NoiseLen(60),Price(C),LThold(.25),HThold(.75),effxlen(2);

Vars:Noise(0),Signal(0),Efficiency(0);
Noise=@Summation(@AbsValue(Price[0]-Price[SigLen]),NoiseLen);
Signal=Price[0]-Price[NoiseLen];

IF Noise<>0 Then Efficiency = (Signal/Noise);

if signal>0 then Plot1(signal,"signal+");
if signal<0 then Plot11(signal,"signal-");
if SIGNAL=0 then begin plot33(SIGNAL,"zero");end;

Plot3(0-LThold,"LTOS");
Plot4(0+LThold,"LTOB");
Plot13(0-HThold,"HTOS");
Plot14(0+HThold,"HTOB");


Noise 3

Inputs:SigLen(1),NoiseLen(10),Price(C),LThold(.25),HThold(.5),effxlen(2);

Vars:Noise(0),Signal(0),Efficiency(0);
Noise=@Summation(@AbsValue(Price[0]-Price[SigLen]),NoiseLen);
Signal=Price[0]-Price[NoiseLen];

IF Noise<>0 Then Efficiency = (Signal/Noise);

if Efficiency>0 then Plot1(noise,"Efficiency+");
if Efficiency<0 then Plot11(noise,"Efficiency-");
if Efficiency=0 then begin plot33(noise,"zero");end;

Plot4(0+LThold,"OB");
Plot14(0+HThold,"HTOB");