The Ultimate DAX Scalping Discussion Thread!

[Scientist]

Quote from dpanic:

Just an fyi to pass on a learning experience I recently had. I think I told you that last year I was trading the DAX opening session(I'm in USA east coast) so that's 3:00am my time, taking "power naps" but not getting a solid block of sleep. This past year about a week or 2 before xmas I decided to take some time off thru the end of the year, in doing so I came to realize that the lack of rest was a real issue for me. I didn't even realize it was such an issue until I took the time off. So.. now I'm skipping the DAX open, trading 9:30-3:30 east coast. I've found that I've been in the groove like never before these past 2 weeks. It's like my skills grew during those 12 hour trading days but my head was so scattered from lack of good rest that I had no focus and was not executing efficiently. It's funny, about 2 years ago I remember making fun of a trader that was working too many hours and seeing all sorts of stuff that wasn't there, without realizing it I walked into that trap. Thankfully I caught the problem, am now focusing on rest, exercise and good food.

Lesson learned.. take care of your body and mind. No matter how tuff you think you are or how well you think you feel your mind needs to be at 100% to trade at the intuitive level, that's why I decided to try yoga for a while.

How very true, all of this...

I know that myself I am guilty of ALL of these problems...
Not enough exercise, not enough good food, not enough rest, too much trading (3:00 EST - 14:00 EST = 11h a day), and just not enough recreation or holidays.

I've been a complete worcaholic for about the last 3 years and it's an easy trap to walk into. Because you think "more work = more money = less work later = earlier holiday " etc. My real life looks different: More work yes, more money maybe, earlier holiday no, because when you're a worcaholic you just don't do holidays. If I had more rec, I would probably do much better, with less work - this is a common truth, i.e. "sharpening the saw", as Covey says. Yet, it's admittedly a true challenge for me. I have created an "empire" that does nothing but make me work more. That's not what life should be about.

I have set myself to some definite changes to occur this year:

- Less screen time. Do the DAX EU open first 2 hours, break and then DAX US open first 2 hours. 4 hours total.
- More exercise. Running 30 miles/week or swimming 5 miles/week.
- Back into 3 full nights a week Karate. The time fits perfectly into between the two DAX sessions (6:30-9:00pm my time, equal to 5:30-8:00 EST)
- Back into more extra training / i.e. Karate championships
- Less comms on ET, more private comms in a small circle, back into writing books etc.

Lots of great inspiration, thanks a lot dpanic! Good trading to you bro!

 

[Captain Future]

Quote from Scientist:

Captain... Probability Warship decloaking starboard, sir! I'm not too sure about this... LOL

This might rightly apply in the larger timeframes, but in the smallest fractals (scalping for ticks or a few points) it doesn't really. It isn't only "a statistical exuberance on the far right side of the probability distribution". While this might apply for John Bollinger's or Nassim Taleb's position trading, it doesn't for scalping. Scalpers make a living by anticipating short-term movements. A scalper CAN NOT succeed unless he has a very good predictive advantage! I don't claim to "know" what the market will do with certainty, but I can consistently identify short-term momentum shifts and drive my axe into the spread!

I used to have a hit rate over 70% and higher at times - Not anymore, because now I tend to exit after ~1-3T against me! Clearly, with smaller stops, your hit rate suffers dramatically. But your R:R ratio improves on the other side! Now I cut most losers within ticks or at breakeven, and let the winners run preferably for several points! But again, unless you have an anticipative touch, even the R:R ratio won't help you - You'll only get chopped to death! So you really need to get an eye for picking a good moment "opportunity window" every minute or every few minutes. AND your exiting strategy needs to be very refined! You need to be at least as good at exiting as entering - Most people fail on the exit side of things.

Markets might be totally random and efficient on a daily chart, and it may be a zero sum game. Sure.

Just look at today's massive fall: Volume stalls, price hits a trend line or is completely overbought, momentum shifts, people soon start selling off like crazy and I hit the bid, is that random? Whatever moves the people on the bid to be mad enough to sit there willing to buy I really don't know. Perhaps slow brokers, orderfillers and crazy short-term traders, and maybe a few beginners. Whatever, I take it with a "thank you" and move on a few levels lower. I do this 50-150 times a day. Would you call this zero-sum or completely random???

I don't believe it.

Scientist, sorry man, I didn't meant to provoke your long post...I was just joking!

I sure don't believe in efficient markets and you are completely right, the greatest predictability might be in the smallest timeframes. I know that you can have a great hitrate and tight stops.

Thanks for sharing some of your trading style!

 

[Grob109]

Quote from Captain Future:

Scientist, sorry man, I didn't meant to provoke your long post...I was just joking!

I sure don't believe in efficient markets and you are completely right, the greatest predictability might be in the smallest timeframes. I know that you can have a great hitrate and tight stops.

Thanks for sharing some of your trading style!

Nice retraction (in the humor context); now, were I you, I would focus on getting past being involved in any way with prediction.

Once you have that out of the way once and for all, you can begin to deal with how markets operate. Don't go quant either.

You can observe by reading all the employment threads that quants are not able to deal with making money. They have two problems: too much money to deal with and looking at the total market.

The singular reality of investing is to operate within a market and not affect that market. Optimizing making money is based on the efficiency of the market to deliver money to you. And how well you take that money from the market into your personal account.

DAX scalping is very efficient market wise compared to other similar markets. The DAX follows another market's operation as well so, therefore, a person can follow the other market to have notice of what is coming up on DAX. The trading frequency used to acheive a very high efficiency of transfer varies. The transfer efficiency is primarily based upon one matter. Continually extracting from the "right" side of the market and simultaneously extracting from the market "noise bandwidth".

By segmenting accounts and treating each segment from it's relevant risk management orientation, you can maintain a "portfolio" of extractive mechanisms in parallel. The quants do portfolios too but there is no basis for the segments based on quant stuff. It is a timing dichotomy it turns out that is, in effect, a dilemma. Quant performance proves this.

You can see the mutually exclusive nature of "quants stuff" and "making money stuff" for an individual.

This thread focuses on making money continually from the "noise bandwith".

 

[Captain Future]

Quote from Grob109:

Nice retraction (in the humor context); now, were I you, I would focus on getting past being involved in any way with prediction.

Once you have that out of the way once and for all, you can begin to deal with how markets operate. Don't go quant either.

I am not sure what you mean by prediction.

How can someone trade, if he is not doing a prediction what will happen next? There is a pattern or situation X, so there is a good chance of Y happening, which is the reason I initiate a trade.

 

[nononsense]

Quote from Captain Future:

I am not sure what you mean by prediction.

How can someone trade, if he is not doing a prediction what will happen next? There is a pattern or situation X, so there is a good chance of Y happening, which is the reason I initiate a trade.

Dear Captain Future,

Don't try to make sense of what Grob writes about. We know him a long time around here as Jack and a couple of other names. Simply let him do is thing and don't ask questions. I admit that he is a furious writer though.

Good to you,

nononsense

 

[madf]

Of course.. you are 100% correct.

Either the forecast is explicit (i.e. technical indciators/s/r) or it is built in recognition - which I believe the most experienced/best use.

Whatever it is, a combination of circumstances .. work and are often self fulfilling as enough good traders recognise them to make them so..

And in prolonged market trends (eg bull/bear markets) they are even more pronounced.. eg.. buy the dips before and during the 2000-2002 bear market was a Pavlovian reflex brought on by years of success in the prior bull market and short the tops in the current bull market brought on by the bear market.

It's a case of recognising why your inner self recognisies patterns - or why your software does..

 

[Grob109]

Quote from Captain Future:

I am not sure what you mean by prediction.

How can someone trade, if he is not doing a prediction what will happen next? There is a pattern or situation X, so there is a good chance of Y happening, which is the reason I initiate a trade.

There are a couple of posts following this one of yours.

Most people here regard what I suggest as bull$hit. See nononsense for example. I commented on prediction because you mentioned it and your post was a nice one.

The comments on what and how prediction works you and madf made are fairly standard for a lot of people.

Investing and using prediction as a basis of taking actions is quite common, meaning a lot of people do it. I happen to be a person who tries hard to avoid doing prediction and acting upon it. My reason for not doing it is that it is unnecessary.

The general view that I have about it's practice is this. People predict and then enter the market based upon their prediction. They either succeed or fail as a consequence. It may be that this is a causal factor for why so many people fail in trading commodities.

I find in talking to many people that they feel they need to predict. Some feel strongly that there is no alternative. Having this picture can close a person's mind to other possibilites.

I know your question regarding can there be any other way is rhetorical. you amy even be saying to me the kind of stuff nononsense does to protect other ET'ers from my input. He reads everyword of all of my posts to be sure to provide this continuing single minded protection.

Many people follow in his fottsteps and they do not get what I am saying either. On the otherhand, you can check out some such people and find that after a few years or months, that they did change their view and the result for them was progress of some sort usually.

There are many alternatives to predicting that are used successfully by people. It is extremely difficult to even consider this sort of thing even provisionally. Most people cannot even determine where their views originated. They get really locked into this viewpoint and some even make it an exclusive orientation. You can look at the vast set of remedeal props that people use to deal with the consequences of predicting. It is a very broad and encompasing set of corrective devices. I cannot think of any other specific trading aspect that has as many such associated devices. The comparison to gambling is a prime example as well.

The common definition of predicting is like assessing the cards dealt and then betting upon them. It is a little worse in trading though because thee are a finite number of cards and in trading the possibilities are kind of large.

 

[easyrider]

Jack
While your way of expressing yourself is rather difficult to follow for some of us, your posts are amongst the very few here that I am learning something new from. I dont see how you can trade without predicting, however. Even on the smallest timeframe you are predicting which way the market is going to go when you enter. Another thing I am interested in is these wash trades you talk about. Could you give an illustration of the type of trade you are talking about?

 

[traderob]

Quote from easyrider:

Jack
While your way of expressing yourself is rather difficult to follow for some of us, your posts are amongst the very few here that I am learning something new from. I dont see how you can trade without predicting, however. Even on the smallest timeframe you are predicting which way the market is going to go when you enter. Another thing I am interested in is these wash trades you talk about. Could you give an illustration of the type of trade you are talking about?

Jack and easyguru,
I always have an opinion of where I think the market will go - otherwise I couldn't place the trade.
What I am trying to learn to do is that as soon as the trade is placed to drop that initial opinion and simply study the market as it is right at the moment.
I try to do this because as soon as the trade is filled there is so much hope invested in it going my way that it is hard to look at the chart objectively: instead I am usually stuck in that old opinion developed in the time just before placing the trade.

 

[benticat]

Hello,

I`m new to this board.
Some postings before someone wrote that he/she sometimes trades the HSI-Futures.

Which Broker and charting software do you use for HSI ?

And which datavendor/-feed do you use for trading/scalping the Dax Future ?

Actually I`m using QuoteSpeed (Tenfore) and searching for a new one !

Thanks a lot & happy trading

Best regards
benticat