Very tight stp.daytrading the ES ??

A

aspenboy

It has been my observation if my timing is good I take very little heat and the trade usually goes my way almost immediately.
Hence,would I be foolish to use something like .50 or .75 as an initial stop?Or,will random noise chop me out too much?
I don't have a problem(that big of one that is ...lol) taking a loss and have the discipline to do it
Any insight or suggestions ? Am using IB so the commissions are not a major factor.($5 RT). Thx.!!
 
It depends on your timeframe, entry approach, profit target and winning percentage. If you have a system, I would suggest doing backtesting and you can see the effect of using different size stops. FWIW, I found that, for me, stops that small did not work. Too many random stop outs on trades that went on to be winners. For a scalper, maybe it's different.
 
Unrealistic

You folks just cannot get it together apparently

Futures markets, especially the ES are noisy. You cannot consistently find entries that move your way immediately.

I know a lot of traders who make consistent money by placing stops at two (2) locations, PDH (Previous day's high) and PDL (Previous day's low)

I know a couple of very good traders who use the FHH (first hour high) and FHL (first hour low).

What all these folks have in common is the following;

1. They have the skills and experience to make good decisions
2. They enter early (first hour)
3. They have sufficient capital to take the heat when they are wrong.
4. They have sufficient experience to stay in a trade even when it looks like they are wrong.

It is the retail trader that is always trying to find a way to trade with little or no drawdown, and to trade with very tight stops. When will you guys figure out that you are cannon fodder for the professionals?

Oh well, you can't say you weren't warned.

Steve
 
Quote from steve46:

Unrealistic

You folks just cannot get it together apparently

Futures markets, especially the ES are noisy. You cannot consistently find entries that move your way immediately.

I know a lot of traders who make consistent money by placing stops at two (2) locations, PDH (Previous day's high) and PDL (Previous day's low)

I know a couple of very good traders who use the FHH (first hour high) and FHL (first hour low).

What all these folks have in common is the following;

1. They have the skills and experience to make good decisions
2. They enter early (first hour)
3. They have sufficient capital to take the heat when they are wrong.
4. They have sufficient experience to stay in a trade even when it looks like they are wrong.

It is the retail trader that is always trying to find a way to trade with little or no drawdown, and to trade with very tight stops. When will you guys figure out that you are cannon fodder for the professionals?

Oh well, you can't say you weren't warned.

Steve
More...

very nice post!

futures are way too noisy for tight stops.
 
Quote from AAAintheBeltway:

It depends on your timeframe, entry approach, profit target and winning percentage. If you have a system, I would suggest doing backtesting and you can see the effect of using different size stops. FWIW, I found that, for me, stops that small did not work. Too many random stop outs on trades that went on to be winners. For a scalper, maybe it's different.
More...


not to pick on you in particular:

How do you know what price is "RANDOM" in a stop out ?
or better yet,WHAT THE HELL IS A RANDOM PRICE?(other than one not convenient to your trading)

virtually every price (position entry )has a period of both gain and loss at some point in time.

Just because the trade could have been profitable at some point in time does not mean it was randomly stopped out.
unless of course you beleve in random profits
 
Quote from steve46:

Unrealistic

You folks just cannot get it together apparently

Futures markets, especially the ES are noisy. You cannot consistently find entries that move your way immediately.

I know a lot of traders who make consistent money by placing stops at two (2) locations, PDH (Previous day's high) and PDL (Previous day's low)

I know a couple of very good traders who use the FHH (first hour high) and FHL (first hour low).

What all these folks have in common is the following;

1. They have the skills and experience to make good decisions
2. They enter early (first hour)
3. They have sufficient capital to take the heat when they are wrong.
4. They have sufficient experience to stay in a trade even when it looks like they are wrong.

It is the retail trader that is always trying to find a way to trade with little or no drawdown, and to trade with very tight stops. When will you guys figure out that you are cannon fodder for the professionals?

Oh well, you can't say you weren't warned.

Steve
More...

there are ways of making consistent returns intraday es retail, most will not seek out little niches hidden in chart patterns (repetitive), won't listen or simply wouldn't have enough dough to sustain profitability, but that is another matter as loads of other naive trading principles, which are just plain bad.

edit: just to add, positive average roi is all that matters, most can not grasp this concept.
 
Personally I think a 2-3 tick stop is a little tight at first. As the trade moves you can move the stop closer but the ES definitely has noise some days and you could easily see a 2 tick stop taken out prematurely.
 
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