Wait, is this actually how people scalp?

ElectricSavant said:
Folks,

If you learn how to read the DOM you can take out one tick all day long and at some times in the evening...I am not kidding you...but have your wide stops in place when you place your bracket entry and be able to slide them close based on a low/high that you pick. Remember one mistake you wipe out one hour of trading.

es

P.S. I am totally new to scalping...but not to trading. I should not get so excited as this is a demo account..my experience tells me that I do not get filled in live the same way...but I continue to practie and try to learn the DOM and where the higher probability ladders are. When I go live this should all be natural and I should not be scared. Some say this could take a minumum of 6 months.
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And not to mention commissions for us retail traders is through the roof.
 
oh..I see...this can be used while waiting for the entry...I usually get filled so fast because I wait for a good ladder...but when it gets busier in the day this can be useful.

Thank You CALLumbus

ES

CALLumbus said:
Instead of adding some funny indicators, which will add nothing but confusion, I suggest you to add a feature that the TT platform offers that can really give you some additional information that sometimes can give you a very useful hint if you should keep your limit order or if you should cancel it.
It is called the PIQ (position in queue), it will show you how many other contracts are in front of your limit order. Until about 1 year ago this was an estimated value (EPIQ, estimated position in queue), but CME is supporting Level 3/ market by order since some time now, which will give you information about your EXACT position in the queue. EXTREMLY useful in thick and slow markets like the ZN, but from time to time also very valuable in a market like the ES.

You will find it in the settings of your TT platform, it will add an additional column on your DOM.
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It sucks when there is a block wall forming in the DOM after you enter. Those standing orders can be orders with huge volume...so the VAP bar can remain large as the number of standing orders are taken out. There must be enough power to take that VAP bar out or you can wait longer than one minute to get the tick...then your DOM changes and you get out with a loss...do not WAIT too long...follow the DOM and don't be afraid to get out with a loss. Suck up or down that SL according to what you see in the DOM and forget the high and the low of the chart when you know there is a problem with the trade.

When you enter you can see where the large bar is (look at the chart..it is usually at a high or a low)...so because of the length and nature of your trade other bars do not necessarily grow and you have tightened your stop loss before they grow. Often you can get one tick IN BETWEEN the high and the low if you enter correctly.

The problem I am having is looking at the chart and the DOM at the same time...it moves so quickly...this is where practice comes in. If I can trade this manually will the HFT's allow me to automate this? Won't they let me have the high probabilty ladders...c'mon! I can let the other ladders go. Just let me have a few ladders with a couple hundred cars and I am good to go....no need to get greedy.

ET is the best..I am learning from the best. I am convinced we are not diluting the trade by posting publically as we need their money :D

ElectricLearnsFastSavant

P. S. As I was writing this the ATR popped above 50 and I took two more trades and got the tick on each one. Caution! I am not sure about night trading due to reduced liquidity. Does anybody night trade live with the DOM?
 
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Folks.. I am being accused of sandbagging privately. I promise you I do not know how to scalp the ES. The experienced scalpers here must know that because of all of my novice comments. I can talk the talk...but can I scalp?...time will tell.

ElectricDoNotTryThisatHomeSavant

Can the YM be traded through the DOM as I am explaining? Gawd! could you imagine some of that Hong Kong stuff with the DOM?
 
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Talk to me in 6 months...I have a few old friends in the industry that can get us proper commisions (if they are still around). This commision issue can make the difference in being profitable or not with this trading with the DOM for one tick. It's just one phone call for me and they would be thrilled especially if there are two or more of us.

ES

JSOP said:
And not to mention commissions for us retail traders is through the roof.
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ElectricSavant said:
callumbus,

Yeah thanks it works...I got 49 in front of me for my exit...as I neared the exit it dropped to 14...i got the exit for another 1 tick target. what does all of this mean?...what do I compare the 14 to?

es
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I will give you an example how the PIQ can help you.

Imagine you trade a thick market like the ZN. On each tick the bid/ ask size might be around 1000 to 3000 contracts. Lets say you place a limit buy order now, several ticks away from the inside bid/ask. The bid size at the the price where you place your order is 3000. This means 3000 contracts are waiting to be filled here. Now after you place your limit buy order at the same tick, the bid size changes to 3001 contracts and the PIQ value will be 3000, meaning that there are 3000 contracts in front of you in the queue.

Now since you have placed your order a few ticks away from the inside market, you can wait and see what happens. ZN usually does not move alot, so it is possible that hours pass and the market will still not reach your limit price. But pay attention how the PIQ is changing. Even if there are no trades yet at that price level, your position in the queue might have improved significantly, because people and especially the computers are constantly cancelling and readjusting their orders. Sometimes you might get so lucky with your order, that by the time that the market really arrives at your price level, your position in queue has improved from for example from 3000 to 50, with the bid size maybe still around 2000 or 3000 or even more contracts. This means now: once price starts trading at your level, you will almost immediately get filled. The moment you get filled on the bid, place a limit sell order 1 tick higher. Now you have to watch closely. Is there more buying or more selling ? What is the market doing now ? But at this position, you have an edge: you have been filled at the bid, and there are still thousands of contracts behind you. If you see and/or feel that there is too much selling pressure, and there might be a risk that the market will push through the bid, then you can payout your edge and sell the contract you got filled on at the same price, because there is still a longe queue behind you. You scratched the trade.
If you are more lucky, and right after you got filled the buyers start buy into the offer, then you will probably make 1 tick profit with this trade.

You can build a whole trading system around this idea. Get a little edge by a great position in queue, make a few scratches a day instead of a few 1 or 2 tick losing trades, make a few 1 tick winners. In ZN you can trade that way with serious size, so a handful of ticks a day is more than enough to make a great living.

But of course, to be really successful with a trading style like this, you have to spend countless hours in that market and get a feel for how it moves, to know all its characteristics. But there is no need for secret formulas, indicators, fancy charts and all that gimmick stuff. Just a DOM to follow the pure market activity and plenty of time and love for what you do.
 
TY. When you say orders? is that one car or differing amounts..because my DOM has a VAP bar which does not necessarily grow and shrink with the number indicated. I am assuming not only is there a number but there are large orders embedded somewhere in the line if the VAP bar is big. VAP is a very good thing more so than a total imho.

es

CALLumbus said:
I will give you an example how the PIQ can help you.

Imagine you trade a thick market like the ZN. On each tick the bid/ ask size might be around 1000 to 3000 contracts. Lets say you place a limit buy order now, several ticks away from the inside bid/ask. The bid size at the the price where you place your order is 3000. This means 3000 contracts are waiting to be filled here. Now after you place your limit buy order at the same tick, the bid size changes to 3001 contracts and the PIQ value will be 3000, meaning that there are 3000 contracts in front of you in the queue.

Now since you have placed your order a few ticks away from the inside market, you can wait and see what happens. ZN usually does not move alot, so it is possible that hours pass and the market will still not reach your limit price. But pay attention how the PIQ is changing. Even if there are no trades yet at that price level, your position in the queue might have improved significantly, because people and especially the computers are constantly cancelling and readjusting their orders. Sometimes you might get so lucky with your order, that by the time that the market really arrives at your price level, your position in queue has improved from for example from 3000 to 50, with the bid size maybe still around 2000 or 3000 or even more contracts. This means now: once price starts trading at your level, you will almost immediately get filled. The moment you get filled on the bid, place a limit sell order 1 tick higher. Now you have to watch closely. Is there more buying or more selling ? What is the market doing now ? But at this position, you have an edge: you have been filled at the bid, and there are still thousands of contracts behind you. If you see and/or feel that there is too much selling pressure, and there might be a risk that the market will push through the bid, then you can payout your edge and sell the contract you got filled on at the same price, because there is still a longe queue behind you. You scratched the trade.
If you are more lucky, and right after you got filled the buyers start buy into the offer, then you will probably make 1 tick profit with this trade.

You can build a whole trading system around this idea. Get a little edge by a great position in queue, make a few scratches a day instead of a few 1 or 2 tick losing trades, make a few 1 tick winners. In ZN you can trade that way with serious size, so a handful of ticks a day is more than enough to make a great living.

But of course, to be really successful with a trading style like this, you have to spend countless hours in that market and get a feel for how it moves, to know all its characteristics. But there is no need for secret formulas, indicators, fancy charts and all that gimmick stuff. Just a DOM to follow the pure market activity and plenty of time and love for what you do.
More...
 
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ElectricSavant said:
TY. When you say orders? is that one car or differing amounts..because my DOM has a VAP bar which does not necessarily grow and shrink with the number indicated. I am assuming not only is there a number but there are large orders embedded somewhere in the line if the VAP bar is big. VAP is a very good thing more so than a total imho.

es
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The VAP is something different. It has nothing to do with the resting limit orders. The VAP shows the volume that has already been traded during that session on each price level. I dont pay too much attention to it, but it can help you to identify areas of high activity, resistance and so on... but if so sit in front of the DOM all day long, you will notice these things without the help of a tool like the VAP. Just like a chart, the VAP tends to give traders a biased view, which I dont like.
 
And when you say orders, of course there are orders over more than 1 contract. But the PIQ and the bid/ask size will always show you the number of contracts, no matter in how many orders they are packed to. Even if there is only 1 limit buy order at a price level with a size of 3000 contracts, the bid will still show 3000, and if you place a limit buy order at the same level the PIQ will also show 3000.
 
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