Not since the wild west has scalping been so messy
Why scalping beats any other trading style
- Thread starter yoohoo
- Start date
Not since the wild west has scalping been so messy
i agree - sort of. scalping is not more profitable for me than my position trades/investments, but i could see how it could be for some. having said that, i think you could scalp, daytrade for an hour a day and still make enough to live on. if you're good. (i.e. 6 hours/day not necessary) usually i play and do other things, returning to the computer now and then to see if there's a good setup.
today, i spent about 20 minutes making $200 with only 1-2 contracts at a time. then i went out to play. came back a few hours later and spent another five minutes making $50 more. i could've gone farther, but decided to call it a day after that. i trade from 2 minute charts but watch each tick. $200/d is about 50k/year, enough for most to live on. since i'm not trying to live on trading income at present, i don't trade every day and don't force myself to have high daily expectations. right now, i'm only doing what's easy for me to do so there's no pressure. i trade because i enjoy it. my personality type loves the concentration and stimulation that scalping provides. i don't like pressure, feeling like i HAVE to do it, so i don't force myself to do it every day, only when i feel like it. my goal is to be so good at it, that i can increase my daily take without any pressure. how high will my eventual self-imposed quota go? who knows. i'm taking it one day at a time....
What did you play outside?
Yoohoo,
Recently I switched from 5-min TF to 1-min/3-min TF and found my trading has improved tremendously. Better entry and much less whipsawed. Plus, there are a lot of scalping opportunities under short TF at sideway or slightly trending market conditions. Now I completely believe what you said:
The only way to have the potential to make more than a day trader is to position trade large size.
Since I'm still relatively new to day trading and I've yet traded size yet, my question is that:
What about the slippage if you trade size in scalping? Can you move 50 contracts in ER2/NQ/YM easily when doing scalping? How about partial fills?
Thanks.
Recently I switched from 5-min TF to 1-min/3-min TF and found my trading has improved tremendously. Better entry and much less whipsawed. Plus, there are a lot of scalping opportunities under short TF at sideway or slightly trending market conditions. Now I completely believe what you said:
The only way to have the potential to make more than a day trader is to position trade large size.
Since I'm still relatively new to day trading and I've yet traded size yet, my question is that:
What about the slippage if you trade size in scalping? Can you move 50 contracts in ER2/NQ/YM easily when doing scalping? How about partial fills?
Thanks.
enlightedtrader, you are going in the right direction and you can take it a stage further. Time can be a real enemy if you use it alone. eg a 1min signal isn't complete until the bar closes but that will allow whipsaws at times or missed entries if there's a wide range bar - and it gets worse the bigger the timeframe. Try adding range bars instead of time to your current set up. A 3R and 6R for the ER2 & YM - on second thoughts it might be better to start with 4R. The ES is more messy because it's not in 10th's so try 75R $100R. You should find a similar improvement as to when you reduced your timeframe.
As far as size is concerned test it for yourself when you have range bars to get you in earlier. Your experience will be different from mine as I'll enter earlier than you so you have to discover this for yourself by raising it in small increments. The answer on fills is yes & no. When it's busy and you're early yes - when it quiet no. If it's busy and you lag a little you'll suffer averaging and a lot of slippage, esp on the ER2. The ES is by far the easiest for 50 contracts. Slippage and averaging are determined by how quickly you enter at the turn, what time of day it is, the number of contracts you trade and of course the instrument traded. The answer could be anywhere from 2 - 1000+ depending on how these factors affect you.
As they say over here, there may not be so much left if you're sucking on the hind tit.
As far as size is concerned test it for yourself when you have range bars to get you in earlier. Your experience will be different from mine as I'll enter earlier than you so you have to discover this for yourself by raising it in small increments. The answer on fills is yes & no. When it's busy and you're early yes - when it quiet no. If it's busy and you lag a little you'll suffer averaging and a lot of slippage, esp on the ER2. The ES is by far the easiest for 50 contracts. Slippage and averaging are determined by how quickly you enter at the turn, what time of day it is, the number of contracts you trade and of course the instrument traded. The answer could be anywhere from 2 - 1000+ depending on how these factors affect you.
As they say over here, there may not be so much left if you're sucking on the hind tit.
Enlightedtrader,
You bring up a good point !
Like I said that from under the 10-minute
TF the profit starts to rise exponentially,
this is certainly the case when trading
only 1 contract.
For example in the E-mini S&P the spread is 0.25 99,9 % of the time when trading 1 contract but when trading more than 1 contract the average spread will become
higher than .25.
Suppose your average trade is 0.75 points when trading only 1 contract.
Now if you would be doing 200 contracts
per trade, the spread of .25 would rise
to for example .60 and decrease your
average trade by .35 points.
With the above calculations , we don't
take into consideration the market impact of those 200 lot trades.
So the question is to what extent the increase in profit on smaller time frames is affected by the size of the trades on that smaller time frame..........
You bring up a good point !
Like I said that from under the 10-minute
TF the profit starts to rise exponentially,
this is certainly the case when trading
only 1 contract.
For example in the E-mini S&P the spread is 0.25 99,9 % of the time when trading 1 contract but when trading more than 1 contract the average spread will become
higher than .25.
Suppose your average trade is 0.75 points when trading only 1 contract.
Now if you would be doing 200 contracts
per trade, the spread of .25 would rise
to for example .60 and decrease your
average trade by .35 points.
With the above calculations , we don't
take into consideration the market impact of those 200 lot trades.
So the question is to what extent the increase in profit on smaller time frames is affected by the size of the trades on that smaller time frame..........
Enlightedtrader,
Did your risk/reward figures, for example
measured in profit factor also increased ?
A lot of people say that trading on smaller time frames, you will have more noise, I have experienced the inverse,my
profit factor increased.
Did your risk/reward figures, for example
measured in profit factor also increased ?
A lot of people say that trading on smaller time frames, you will have more noise, I have experienced the inverse,my
profit factor increased.
I would agree with you. I think this is the direct result of better entry. When the entry is good, the stop can be tighter and the reward/risk ratio can be improved.
Someone's noise is somebody's else edge 