Started E-mini Paper

[johnnycakes78704 10]

Hi guys. I just started paper trading the /es and was wondering what the results I've gotten so far are normal and expected.

 

A bit of background on me, I've been trading for myself from 2000-2008, becoming licensed with my 7 and 66 during the market crash, taking a job as an Investment Advisor in 09, leaving about a year ago as my wife lost her job and the savings I had from my trading quickly evaporated.

 

I got a job not within the trading or investment world a year ago or so to ensure we could keep our lifestyle, but now I'm getting the bug again. I found out about the ES through this forum and it was recommended to me to start trading that about two years ago or so I think. Well, I was unsure of it as I'd never traded any futures before, sticking strictly to stocks. That has since changed over the past month and I've done alot of research and investigation to be sure I have an accurate grasp of its ins and out.

 

I found an excel spreadsheet and signed up for a practice account. Currently, I'm limiting myself to 1 contract per trade so I gain the maximum experience and understand of the market before I go live.

 

Before I commit capital to this, I have some questions and hopefully will get an answer. :missy:

 

Would you care to share how many points or ticks per trade do you currently make? Do you have a count of how many points per contract per week you are positive? Do you usually finish up your gains early in the day? I see today has netted thus far an 18 point gain. Do you buy/sell consistently throughout the day or hold for a period of time?

 

I started paper trading the week of Thanksgiving and over 2 days gained 4.75 points. More research over the weekend has increased my confidence and through that, I netted 39.25 points this week thus far with just two stop outs (at 1.5 point stops, is that too shallow of a stop?). A goal is to take away as close to 10 points per day as possible. Today is 9 so far and tomorrow I'd like to get at least 11.75 so as to hit the 50 point per week mark. Am I being reasonable in my goal? A search online for emini points per day indicates an average gain of 2 points per day per contract, 10 per week. Is that feasible? Am I missing something? Am I being too ambitious?

 

thank you for your input.

[johnnycakes78704 10]

If you don't care to share your point takes per day or other identifying info I definitely understand, but please provide constructive criticism if you could please take some time out of your day. Thank you

 

Today thus far I have been able to pull 12.75 points from the market. I am learning more and more with watching the markets and instead of going long, just taking an average of 2-3 points per trade per contract this week but with todays short trading range the average take is 1.75 points per trade. Is this normal? Is this a sound strategy? The excel sheet being used does have an in/out page and I'm documenting every in and out position, every short/cover, every detail or as much as possible anyways.

 

I'm going to call it for this week, not get into pig mode and take a 12.75 point gain today, increasing the weekly total to 52 points over 21 trades and a paper gain of $2527 this week. For a beginner, is this good/bad/so-so/you suck?

Edited December 3, 2010 by johnnycakes78704

[Tams 20]

.... Is that feasible? Am I missing something? Am I being too ambitious?

 

thank you for your input.

 

If you don't care to share your point takes per day or other identifying info I definitely understand, but please provide constructive criticism if you could please take some time out of your day. Thank you

...

 

nobody is responding... because this is not the question a trader would consider in his trading process.

[WHY? 16]

I sometimes trade the ES during the night session. I use an hourly chart and a combination of support/resistance zones along with tape reading. By tape reading I mean correlating price with volume. Trading the ES at night (after 5:00 p.m.) on an hourly chart 1.5 to 2 pt stops works pretty good. Profit target .50 to .75. Sometimes a point. General rule if 1 contract hands me 30.00 to 40.00 I like to grab it. This can be done sometimes several times in 1 hour...sometimes 1 time in 2 hours. But, I usually trade the NQ and YM at the same time as all three tend to track together. More money can be made by raising size but one has to be careful with large size in the night session as it is much slower.

Edited December 3, 2010 by WHY?

[neoikon 10]

Today thus far I have been able to pull 12.75 points from the market. I am learning more and more with watching the markets and instead of going long, just taking an average of 2-3 points per trade per contract this week but with todays short trading range the average take is 1.75 points per trade.

 

What rules are you using for your setups? Entry, exit, etc.

 

I tend to use pivot points heavily, so I use the average distance between pivot points (for that day) as a guideline for my target setting.

[Tradewinds 12]

I think the results you are getting are great. Have you traded different market conditions? It's possible to get great results for a period of time if the way you trade happens to coincidentally match market conditions. It can happen that a person gets great results under certain market conditions, then gets killed if the market changes, and you don't adapt.

You didn't mention anything about what you use to make your trading decisions. Do you trade through the news? Have you ever got caught on the wrong side of a trade when price has a flash drop?

How do your results from trading the ES compare to your trading success in the past?

[leobust 10]

Yes - You are missing something big and very important part of trading - the emotion side of it. Because you are only paper trading and no real money is at stake, you don't feel the "fear and greed" aspect of it. Start trading few contracts to get the real "feel" of it and see how you go. You'd be surprise its a totally new ball game.

If you can maintain a 10 pts gain a week, you can consider yourself a "professional".

[robertm 10]

If you can maintain a 10 pts gain a week, you can consider yourself a "professional".

 

Points/Pips gained have nothing to do with the success or measure of a system. It all comes back to what you risked to make that gain.

[johnnycakes78704 10]

nobody is responding... because this is not the question a trader would consider in his trading process.

 

Maybe ambitious is the wrong term and overall wrong question. More along the lines of...what am I missing, if anything? What are costs for items such as charting fee's? How often are your sells/cover's not at the mark you attempted?

 

What rules are you using for your setups? Entry, exit, etc.

 

I tend to use pivot points heavily, so I use the average distance between pivot points (for that day) as a guideline for my target setting.

 

My rule for entry/exit is based on the news and trends, but as of yet are still largely undefined. This is the learning curve and still requires definition, although I quickly learned to make multiple trades based off shorter moves than trying to ride it out with hopes for gains at the end of the trading day. This morning I made a mistake and was stopped out for shorting at 1218.5, with the stop coming at 1220, with a trade based off euro's fall and other news. I am still learning the indicator intricacies though and just need to spend some time getting familiar with them.

 

I've not looked into pivot points as of yet, but certainly will, thank you.

 

I think the results you are getting are great. Have you traded different market conditions? It's possible to get great results for a period of time if the way you trade happens to coincidentally match market conditions. It can happen that a person gets great results under certain market conditions, then gets killed if the market changes, and you don't adapt.

You didn't mention anything about what you use to make your trading decisions. Do you trade through the news? Have you ever got caught on the wrong side of a trade when price has a flash drop?

How do your results from trading the ES compare to your trading success in the past?

 

I've traded various market conditions in stocks from 00/01 till 08 and was very happy with the results.

 

My decisions are based off news and trends via volume.

 

As far as flash drops, I did learn to always use stop's here as DCA is not as important at this stage due to the trading of just 1 contract per.

 

Yes - You are missing something big and very important part of trading - the emotion side of it. Because you are only paper trading and no real money is at stake, you don't feel the "fear and greed" aspect of it. Start trading few contracts to get the real "feel" of it and see how you go. You'd be surprise its a totally new ball game.

If you can maintain a 10 pts gain a week, you can consider yourself a "professional".

 

I think I've conquered the fear and greed aspect of this from my previous market experience and I am disciplined in my approach. The capital I'll be risking is not a nest egg and can be lost with little to no concern. Yes, it would be a disappointment, but more along the lines of not winning instead of relying on it to be a singular source of income. Perhaps eventually, but once my account goes live in late Feb/early March, it'll just be to dip the toes in the proverbial waters, instead of just taking the temperature of it.

[robertm 10]

 

 

I've traded various market conditions in stocks from 00/01 till 08 and was very happy with the results.

 

Be careful with 08 statistics, you may wait a long while before seeing volatility like that in the market again. The entire grouping could be classed an outlier and treated as a separate project study for when that event does cycle around again though (which I'm sure it will if we live/trade long enough).

[Iris 10]

That's exactly right. If you trade with no stops or rediculous risk/reward ratios what goes up comes down and what comes down goes up; eventually you win. Drawdown might be so outrageous and margin calls would happen so often that paper trading is actually a joke. Add in commissions and slippage. Perception is not reality.

[johnnycakes78704 10]

What is a good stoppage in your opinion? 1 point? 2 points?

 

I've got commissions built into the spreadsheet I'm using. What of slippage, how often does it affect your trades and what is the general amount of loss % for slippage?

[Iris 10]

If you do not trade at night (market too thin for the number of contracts you might want to get out of), if you ONLY trade the ES-Mini, if you only go through a rapid-fire electronic brokerage (e.g. Tradestation), if you have the fastest computer and internet speed and a backup line (e.g. High Speed Internet and DSL - one might go down), and if you almost always use Limit orders for entry (Market for emergencies only), it should be zero. Max commission round turn for a non-pro should not be more than $4.95. Into your Spreadsheet, you might want to average in your monthly expenses (rent on internet, exchange fees for live feeds, rent on the platform (no fees for Tradestation if you place 10+ trades p.m.), costs to retrieve money from accounts or to send wires etc, and deduct from the daily win/loss. It's a business. It has to be run like one. There are profits, losses and overheads.

[johnnycakes78704 10]

Crazy busy at work today, was only able to get enough time in to scrape out 4.75 points over 6 trades due to limited exposure to marketplace and me not wanting to get stuck in a losing position time and again. I got stopped out early for a 1.5 point loss. Not bad considering the trading range today.

 

Iris, I've run a successful business before so I understand all the aspects of it and expenses are certainly part of the daily P&L.

 

I see that the Z contract is soon coming closed. Have you moved onto the March '11 contract yet?

[johnnycakes78704 10]

In an effort to learn a bit, I placed a trade based on the news that Brian Cowen's budget is set to pass. Bought 1 at 1223.75. I saw last week how positive news created a huge upswing in the pre-dawn hours so this is going to be a hold for me until tomorrow morning. I do see that volume has steadily increased about a hundred contracts every few minutes to as of this writing 60,470, so what would that tell the ES trader? Is it normal?

 

Trying to scour for news, I checked in a few minutes later on the volume and it now at 62618. Price is up to 1224.75.

[bathrobe 10]

I see that the Z contract is soon coming closed. Have you moved onto the March '11 contract yet?

 

Thursday is when most will start to trade march 2011. Also be careful of where you get your news and fixed stops.

[johnnycakes78704 10]

I get most of my news from overseas sources. What/where are your favorite places to get your news?

[bathrobe 10]

I don't trade the news, so I am not paying for anything. I would just make sure if I did it was the fastest, most reliable news there was. Which would be bloomberg or Thomson/reuters. These are over 17k a year.

[johnnycakes78704 10]

Then what do you trade on?

[bathrobe 10]

Price action/Support Resistance

[johnnycakes78704 10]

So this is what you'd be interested in?

 

2nd Resistance Point:1,245.42

1st Resistance Point: 1,239.83

Last Price: 1,234.00

1st Support Level: 1,223.83

2nd Support Level: 1,213.42

 

Volume 336,893

Open Interest 2,805,344

 

I closed my overnight position at 1234.25 and reopened at 1233.75, closed out at same viewing falling prices.

Edited December 7, 2010 by johnnycakes78704

[bathrobe 10]

not those numbers but yes

[johnnycakes78704 10]

Stopped today at 11:33 after a 15 point gain today over 4 trades.

 

If you paper traded and had similar results and then went live, what was the difference in your paper trading points vs real points?

 

I've decided to start trading in January instead of waiting until late February/early March. I'll be researching platforms and going with real-time practice accounts for a few weeks on different platforms to see what I like then take the plunge.

 

not those numbers but yes

 

what numbers do you look at?

Edited December 7, 2010 by johnnycakes78704

[suckassjuice 10]

Yeah, it seems pretty obvious you're missing, not something, but a lot with respect to thinking your paper trading will emulate anything close to what you will get trading real money. Here's something simple to help you put it into perspective. I want you to keep paper trading and then report back when you have have lost money for at least five days straight. All I've seen you report is winning days. And since you can "game" your paper trading results, most end up doing this deliberately and/or unintentionally. You won't get cut that kind of slack (in fact, you won't get cut ANY slack) when trading live. Once you figure out how to lose paper money, then take another step, a real step. Set a goal of trading live for as long as you can until you have lost $1,000 in real money (consider it the first installment on your tuition because you will be paying it and probably lots more) and then have at it. You'll be humbled by how quick this drawdown happens and then you will begin to understand the gulf between paper and live trading. In the meantime, check out edabreu's post here...a thoroughly insightful post for you to chew on in the meantime.

[Iris 10]

News: Watch the Announcement Calendar the day before:

 

Economic Calendar - Bloomberg

 

do not be trading when the red or yellow stars are about to happen.

 

Supp/Res Lines:

Probably S1 and R1 should be of interest. S2 and R2 are the important lines: