Started E-mini Paper

[johnnycakes78704 10]

First of all, I am trying to help. Pretty much all I learned about futures trading, I learned on my own. Nobody helped me in the beginning. In fact, most were opposed to answering questions and most were treating me like an idiot.

 

What you need, imo is to have self discipline and solid risk management.

 

You will not be aware of the level of difficulty in trading until you place a trade with real money. That is simply a fact.

 

I mean this with no disrespect or cynicism but the points you are saying you make each day as a beginner in the es makes it sound as though you are without a plan or a reason to trade (setup). Instead something like "it's moving, I better get in".

 

I know of 2 or 3 traders who in the beginning ran their account from 10k all the way to 50k in 3-6 months only to lose it all. I have a friend who started with 3k and was making about 5k a week for quite a while.

 

With 9 years of market experience you must have a risk management plan, if you do not, get one.

 

Bathrobe, my remarks were absolutely (!) not directed at you, instead two individuals who made comments that were in jest of my intentions. Thank you for your input.

 

I know I am a beginner at this and my risk management plan is in development. With my experience being in a different field, the plan for futures has to be researched and with discipline, followed.

 

reduce that 4,5 points by 75% when going live with real money. if you can make your methodolgy work consistently at the 75% reduced performance level then the money is simply a question of trading size and being disciplined.

 

good luck

 

Thanks so much! My methodology is in development now.

[bathrobe 10]

Bathrobe, my remarks were absolutely (!) not directed at you

 

I was just trying to point you in the right direction because of the many sad stories I have heard about beginners in futures trading, I am sorry if I came off as abrasive.

 

I wish you the best of luck!

[jackb 10]

Proven track record? Uh, no. And there is no promise of future growth. I'm a firm believer in the 7P's. Proper prior planning prevents piss poor performance. But I'm sure you know this

 

Well, I may have misspoken with respect to you having a proven method when what I really meant to say was it's clear you've got something right going on (really, really right). Despite the interruptions.from periphereal matters, you continue to prove you have some special talents. There are a lot of people who can't trade profitably, even on paper. You come across as having done a lot due diligence and that makes me believe your are serious about letting loose those raw talents of yours so you can prove the thoughts invading your mind over the past few weeks; thoughts that slowly and ever more loudly have been growing and reiterating "this is doable" and "there's good money to be made". When I look at the 7 Ps, the one that stands out is performance; It's not by chance that all that work and diligence in tracking your paper profits has resulted in impressive performance. I think deep down, you know you were meant for this. And deep down you also understand that such talent needs to be let loosed to flourish. A forced reigning in of something you are meant to do, is not good for one's mental state and/or physical state. Maybe it's time to become a believer of the 10-Ts: true traders tackle temerity then tactically target tallying tremendous totals. Your time has come. Your time to tally some tremendous totals is now!. Let nothing stop you. Any reason Monday can't be your coming out day? Nobody expects you come out guns blazing. Just make a few trades to start out and book few hundred dollars in profit for 20 or 30 minutes of work and don't force anything. This would be a real solid way to "get your feet wet." You've got the talent. Here's rooting for you: :applaud:

[mahesh 10]

I'll say jackb, you have quite a way of putting things out. I would not be asking for advise myself if I were making 10 - 15 points a day.

 

Thanks all.

 

Very intersting read.

[bathrobe 10]

Johnny Cakes,

 

Earlier you said you were trading off news, where did you get your news? Also, and more importantly how did you deal with the scenario where a number beats wall street expectations by a lot and the market sells off (usually after a small rally to bring in retail)?

[Iris 10]

Walking the Tightrope - my experience (16 years) regarding the balancing act: I think that it is easy to get into a trade - any trade - the problem is when to get out. Most indicators are designed to get into trades. Because of the lag, most indicators are late getting out. There is no such thing as a "no-lag" indicator". Best thing is to stick to what works for you and beware of letters, email alerts etc. However, make the choices so that the odds are on your side. e.g. stick to the e-mini with the most volume, lowest slippage, lowest costs, don't stay in the market overnight, don't trade on FOMC days and in front of holidays etc.

The problem is that people get bored sitting and watching and waiting for things to happen and then they start fiddling and try to make things happen. Then the trouble starts. Most people are proud - they do not admit to making mistakes and when getting into a bad trade cannot admit that they were wrong and get out - so they wait for things to get right and they get worse. Then the pain gets them out and it takes days to catch up on the mess.

Most of the time the market goes sideways. Trending occurs infrequently. It is better to take what the market gives than to try to squeeze out the max. So taking a regular amount out instead of getting whipped by the sideways moves almost always caused by following indicators, is consistent and less stressful. The market needs to have room to move, but using a ridiculous win/loss ratio makes no sense. The faster the speed of the chart the less one should try for e.g. a chart at 500 ticks looks better with an aim for a 3/4 point move as opposed to a 1200 tick chart where one might regularly get 1 point out of a move. Aim for 4 points a day. If one loses three times in a row, it is mandatory to stop for the day and come back the next day. Everyone has off days. Don't get caught by the Las Vegas Syndrome = "My Luck IS Going To Change" - luck has absolutely nothing to do with it. Getting out of a bad trade by "luck" or by chance still makes it a bad trade. A good trader does not trade by instinct, but by following a trading plan with discipline. The stop should be placed at the time of the trade. There is no such thing as a mental stop. The ratio of the stop to the profit should be the same, otherwise, a loss generated means that there has to be two wins to make up for the loss and that adds unnecessary stress. A good move is going to happen in 5 bars or less (regardless of the time frame). If you made a mistake and nothing happens, get out at par and wait for the next time. Breakeven is a loss of the commission - a small price to pay for being safe. If you make 4 points, close down the shop for the day. Thank the market for what it has given and come back another time. Being greedy is the way to self-destruct. It's just a matter of time, not if but when.

Never risk more than 2% of the total account at one time. After a few weeks there will be enough to place 2 contracts etc. etc. Aim for small wins, and don't try to break the bank of Monte Carlo. Always remain humble - just when you think you know it all, you have it down, you can do this thing and you start telling people about how well you are doing (and neglect to tell them about the shambles that you nearly did not make it out of), the "Great Equalizer" comes along and kicks the living hell out of you. Remember, that each contract is a huge amount of money at risk for margin calls - it needs protection and the longer you leave it there exposed, the more you risk losing it. Take the little bits offered to you and get the hell out of there. The little bits add up. After a time of accumulation, you could place up to 6 contracts. I see some of the online Gurus place 10 at a time - actually if you look very carefully at a screen after freezing it, it is invariably a simulated account, and they are bull-shitters. All of them.

Lastly, keep it simple. The more the charts are cluttered, the bigger the mess becomes. The more charts there are on the screen, the more confused it gets. The more mixed groups of timeframes there are, the more complicated it gets. If you are serious and this is not a scam thread, good luck - everyone wants you and all of us to succeed.

[mahesh 10]

Hey Iris,

 

You are right. I myself was very successful when I was paper trading. But when I started trading with real money, I got cleaned bowled and lost $20,000. Emotions do play a great deal in your trading and putting real hard earned money on the line does take a toll on your emotions and hence your trading.

[robertm 10]

Great points Iris, totally agree with your observations.

[johnnycakes78704 10]

Well, I may have misspoken with respect to you having a proven method when what I really meant to say was it's clear you've got something right going on (really, really right). Despite the interruptions.from periphereal matters, you continue to prove you have some special talents. There are a lot of people who can't trade profitably, even on paper. You come across as having done a lot due diligence and that makes me believe your are serious about letting loose those raw talents of yours so you can prove the thoughts invading your mind over the past few weeks; thoughts that slowly and ever more loudly have been growing and reiterating "this is doable" and "there's good money to be made". When I look at the 7 Ps, the one that stands out is performance; It's not by chance that all that work and diligence in tracking your paper profits has resulted in impressive performance. I think deep down, you know you were meant for this. And deep down you also understand that such talent needs to be let loosed to flourish. A forced reigning in of something you are meant to do, is not good for one's mental state and/or physical state. Maybe it's time to become a believer of the 10-Ts: true traders tackle temerity then tactically target tallying tremendous totals. Your time has come. Your time to tally some tremendous totals is now!. Let nothing stop you. Any reason Monday can't be your coming out day? Nobody expects you come out guns blazing. Just make a few trades to start out and book few hundred dollars in profit for 20 or 30 minutes of work and don't force anything. This would be a real solid way to "get your feet wet." You've got the talent. Here's rooting for you: :applaud:

 

jack, thank you for the vote of confidence. However, this still does not sway me from my original thoughts as I still have more to learn and define in regards to my strategies. Raw talent, for any field, requires discipline and concerted effort to ensure future payoff.

 

Johnny Cakes,

 

Earlier you said you were trading off news, where did you get your news? Also, and more importantly how did you deal with the scenario where a number beats wall street expectations by a lot and the market sells off (usually after a small rally to bring in retail)?

 

Finviz aggregates several news sources w/ title of article and a link.

 

In that scenario, I could short the market, buy at the bottomish of the sell off or wait for the correction. Given I am new to this trading platform, what is your way to benefit from this scenario?

 

Also, I must say, I never took anything you said as abrasive.

 

Isis, what an invaluable contribution! Thank you so much.

[bathrobe 10]

Given I am new to this trading platform, what is your way to benefit from this scenario?

 

I personally don't actually care what the number is because I have seen it react differently so many times. I enter using my definition (mine may be different and probably is different) than others) of price action and order flow.

 

On fed days or non farm payrolls the es moves so quickly by the time I see what I want and enter probably less than 1/2 a second a lot of times I end up with an entry that is late and far from ideal so this will often keep me out of the trade because my stops are based on levels and not a fixed stop.

 

I do like your news trading idea of buying at the bottom of the sell off or wait for the correction, with the es I would be looking for an instant correction though, if you are using this for stocks I have never traded stocks on the news.

 

My main market is the ES, I also trade the Ten Year.

[johnnycakes78704 10]

Broke even the past two days. Early day gains are 2-2.5 points. This was my first post FOMC trades for futures and for a quick minute my trade registered a 1.25 point gain, only to suffer a stop two points down, just about wiping me out of all of todays gains. Have a 66% positive trade ratio, but the two trades that went south went way south. Looks like massive profit taking late today and yesterday....this reinforces morning trading only.

 

I can definitely see the market moving sideways most days, appears that the conditions previously really suited my trading style. Gonna have to learn to profit from .75-1.25 point moves

Edited December 14, 2010 by johnnycakes78704

[mahesh 10]

Welcome to the world of trading where experience means nothing.

[johnnycakes78704 10]

I found some indicators I liked yesterday spending then and last night reading up on them. Today, using them I pulled 5 points but was too busy to really watch it so I lost all those points plus 2 more. I am not frustrated as I realize P&L are because the indicators are showing the movement and when I am available I am capitalizing on them. I need to be more diligent and ensure my positions are closed out when I am not at the screen.

 

Does your charting s/w show afterhours movement?

[Iris 10]

What indicators are you following?

 

To see after hours trading you have to have the right contract. To have live data you have to subscribe to a service which includes exchange fees. End of Day data is often free. Live data that has a D after it will not show after hours or Globex trading.

e.g. Tradestation E-mini = ESH11 for the lead live all day and night contract, @ES for the continuous live day and night contract which also automatically rolls over but cannot be used to place trades with, and ESH11.D which only shows live data during the actual day time trading period and starts and ends with the exchange (CST) time.

[johnnycakes78704 10]

I am using the Keltner channel and candlesticks. Today I added the Chaikin Money Flow indicator as well. Not sure how well that is working.

 

I know I'm making too many trades given the live feed. I slowed it down to instead of 1 minute to 5 minute. Don't see a tick chart anywhere....

 

Attempts are at .75-1.25 points long and short side. Looking at this weeks performance, the shortside trade is my biggest detractor, and being unfamiliar with the software. For example, I accidentally pressed "Sell market" on a short position instead of buying and was caught up in a 2 contract reversal instead of a 1 contract reversal, doubling the loss upon closure.

 

Point wise, this week I did better as the week progressed.

Monday had a 1.25 point gain

Tuesday had a 2 point gain

Wednesday had a 3.25 point gain

Thursday had a 5 point gain

Friday had a 4 point gain.

Average gain is 3.1 points per day, exactly what Why? said it would be, roundabouts

 

The losses for the week were more significant due to ill timing, poor conditions, and being hardheaded thinking the market MUST go back up...Monday resulted in over half of the week's losses.

 

I'm now going over the data and the indicators to see where and how I won and where/how I lost to further refine my understanding. I'll be reviewing what worked and what didn't for a better week next week, at least for a few days.

[Tams 20]

just the point gain is not sufficient analysis...

 

you need to look at your MAE and MFE,

and your average points per trade.

[Kiwi 16]

Prediction:

 

Unless something changes dramatically this thread will describe Johnnycakes failing as a trader.

 

Why:

"Today I added the Chaikin Money Flow indicator as well"

"I found some indicators I liked yesterday spending then and last night reading up on them"

 

combined with (unless somewhere it said otherwise)

 

"live trading."

 

In summary, the process is wrong and will just result in JC building bad habits and damaging himself if the $$ are significant enough to raise his pulse rate. A gambler is born?

[Kiwi 16]

Came back to read the first post and suspect Johnny may not be trading live. Hope not anyway unless he's just planning to be a donor.

 

Johnny,

 

It seems to me that you have a divergent path here while you are practising live in the market. I haven't seen this lead to success in the past. A more likely path, given your time, would be to take what you know and attempt to define an effective edge (context, entry, exit plan). Then, having tested it on historic data, and practised it in replay to find out if you can actually do it at the rh edge of the chart, forward test it for a bit. I would expect that the forward testing would lead to convergent minor modifications or abandonment rather than the adding of entirely new "things."

 

But, it is your life, your money and as for all traders, your choice of your path to success or failure. I will watch with interest.

 

I'd wish you good luck but luck shouldn't have anything to do with trading any more than hope. So, best wishes for your fast convergence.

[johnnycakes78704 10]

Kiwi, thank you for the input. I am using a live sim, but not trading any account. I am still defining my methods. We shall see what this week of testing and application gives.

[WHY? 16]

Whatever you can do consistently on a live simulator then reduce that by 75% maybe 85% because of slippage...emotions...errors under stress...etc. and that will probally be what your method will pull out of the markets providing you are disciplined to follow entry/exit signals. If you pull 3 points on average using a sim look to pull .50 to .75 pts live trading. On average that is.

[johnnycakes78704 10]

Applied some earlier techniques using info from Bathrobe along with Support/Resistance and a trending indicator, resulting in better trades. Found video libraries on setting trailing stops in simulator to help out with P&L and will review them tonight.

[johnnycakes78704 10]

Done ALOT of reading, backtesting, and review of methods and have defined my rules. Traded a bit over the holidays and came up ok.....just ok...not bad, not great. Due to circumstances out of my control (wife totaled the vehicles over the holidays) and schedule changes, my trading hours have been adjusted out of my control until at least 1 vehicle gets replaced, which should be by this weekend.

 

Started with my trading on the defined premises on Tuesday when we came back from the holiday.

1/4: Profit= .75 points

1/5: Profit= 1.75 points

1/6: Profit= 4 points.

 

All of my profit taking was on 1 point or smaller moves. No trying to break the bank. Also, there were trade losses each day.

[bathrobe 10]

Done ALOT of reading, backtesting, and review of methods and have defined my rules. Traded a bit over the holidays and came up ok.....just ok...not bad, not great. Due to circumstances out of my control (wife totaled the vehicles over the holidays) and schedule changes, my trading hours have been adjusted out of my control until at least 1 vehicle gets replaced, which should be by this weekend.

 

Started with my trading on the defined premises on Tuesday when we came back from the holiday.

1/4: Profit= .75 points

1/5: Profit= 1.75 points

1/6: Profit= 4 points.

 

All of my profit taking was on 1 point or smaller moves. No trying to break the bank. Also, there were trade losses each day.

 

Glad things trading wise are progressing well for you. when you become more comfortable with trading you may look to hold for larger gains but I think how long you hold is a matter of personal temperament so if you dont feel comfortable doing so, dont worry about it.

[johnnycakes78704 10]

Got stopped out on reversals today. Was able to get 3.75 points out today, almost covering losses. Ended the week positive. I should have closed out my final trade at 2.75 points though instead of waiting to see if it'll go to 3 points...it regressed to a 2 point gain.

[johnnycakes78704 10]

Am limiting my trading to 2 trades a day in an effort to be more sure of my trades, 1 long and 1 short. Today was first day of implementation, gained 2.5 points today.