A good trailing stop amount for ER2?

Discussion in 'Index Futures' started by Amnesiac, Feb 3, 2006.

  1. Amnesiac


    As you probably know, the ER2 sometimes develops very strong intraday trends.

    To profit from those it seems to be a good idea to use a trailing stop.

    As I haven't traded the ER2 a lot yet, I wonder what you think would be a good trailing stop amount to trail those trends?

    (I currently use a 2,50 point trailing stop and it worked very well in yesterdays selloff)

  2. 2.50 trailing is kinda tight. Actually, I've failed miserably trying to daytrade ER2 so good luck to you. It's too sporadic for me.

    I think ER2 is good for swingtrading though.
  3. buzz


    ER2 moves much fast than the YM I have traded both....I would say 3.5 points
  4. all I do is trade futures and can apply my system/methods to any market.....

    EXCEPT -- ER2..

    freakin impossible....

    a consistant stop loss is a guess and if anyone tells you otherwise imo they are lying
  5. mogul


    just set a breakeven after 1 pt and then experiment with the trailing
  6. I suggest you backest different exit methods.
  7. I trade ER2 daily and have found a combination of trailing stops work well for different markets.

    I always start out with the same type of stop. How it plays out varies depending on the day.

    On days that trend strongly from the get go, I trail with 3 x (20 period ATR ) using 5 min bars. Once I have the original 3 x ATR profit I trail progressively more closely.

    The faster the move, the tighter I trail.

    If the range really contracts without stopping me out, I put my stop at the top of the congestion and wait. If it continues my way after the pause, I trail at 4 ticks. Leg two of the move usually pans out one of two ways (reverse for longs):

    1. It breaks the low of the congestion then reverses, stoping me out before the big retracement.

    2. It breaks the low and does another couple ATRs without any hesitation then I get stopped at the beginning of the next consolidation or reversal.

    I use te same approach with EMD as well but with a slightly tighter ATR setting.

    One more thought: If the stop is very close to obvious support or resistance at the onset of the trade, I will loosen it .
    Although it starts the same way, my trailing approach on whipsaw days is to reduce loss as opposed to keep profits. On those days I get out with what I can, when I can.

  8. fletch2


    Kind of interesting. I develop my systems on ER2 and they never seem to work for jack squat on any other contract.


  9. lol...

    well... I guess that's what makes a market :)

    .... so you're the one that has been taking my money anytime I touch ER2??? hope you had a good time with it..lol
  10. ER2...

    Its my fave equity future due to the rapid swings. I have been trading it awhile and use a combo of techniques already discussed here.

    1st, I never take more than a full point loss on the thing. I like to get in right when it is at Supp or resis. Yep, I get stopped out a lot on entry, but its been quite profitable entering this way. I trail it with a 10 H/L MA on a 5 min bar usually, and take half profits when its really rockin in my direction. Its a gut call often, or when it is about to hit a significant price. Usually trail other half for awhile unless things slow down.

    If the market is really rockin, I may change the bar to a 1 min, but stick with the same MA.

    I make more off this than ES.

    #10     Feb 3, 2006