A mini ES scalper's journal

Discussion in 'Journals' started by ycxc16588, Dec 10, 2009.

  1. 12-17-2009

    Total trades: 10 RT
    winner: 8
    wash: 2
    net P/L: 4.5 point

    I broke one of my trading rules for I didn't trade single contract for the entire day.
    At 3:10, I added second contract after channel breakout and throwback test failure. The reasons were, 1. I had made some points so I thought I could affort the loss of two contracts if my judgement was wrong, 2. channel breakout with throwback retest failure is one of the setups I want to trade.


    EURO/USD broke a important support on its daily chart. Future started moving lower since last night. SP500 cash index gapped down at open below daily pivot range 1110.15 to 1112.08. It implies today most likely would be a bearish biased.

    ESH10 moved nicely between a down channel since yesterday 2:15pm and over the night.

    A quick long trade as ESH10 bounced of 1093.5 with vol spike right before 12:00pm ET. Had to leave for a meeting from 9-10am pacific time.
    Continued trading at 1pm ET. At 12:30 there was selling climax with vol spike. Long for retracement and exit at 23.6% FIB retracement level.
    Shorted at 50% retrace ~1094.5 and covered at 23.6% retrace level again.
    An up retracement channel formed and price retraced all the way back between 61.8 to 78%. The vol spike at 2:35 indicated trend reverse as price hit 1096.5 up channel line. Played short since then since it looked like a bear flag and the down trend should resume shortly.
    Price touched bottom of retrace channel at 2:45 and moved back to 61.8% level and reversed again.
    Went short when price broke 1103.5 at 3:10, my stoploss for this trade was above 61.8% retrace level 1095.5 (the reason I chose 2 pts stoploss was because I've made some points for the day and I could risk a little more for potential big move). then a throwback to retest the bottom channel line (coincidently also 61.8% FIB resistanec here second time) at 3:10. Here I initiated second conract to short at 1094.5. 1092.5, the 23.6% retrace, was my original profit target. I closed all my positions at 1093 since teh price stayed there a little longer than I would like. After I exit, the price eventually touched the lower channel line at 1091.5 trying to retest intra day low. What I could have done was to exit with one conract and set stoploss at breakeven for the second one. That would give an extra one point profit.

    I keep reminding myself since I am still unexperienced, the first priority for me is to control loss, the second is to maximize profit. This definitely takes time and effort to accomplish.
     
    #11     Dec 17, 2009
  2. I went live trade today first time. My plan is to trade on paper a few day and then trade live a few days. The goal is to trade exactly the same way for both paper trading and live trade. This can be done since I use exactly the same trading platform for both.

    Total trades: 11 RT
    winner: 7
    loser: 4
    net P/L 1.25 pts

    It is not a successful day, but I managed not to lose money.

    Today is option expiration/future roll over. Volatility is not at extreme. NAZ has been green due to RIMM's upbeat report last night. There is some divergency between DOW/SPX and NAZ.

    Started at 11:30, noticed SPX pivot zone 1097.8 to 1101.11 an open range 1096-1098, broke pivot zone and touched 1103, then sold down belwo pivot zone to 1093. 1101 has been the resistance for most of the day until last 10-15 minutes before closing bell.

    For the last 2 days, ESH10 intraday high/low 1111.5/1090.75, future retraced back between 50% and 61.8% last night to 1102.75, and resumed down trend until 11:30. It looked like double bottom on 3 day chart and another double bottom on 5 min chart from 11:15 to 11:45 ET. Volume spike at first swing low selling climax at 11:15, vol dimished when new swing low formed at 11:45

    long after double bottom. several small winning scalps. left for meeting from 9-10am pacific time.
    resume trading at 1pm ET, short near 1095.5, a 50% retrace between last night's high and this morning's low. brokeout and failed to reach 61.8% (1097.25), 1096.5 looked like good resistance.

    a bull flag from 1:30 to 2:30, short here looking for retrace to 1093.5, a 38.2%, good support at 1094, went long when micro supply line for the small bull flag broken and looking for break of 1096.5 . Here is the tricky part. Second attemp at 1096.25 failed. a shallow retrace and made third attempt and failed.
    My entry was near 1096. Here came a shakeout (throwback retest bear flag schannel line and 38.2% retrace). I suffered 1.5 pt stoploss here. 3:30 vol spike, went long again and took quick profit at 1095 and close positions 15 min prior to 4pm ET.

    I've found some problems with my live trading.

    1. I was not as decisive as I was when I paper traded. Since sometimes my fill was better than simulation, I stayed a little longer trying to get better fill for the exit. During paper trading, my exit is always adjusted to profit target subtracting 0.25 spread.

    2. My strategy with breakout is still poor. If price is near resistance, I should use stop order to play confirmed move though giving back some potential profit instead my early entry become loss when breakout fails. If I want to position better for breakout, then I should buy low and sell high for bullish.bearish breakout. This has been a problem for me regardless whether I am in paper or live trading.

    I plan to trade 1 day live, and rest paper trade for next week. The goal is to trade exactly the same way for both paper trading and live (psychologically and technically).
     
    #12     Dec 18, 2009
  3. Stock daytrading vs future/commodity daytrading
    There are daytraders who would trade future/commodity exclusively and some would trade stocks exclusively or both. I am not trading stocks daily so what I think about stock daytraders is not from my own experience, but some of my understanding/observations. Stock daytraders are looking for stocks that would fit the setups they are familiar with and have confidence trading with. They have a large selection pool to work with everyday. For those who day trade future/commodity exclusively, the choice are limited if compared to stocks. Future/commodities behavors can be different from day to day or minutes to minutes. If a trader is looking for a specific pattern or signal in a given day, he may not find it since it doesn't appear all the time. So what future daytrader can do is to go to small time frame in hope of the setup/pattern he is familiar with would occur more frequently. Or a daytrader can study and master various setups particularly associated with specific future/commodity he is trading. In latter case, the opportunities would be abundant.
     
    #13     Dec 18, 2009
  4. 12-21-2009

    Live trading today from 12 to 3:40PM.
    Total trades: 10
    winner: 8
    loser:2
    net P/L: 2.5 pts

    Started at 12 PM ET time (9am pacific time). Statistically, the Christmas and New Year weeks have been bullish for most years. SPX gap open high this morning.

    ESH10 challenged open intrad-day high at 12:10. A channel drawn from this morning's 9:40 and 10:20 swing highs with parallel support line connecting from open to 11:02 swing low, became perfect dynamic resistance at 1113 at 12 noon. The test of new high looked like throwback. Went short at 1112.75 and did several small scalp expected a retracement to 1109.25 (38.2%) and 1108 (50%). Sellers were patient and working on breakout/retest and steadily moving price to key retracement level without rush.

    Selling climax with vol spike around 1:14 and 1109-1109.25 looked like good support here. went long as price broke micro channel supply line and another throwback retest supply line around 2. My entry was not so good and the profit was quite small within a small range movement. A two leg retrace to 50-61.8% formed a bear flag.

    Around 2:30 to 2:45pm ET, bulls were looking for rebound from second retracement, bears were working on bear flag breakout to resume down trend. Price moving slowly and passed rebound time window. Bulls lost some control heer. Went short at 1110 as bear flag breakout. A symmetric movement of price to 1108 (50% retrace). Covered short too early and didn't take full advantage of projected price target.

    The neckline of HS looked broken at 1108.75-1109. Didn't initiate new short here since 1108 could be key support. Another selling climax at 1108 level. went long at 1108.5 after long leg doji at 1107.5 and covered at 1109 as the bounce looked like labored move (bulls were not in total control).

    No new position after 3:40.
     
    #14     Dec 21, 2009
  5. Another observation on order fill.
    I started paper trading first using ThinkorSwim paper trade platform. The limit order fill mechanism implemented with ToS paper trading software is that limit order will get instantly filled as soon as last trade price hit it. In other words, you can get easily filled on limit buy/sell order at bid/ask price as soon as last trade price touches it. Since Globex for ES trading order fill algorithm is based on first in first out rule, it would not be easy to expect limit buy/sell order to be filled at bid/ask price unless your order was placed long before price moves to that level.
    So I buy at ask and sell at bid in order to get in or out of order. If I really want to get in/out immediately, I'd use market order. However, I rarely use market order to establish a position since when you don't have time to get in a trade, it means you are probably already late. This is often the case for scalpers. A few tickers probably doesn't really matter to intermediate term traders who are aiming at 10, 20, 50 or 100 pts SPX moves. I do sometimes need to get out of a trade quickly by using market order if suddenly I realize I am on the wrong side and want to cut loss short before it hits my stoploss.
    This would lead to another question "where to place stoploss?" I will make some comments regarding my stoploss in another time. I am very curious to know how other experienced day scalpers place their stoploss for their trade.
     
    #15     Dec 21, 2009
  6. yc, Nice journal. What time frame are you trading on? It would be nice to see some charts if you are so inclined. Keep it up and 2010 will be a good one for you.
     
    #16     Dec 21, 2009
  7. nicer yet to see some evidence of actual trades. yup, new scalper who wins every day. no shred of documentation this is anything other than pure fantasy posting
     
    #17     Dec 21, 2009
  8. 12-22-2009

    Total trades: 8
    winner: 5
    loser: 3
    net P/L: -0.75 pt.


    Started around 11:45 ET. Trading live again. My old demo account expired and spoke with my broker and got new one. I intend to keep a demo account all thetime so I can test/optimize my trading skill from time to time.

    SPX pivot range 1111.5 to 1113.2
    open range (first 10 min) 1115-1119 (eyeballed this number from Yahoo financial chart). Open was quite bullish and made new high with NASDAQ composite. However, DOW didn't make new high. This divergency might mean something. It looked to me DOW open led the other two in the past.

    ESH10 made new high and then retest open and found support above pivot zone. At 11:30 there was a selling climax, which ended the down trend since early high.
    Here is how I did very poorly. I started short at 50% then 61.8% retrace. I covered my shorts when the price retraced all the way back to 78.6% (1114.75). There was a good chance that it wanted to retest intra day high.

    Lost 3 pts. I had opportunities to get out with total 1-1.25pt loss. However, it was one of those old familiar moments that I enetered a trade, saw it went against me, and hoped it would turn around to become a winner. This is the typical psychological weakness mst beginners have experienced. As a scalper, I will have to constantly remind myself to be nimble and need to get out of losing trades quickly before it becomes a disaster.



    It was a nice channel and a acscending triangle formed from 1:10-1:55 (2-5 min chart). ESH10 broke 1115 finally at 3rd attempt, but failed to follow thru and fell back immediately though NAZ made another new high. Entered short here and was extremely nimble by taking samll profit of 0.5 pts per trade to get me back to the game.

    Around 2:15, price tried to break the down correction (the pattern looked like a bull flag/ending diagonal). It failed and next stop is 50% 61.8% retrace to 1112.5 level (most bull/bear flag should retrace more than 38.2% of previous trend range). It found support at 1112.5. Sellers were not particularly aggressive judging by many overlaps of the price bars during down move. Went long and took quick 0.5pt when it hit extended supply line. Retrace to 1112.5 and went long again for another 0.5 quick pt.

    Price fell back after touched 1113.75 and retest supply line of down channel. This was not surprise since if you loo at the price/vol between two price pushups at 3:16 & 3:34. The selling pressure was not completely cleared.

    No new positions since 3:40 since I couldn't get very clear read for neither buyers nor sellers were in full control.
     
    #18     Dec 22, 2009
  9. Hello bmwhendrix,
    I use 2 or 5 min chart most of time. I don't use any indicators except for the fib retracement tool. I am using Turbo Trader web since I can only use web platform due to the firewall at my workplace and I noticed Turbo Trader web is simpler and more stable than ThinkorSwim's web platform. With Web platform, it doesn't provide TOS/DOM, but I haven't figured out how to read them yet.

    I've found that sometimes, SPY's price/volume actions might be easier to read than future's.

    Regards,
     
    #19     Dec 22, 2009
  10. Of course new scalper can't win everyday. See, I lost today. Besides, I started this journal only two weeks ago. It is not long enough to conclude whether a scalper wins everyday or not based on only a few trading days.

    As a scalper, the first goal is to minimize drawdowns. This is extremely important to those with very limited funds.

    I don't know if you have ever given any good thought about drawdowns. If you look at the scalper's account liquidity at real time (position value is calculated vs real time quotes to reflect paper profit/loss as well), the realized/unrealized drawdown could be comparable to his average daily profit. The curve might look smooth at surface, but it should be quite similar to a typical swing trader's equity curve if normalized to average daily profit at percentage.

    I am not sure what we can approve or disapprove here by showing our real account info. I tried to use this forum to learn from experienced traders and share with other beginners.
     
    #20     Dec 22, 2009