Well, you are a futures trader. There is more liquidity there. In the small cap stocks that I get involved with, any kind of crowded play tends to blow up a lot faster. Even in the more liquid stocks you tend to see that. Take a look at RYLP this week. The play got crowded on the long side quite quickly and a result you saw a reversal friday. People felt confident because of the huge price targets and loaded up, as a result you had a shakeout. Doesn't mean that they won't be eventually right but if they sell because they can't take the pain, then it was a mistake to have loaded up
Trading futures, the worst is going from a one lot to a two lot as you have doubled your size, it is mind numbing for me way back when. But in stocks, it was much easier, Let's say you trade 100 shares, what amount would be trivial for you? 20, 10, 5? You add that trivial amount for one week, the brain doesn't register it as much of what is being added on, so next week you add again but add one more, and do so every week. You need to know what your "mean" is for losing days and winning days in a row, when you expect a possible losing day based on stats, cut back volume, so when the lose comes in, your added amount is not ripping you the greatest lose for the week, then after, you resume at volume you were highest at and keep increasing, you have to be smart enough to be able to fool the brain, before you know it, few years later you are trading much bigger amount and yet brain doesn't see the size as it is calm in the manner you sneak it in.
I trade spot, so i trade close to magin call, limiting my loss, i profit lot size increases and vice versa. Stops me averaging down excessively to.
Now just imagine had you listen to the advice that I and others gave you soon after you've arrived at this forum. Do not trade, you're not suitable for trading. Had you listen to that advice, you most likely wouldn't be in your current situation. Instead, you would have been forced to be employed somewhere so that you can pay your bills even if its a job you hate. Another valuable advice that was ignored by you...keep your job until you've proven you're a consistently profitable trader. There's nothing to be ashamed in saying you have a job and that trading is just secondary. Also, I do remember someone telling you not to trade with money you can not afford to lose and to save up enough money to pay your expenses for at least 1 - 2 years worth of income. Actually, its never too late for you to listen to the above advice that has been given you...get a job, pay your bills, re-load your trading account to bring some equilibrium back in your life and to minimize the current psychological pressure you have.
As soon as I feel ready and start hitting $4000 USD per month, which is twice my current income, then I'll be closing shop and just trade, lifes to short to waste working and worrying, time to doooo ittttt!! If you losing that much on just 2 trades and having to break into money for bills then your doing something wrong, slow ish and steady wins the race, I fear your trying to hard, or just really really bad chance ??
I have a fixed leverage that I use no matter the size I trade. Because the leverage is stabile, the risk and reward ratios and the recovery time stay the same. So there is no extra pressure as the difficulty to overcome a drawdowns is always the same regardless of the size traded.
You are undercapitalised if you need to withdraw money from your account to meet month-to-month expenses. But you probably already know that by now.
Think he's having to use, saving put away to save the account to try to make enough to live off. Think of it as a job, you work each month to pay the next months bills, at first unless you start off rich, this is a risk your going to have to take.
One good method is to know the historical drawdowns of your system/portfolio and increase your size when you hit a certain drawdown percentage. In my case there have been 24 x 4 % drawdowns for my portfolio of systems since 2004 - and 86 % of those formed the deepest point in that drawdown. If I have to increase size then that is when I do it. Good trading to all.
I'm a "semi-scalper", mostly, so my drawdowns happen to be minimal, but if I had a drawdown of 4%, I'd instinctively be wanting to decrease my position-size, not to increase it. Otherwise you're "chasing", aren't you? Increasing your stakes during a losing run is an eventual way to the poor-house. In my opinion.