As a scalper in ES, I don't use stops nor do I go to a breakeven stop, I don't want my computer to having to do extra steps that might slow down speed. If an order was used 2 tics away and I do a market order to exit, there is pretty good chances I will be in a trade that my computer was not fast enough to cancel the order. Goals for trading should be generated based on your well backtested method. If you noticed on your method consistently makes so many points on the average of six points then has intraday drawdown, perhaps at five points, you might want to reduce the number of contracts by 80%, this way, you can't ever have a losing day. I use 2.00 pts in ES as my goal, it might take me 2-5 trades to reach that, then I will either cut back 80, 90% or quit for the day, or trade crude oil/currencies. It all comes down to your method of trade and your past history of trading it.
just ignore P/L target. P/L target is a very bad idea to start trading. it will take away your attention from the primary focus: trading. when you reached your target, you may hesiatate in the next trade (you know you may lose, and you do not want your target to be de-realized) , when you losed and missed target, you may start to trade aggressively since time squeezed and you are hungry for trades to reach your target while there are no proper market conditions for your edge. what is more: how much you want to make is a trading idea?you know that is just your hope/wish,obviously, no! I will list the followings as my target: 1) I always trade under my means (I do not over leverage or I do not be too coward according to my trading account) 2) I always take my setups, and out accordingly either wrong or right 3) I donot trade if there are other things to conflict me until I am able to have my full attention 4) If I am day trading, then I am sticking to my daytrading rule, I donot put lots of hats on me. ok, I know what target I should reach, I still couldnot reach those four targets daily, just want to mouth out the frustrations I have. I hope I can reach them 100% time this year.
Never back off when you are winning the battle. You'll do best early on in trend days and it is precisely those days when home runs happen. Have a hard limit on losses and big aspirations for profits. Big aspirations for any trade that is not designed as a scalp, big aspirations for the good days, weeks and months. There are days when it is a struggle to comeback to scratch and certainly plenty of days when seeing a small profit is like pulling teeth. You're not working for wages you are working for opportunity. When those opportunities present themselves -- generally strong trending days -- ride them hard. Whatever your full position is keep it working for every last second that prudence allows. If you don't do this the risk of ruin increases dramatically. That is why you must do it. It is not about greed it is about survival until your skill set is so strong that survival is no longer in doubt. While I am not yet there logic dictates that is when boatloads of money can be made.
Never trade PnL â never Having said that when you first start offâ¦, the simple act of being handed several hundredâ¦, if not several thousands in seconds/ minutes â can be unnerving. Which then could throw you off your gameâ¦, causing you to give it all backâ¦, plus some. The litmus test would be; Can you accept the profit without ever beating an eyebrow, or skipping a breath... iow; Without second thought as you are more focused on the process of trading correctly.., rather than the result of trading correctly If you can â then do what you do â trade If you canât â then obviously step back, catch your breath, refocus, and then resume executing (trading) None of us know your make up..., the mere fact you asked this question suggests you are less than sure of your execution skills..., ability to tune out all but the process of trading No need to hurry it â as the money you save will be yours⦠But also no need to over delay the inevitable⦠Youâre a trader â you should be trading whenever you believe you can make money⦠If however market conditions, equipment malfunctions, or personal issues lead you to believe you canât â then obviously donât trade until the issue(s) is/ are resolved. AND/ BUT... Never get too greedy - market will castrate you in a heart beat - simply through your own actions..... just my opinion RN
As a counter-trend trader turned trend-follower, one way for others like me learning to hold winners longer is to remember how long you could hold a loser as a counter-trender. Think about your worst losses (they're always counter-trend trades because if you're running with the herd, you're unlikely to suffer a large loss unless you hold after the trend has clearly reversed, in which case you're counter-trend trading). Think about how you held a losing position when price came back close to break even but not quite there and instead of cutting the loss while it was small, you imagined that normal retrace was a sign of the coming strength or weakness you were looking forward to all along. In reality, it was a sign of trend-followers buying or selling at a key level with the trend, and then price makes another move even further against you, and you....AVERAGE DOWN! Well, now that you're a trend follower, price engages in a normal pullback and you hold as long as a key level isn't breached and when it's clear that the trend is intact, you...ADD TO A WINNER! The eventual goal here is to have those monster winners, as big as or bigger than those old monster losers. It's a rare counter-trend fading trader who has a winner as big as his/her largest loser. And it's a rare trend-follower who has a loser half as big as his/her largest winner. Really good experienced counter-trend traders have a very high win percentage that can easily pay for the occasional large loss; anything less than "really good" and you'll be unlikely to make a living trading that way, and likely to eventually blow out an account. Trend-followers who don't learn how to let a winner run at least to a target that's greater than the average loss are also likely to fail, because the win percentage is generally closer to 50% if you're holding trades for a profit target that's at least 1.8 or more times your max loss per trade.
the system i have used has worked wonders for me. risk 5%/day with 2ish outliers per year where it blows through -5% and you end up losing 8-9% make a minimum of 1.25% on the other days with a general average of 2% on winning days throw in the towel if you are anywhere near your +5% for the day if you haven't already, but generally start exiting positions between +1.5-3%. the only way i have a bigger winner than that is if i see something juicy develop after i'm already out +3% and that doesn't happen more than 2 times per month.
In the past, and in a day trading environment, I never used profit to determine how long I stayed with a position, but I certainly considered my P&L for the day in terms of how enthusiastic I was for entering a fresh position. Good or bad, right or wrong, I always wanted to protect profits if I was day trading and it was very late in the morning or after the noon hour. I used to do it when my strategy was primarily to daytrade very large futures spread positions. At a large Chicago prop futures trading environment, the trader typically has to be flat by the close. In that environment, I wanted to take on the most risk during the morning U.S. East coast hours where I felt that I could move in to and out of a substantial position. Spreads certainly move and behave differently than flat price trades, and I would be the first to admit that I really liked to hear that cash register ring and see that account balance grow. Being married with three kids, cars, boats, mortgage, etc. etc. I had to be consistent with my trading.
Excellent way to look at it. Except when I bring back those memories the screaming in the middle of the night wakes up my wife!
I wouldn't attempt to replicate what others are doing or try to be the trader they are...simply put, you do what you think you have to do and keep going with what works for you. If you feel you will be more successful stopping for the day, then thats what you do. What works for others may not work for you.