To my intra day trend trading brethren. Do you just step aside when the market is chopping or do you switch gears to fadey fade system? I trade the YM and its hard for me to switch gears so I think its best to keep swinging and get chopped up so I'm ready when the trend resumes. If I switch to fading I sometimes get stubborn and ran over when the trend resumes and I would have had a monster day that would make my week or month. So... what do you do when the slop is flowing?
I like it choppy. I cut my teeth on "rolling stocks" doing trades every few months or so. It feels about the same to me, but doesn't require as much patience on my part. What I like to do is trade a choppy day around 11-2 or so, for the most parts the price movements are gentle and you can scalp for profit. Of course, trending is nice, too. I do better on days that trend down than up, though. Guess I'm a bear at heart (sometimes that bothers me, it'd be nice to be optimistic).
what is the time frame that you trade? . what looks like chop on one time frame is a trend in another. My system is based on a minimum of 30 ticks, although I use a 89 and a 144 tick chart on the YM. when it gets "choppy" i get stopped out for about 5-10 points over and over again. I call that "the low rent district". its a small price to pay because when the trend starts to kick in, im in for about 30-50 points or even more per trade. But if its really choppy (low volume, 12-2 EST deadzone/lunch)...then going for quick 5 point scalps takes care of the that. Although its not my main style, scalps are fun and its like a video game at times.
hey flipflopper big well done on being able to trade the trend - lots can't and only trade the chop. You need to brush up on your PA reading skills, get some kind of structural understanding of the market and consider learning how to use indicators (don't tell the PA-Only brigade I said that!). Take a look at HolyGrail's point & figure method to see if that helps. Also look at my suggestions in Intraday Fx Trader. If your S/w allows you to use Range charts take a look at 3 and 4 range charts for chop on the YM - that's what I use. You might find that very fast so just keep increasing the range until you can cope with the speed. Learn in this order: PA - Structure - Indicators. You can tade well without indicators but for those who can use them they give an edge. Those that can't will be adamant they don't work. You decide for yourself
Hi Tokyo, How many point stop do you use on the YM? I am starting to wonder if a tight stop like 10 points might be better than a looser stop. Take small losses until you get a runner might be a good idea.
I have a hard stop of 20 points when I enter my trades and I use a MA as a stop to exit trades, regardless if I am in profit or not. VERY rarely do I get hit on my 20 point stop loss, and I trade mainly off a 89 tick chart. most I lose on a trade on average is 10-15 points. when I am in chop I can exit trades some times with 2-5 point loss. its frustrating but it indicates that the market isn't ready to trend yet. the 20 point stoploss is just there in case something major comes up and the market runs against me. you should set your stop to what you feel comfortable losing on a trade. I know that it sucks but its a reality of the business, traders will lose money. let your money management decide your stop. if 10 points is your max then try a smaller/shorter time frame to avoid chop, although it might mean smaller profit targets, at least you will be making profits. when your in chop, scalping for quick profits is fun