Let's be real: anyone trading 100 lots of any future most likely has a significant clue what they're doing and the capital to back up the margin requirements. You can make decent money with a 1 lot. You can make large amounts of money with a 10 lot. You can make shit tons with a 100 lot. All require you to have an edge to make anything. Most people are not throwing on positions requiring half a mil worth of margin unless they're damn sure they have an edge and accrued capital to back up significant drawdowns.
I see any PA theory dealing with trading at the 5 minute timeframe to be INCOMPLETE and HAZARDOUS to new traders if the creator of such a theory does not include concrete information on the new risks associated with HFT and algorithm trading and mentor-like advice suggesting tactics to avoid substantial losses and subsequent psychological issues. The point you made in the post where you linked the articles suggested that HFT is into currency and commodities states this is the case because they are looking for easy money from retail traders and less sophisticated traders in those markets. I guess we can assume most retail traders in futures and stocks have increased their timeframe above the 5 minute level or have been destroyed by HFT.
Obviously people trading 'proper' size like 100 lots etc aren't trading from charts and price action/technical analysis etc! To trade any big size, you'd need a real edge.
You should spend time learning about the foreign exchange markets. Its a trillion dollar per day industry and it ain't because of retail traders (small fish). Note: I said above per day...its not a misprint. I've seen numbers like 220 billion dollar industry per hour. Its the bread n butter of many involved HFT wants a big part of it...they want to compete against other big boys...markets heavily involvement by world governments, world's largest institutional firms and economies. Heck, some world governments are getting involved in HFT themselves to prevent other HFT firms from having a major impact on their markets and currency. Retail traders as a whole have been declining with new exchange rules, requirements since the early 2000s. For example, when the CME sold the Russell Emini ER2 futures to the ICE exchange and its now called the Russell TF futures... 47% of the professional firms involved...they stop trading the TF and moved into other futures. Just as importantly, 53% or the retail markets was loss at the same time. Lost participants that today still has not been replaced...mainly due to the 2008 financial crisis and the lingering impact of such that pops up in world markets like China, Greece and other world economic concerns. It has nothing to do with HFT or algo...folks just didn't like the change in location, change in volume, change in volatility, higher exchange fees and the management of ICE with their partner contracts. Then the markets got slammed by the 2008 financial crisis...trading the Emini TF futures became a "trust issue" or lost trust...this latter issue is just an opinion after I've talk to many traders (retail and institution) that were no longer interested in trading the Russell 2000 Emini TF futures. Don't misunderstand. I'm not saying HFT and algos are not a factor in today's markets. Instead, I'm saying that the problem was not started by HFT and algos. Simply, professional firms went through a crisis of having some of the trading products more regulated, changed or whatever...resulting in these firms finding new ways to become rich. There was a nice article on Bloomberg that talked about how these banks, institutions have created new financial products to get outside of these new regulations. Funny thing is this, HFT and algos are not involved in any of these new products but give it a few more years when other firms become jealous and want access to those markets too. Please stop guessing...do your research.
A good majority of PA trading teachers focus on the ES for new traders, so the education and edification of new traders regarding the hazards associated with the ES futures market with HFT and algorithms and subsequent financial and psychological damage should be ethically mandatory, do you not agree?
If TF had good liquidity at all hours I'd probably trade that vs ES. A different exchange than CME which makes it harder to cross-instrument arb is a positive not a negative. I have no issues with ICE (other than their data fees) and trade on ICEUS and ICEEU. Anyways HFT is annoying but it does not make trading impossible by any means. My beef right now would be with the exchange's selective enforcement of spoofing. The current environment is ambiguous and annoying when it comes to spoofing and while there's less of it these days, it's still there. Either bust everyone or bust no one.
You mean a good majority of PA educators focus on stocks and then that's follow by futures. Emini ES futures should not be taught as a trading instrument to newbies as I first explained to you when you stated you were trading the Emini ES futures upon your arrival to this forum. Further, as stated to you when you arrived to this forum...Emini ES futures is heavily discussed at trading forums mainly due to its liquidity, low margin requirements and marketing by many well known data vendors. Its the primary reason why its so darn attractive as a trading instrument for new traders. By the way, PA teachers marketing the Emini ES futures to newbies is just plain wrong as earlier noted to you when you first arrived to this forum. Therefore, I do agree with that such results in subsequent financial and psychological damage. Yet, some do state for fact as one you're strongly familiar with about new traders...you will lose money. If the above isn't a strong enough warning...I don't know what kind'uv warning you need. Maybe someone knocking on your door with a baseball bat ??? The worst aspect of the above as noted earlier to you...no matter how many new traders come to this forum and are told the Emini ES futures is not a suitable trading instrument for new traders...those traders continue trading it as if they'll find some secretive movement specific to the Emini ES futures. In fact, I specifically named a few newbies doing such and I informed you about a specific advice that I and many other veteran traders at this forum was stating...test their trade method on all available futures trading instruments to determine via the method results to determine which trading instrument is more suitable than the other trading instruments. Why do they keep trading something not suitable for them ? That's where the promotion of the Emini ES futures by other ET members comes into play...that popularity from other ET members gives them the illusion its the proper trading instrument for a newbie trader. Seriously, do you remember...I was one of the few that warned you about the Emini ES futures as a trading instrument for newbie traders while others were chimed in about how they trade it successfully...furthering the illusion its a proper trading instrument for newbie traders. Did you see any warnings or hazard statements from them ? I also noted that the Emini ES futures is not a suitable trading instrument for low volatility trading environments. Low volatility has been getting more research lately as a time period with heavy HFT and algo involvement...I guess we got to wait a few more years after more research by those companies following trading habits by HFT and algos. I just don't agree that the real hazards of trading is due to HFT and algorithms nor do I agree that it has something to do with the 5min chart because PA trading teachers are low on the totem pole when it comes to education about the hazards of trading. The real hazards are due to lack of discipline, lack of risk management, abuse of margin/leverage, lack of diversification, lack of understanding that trading is a business and many other things. That responsibility lays with the trader themselves, data vendors, brokerage firms, sites like stocktwits.com, stockcharts.com and so many others that promote TA, PA or FA and discussion forums. Those disclaimer statemenst about the hazards of trading should be at the top (not at the bottom) and required read via a "I Agree I Understand" button prior to being allow to use those resources. *** Your attempt to pretend the primary source for the Emini ES futures has no responsibilities including yourself and it lays all on PA educators is weird. *** Seriously, when you signed up with CQG...did they inform you about the hazards of trading...was there any kind'uv a confirmation "I Agree I Understand" button when you decided to cough up your credit card number and use CQG ? I ask because you can't trade the Emini ES via PA or TA unless you have access to charts and a brokerage account. They should be the first line of "warning" to you about hazards of trading. Seriously, here's a very good question you need to think about very carefully. If you never used a PA teacher...who is responsible for you knowing about the hazards of trading, negative and positive impact of HFT and algos ? Something to think about very carefully don't you think !!! P.S. Both my kids play football. Its my responsibility to learn as much as possible about head injuries, concussions and long term effects of such. It was then my responsibility to inform my kids about such via videos and real life stories so that they fully understand the hazards of contact sports because head injuries is a big problem...not just football but in other contact sports like hockey, rugby, boxing and others. No way in hell would I expect the coach to do such although I was pleasantly surprise that he handed out pamphlets to all parents about such along with national contact info for further info and explaining there will be a medical personnel on the sidelines that's trained in concussions and other types of injuries for all football games. My point, learn to be responsible because in a few more years on your own as a trader...you won't be able to keep blaming others for not informing you about hazards of trading. Thus, after all your complaints about HFT, Algos and PA teachers...your psychological and financial well being is solely your responsibility. P.S.S. First game a kid on the team breaks his leg and is done for the season. It was my son's best friend. My son then made a comment...nobody taught us about that.
The quality of the edge you have can be measured by watching how much of a move you take. The bigger the piece you take the better the edge is. And the better the edge is the bigger the size you can trade. The better the edge the longer you will stay in 1 trade too, which is necessary if you trade size. 10 sec trades are not really optimal for trading size. Trading 1 lot ES with 1 point net profit a day will make you $13,000. Trading 10 lots ES with 1 point net profit a day will make you $130,000. Trading 100 lots ES with 1 point net profit a day will make you $1,300,000. Trading 100 lots ES will bring you $5,000 for each point it moves. But not only in profit, also in losses! So you need a very good edge and enough capital to manage this properly. If you have a good edge you make much more than 1 point a day. If that's the case, trading only 100 lots is not small but huge in profits. I only trade the ES. It generates for me enough money with XXX lots. I only have to watch the ES, so not jumping around between different futures. No need to reanalyze for each future how the situation changed the last X minutes . And do this over and over again. In short: relax trading, and most of the time just watching and waiting. Most people who start see things very big, want to become the biggest in the world and make billions. But on the road to trying to realize this dream, they will learn many things and probably also to adjust their dream to more comfortable sizes. If you make 1 million or more a year, normally you will start to think: why should I be the best and the biggest? You will change your opinion because you will add quality of life as one of the objectives. But to realize this objective you will have to reduce the size of your trading. And that's finding the optimal relation between trading and living well. From what I read on ET, most people are still in the first stage. For them being the richest man on earth is still the objective. So everybody who made in past this remark on ET (on others) is still a newbie who still has proven nothing, except that he is still a small player. Because he never made real money he has no clue what it can buy you and how much efforts are needed do become the richest man on earth. One of these efforts is: you have to give up your live and trade day and night. I trade for a living, I don't live for trading. One last advice: if you are a newbie don't start with the ES. From what I heard the ES is for the big boys. Trade the ES when you have already proven to have a good edge.
Edge is the hard bit! We all use the same tools/charts. There's only 1 poster on elitetrader who seems to have an edge. Posts his calls in the ESjournal. And i've found 2 posters on bigmike who also seems have an edge. Maybe 1 poster on trade2win but stopped posting a year or so ago.