A picture is worth a thousand words. After over a year of day trading on a Sim, first on Schwab SSE and later on Schwab TOS, here is one chart that says it all, after about ~200 cum days and over ~2,500 trades spanning over roughly a year. There is a cum profit but I think it is an artifact of randomness: There is no edge (or a very minute, insignificant edge). The truth is painful.
It's good that you realized that. The market truly is random but this is the trick it is not 100% random. As a trader you need to figure out what part of the market is not random and develop a strategy to exploit that idea. For example, You want to buy breakouts. That's something that happens a lot. Problem is a lot of breakout fails a lot of the time. Then you need to ask yourself why do some breakout work and some doesn't?
Looking at your daily returns, I'd ask myself what I (or the market) was doing from day 25 through 75. During that period you were having positive and consistent returns.
Usually trading a different market or asset class helps. If not then try different time frames, it can also matter a lot. If you then did not find your edge then try a different strategy. This is the most difficult to change. Then again on different markets and time frames. This will take usually a few years. Then after that the market could completely changed so you need to repeat it again if you did not find your edge meantime, because a different market structure means that your strategy just has its right time to use it. Keep also your trading discretionary as I can guarantee you with algos you will not find your edge. Cause markets do change all the time and optimizations on the past do not help for the future. So you need to adapt your trading all the time. My two cents here.
If the graph is the cumulative pnl then yes, there is nothing there. If it were the daily pnl (non-cumulative) then you may have something. From what you mentioned is seems it is the first.
That's over trading, you need to be more selective. Most years we are going to struggle to find 2,500 good quality trades. When the market is crazy volatile like 2008 or Covid 2020, or Ukraine war + Fed hikes 2022 etc... Then you can potentially find more trades but most of the time I think we need to be more selective..
Hi IronChef. I applaud your effort. I'm not accomplished enough to brag about my results, but if you trade ES or NQ, there certainly is nothing wrong with the revenue generation vehicle. If you have the time and if you enjoy intraday trading, the obvious answer lies in keep looking for that edge and keep learning when to enter with what kind of target / stop. I wish you much success https://gyazo.com/6f5f851fc58b73548aa46a797a3f7b54
An average of 9 trades per day, counting that you didn't miss a single available day. Which counts to more than 10 trades a day for realistic measures (like missing a few days in the year) That's a trader without a plan. Someone that is a gambler, entering a trade without a proper setup. It is actually great that you didn't do that on a live account and took the time to record your footprint. If that makes you feel better, you are just following a gambling pattern that is common to most day traders. If you had a proper plan in place you wouldn't even have recorded a third of those trades.
As others have said, what exactly is the graph showing? The title, "% daily profits", implies that any time the data point is above zero, you made money that day, and below 0, you lost. The area under the curve would I think therefore show if you are profitable or not, and there is clearly much more area above 0 than below 0. If we exclude the few peaks that hit +4% or -4%, it seems to be as if your average negative day is only -0.5%, whereas the average positive day is about +1%. Plus, there are way more positive days than negative days. How is this not profitable? With a $100k account, this would be profits of $1,000 or losses of $500. Even commissions, if they are 10% of this, will not kill this strategy.