It's a naturally tendency to take your profits too soon and not cover your losses quickly enough (loss aversion). But if you never have an edge to begin with, this principle is irrelevant. ES are basically the most liquid future there is, and I sincerely doubt the OP has a leg up on the 100s of algos out there he is competing with. Try a little experiment. Buy 10 ES at the market, regardless of where it is. Offer 10 ES 5 bucks higher. 90% of the time, you will get filled that day, making at tidy profit. 10% of the time you won't, and will lose big. Such is the nature of scalping futures. It has nothing to do with your view of the markets.
Lets see, you know when you will tend to lose your money but you can't stop yourself (it's like an addiction) from trading in a duration that's no longer suitable for you're method. Seems like you're trading alone. Try this, find someone you know that doesn't like you. Pay him/her for two hours of work every trading day. Their job is to hit you with something that's very painful (e.g. plastic baseball bat) if/when you continue trading after you've reached your usual $100 - $150 dollar profit. They don't leave until you turn off your computer and go do something productive away from home. Continue with this until your addiction goes away and you are in control of your emotions while trading.
As an avid ES trader I would tell you to stick with trading stocks, thats your forte. Trading the ES takes a different way of thinking. ES is much more macro in terms of understanding its behavior. Trading stocks is generally more sector(compartmentalized) and you obviously aren't used to thinking that way. Stay out of ES, its not for you. Best Regards
Taking an uncovered directional highly leveraged position is risky period. Every time you put on a position you are betting $60k. Most who lose fail to do basic risk reward analysis. $60K bet with TP set at $100 and SL set at $250 only has a chance if you severely limit your trading activity (hh,ll max 2 - 3 trades per session). Over trading or always being in the market guarantees always losing. You need to be right 60% of the time just to break even.
There is more to trading than day trading ES futures and it is a pity you had to lose that much money to find out it was not for you. Different instruments, different strategies, holding periods, etc. IMHO, the problem with limiting oneself to day trading only ES is that there is a lot of days that simply suck for day trading. If you still want to day trade - which probably is not a good idea for you right now - you could solve that by choosing an instrument that is consistently volatile or track 2-3 instruments and trade the one with the best action on any given day. If you`re consistently losing, you could backwards engineer your strategy as alluded to by some here already. Good "luck"!
Thanks for the background information. It is clear that you manage your own stock portfolio successfully. Your problem is twinfold - problem of psychology and problem of finding an intra-day edge in ES and sticking to it. Simplest step by step solution is: 1. Just STOP trading ES TILL the time you develop an edge in it. Trading ES intra-day is REAL hard. 2. You made JUST 25,000 USD in stocks. Common - you can easily be making 500,000 in stocks before you will face liquidity issues. Go for ES once liquidity in stocks becomes a problem. Think about it. Is there a good reason for you to trade ES, rather than just stick to stocks till the time condition 1 is true ??? Can you please write that reason ? 3. To get above points in your head, I will tell you a story. Assume, you have Miss Houston or Miss Philadelphia or Miss San Francisco in your harem everyday to freely choose from and enjoy, but you don't enjoy with them because you want to enjoy with Miss Universe. And every time, you approach Miss Universe with your proposal, you get a good beating from her bouncers. Imagine seeing in the mirror while you are brushing in the morning, your red back and bleeding face and gums and broken teeth from the constant beating that you get everyday from Miss Universe bouncers. Why do you want the beating to continue?? Enough man! Figure out a way to seduce current Miss Universe, backtest it with earlier Miss Universes to see if the system works, and then only approach the current Miss Universe. If your research is solid, she will be seduced and you will be well rewarded. In the meantime, keep enjoying all the city Misses of USA and the world till you get a plan to seduce current Miss Universe. I didn't want to write things like read Mark Douglas and develop a good edge etc. People write it all the time and it fells on deaf ears. I know it firsthand. I am consistently +ve in FX and consistently -ve in ES. I have tried so hard to stop trading ES, but I again and again come back and trade it intraday and lose money. Its all a question of our psychology. I just wanted to write in a way that it gets in your head and hopefully in my head also. Good Luck.
Classic answer that will lead to immediate failure. Trading is an art and requires the ability to untuitively know when to hold them and know when to fold them, know when to walk away and know when to run. Why do so few make it in Gambling? Why do so few make it in Baseball? Why do so few make it in Brain Surgery? Why do so few find effective treatments to fight cancer? Why do so few discover the laws of Physics? Why do so few discover new Stars or Galaxies? Why do so few make it in trading? The answer most certainly won't be found in "cut your losses quickly and let your profits run." The simple truth of the matter is...some people are just more talented at certain subject, relative to the population. Meet the next Albert Einstein. I'm pretty sure this kid isn't relying on some cliche' of Physics to do what he does. http://www.cbsnews.com/video/watch/?id=7395214n&tag=contentBody;storyMediaBox
have this kid solve the worls economic problem,probably have an answer in two weeks that they wouldn't implement