I have been demo trading ES and CL for a few months now and am going to take the plunge and open a live account. I'm planning on starting with 25k. Is this sufficient capital for daytrading these 2 instruments or should I wait until I can afford to put in 40-50k?
You can easily trade ES with 10K ( max 2 contracts) and CL with 20K (1 contract) Trailing stop only for CL - Profit Target for ES Stop loss always (min $ 250 - max $ 750)
First time going live I'd recommend as small an account as possible so you're not able to cheat (average down, move a stop loss further and further away, turn a negative day trade into a swing trade, etc.). Trading real money is somewhat different from demo trading.
My win rate is about 65%. On CL my stops are usually 200$ at 1 contract with at least a $400 target. Similar stops/targets with ES. So I'd be risking a little less than 1% of my account per trade. I was taking on average 7-8 traders per day. Pretty consistent results and I feel confident in my setups. Yes I understand live trading is much harder, but I need to take the plunge at some point and feel as if now is a good time.
Then don't even think about going live. Until you can get through the session by trading your plan without regard to your ongoing P&L AND maintain the stats you think you have, you're not ready. You have nothing to lose and everything to gain by trading this way for a few weeks.
This is very good advise to force/enforce discipline. Assume "pretty consistent" (demo trading) is misleading. Assume failure. 8 trades per day x $200 loss each x 1 week (5 trading days) = $8000 Cushion for slippage, commissions, fast markets, infrastructure failure, etc = $2000 MAXIMUM INITIAL PLUNGE = $10000. Trade On!
you need a monthly max loss,12 months X 2 k is 24 k, will keep you alive for a year,you are going to make a lot of stumbles, and afterwards trade to get it back, not trade because the setup was there, the discipline in small losses and trading layups only, once developed will keep you in business, the biggest hurdle will be in your head,i'm superman, man what a loser i am,..when that roller coaster fades away ,you will be on your way, until then, stop trading and go back to sim til you overcome that ego,voice in your head,pride and guilt