Great reply. Thanks. I'm starting to look at swing ideas using patterns, etc. Scalping requires a lot of focus, speed and reliable infrastructure. It is a lot like dogfighting on a fighter jet. You lose focus while in a position and down you go. As time goes by, I'm more and more attracted to taking bigger positions on bigger moves (look at larger time frames) and trade less. I'm reading several books, but I have not tested any ideas yet. Nice to see that you have found something that works for you. I would love to chat with you about the road you took to get to where you are.
FT71, Would you advise me a book about scalping?(or a website, wathever) I'd lov to read some about this kind of trading Thanks for posting on this site Alexis
I don't really have a book. It is very expensive to learn to scalp unless you are in a prop group that has the right commission/fee structure, etc. There are many different styles of scalping. I mainly use market depth and tape reading combined with price and volume action on short term charts. I believe there are several books on tape reading, but the main focus for scalping is loss management and discipline. If you can put 80% of your effort into cutting losses fast, then you won't have to worry to much about the winners when they occur. You then learn how to scale in and out to maximize wins over losses. This can be a whole huge thread and much of it is just based on getting beat on the head many many times to finally realize that it is better to hop in and out many times than to sit and wait for the market to prove you wrong (this comment applies to scalping only, of course). If you have specific questions, I would be happy to offer insight through a separate thread or PM's (just so that Avid_Consumer won't have to get a headache from rolling his eyes so much ).
Have "evolved" into trading 5 - 15 times a day. Mainly in the Bund and the US 10/30 years. My daily contract volume, then, is around 1500 - 5000 contracts a day. Used to trade much more, but realized my stomach and nervous system couldn't take the swings in my P/L if trading was going to be a long career. Now I compare myself to the cheetah and lie and wait for my prey.
its pretty obvious by these notes scalping in very short time frames is tough.to ousmart the market on a 1 or 5 to 10 minute interval is a very tough and nervewracking way to make a dime
Well, that's the question, isn't it? I mean, do you want to make a dime or do you want to become seriously rich?
I personally feel that daytrading ( 2-5 trades a day) is much more difficult than scalping. When people talk about scalping i always see in my imagination nervous guys running around and constantly gambling and panicking. By the end of the day most of them are a wreck and i think they are probably glad the day is over. Daytrading on the contrary can be very relaxing. You analyze the market just before the opening and decide what to do. When you take position you must have a clear view of what, according to you, will happen in the next hours. If your system is good you just have to thrust it and let the market do the job. There are three outcomes for each trade: 1. you get stopped out 2. you have a winning trade 3. you see that the trend turns and get out before youâre stopped out So what you do, once youâre in a trade, is wait. As long as the market moves according to your system you can watch relaxed at what happens; you only have to check if the system stays in the direction of the trade. If not you have to get out. The only important thing is to have faith in your system, because if you stay in a trade for 1-3 hours there will be moments that the markets will take back a part (if not all) of your profit. I stay in a trade till my system says to get out ( or I can be stopped out). I always try to take the maximum move. Testing my system confirmed me that in the long run staying in till the system says to get out is the most profitable way. Some trades will be better by putting a take profit, but because you cannot predict how far a move will go you will lose also lots of profits due to this profit taking in other trades. Your system should be well balanced to take the maximum move. Especially because the big moves make the real profits. I tested over a 2 year period with more than 1000 trades. This gave me the opportunity to create (in a period of 10 years) a well balanced system that gives me the possibility to trade very relaxed. I know in general already 1 hour in advance where I could get in trouble. This gives me the time to think what to do. If by then I donât know what to do I just get out and take the profit there is. I started with the idea to become rich, I took big risks and went through hell. But after years of suffering I arrived in heaven. The results went far beyond what I initially dreamed of. But I know people that suffered also but never got any profitable system. I trained a group of 6 traders with each a Tradestation. After three years only one is left over and still trying to become profitable, all the others gave up. Building a good system is a tough job and being a little bit crazy sometimes helps a lot. My whole family was convinced that I was mentally ill and addicted to a dream that would never become reality. Reality is that I now earn more per day than they earn per month. I donât want to show off with what I realized but I just wanted to tell how I came from nothing to a daytrader. And I must admit that what happened was completely different from what I initially expected to happen. Some periods were dramatically and others were euphorically. But it all ended very well. This is rather an exception than the general rule i'm afraid. But if you don't try you will never know it for sure.
i look to trade between 0-3 times a day. my win ratio is 50%, so once i have a winner, it seems pointless to risk that, so i walk away most times, unless another opportunity comes that is screaming my name. of course, my winners are larger than my losers (most times). i am for ever trying to increase my win rate (i am a discretionary trader). if i can consistently do this, then i will think of increasing my frequency, but for now id rather focus on increasing my size. the other option is to increase the number of markets traded with the same method, quitting a market for that day after a winner. does anyone else believe that trade frequency is a function of win rate?
Its funny the thread started with Kastro who disappeared...it ends up with Fred saying he trades 3x a day. Where did Kastro go and why does he want to know the answer to this question? It seems that everyone trades according to his/her need on this thread.
It's not... scalping is harder. Per your imaginative description it sounds harder as well... not to mention inaccurate.