Being consistently profitable is incredibly hard. Take solace in that. If you don't have the details worked out then yes - take some time off and work them out. Self-control is easier when you don't need the money as it's just another day or just another trade among thousands. If you're desperate to achieve a specific result you're only shooting yourself in the leg and amplifying your and your system's weaknesses. That's when you won't accept a loss or won't accept a losing day/daily loss limit. The more objective your system the easier to follow and the easier to NOT trade. It's been said that day trading index futures is one of the toughest thing you'll attempt as a trader, so it's possible you might want to consider other markets or time frames also. Not to say that is easy. But it might be easier. I know a guy who never made it day trading ES, but became successful trading another more quiet market.
Hmm....just tried something. Took the candles off my charts and used a current price marker to trade with indicators only...first trade went well. I know, can't base any future potential off of one trade, but regardless, it seemed to help to focus the indicators in a way I haven't been able to do when watching candles.
Just for honesty's sake, I ended in net loss for the day....in demo trading. Haven't been trading live lately. I've tried studying the charts and re-evaluating every rule or idea I've had about trading. The trades I'm showing were how I traded the end of today. It's actually very close to the method I created this journal to follow, but have had a hard time following. The biggest change today was trading off of 5 minute charts only and not using any timeframe smaller. I also quit using a 20 tick stop loss for every trade. I know just a few positive trades aren't enough to get excited about. It's making trades like this consistently that matters. Can I? I don't know yet. But once the volatility of the open died off and there was some direction in the market, it seemed easier to take the right trades. I might be getting the hang of this after all.
I'm finding that I usually do better when I only use 5 min bars or candlesticks. I need to make a plan for when to use 3 contracts per trade and when I use only 1 or 2 because so many of the 3rd contracts get taken at break even that it's not worth the added risk of having a 3rd contract when I get stopped out. Today I took trades based on where I thought I could get to at least 1st target, and usually I did, but a better goal would be to only take the trades that are likely to have the runner. That means less trading, and that's something I still need to work on. I still have a tendency to try to catch a reversal when it's in a strong trend. When I use only 5 min charts or higher I do better but I still do it. I guess that's why I'm not posting charts today....some of these trades were counter trend and I'm trying to stop that. It's kind of a mental thing, I guess. Towards the end of trading today I began placing my mouse over the retracement in the trend and saying (in my head) that it should go up even though it looks like it's going to keep going down....and then I was surprised that most of the areas I tried it on actually DID go up at that point, although I "felt" like price was going to continue down. I haven't traded live for a long time. It still feels like I'm guessing when placing a trade and I want to have more confidence this is working. What I think I'll do is stick with 5 min charts only for a little while longer and then go back to smaller time frames and try to trade the smaller time frames using the trend on the 5 min chart that I'm learning to trade. Last 3 days have ended in demo profit. Before then, not so good, but I had gone back to smaller time frames. These demo trades were the only ones I took today. They were all placed within the first 2 hours of the open. Trade List: Yellow highlights are showing 1st and 2nd targets closed close to BE after price hit 1st or 1st and 2nd targets. Green highlights show a favorable "open loss" amount before going into profit.
It feels like I'm SO CLOSE to making real money. Still not trading live....just waiting to get those stats better. There's a lot of room for improvement with how I'm trading. I'm still taking too many trades but I can fix that easily by making a rule about it. It seems like I really have turned the corner and I plan to make some adjustments to get the winrate up and become more accurate. Still using my original method for this journal with adding some flexibility for other entry types as well. One thing I'll do very soon is actually trail my trades. It's too much mental work for me to do it now. I'm trying to focusing on getting the entry right. These were taken using 20 ticks stop loss and 60 ticks to take profit, no adjusting the trade after entry, except for a very few times when I did adjust, because it was so ridiculous to not close a trade early that broke the wrong direction, or I trailed just a couple times to catch a runner. I count those as losing self control....why? Well, eventually I'll do both, but I know in the past when I let myself adjust, I ended up not getting a clear picture of how well I'm recognizing entry signals. So, using 20 sl and 60 tp is not best way to trade, but it's training my mind to recognize a good entry and it's actually working. Well, my winrate is low, but I'm profitable, and I can see how I should be trailing whenever I decide to do it. Only showing the past 4 days because they were all traded using the same rules. Before that I traded with other timeframes, target rules, etc. but even then I've been doing OK. What I've done the last 4 days seems the most reliable though. All these were single contract demo trades.
To this point, I think day trading off 5-minute charts is even harder! Part of the issue is that if you're that micro, you may be missing the bigger picture. Some people may be able to do it successfully but I have seen a lot of folks trying to do this and have no idea where the real momentum is. I remember in March 2003 a post by a guy who was a "trading educator" for a trading website demonstrating his successful scalp of some tech stock. BUT -- It was on the day that a 2 year bear market finally reversed which started a 4-year bull market!!!! The market then rallied something like 20% in a few days! He was surfing 6 feet from shore when there was the wave of a lifetime 100 yards out!
There's something about trading smaller than 5 minute time-frames that is addicting...at least, for me it is. I like the challenge of getting a good entry with little risk. Where I'm at right now with trading is that I take way too many trades in a day which is itself adding more risk to trading, but finding I can more often than not end profitably...with a lot of work and not capturing much at all of the profit potential. Sometimes I think I'd be better off dividing the 5 minute chart with a lower 1/5 range and upper 1/5 range and have my stop below that low and wait until at least it reaches the upper 1/5 to get out, and maybe keep holding until the close. Looking over charts I see that potential all the time. But I've never traded like that. I get too focused on the short term and have a really hard time believing the trend will happen. Today on the NQ would have been a perfect example if I had gotten in somewhere near the bottom and just held on. I think I'll try to trade like that eventually. The problem I used to have was losing so many trades trying to catch a runner that when I got the runner it would only help a little with all the losses. So I've been working on getting entries down. Maybe I should move on to just trying for the bigger moves. You make a good point about missing the bigger picture. Thanks!
Thanks for your reply and being receptive. I have to remind myself that just because I'm drawn to shorter time frames in the market (i.e., your "addicting" reference), doesn't mean I should be trading them. You can always cut your size down, especially now with the micros, to trade bigger moves. But some days you're not going to have them. Also, I spent a lot of time away from the screen on Friday and just let my trades work. I knew we were going up but my staring at the screen and sitting through all of the iterations doesn't help. It felt good. I felt relaxed. And it was the right thing to do. Keep in mind that preserving mental capital is key and decision fatigue is real. Best wishes to you.
Well, I use a 1-minute chart and a faster volume chart for my entries, but am of course aided by a framework which takes care of the big picture or major pattern for the day in play.