I want to trade a very simple automated scalping startegy around the pivots. Basically, I will put buy order near support for 2 point target and similiar short orders around resistance. Initial size will be 2 contracts and will increase with profits. what would be a good stoploss point? I was thinking risking 5 points or is this too conservative? Thanks!
take the average range of the past 21 days, then use it to position above/below the previous day's High/Low as stop.
spectra, No plans on automation at this time. Goal is 2 pts and out for the day. Currently trading this with 2 contracts but will add as account grows.
WD40, Isnt that a bit excessive to put a stop of ATR(21) jus tto make 2 points. Currently that would be risking 16 points
excessive it might seems, go do a back test and see if it makes you money. if you are too concerned, you can also add a time stop, say go flat at EOD. or a technical stop, say PH, PL, etc., or a money stop, say 5% of your purse, etc.