I think the original question should be rephrased...
Instead of 2 Points per day on the ES! Can it be done ?
2 opportunities per day on the ES and be profitable at the end of the week! can it be done ? And as a corollary what can i expect in terms of ticks if i trade 2 contracts with a starting stop loss at -2 points considering i cover 1 contract at +1 point and set the other contract at break even to protect my capital. At +2 points on the remaining contract, i trail my stop 1 point behind. This scenario is valid if the ATR hovers around 13+ points/day and i trade at peak hours. So what can i expect in terms of tick ?
That's the new revised question. Hope it will bring you a plethora of good commentaries or revision.
The following 4 users say Thank You to trendisyourfriend for this post:
To form an expectation of what you can make day trading, use a 7 period ATR (average true range) on a daily interval of your market calculated once per week usually on a Friday or Monday. This will provide you with a consistent way to measure your performance against the market's current volatility.
For example = if the market ATR for the S&P is 16 points and you are averaging 16 points per week, you are making 100% of the ATR.
If in your live trading you only average 74% of the ATR or less then you know it is time to go back to simulator and maybe evaluate why your performance has dropped.
Using the ATR will allow you to adjust for volatility. For example if the ATR goes up to 20 points and your trading on simulator has been at 100% of the ATR then you would expect to make 20 points per week as the potential profit in your live trading.
Pulling your stop to breakeven after +1 point, your bound to get stopped out alot on your second contract with the ES... Most of the times, it will stop you out on your second contract, then take off.
If you want to play that game, i would do 1 car, for a 1 point profit, then add again at original entry with the same car... I've actually tested this, and it's better than doing 2 cars and raising your stop to breakeven..
You do have to use the same stop though on your add.
It's been a while since i tested this trading style, since i don't do 2 cars anymore, and im trying to pull away from the ES since it fills back and forth alot. But your welcome to test it out on sim
The following 5 users say Thank You to Michael.H for this post:
Wow, you got a lot great opinions from seasoned traders. Ultimately the decision is up to you...if you truly believe you can get 2 pts in ES per day, then it will happen. The first 3 hrs of market open is the best time to do it.
"Faith is the substance of things hoped for, the evidence of things not seen." --- "Therefore, I Believe it and I will see it. And every day and in every way, I am healthier, wealthier, and wiser."
The beauty and the reason why this trading style works better is not just because your taking advantage of the choppy nature of the ES, its also because if you never hit your target, you get stopped out on only 1 contract, where as if you did 2, you would get stopped out on 2 cars.
That's why this style had a better expectancy than pulling to break-even.
You do have to be a bit of a discretionary trader on this though. If you see the markets are slow, on your add, try to get a better fill by using limit orders below your original entry. Or You can buy a pullback and going market by using the nyse tick to do this( when you get +/- 400 readings). When the markets are trending, you might want to use 2 since you'll prob won't be able to re-add. Again, you gotta be able to spot early on how the markets are behaving, and that comes from experience and homework.
Clue, look at volume for trending days/non trending days.
But for now, do sim with 1 car and be patient.
Tell me how it goes, i would be interested how well this still works. We're heading into december trading, which is slow and choppy, so you should get some good results.
asking for 2 points profit . . . to me........... seems greedy ,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,, hell . . . . I would be happy with 2 - 3 ticks profit ,,, on the ES ................ everyday,,,,,,,,,,,,,,,,,,,,,,,,,, with of course... almost never losing . . . . . But of course,, that's not a guarantee ...... and so the question becomes..... when I lose, how much is the most I can lose, which in turn, doesn't takeout my entire profits from prior trades . . . . . . . . Aww ,,,, "the million dollar question" . . . . .
if there's a strategy/system out there . . . . that can give me 99% chance I'll make 2 - 3 ticks profit each day on the ES . . . . then I'm dieing to know ? ? ? ?