Scale In or Scale Out - The Latest Thoughts - Psychology and Money Management | futures io social day trading
futures io futures trading

Scale In or Scale Out - The Latest Thoughts
Updated: Views / Replies:3,480 / 12
Created: by tderrick Attachments:0

Welcome to futures io.

(If you already have an account, login at the top of the page)

futures io is the largest futures trading community on the planet, with over 90,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.

At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors Ė all of which you can find on futures io, utilizing our social trading environment.

With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you donít need to worry about fake reviews.

We are fundamentally different than most other trading sites:
  • We are here to help. Just let us know what you need.
  • We work extremely hard to keep things positive in our community.
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts.
  • We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

Thread Tools Search this Thread

Scale In or Scale Out - The Latest Thoughts

  #11 (permalink)
Site Administrator
Manta, Ecuador
Futures Experience: Advanced
Platform: My own custom solution
Favorite Futures: E-mini ES S&P 500
Big Mike's Avatar
Posts: 46,335 since Jun 2009
Thanks: 29,444 given, 83,934 received

dansota View Post
I'm thinking that scaling in multiple contracts is a way to say "I was wrong at this price, I'll keep trying until I hit the right price" Am I wrong?

Yes, wrong in my opinion.

Scaling in is often confused as averaging down. It is not the same, but the rookie will treat it as though it is.

Scaling in requires a well thought out plan and is an advanced technique. It is not for "I was wrong, lets try again".

Scaling in can be both scaling in while price is in your favor, and scaling in while price is against you. But never, I repeat never would you scale in to a losing trade that itself has turned against you.

For a trader with larger stops (50-100+ ticks) you can scale in as price moves against you, so long as the trade itself does not move against you. So if you are short you don't scale in on a series of HH+HL.

My advice is for you to not scale in.


Due to time constraints, please do not PM me if your question can be resolved or answered on the forum.

Need help?
1) Stop changing things. No new indicators, charts, or methods. Be consistent with what is in front of you first.
2) Start a journal and post to it daily with the trades you made to show your strengths and weaknesses.
3) Set goals for yourself to reach daily. Make them about how you trade, not how much money you make.
4) Accept responsibility for your actions. Stop looking elsewhere to explain away poor performance.
5) Where to start as a trader? Watch this webinar and read this thread for hundreds of questions and answers.
Help using the forum? Watch this video to learn general tips on using the site.

If you want
to support our community, become an Elite Member.

Reply With Quote
The following 2 users say Thank You to Big Mike for this post:
  #12 (permalink)
Futures Experience: Beginner
Platform: NinjaTrader
Broker/Data: Interactive Brokers
Favorite Futures: Stocks
ShruggedAtlas's Avatar
Posts: 191 since Apr 2011
Thanks: 78 given, 74 received

Yes I agree with Mike. Scaling in is an advanced procedure to be implemented only when the setup is still valid. That is, all the conditions of your original setup are still holding true even if price is moving (temporarily) against you within the range of your stop loss. If you scale in to a position that is moving against you while the original setup criteria are still valid then that is fine if you have the skill and stomach for increasing your risk in a losing position. This is a type of averaging up/down and there is nothing wrong with that.

However, if price moves against you AND you no longer have the original setup conditions then your operating on hope and possibly a prayer. This is also averaging down/up. The main difference here is that now you no longer have a reason to be in the trade since the setup conditions are no longer valid. At this point your throwing good money after bad.

I think the original post made mention of the rational for doing this; that is to keep 'accumulating' a position (essentially averaging up/down) until price turned around, if only temporarily, and allow the trader to scalp a profit. This CAN be done however it is extremely risky and you need to do a number of things for this to work.

1. You need a lot of capital. Much more than you can imagine. As price continues to move against you you need enough capital to keep averaging up until price turns in your favor so you can scalp profits. If you run out of money and price continues against you. You're screwed and you WILL lose big money.
2. You need to average up/down in a ratio of at least 2:1. So if you have one contract you need to buy 2 contracts to average close enough to be able to scalp a retracement. When price continues against you with 3 then you need to to be prepared for an additional 6 contracts. Now you have 9 so as price moves against you you need to enter with 18 and now you have 27 contracts. So now what happens if price continues to move without any significant retracement? Who among us has that kind of money? By now of course the trader is at a loss for several thousand dollars. Is it worth it?
3. You need to have a stomach of iron. Few retail traders have the guts for this kind of gambling.
4. You need a cyclical market that is predictable and has enough volatility to scalp. the problem is that markets change. On week your in a cycling market with lots of predictable movement up and down and the next your in a market that's in a panic to buy or sell and price refuses to retrace. You just can't know when that could happen.

I know this from experience! Last October I did exactly that. I made a lot of money trading that way and because i was always averaging up/down I almost never had a losing trade. I was scalping over and over throughout the day and was averaging close to $1000 per day as I got close to the end of the month as I perfected the 'strategy' but something awful happened. It's called a bull market and it steamrolled me. One day us equities just decided to go straight up and not come back down. I was short. 5400 loss. A few days after dusting myself off, bam! 7000+ loss. I never want back to that. I was psychologically ruined.

So, if you want to try scaling in, go ahead but never lose site of those conditions that got you in the trade. If you lose those, it's time to get out, not the time to increase your position.

Sent from my iPad using Tapatalk HD

"I've missed more than 9,000 shots in my career. I've lost almost 300 games. 26 times, I've been trusted to take the game-winning shot and missed. I've failed over and over and over again in my life. And that is why I succeed."
- Michael Jordan, 5-Time NBA Most Valuable Player, 6-Time NBA Champion
Reply With Quote
The following 3 users say Thank You to ShruggedAtlas for this post:
  #13 (permalink)
Quebec, Canada
Futures Experience: Advanced
Platform: X-Trader, InfinityAT, Saxotrader
Favorite Futures: Emini ES, Emini RTY (TF), Crude CL, Eurex DAX, EuroFX 6E, Forex EurUsd and Hang Seng HSI
Posts: 32 since Mar 2011
Thanks: 40 given, 39 received

tderrick View Post
I'm just wondering what method people are preferring currently and why.

Of course, let's not forget, the old all in / all out gag.

I'm testing the waters of multiple cars and need some insight.


In general, during high volatility market conditions...I tend to all in and then scale out. In contrast, during low volatility market conditions...I tend to all in and all out. Yet, if volatility changes dramatically in the middle of a will also cause me to adapt and change the original plan of how I manage my trade.

I rarely scale into a position.

Reply With Quote


futures io > > > Scale In or Scale Out - The Latest Thoughts

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Upcoming Webinars and Events (4:30PM ET unless noted)

Wyckoff Hunting for Great Risk/Reward Ratio w/Gary Fullett

Elite only

Digging into the Details of iSystems w/Stage 5 & iSystems

Jun 5

Similar Threads
Thread Thread Starter Forum Replies Last Post
Log scale point and figure charts. dakine Investor/RT 2 February 24th, 2012 09:12 AM
Multicharts code of scale in several positions Masse EasyLanguage Programming 2 August 25th, 2011 09:30 AM
Simple 3 Tier Scale Out Order Setup horton IB Trader Workstation 1 June 23rd, 2011 01:18 AM
Creating a 12 minutes time scale arjfca EasyLanguage Programming 4 September 19th, 2010 01:14 AM
NT7 - Programming a Scale Justification=Overlay? chrisflow NinjaTrader Programming 3 May 27th, 2010 12:03 PM

All times are GMT -4. The time now is 01:11 PM.

Copyright © 2018 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432,
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts
Page generated 2018-05-21 in 0.09 seconds with 19 queries on phoenix via your IP