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Money management questions for CL traders
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Money management questions for CL traders

  #1 (permalink)
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las vegas
 
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Money management questions for CL traders

After a good Monday trading currencies, decided to spend the rest of the week demo trading CL. Went pretty good, was positive every day and plan to do it again next week. On Tuesday and Thursday, maintained strict stops and only entered within 15 ticks of the stop and fully managed losses. On Wednesday and Friday, still only entered within 15 ticks of the stop, but loosened stops an additional 10 ticks (maximum of 25 ticks) and let them go. On Tuesday and Wednesday, used a T1 of 10 ticks and T2 of 25 ticks. On both days exited the T2 at the first sign of weakness. Because of this, once on Tuesday and twice on Wednesday, left 30+ ticks on the table. So on Thursday, kept the T1 and loosened the T2, but unfortunately didn't catch any good runners. On Friday, ditched the T1 and fully managed the exits and caught two good trades. With only two days results, the larger 25 tick stop didn't help once, if it was bad at 15 ticks, it was still bad at 25 ticks.

Ignoring individual circumstances, overall,

1. Are you quick to cut your losses or do you feel it is better to stick to your initial stops?

2. How quickly or at what point do you move your stops to breakeven?

3. The CL was highly correlated to the dow this week and Cl traders seemed considerably more savvy than currency traders, i.e. they anticipated the dow's next move and didn't overreact to every little retracement. Is this typical behavior or did they just happen to be on their A game?

4. To what degree do scheduled news events have on CL, i.e. will it move 100 ticks in 2 seconds based upon some monthly inventory report? Is there a CL news calendar?

5. My initial plan for next week is to keep a maximum 15 tick stop, give it a little more wiggle room on slow days, keep it tight on volatile days, set my T1 at 15 ticks and open up the T2. Would you recommend any changes or have any other advice?

Thanks for any feedback.

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  #2 (permalink)
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  #3 (permalink)
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Forex Factory has a good economic news calendar. Primarily for oil it's the weekly inventory reports that will move the market, but there is usually news each day, sometimes with no impact, sometimes with major impact.

WRT to correlation of CL and other futures, it can have an impact but I typically don't watch any other instruments. For a while I watched ES along with CL, and sure there are times when the ES is making a double bottom and that stops oil in its tracks and it won't go lower even though the price action suggestions it should. But for the most part, my feeling is that there was no 'edge' in monitoring ES (or YM, etc) for making decisions on CL.

As for the rest, there are so many strategies involved, it's like asking "How do I make money trading" and wanting a nice concise answer One could say "buy low, sell high" or "when that doesn't work, buy high and sell higher". But for a more detailed explanation, you'll need experience (years) of trial and error and your own learning process, plus spends hundreds or thousands of hours on a forum like this reading all the posts and participating in the discussions

Mike

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  #4 (permalink)
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BTW,

Congrats on nice sim trading this week Looks good.



Mike

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.
6)
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.

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  #5 (permalink)
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I was just hoping for general feedback to help me shave a little bit off those few years . Yeah, it was spot on tracking the dow all week, as in tight, which I thought was interesting, but like currencies, it may not be persistent, don't really know just yet. It went good, but that last trade really helped the average, so I'm waiting for next week's results before I get too excited. I do like the possiblity of trading something else that moves so well though, I thought gy was the king of volatility. I am also curious to see how well I get filled in real trading and, honestly, I am not really sure who I am trading against with IB futures, do I have to worry about getting stop hunted, targets not transacting, etc. Need more practice and to figure those kinds of things out first. Thanks for the reply, have a good weekend.

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  #6 (permalink)
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Slow day, but stuck with the plan for the week and it seemed to work pretty good. Used demo IB account instead of NT sim account and had a few problems. For some reason it doesn't show the p&l in nt, and when I tried to "close" a trade, it was closed in nt but not ib, see first picture. Later figured out the atm orders still transacted correctly and I could manually close a position in nt by buying or selling at the market, but this left the original stop and profit orders from the atm in place, plus it placed new stop and profit orders, all of which had to be cancelled. Obviously this would bite me in the ass at some point in a fast moving market, so it is not really an option. Switched to closing positions in ib, but it covers half the screen, so need to get this figured out. Does anyone else have this problem with cl and ib? Also, the nt results are showing the contract as 05-10, even both the chart and ib are showing 06-10, see second picture.

For the first trade, it consolidated pretty tight before the open so I decided to trade the break out. Not sure if this is a good cl strategy or not, will keep simming it and post the results if it seems worthwhile. Anyone else do this with success? I was a little suprised that the buy transacted, I didn't expect the dow to fill the gap, thought it would drop from the open, retrace, then continue down. Accordingly, I closed the position at the first sign of weakness, which turned out to be a pretty big mistake because it ended up doing the opposite, it filled the gap then dropped (I traded what I expected not what I saw ). After that, hit the next 4 trades, but only one medium. Next 2 were duds. I closed both out early at a small loss, which was the right decision, because both would have stopped out. Not moving anymore, so gonna take a nap now.

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  #7 (permalink)
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Good job vegas - you should start a journal in the journal section to track your progress and thoughts.

I removed one of your attachments, it showed an account #.

Mike

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.
6)
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.

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  #8 (permalink)
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las vegas
 
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Thanks for the edit Mike. Just a few comments. The opening range breakout didn't work today, barely got short and then held it to the stop for purposes of evaluating the strategy, which ended up being no good on a day like today, see trade #3. I think the orders were too tight, so I plan to loosen them tomorrow to see if that helps.

Apart from that, found out that NT hasn't work correctly with IB energy futures for almost a year due to some problem with the dates and so far neither party has been able and/or willing to fix the problem. I am going to inquire if multicharts has the same problem. BTW, I have been posting the logs of my trades and not the charts because the trades don't show on the charts due to this problem. Anyway, today I preset 3 buy and 3 sell orders so I could exit the positions manually, but was pretty much a still tired dumbass because I didn't consider that once my T1 was hit that I would have to place an order for 2 lots and not 4 lots. Trade #7 is me selling 4 lots and getting short 2 lots when I just wanted to exit my 2 T2 lots. It finally occurred to me that the IB dom has close and reverse buttons, so I started using those.

Otherwise, I didn't fully stick with the strategy today. I had planned to give it more wiggle room on slow days (like today), but didn't and ended up trading more and making less (in pretend money anyway). As you can see in trade #10, I went long around 7:38 a.m., but bailed early and then got long 3 more times with mediocre success. If I had stuck in the original trade then I would have hit both profit targets on only 1 trade. So ended up netting 17.5 ticks per lot on 4 trades and would have hit 27.5 ticks per lot on 1 trade. Even when I demo trade, it's just really hard for me to give anything back after being up, so even though it seems like a better strategy on slow days with CL (still to be determined), I don't think in real trading that I will ever be able to let myself get upside down after being up 4 to 5 ticks.

I don't have much more to say, so will update the opening breakout strategy if I can make it profitable and will post my overall cl strategy/experiences in a few weeks (or months?) if I am successful in live trading. Still two big "ifs" at this point.

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  #9 (permalink)
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The Strategy?

Hope this isn't too off topic. But wondering about your 'breakout strategy'. More to the point what do you define as a 'morning range' ie open to noon? Any indis involved?

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  #10 (permalink)
Fortitudo et Honor
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vegasfoster View Post
Thanks for the edit Mike. Just a few comments. The opening range breakout didn't work today, barely got short and then held it to the stop for purposes of evaluating the strategy, which ended up being no good on a day like today, see trade #3. I think the orders were too tight, so I plan to loosen them tomorrow to see if that helps.

Apart from that, found out that NT hasn't work correctly with IB energy futures for almost a year due to some problem with the dates and so far neither party has been able and/or willing to fix the problem. I am going to inquire if multicharts has the same problem. BTW, I have been posting the logs of my trades and not the charts because the trades don't show on the charts due to this problem. Anyway, today I preset 3 buy and 3 sell orders so I could exit the positions manually, but was pretty much a still tired dumbass because I didn't consider that once my T1 was hit that I would have to place an order for 2 lots and not 4 lots. Trade #7 is me selling 4 lots and getting short 2 lots when I just wanted to exit my 2 T2 lots. It finally occurred to me that the IB dom has close and reverse buttons, so I started using those.

Otherwise, I didn't fully stick with the strategy today. I had planned to give it more wiggle room on slow days (like today), but didn't and ended up trading more and making less (in pretend money anyway). As you can see in trade #10, I went long around 7:38 a.m., but bailed early and then got long 3 more times with mediocre success. If I had stuck in the original trade then I would have hit both profit targets on only 1 trade. So ended up netting 17.5 ticks per lot on 4 trades and would have hit 27.5 ticks per lot on 1 trade. Even when I demo trade, it's just really hard for me to give anything back after being up, so even though it seems like a better strategy on slow days with CL (still to be determined), I don't think in real trading that I will ever be able to let myself get upside down after being up 4 to 5 ticks.

I don't have much more to say, so will update the opening breakout strategy if I can make it profitable and will post my overall cl strategy/experiences in a few weeks (or months?) if I am successful in live trading. Still two big "ifs" at this point.

Vegas, obviously I don't know you, your experience, your style, etc....so take this with a grain of salt.

You look to be having some pretty good success, however, I discretionary traded CL (sim) for a couple of months prior to going green and I always seemed to land on my feet. Even on days when I was down, I'd alter my order size and always seem to dig my way out of a hole.

Once I put on green glasses, it became VERY difficult to replicate my success in sim.

I'm not sure if you have icewater in your veins or if you're able to trade a small fraction of your overall bankroll in order to minimize your emotion, but just bear in mind that if 4 contracts is a significant portion of your capital, you WILL have extra emotion not only with your exits, but with your order sizes.

In order to get a true evaluation of your performance, I would recommend trading the same order size and judging your performance based upon that....because like I eluded, it's very easy in sim to double down, quad down and end up on the winning side of a couple of trades to pull yourself out of a hole.....that isn't such an easy thing to do when real green is at stake.

Take it for what it's worth.

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