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Making a Living with the Micros


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Making a Living with the Micros

  #161 (permalink)
 
sstheo's Avatar
 sstheo 
Holladay, Utah, USA
 
Experience: Intermediate
Platform: Multicharts
Broker: AMP/CQG
Trading: MES, MYM, MNQ, M2K
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Cutloss View Post
ScreenHunter 20499



all 1 lot micros with a maximum of 3 micros in a trade but 90 % were 1 lots. yes you can make an ok living off of the micros but you will
need to bust your ass everyday for months on end and when not at the computer be thinking about the mkt and why it works the way it does and how YOU WORK with it

do not give up unless you are doing the same stupid shit everyday and not making changes

Yep, for sure. No where in 16 pages of journal have I ever said it was "easy," LOL.

But for someone with just $1k to $5k, micros are the only sane game in town. (Well crypto and fx may vie for your attention, but watch out with crypto!)

$168 with one micro in one day is crazy awesome. Change nothing but the number of micros and soon you are up to an E-mini at $1680 per day, or over $400k per year.

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  #162 (permalink)
 
sstheo's Avatar
 sstheo 
Holladay, Utah, USA
 
Experience: Intermediate
Platform: Multicharts
Broker: AMP/CQG
Trading: MES, MYM, MNQ, M2K
Posts: 285 since Oct 2012
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Memorial Day.

I wrote this last week



Today was the resolution:




4190 was hit to the tick.

I have learned the hard way to pay attention to the "order flow" as portrayed by the daily volume delta bars.

Of course they are not correct all the time, but why fight them? There will always be more trades.

Probability...




Net for the day was about $150 after fees.

Here is my Micro ES chart. I stayed on the short side because of the previously-discussed volume delta bearish idea and also because we were below the blue -1SD (-1 std dev vwap band). To me, below the -1SD is the EXPANSION SHORT zone.


(1 tick renko with vwap bands. vwap = yellow, blue is -1sd, purple is -2sd, USA Mountain time)

Today we had a shortened trading session because of Memorial Day, and volume was light. This big move down may easily be completely reversed tomorrow and back to the highs we go. Anything can happen.

I am glad I am a day trader. I think swing trading right now (without tight stops) would be nightmarish. This market looks so toppy. But I recognize we are still near the top of a huge bull run. I have no business calling for shorts except on the shortest time frames. I am trying hard to keep an open mind and take longs when they are clearly setting up and imploring, "Pick me up! Free cash!"

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  #163 (permalink)
 
sstheo's Avatar
 sstheo 
Holladay, Utah, USA
 
Experience: Intermediate
Platform: Multicharts
Broker: AMP/CQG
Trading: MES, MYM, MNQ, M2K
Posts: 285 since Oct 2012
Thanks Given: 198
Thanks Received: 1,490


Memorial Day continued....

My confidence in my VWAP bands has been rising, and today I thought outside the box a bit and traded some Mini CL, a.k.a. the "QM."

I heard that the micro CL will be out soon, and I am excited! It will be 10% of the CL, like the MES is 10% of the ES. Even though the mini is still 50% of the CL, it is still a hairy beast that gives me the heebie jeebies, and I will probably just wait for the micro CL to come out - while sticking with my 4 micro index charts.

Nevertheless, I did okay:


Trade 1. The first trade almost hit my stop. Notice also that I got out of my first trade at exactly the wrong time - right before a flash selloff of $150+. Arghh! (not Zen, but allow me some emotion...) The VWAP bands predicted weakness right where I took the scratch (-$12.50). In other words, I got out exactly where my original short entry should have been! Between the Blue +1 and -1 std dev bands is the RTM (Reversion to the Mean) zone. And the mean, of course, is the VWAP.

Trades 2 and 3 were great.

Trades 4 and 5 were short, but I should have stayed flat or gone long down at the -1SD at 9:50 (11:50 ET). Being in the lower RTM zone, I really need to be looking for longs while below the VWAP but above the -1SD.

My reason for posting this QM chart is to show how the VWAP bands can be a universal FRAMEWORK for me. Any chart, any time of day, I can look at the VWAP bands and have a good idea of some probable trade directions, including entries and exits.

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  #164 (permalink)
 Cutloss 
Midway florida
 
Posts: 243 since May 2021

I wanted to clarify my 168 net gain. it was starting out with 1 lot micros but there were a few trades taht ended up having 2 micros at 1 time for the same trade so i do not want to mislead anyone but 90 % were just lots and i appreciate you telling me it was some good trading.

if you really want to do the numbers i fyou can make it with micro with a $ 1.25 round tripo commission like i am paying then when you switch to mini if the dollar amount doesnt scare you then
you should be doing even better because a lot of your 1 tick scratch trades will be profitable and your slippage may actually be less than in the micros as well as your NFA fees will be lower overall.

I am far from doing mini lots but building. i think this week i will scale up and start doing 2 lots. i didnt even realize the mkt was open today which shows i should have done more homework but also i had a nice break.

i have lots of days that are much better than that and some that are worse.

It is true that if you are really good you should be able to make 5k a day with a 2 lots in the MINI especially with these point move. that is not a lie if you are really good and a little lucky. the market of course must be coopoerative and you must not fight too much.

think of it like a real war. you ahve 300 men you are willing to risk in the battle. you losee 100. do you keep fighting or wait and re strategize and come back to fight and win the next battle.

citadel is not named citadel because they are a freindly ally they are all out war every day and they are your enemy just like everyone else.
ScreenHunter 20580

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  #165 (permalink)
 Cutloss 
Midway florida
 
Posts: 243 since May 2021


sstheo View Post
Memorial Day continued....

My confidence in my VWAP bands has been rising, and today I thought outside the box a bit and traded some Mini CL, a.k.a. the "QM."

I heard that the micro CL will be out soon, and I am excited! It will be 10% of the CL, like the MES is 10% of the ES. Even though the mini is still 50% of the CL, it is still a hairy beast that gives me the heebie jeebies, and I will probably just wait for the micro CL to come out - while sticking with my 4 micro index charts.

Nevertheless, I did okay:


Trade 1. The first trade almost hit my stop. Notice also that I got out of my first trade at exactly the wrong time - right before a flash selloff of $150+. Arghh! (not Zen, but allow me some emotion...) The VWAP bands predicted weakness right where I took the scratch (-$12.50). Between the Blue +1 and -1 std dev bands is the RTM (Reversion to the Mean) zone. And the mean, of course, is the VWAP.

Trades 2 and 3 were great.

Trades 4 and 5 were short, but I should have stayed flat or gone long down at the -1SD at 9:50 (11:50 ET). Being in the lower RTM zone, I really need to be looking for longs while below the VWAP but above the -1SD.

My reason for posting this QM chart is to show how the VWAP bands can be a universal FRAMEWORK for me. Any chart, any time of day, I can look at the VWAP bands and have a good idea of some probable trade directions, including entries and exits.

do you realize that when you exit is when the mkt does what you thought that is because retail traders are the MARK and the fulcrum point for the professional algos. they dont take the other side of your trade for nothing. that is for sure. this is why demo always works. there is no counter party in demo. the algos have time spliced into such incremental nano seconds that they do worry and add up 1 lot micro orders.. why wouldn't they worry about every 1 to 5 lot small trade. the 20 and 50 lot traders the algos figure those guys are settng up for something or know something because they wouldnt be throwing 20 ro 50 lots around as noise. Also there is more risk in doing battle with a 20 to 50 lot order than say 1 to 5 lots. just my 2 cents

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  #166 (permalink)
 
sstheo's Avatar
 sstheo 
Holladay, Utah, USA
 
Experience: Intermediate
Platform: Multicharts
Broker: AMP/CQG
Trading: MES, MYM, MNQ, M2K
Posts: 285 since Oct 2012
Thanks Given: 198
Thanks Received: 1,490

I have mentioned multiple times about bailing quickly on trades that go against me.

I thought I would show an example:


(1 tick renko MES, with 20 ema and OBV)

I got short at the first red arrow.

Today is a big down day, from a high of 4230 (near the recent ATH's at 4238.25) AND the OBV was down at the moment of my entry.

But I was wrong.

The upgoing 20 EMA did what it often does and gets a strong reaction. Additionally, the push up from the 9:33 local low (11:33 ET) was a strong thrust, and strong thrusts almost always resume the trend after a pullback.

Seeing the trade go against me, I quickly dumped the short.

The longer I hold trades that are going against me, the more and more inhibited my judgment becomes and the poorer and poorer I get. This, of cours, is a toxic cocktail that gets the dark emotions boiling inside and these could potentially lead to acting out self-defeating behaviors that look a lot like "revenge trading."

I must avoid revenge trading at all costs; it has NEVER worked for me.

So I am trying much harder to always cut my losers quickly.

But I did get back in and was well-rewarded for my discipline:



3 tick loss, then an 8 tick winner.

Yes, with a strong belief in more down today, I could have held, but I should NOT have held. Why?

Because my strong beliefs have no place in my trading plan. The market can do whatever it wants. After 15 years, I still struggle to have a completely neutral mindset.

It is exactly at those times of elevated confidence--when I am thoroughly convinced the market "must" go a particular way--that I have "loaded up" and BAM!

Fortunately, significant account damage is no longer a daily feature of my trading.

But I still have a long way to go.

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  #167 (permalink)
 
sstheo's Avatar
 sstheo 
Holladay, Utah, USA
 
Experience: Intermediate
Platform: Multicharts
Broker: AMP/CQG
Trading: MES, MYM, MNQ, M2K
Posts: 285 since Oct 2012
Thanks Given: 198
Thanks Received: 1,490

"The Revenge Trade: Origin and Resolution"





I have a great friend with an amazing 95%+ win ratio. But that final 5% haunt him.

He is ultra-competitive and consequently hates to lose--even more than the rest of us. Guaranteed.

Admitting he is wrong and closing out that 1 in 20 losing trade while in the red is anathema to him. He will vehemently reject taking that loss.

While most of the time he will average down a bit and recover nicely, about 1 in 10 times he will get burned.


So if you do the math, about 1 in 200 trades is seriously out to get him. And it hurts him bad.

I think even more than his depleted pocketbook, I believe the pain comes in the form of (an unjustified) loss of confidence in his trading, an accompanying stripping of optimism, and the resultant pervasive gloom.

I say "unjustified" because if he simply changed his attitude about the losing trades, I think he would be in the top .001% of traders in the world. (His entries and targets are that good.)

So what is the origin of the hyper-competitive self-sabotage? I can't speak to his golf, cycling, skiing, and tennis, but as far as trading goes, my theory about the origins of the revenge trade are simple.

Origins:

1. His win rate is beautifully high so anything other than a win is not handled well emotionally. He is not used to losing -- at all. This actually gets in his way!

2. He is looking for just 1 to 3 great trades per day, so if he gets in a trade and it goes against him, it sets up a FOMO situation where he believes he may not get another trade, so he has to "make this one work." He then gets "married" to that trade, and may even "go down with the ship."

So, what to do?

Resolution:

A. Emulate the best hitters and be a great loser. I think I need to take him out to a baseball game. He can watch those pitchers strike out most of the batters. And then he can watch those very same batters just keep lining up to take the same punishment over and over again. But there is a secret. Those batters know that about 1/3 of the time they will connect with that ball, and when they do, they know there is a good chance they will get on base and maybe even win the ball game. My friend has a .950 "batting average" as a trader, but can't humbly take the 5% of losses and wait for his next at-bat. As a reminder, here are the batting averages for the top 10 in all of Major League Baseball history. Just let those numbers sink in. Ty Cobb, with the top batting average in MLB history "had bad trades" 63% of the time!




B. Practice closing trades quickly. I think he should get on sim and literally just practice closing out small trades, both winners and losers. He needs to develop the habit of clicking that "Take the loss!" button that he has previously felt was almost blasphemous to his very existence.

C. Go for smaller profit targets. To help reduce the FOMO, I think he might consider looking for more frequent (and consequently smaller) trades. He is great at getting 5 to 10 ES points. But what if he went for 2 to 4 points instead? (8 to 16 ticks). And what if he practiced that for awhile and then took the smaller trades but increased the number of contracts? I am sure there have been times where he was up 8 ticks on the way to a 20 tick target, but it reversed and he had a loss. This is the kind of trade that would benefit for sure with an 8-tick target.

D. Trade smaller. To help with all of the solutions mentioned, trading smaller position sizes can help. Perhaps even trade as few as one micro, if needed, until taking a quick stop becomes easy. Each person has their own "I don't care!" size. That is the size you must trade at all times to keep (most) emotion at bay.


HERE is a short article on how to overcome revenge trading. It says to
(1) Question your motives,
(2) Learn to accept losses, and
(3) Take a break.

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  #168 (permalink)
rossetto ricardo
Presidente Prudente, Brazil
 
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sstheo View Post
"The Revenge Trade: Origin and Resolution"


B. Practice closing trades quickly. I think he should get on sim and literally just practice closing out small trades, both winners and losers. He needs to develop the habit of clicking that "Take the loss!" button that he has previously felt was almost blasphemous to his very existence.

I've been reading yours journals, learning a lot. Many thanks.

I've thought more than once at putting some kind of recorded alert in a predefined level ("Take the loss" sounds great) in order to 'shake me out' of this tunnel vision situation (don't know if that's easy to implement, though).
Never put the idea to work, training a lot and succeeding at keeping losses small (using hard stops that I only move tighter, unless I want to sabotage myself!).

Might be a solution to cut the problem short from a mindfulness perspective; one is basically out of the present time once this 'dont take a loss' situation kicks in. My 2c

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  #169 (permalink)
 
sstheo's Avatar
 sstheo 
Holladay, Utah, USA
 
Experience: Intermediate
Platform: Multicharts
Broker: AMP/CQG
Trading: MES, MYM, MNQ, M2K
Posts: 285 since Oct 2012
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rossetto ricardo View Post
I've been reading yours journals, learning a lot. Many thanks.

I've thought more than once at putting some kind of recorded alert in a predefined level ("Take the loss" sounds great) in order to 'shake me out' of this tunnel vision situation (don't know if that's easy to implement, though).
Never put the idea to work, training a lot and succeeding at keeping losses small (using hard stops that I only move tighter, unless I want to sabotage myself!).

Might be a solution to cut the problem short from a mindfulness perspective; one is basically out of the present time once this 'dont take a loss' situation kicks in. My 2c

Great idea about the audio!

Thanks for the kind words.

I know The Rithmic platform allows you to set a "shut it down" level where is closes all your trades and does not let you continue for the day.

I asked my AMP broker about the auto liquidate feature. YES, they have one. Guess where it is set? At 80% loss on the day! LOL They said it is adjustable. But wherever it is set, they will charge you a liquidation fee for each contract. So it is much better to find a platform-side solution - unless your broker has something less punitive available.

Better yet. Stay far away from the need for this type of solution by taking all losses quickly.

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  #170 (permalink)
 
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 MNSTrading 
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sstheo View Post
"The Revenge Trade: Origin and Resolution"





I have a great friend with an amazing 95%+ win ratio. But that final 5% haunt him.

(1) Question your motives,
(2) Learn to accept losses, and
(3) Take a break.[/INDENT]

I had a friend like that too. That behavior taught me more than anything else.

Anything.

It is a kind of empty compulsion. Don't waste your life brothers.
Don't go chasing waterfalls. Stick to the lakes and the rivers you're used to.

If there is a take the loss button. I would do it in Obi Wan Kenobi voice, "Take the loss Luke, move away from the dark side"

Coming, they can't be denied. Going, they can't be detained.
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