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Trading fast markets
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Trading fast markets

  #281 (permalink)
Elite Member
Tucson
 
Futures Experience: Intermediate
Platform: NinjaTrader
Favorite Futures: CL, TF
 
Posts: 111 since Jan 2011
Thanks: 110 given, 69 received

TST Combine

I am will start my combine next week. I start with one contract as well and add, but not as soon as you. I like to add at around 30t and move stop to BE+ a few for the new entry price. I trade CL and GC, and will probably focus on GC for the combine. I watch the candle OHLC, Bollinger Bands and GOMI CD to make my decisions to enter. Good luck to you!
Bob

xelaar View Post
Here we go. I applied for a Combine yesterday and today is my first trading day. I have introduced myself in my first thread now moved from Elite to regular forum, so if you are interested - feel free to check it out. It also includes my pre-combine practice with both methodology and CTS T4 platform.

I am a momentum trader. I like to go with the flow and be done fast. I don't like to nurse winning trades and I despise keeping losing trades on a life support. So I trade with a small stop and large target, not being afraid to be wronged by the market even if it continues to move my way after stopping me out. It's not about direction only, much more important is anticipating volatility and timing the trade.

I am not married to a trading system or an instrument. I use what suits me best and what works best at the moment. I have found success previously trading news releases on Forex market, being consistently profitable. I could still do it, but I have chosen to move up to the professional arena and not be a subject of brokers' manipulations and tricks they play constantly in retails FX, having heated conversation with brokers confiscating profits and promising to have an FSA Ombudsman to go after them. Enough is enough. I traded different styles from 3 pip scalps to trades off daily charts with 500 pips stops. I am most comfortable however with intra-day trading and with fast trades that prove you wrong or right without unnecessary delay. Thus momentum trading in fast moving markets.

The reason I am taking a Combine is first and foremost I want to test myself as a trader, I want to force myself to improve my discipline and patience, and I want to place myself into a more professional atmosphere than trading from home lonely staring at charts and having zero accountability. I love very strict risk management of Combine and I believe it will improve my trading. I also wouldn't mind getting funded with a larger account, since I prefer not to put together a sizeable trading capital myself at this point, having other financial commitments. Perhaps when I am funded and if I like the way it goes I will look at option to trade both PTP and my own funds.

I believe there are two type of people in markets: analysts and traders. First group is much more populous. Most people with technical degree and analytical skills and mindset naturally assign themselves into a first group. These people concentrate on what market did before and trying to find out what it will do next. They find all the reasons to support their argument. They also find all the reasons why they are wrong and they wrong often enough. Another group is traders. These people trade what they see, not what they think. Paralysis by analysis never applies to them. I had started in the first group like most people, having a masters degree in IT and natural aspiration for analysis. It took me a long time to cross the border and get into a second group. I am by no means is master trader and I do have lots of faults like impatience, periodical lack of discipline. However I understand them and control them as much as I can.

Trading plan.
It is very simple. I trade with momentum. I start my day by doing a basic top-down analysis from daily to trading time frame. I mark major support and resistance zones and channels. I don't use any predictive indicators or oscillators. I use EMA 21 for general guidance and I use zig-zag for anchoring and knowing sizes of rotations and legs. I trade normally from just one chart but currently I use a secondary chart with range bars and Keltner channel to look inside bars of my main chart.
I have decided to trade Gold for the Combine, because this is the most appealing market right now with shocking volatility and huge swings. I have chosen 2 minute GC chart as my trading chart and 2 ticks range chart as my peeking-inside-candles chart. I use EMA21, 50 ticks zig-zag and volume on my 2 minute chart and 20/20/4 Keltner channel on my 2 tick range chart.

I have just one setup. I establish the direction of market sentiment by comparing recent rotations on 2 minute chart, which must be at least 50 ticks in size (zig-zag does it for me). I want to see a current rotation to be in the same direction as a previous one, so to play a reversal of sentiment I need to see one rotation completed before I will enter on next one. My trigger bar is a large 2 minute bar with little or no wick in a direction of sentiment. For current volatility is should be 20-30 ticks tall at least. During quieter times I would settle for at least 15 ticks. I enter with a stop market order 2 ticks above high or below low (for up and down markets respectfully). My stop is 10 to 20 ticks wide depending on volatility.

Normally I use 10 ticks even if market making large swings. I only opt to 20 ticks if price discovery is malperforming and spread is jumping, like it was last two days. I still try to decrease my exposure as soon as possible by reducing stop and putting to break even as I am 10 ticks in profit. If I use 20 ticks stop I use 2 times smaller position size. That simple.

I strive to trade less. This method allows me to take just few trades per day. I look to trade 3 to 5 trade per day tops and maximum 3 full stop losers. Then I just stop. Even if I had winning trades that day I stop after 3 losers, as it means either I can't read the market or market is too erratic.

I target 50 to 100 ticks depending on recent rotation sizes (I look for no more than 70% of rotation). I look to add to a winning trade once it is at BE and I have a new signal - another strong closing bar. Therefore I never risk more that just 1 position.

For 150k Combine I have chosen 5 cars position as my base position. Relatively large DLL can be deceptive and the Max DD is only 1.5 time of it, so it's foolish to risk a full DLL per day unless a sizeable cushion of profit is already established. Certainly not at the beginning of Combine. I will start first day with 1 contract positions striving to make some cushion to move to 2 contracts per trade. If I have a losing day and I stopped myself, next day I go down one car on my base position until my cushion is re-established that day or later. I will only trade maximum of 7 cars as a base position by the second half of the Combine when a large profit is already there, allowing for 1 scale-in. Normally I will use 5 cars as a base and allow 2 scale-in 5 cars each. (In reality last one will be just 4 cars as T4 has funny ways of calculating exposure but I don't care). This tactic will allow me survive much longer than I would with an inflexible position sizing.

20 day Combine required average of 800 usd net per day profit. In reality it can be as low as 400 as you can trade 40 trading days, not 20. But let's leave as a backup plan. My ambitious target is to look for 3100 usd per day target at which I stop trading. This figure assumes I trade with 5 cars base position size, I have 50% winning day rate and my losing day is 1500 and I need to make 800 per day, therefore 3100 will cover 1500 of losses and still make 1600 per two days. This is of course very simplistic approach and I do plan to have much less losing days than 50% and have few or non 1500 losing days, but I need to put some sort of boundaries in place.

Here I am, hope you weren't bored to death by reading it and let's enjoy this ride together!


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  #282 (permalink)
Elite Member
prague, czech republic
 
Futures Experience: Intermediate
Platform: NT7, MT4
Broker/Data: LMAX
Favorite Futures: DAX, Gold, Euro
 
xelaar's Avatar
 
Posts: 1,517 since Feb 2013
Thanks: 1,739 given, 2,592 received

LTP - day 1

Huge volume, two day's worth packed into one. Several trades, one really good, took 30 ticks out of it, around 60 was available, but TP was hit in a blink of an eye. Was using 3 and 5 lot position sizes. Can't complain, though, nearly half of LTP target is there in one day.

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Was working on complimentary setups, looking very promising.

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  #283 (permalink)
Elite Member
london
 
Futures Experience: Advanced
Platform: NinjaTrader
Favorite Futures: CL
 
Posts: 15 since Dec 2012
Thanks: 13 given, 5 received



xelaar View Post
Huge volume, two day's worth packed into one. Several trades, one really good, took 30 ticks out of it, around 60 was available, but TP was hit in a blink of an eye. Was using 3 and 5 lot position sizes. Can't complain, though, nearly half of LTP target is there in one day.

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Was working on complimentary setups, looking very promising.

That's awesome! can you post your chart with trade setups you took please. thanks.

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  #284 (permalink)
Elite Member
wa/ usa
 
Futures Experience: Intermediate
Platform: schwab, metatrader, OEC,T4,TDameritrade
Favorite Futures: CL ES 6C 6E
 
Posts: 254 since Oct 2012
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xelaar View Post
Huge volume, two day's worth packed into one. Several trades, one really good, took 30 ticks out of it, around 60 was available, but TP was hit in a blink of an eye. Was using 3 and 5 lot position sizes. Can't complain, though, nearly half of LTP target is there in one day.

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).



Was working on complimentary setups, looking very promising.

Can I ask you why you chose the 150k combine ? 30k is a joke for loss limit for crude and gold but 50k and 100k are ok too if you are going to be trading 5-10 lots. I am leaning more towards the 50k but 100k doesnt look bad either. The smaller profit goal should be a consideration, no ? Or are you thinking of when you are trading live you want to trade bigger ?

Thanks

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  #285 (permalink)
Elite Member
Vizag+india
 
Futures Experience: Intermediate
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Favorite Futures: Nifty
 
tinkug112's Avatar
 
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Thanks: 110 given, 87 received

change your experience level....

Trading Experience: Intermediate ????


xelaar View Post
Huge volume, two day's worth packed into one. Several trades, one really good, took 30 ticks out of it, around 60 was available, but TP was hit in a blink of an eye. Was using 3 and 5 lot position sizes. Can't complain, though, nearly half of LTP target is there in one day.

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).



Was working on complimentary setups, looking very promising.


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  #286 (permalink)
Elite Member
prague, czech republic
 
Futures Experience: Intermediate
Platform: NT7, MT4
Broker/Data: LMAX
Favorite Futures: DAX, Gold, Euro
 
xelaar's Avatar
 
Posts: 1,517 since Feb 2013
Thanks: 1,739 given, 2,592 received


garyboy275 View Post
Can I ask you why you chose the 150k combine ? 30k is a joke for loss limit for crude and gold but 50k and 100k are ok too if you are going to be trading 5-10 lots. I am leaning more towards the 50k but 100k doesnt look bad either. The smaller profit goal should be a consideration, no ? Or are you thinking of when you are trading live you want to trade bigger ?

Thanks

Very good question nobody asked before and it took a lot of consideration and thoughts.
Two factors and you named them both: large dll and large size to trade live.
First gives you the highest chances to do rollover among all combines if you are disciplined enough and not swinging all 15 cars from the start. My plan was to start with just one and add after winning days. It worked and also comoletely removed the pressure about not hitting dll or max dd. You can do similar with 100k combine but why settle for less? 150k is toughest to win but easiest to roll over if your target no1 is not to blow it, which minecis. I simply traded it like real money. It worked nice in the end:-)
Second factor you named right - why trading for peanuts. I can fund myself but TST gives a lot of structural benefits, tight risk management and social aspect. If I have uo pay a profit split it better be from tge highest numbers otherwise game is not worth it.
And a third, I did not consider it at the beginning but worth thinkin about - yoy have to built same cushion with both 100k and 150k combines, 10k, and it is faster to do with more firepower.

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  #287 (permalink)
Elite Member
prague, czech republic
 
Futures Experience: Intermediate
Platform: NT7, MT4
Broker/Data: LMAX
Favorite Futures: DAX, Gold, Euro
 
xelaar's Avatar
 
Posts: 1,517 since Feb 2013
Thanks: 1,739 given, 2,592 received


vijidas View Post
That's awesome! can you post your chart with trade setups you took please. thanks.

And your wish shall be granted!

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  #288 (permalink)
Elite Member
london
 
Futures Experience: Advanced
Platform: NinjaTrader
Favorite Futures: CL
 
Posts: 15 since Dec 2012
Thanks: 13 given, 5 received


xelaar View Post
And your wish shall be granted!

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Many thanks for the wish xelaar Your journal is exciting, very encouraging and motivating. Keep it up.

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  #289 (permalink)
The Narrow Road
Belgium
 
Futures Experience: Intermediate
Platform: Ninjatrader
Broker/Data: Ninjatrader Brokerage, CQG
Favorite Futures: FDAX, FDXM ...maybe
 
podski's Avatar
 
Posts: 379 since Sep 2012
Thanks: 443 given, 457 received

Hi Xelaar,

Listening to John Hoagland on a recent webinar (Post Trade Analysis: )

One of the things that is clearly his belief about traders , and he qualifies to have beliefs ... it seems he is specialized in not only "trading" but also "traders", is that in the long run he likes to see how they perform with about a 50% win rate.

I'm not challenging you or saying your system isn't the best thing since sliced bread or anything, I am interested in and also challenging you to discuss your risk management ideas.
  • How are you monitoring slippage on your stops - you have mentioned that this is one of the bigger risks that you want to know about in real time?
  • Getting filled in real time is certainly one of your risks , how are you monitoring that ?
  • What does your system look like with 50% wins ?

If John comes to you and says (cue gravelly voice):

"OK Xelaar. Nice job. Great Combine, great to see that people on Big Mikes are watching too. Great approach to the LP. You had a couple of good days. Very encouraging and I know that you have put a lot of work into this. Let me tell you though, and I don't mean to be in any way dismissive of your efforts, I've been working this floor man and boy, and there is little evidence to suggest that there are 90% traders out there. Show me how you will manage risk with what is in the end my money and yours when you are winning about half the time with some horrible slippage. I want to see you succeed and I don't want you to be discouraged or blow out of our strict risk management parameters too early".


I think that not only for John but also for you that having this picture in your mind will allow you to punch hard. So far you have not had to take one on the chin ... but knowing that you can is very empowering !

Thanks for sharing with the group - you are an example of what can be done. We've seen the trades and now show us where the confidence comes from. Absolutely delighted with your progress man !

p

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  #290 (permalink)
Elite Member
prague, czech republic
 
Futures Experience: Intermediate
Platform: NT7, MT4
Broker/Data: LMAX
Favorite Futures: DAX, Gold, Euro
 
xelaar's Avatar
 
Posts: 1,517 since Feb 2013
Thanks: 1,739 given, 2,592 received


Hey Podski, thanks for the very interesting post.

I do respect John a lot and his experience and wisdom, but all people usually see things from their perspective. John as far as I understand is a discretionary trader and always been exposed to an environment of discretionary traders and pit scalpers. I can clearly see why he's challenging any traders with high win rate percentage. Because it can account to a streak of luck and very favoring market conditions, since even longest Combine is only covering 2 months of trading at most, so they have to work with quite limiting data set to draw conclusions.

I did quite a bit of pure discretionary trading and it is not my thing. As I told Mike I am a systems trader. I do apply discretion, mostly when to use it and when not to. The system I trade now is also very discretionary in regards to targets and exits. But very stricts with entries and risk. I traded different manual systems I developed over several years. None work forever. But why would you think anything should? Nothing stays same forever in our lives. Things change, even most fundamental ones. My approach to trading is to find what works now, test and do stats, optimize, and start trading it, by slowly getting in, using profits as cushion to trade more. Once profitability fades - scale out and stop. Constantly look to tune things, adopt to changing environments.

The longest I traded one set of setups was 1.5 years with very slight changes. Very very profitably, with win rate above 80%. Most trades were just above scratch so if you count them in, my risk-reward was probably little bit above 1:1, but if you cut out all slightly above or below 0 trades, you get 3-5 to 1 trades. Yeah sometimes maybe 5-10 trades per months, but very profitable.

Another system also traded for a run of around 10 month, very profitable, but in the end it completely collapsed. I cut it once it stopped looking good, first by slashing risk to 25% and then to 1% and run it for some time to see if it recovers. It did not. But the run was excellent and very profitable.

Markets always bring opportunities, imbalances, imperfections. I aim to trade them with both high win rate and high risk reward. Maybe there wouldn't be so many of them, and maybe you can't trade them just as well on multi-million dollar account, but this is the reason they exists - if one can trade it with 1000 lots, they will be exploited and removed from existence very fast, by HFT firms and hedge funds.

But if you want to examine my system in regards to its win-reward ratio and profitability with just 50% win rate - you can easily do it yourself, my report is available.

But let me help: I did 130 trades during the Combine, average winner is 343, average loser is 216, in case of 50% win ratio, we have 65 winners and 65 losers, or 127x65 = 8255. It's up to you to decide whether it is good or bad.

I don't get what type of conclusion this sort of exercise should bring, because it's just one setup, developed for favoring market conditions. I have 3 others in testing now. Once I have enough data they will go either live or in LTP.

John refers to discretionary traders, who strive to trade every day and every market. I beg to differ, I strive to trade when I see an opportunity, not when I want to trade. Here is a huge secret revelation: I don't like to trade. I like money and lifestyle that comes from trading. I like the mental aspect of developing ways to beat the market, see it succeeding, winning, thriving. But not the actual trading. I don't like to risk money. But I have to, to win. Trading is not my hobby, I have hobbies elsewhere and trading is not among them. It's business. J.O.B.






podski View Post
Hi Xelaar,

Listening to John Hoagland on a recent webinar (Post Trade Analysis: )

One of the things that is clearly his belief about traders , and he qualifies to have beliefs ... it seems he is specialized in not only "trading" but also "traders", is that in the long run he likes to see how they perform with about a 50% win rate.

I'm not challenging you or saying your system isn't the best thing since sliced bread or anything, I am interested in and also challenging you to discuss your risk management ideas.
  • How are you monitoring slippage on your stops - you have mentioned that this is one of the bigger risks that you want to know about in real time?
  • Getting filled in real time is certainly one of your risks , how are you monitoring that ?
  • What does your system look like with 50% wins ?

If John comes to you and says (cue gravelly voice):

"OK Xelaar. Nice job. Great Combine, great to see that people on Big Mikes are watching too. Great approach to the LP. You had a couple of good days. Very encouraging and I know that you have put a lot of work into this. Let me tell you though, and I don't mean to be in any way dismissive of your efforts, I've been working this floor man and boy, and there is little evidence to suggest that there are 90% traders out there. Show me how you will manage risk with what is in the end my money and yours when you are winning about half the time with some horrible slippage. I want to see you succeed and I don't want you to be discouraged or blow out of our strict risk management parameters too early".


I think that not only for John but also for you that having this picture in your mind will allow you to punch hard. So far you have not had to take one on the chin ... but knowing that you can is very empowering !

Thanks for sharing with the group - you are an example of what can be done. We've seen the trades and now show us where the confidence comes from. Absolutely delighted with your progress man !

p



Last edited by xelaar; May 29th, 2013 at 08:44 AM.
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