I also trade ES. This is my journey - here are some thoughts:
There are only a few real good $$$$ making opportunities that present themselves each week. I believe in waiting till they show themselves. It's kind of like selling real estate. You have to be in the office at the front desk when the client wanting to buy with cash walks through the front door. If your not at the front desk, whoever is will get the deal. So you have to be in front of your computer with everything ready when the opportunity comes. This is hardest thing I struggle with.
I love the short side, when the market hits resistance and sellers show up. You'll need a platform like PATS J-trader with depth of market for this. I like to have the buyers come to me, and hit my offer. If my offer is not hit, I know the market is weak and headed down, so I can offer lower. When they come to me and buy my offer, if I don't like the price action I can sometimes get out at the same price I sold. So it costs to really determine the direction of the market. Keep the cost as cheap as you can.
I do not set a stop until I see the market falling and going my way. If I am wrong I take myself out (way before I could ever get a stop placed) and loose .25 to .5 at the most if I can. I do not want the market to work my position and hit my stop. I want to manage my position and work my trade. I do believe in stops, but my focus is my entry. If my entry does not prove itself to be correct, I am out. My stops are my backup.
If the market stalls and goes sideways it is not doing what I want and I should also take myself out. Why take the risk and wait? The position is not performing correctly. I watch closely. If the market falls and I am in the green I will set a stop limit at breakeven or somewhere to pay for my commission. The trade is now free.
The hard part is riding the fall, and/or adding to a winning position. It's easy to get greedy & let it bounce back on you. It's also easy to get out too soon and not get back in. You can go broke taking small profits.
The S&P has been very flat lately, & volitility has dried up. Very few 25 - 30 pt moves anymore. This also is working against us. |
