Thank you much for the wise comments! As it happens, I am fortunate to have basic living expenses covered by working wife (much younger than me) and SS. The 2.5% represents my 4 point stop loss ($8,000 equity per contract) on trades attempting to take 4 points out of a roughly 10 point trend. Those trends / trading days are not common since May 18. Much more common are 1 point scalps (with a 2 point stop loss). I do not take stop losses very often. Much more often I exit when the trade doesn't prove to follow my expectations fairly quickly. I have missed some trades by not staying patient. But, overall I've made more net profits by minimizing losses and not staying in trades until they've reversed and gone against me.
I think over 11 trades per day seems high to me for ES. I have to assume you are going for small scalps, not sure. I was doing allot of trades previously. Once I got it down to where I am currently at 4.5 trades per day, things are much more under control
A trader shouldn't scalp; They should instead aim to catch the major singular trend in the day, or two major trends (if it reverses) -- or sometimes three tops, if the market is really choppy, Anything beyond that becomes just basically meaningless table scraps, and a waste of time and energy for relatively small peanut returns, ...Of course, all of this is easier said than done in the heat of the battle -- and that's where skill and intuition come into play, It's not enough to follow the chart like a mouse following a trail of cheese, and expect to succeed in this game, Trading is part art, part science -- enjoy the greater, complex, dynamic picture, Each new day, each new chart...is filled with emotion and rationale behind it, The market is random, but it's also very...somewhat...predictable or manageable as well. Actually, if you think about it, nothing is random...there's always a general cause and effect. If you theoretically ask every fund manager and individual what are they buying/selling...then a market movement is obviously not random at all,
On the other hand, if the market isn't giving you range & volume, even making 1~2 points per trade and compounding the profits will still provide great results over a relatively short time period. Say, 4 net points / day / contract @ 1 contract per $8k equity compounds to substantial amounts.
i totally agree... when I trade ES I am hitting 3 points profit per trade, that was 4 last year when volatility was better
%% Well that Barry Taylor webb site does not like RSI ; so Doug Stewart, that + your living expences paid ,are in your favor. One big problem is =most likely what LL just told you is true for 95-99% of traders, so let us know how you do.............................................................................................. Good thing when i lost money in ES[real trades, + recorded on paper], ; i had made enough in stock trends to find better trends than ES, but ES is real liquid so thats good about ES . One advantage, believe it or not, in learning to trade with ES; most likely you will remember it much more, than if you did not use leverage. But you will never learn without getting in; i never trusted broker simulators.Can be easy, but usually not for starters. Paper trading can help; not that its the same as real..... And strange,, most good in trends dont do well in slop=-chop= sideways TRENDS[AKA BARBED WIRE RANGES]
If your trading is discretionary, unfortunately you won't have an answer to your question until you go live, because you haven't faced the most important tests of any trader. Before you begin, set a hard stop for how much pain you are willing to take in your account, and stick with that rigidly. You also need to be brutally honest with yourself regarding costs for actual spreads on your past paper trades, because they can be a real factor with ES. Best of luck.
Although you are making paper money, your money management rules were vaguely explained. How much are you willing to lose/win in a day? When do you know when to stop after a few consecutive bad/good trades? Are you making money on trending days or consolidation? Short or long? What is your best strategy? One month is too short to go live especially with futures. Your strategy is unproven under different market conditions. No need to answer these questions here, just make sure you bulletproof your rules and follow them rigorously. Trading with live money is a completely different game. Completely!!! Especially discretionary trading. This is probably what might happen when you go live regardless of how many months you paper traded. Words below are well known. Not mine. 1. You lose money by being stupid. 2. You lose money by being right. 3. You break even. 4. You make money. 5. You lose money. 6. You make money consistently. You are doing better than 90% already by educating yourself and paper trading first.
The real question is : what is your edge? You compete with millions of traders and wanna-be traders. What do you have that others don't have? If you can't answer this question, you are not ready. CM