TRADERS´ English I September 2013 - page 79

People
79
Whether I’m trading the E-mini S&P 500, crude, or even
the 10 year note, all stops and targets are predefined.
Once the market moves in the direction of the trade I
take a look at my areas based on my indicators and price
levels in order to keep my stops behind these areas. This
allows the market a bit of wiggle room, I call it shake and
bake, giving the trade an opportunity to work.
TRADERS´: Any comments on scaling in and scaling
out of positions?
Wandering Trader:
While some traders do effectively use
the scaling in scaling and out technique, I find it more
effective to have an all in and all out approach. In other
words, I enter with my entire contract load. The only time
I may scale out of positions is based on targets when I’m
using a very high contract load.
TRADERS´: Do you use trailing stops?
Wandering Trader:
I don’t trail stops
as I have found through backtesting
that this limits profit maximisation. It
is more important to identify when
the market is going to continue to
run or exit based on my predefined
profit target.
TRADERS´: Should a high risk/
reward ratio be the top priority for
traders?
Wandering Trader:
The question is:
Would you rather have a trade that
works 60 per cent of the time at 1 to 2
risk versus reward ratio or would you
rather have a trade that wins 95 per
cent of the time at 1 to 1 or a bit less?
It is relative. I would say the most
important thing is to pay attention to
momentum and capitalise on strong
movements.
TRADERS´: Please tell us about
your view on the importance of
Over the course of the last few years our beginner traders were able to make an average of two points a day.
Assuming two contracts and 200 trading days a beginner could make $40,000 in his first year. Assuming ten
contracts it would be $200,000. This is based on all trades between 9.30am to 1pm EST.
Source:
2012
Month
Points/Day
Win Ratio
Points per Month
Jan
3.09
81.82%
68
Feb
1.97
77.78%
35.5
Mar
1.92
72.73%
42.25
Apr
2.19
75.00%
43.75
May
2.20
63.64%
48.5
Jun
1.92
75.00%
38.3
Jul
1.90
72.72%
40
Aug
1.97
65.21%
45.25
Sep
0.84
78.95%
16.00
Oct
1.51
86.96%
31.75
Nov
2.14
77.27%
40.75
Dec
1.65
73.33%
24.75
Average
1.94
75.03%
39.57
T1)
Day Trading Academy Results
Day trading is hard enough as it is and
keeping it simple is the name of the game.
being absolutely clear about what to do in trading, and
also in being flexible in changing your mind quickly
when on the wrong side.
Wandering Trader:
This is one of the reasons why I find
indicators and software to be the downfall of the day
trading industry. The more lines, colours, dots, and
arrows that we are paying attention to the less we are
focusing on what is important – which is the market. Day
trading is hard enough as it is and keeping it simple is the
name of the game.
At the end of the day trading is understanding
psychology. It is people that are buying and selling stocks
not computer algorithms and software programs. If we
can understand that psychology on the chart then we
are going to be able to make a consistent profit. There
are millions of different traders trading in millions of
different ways with a million different indicators. What
exactly is the bottom line? Traders that are able to make
1...,69,70,71,72,73,74,75,76,77,78 80,81,82,83,84,85,86
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