Risk:Reward is the Holy Grail. This isn't a new concept, just one that I'm finally coming to terms with; I mean really coming to terms with. I put on some terrible counter-trend short trades this morning in the mid 860s (completely overlooked the possibility of a gap-fill; also broke my rule of staying out of shorts above mid-point unless price was over extended; my bad). But I'm using a 1:2 Risk to Reward ratio on all of my trades, and that's the only reason I ended the day with a profit; albeit a small one. The ES/TICK chart produced some great setups today that were good for 4+ points a pop.
Gap Filled by 10:00 AM (central)
ES Market Balance (5-min Continuous Contract)
ES Market Balance (5-min Day Session Only)
TF Market Balance (5-min Day Session Only)
My views on trading the E-Mini S&P 500 Futures utilizing Price Action, Market Structure, Volume/Market Profile and the Auction Market Process. Visit www.EMiniPlayer.net for Daily Key Support/Resistance Zones, Trade Plan and Educational Recaps.
Monday, February 9, 2009
Monday 02/09/09 - R:R is the Holy Grail
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I agree! You had some crazy trades today but the R:R saved your tail! Imagine if you had followed your rules!ReplyDelete
You ever going to start notating your actual trades on a chart again?
Yea, still working on discipline, but you gotta admit, I'm much better about it now than a couple of months ago :DReplyDelete
Ninja Trader and Trade Station, both automatically plotted the trades on the chart so it was quick and easy for me to post up the trade chart. As you know, today was on Sim since I'm still waiting for my account to be setup at Infinity. I'll try to manually mark up my trades on the chart for real $ trades. All depends on how much time it takes.