When it comes to trading the markets, I don't claim to be an expert (far from it), but I'm certainly not a novice either. The point of this post is to allow people to post their questions; anything market or trading related goes. In the process of answering the questions, I hope we'll all learn something new. The question may also spark some healthy dialogue and we'll all benefit from the collective knowledge. If I can't answer the question, I'll try to direct you to other resources where you may find an answer.
So, if you have a question, just post it in the comments section. If no one posts any questions, I guess I'll just delete this post; beauty of online content - one click and *poof* it's gone :-)
Do you have any favourite chart trading pattern ?
Hi emini, I only trade spot currency and I have no idea about the futures market so can you please tell me what is the spread of emini SP500? 0.05?? I'm curious because I see index future trader like you tends to scalp for ticks so I'd wanna know what is the typical cost of 1 contract of ES (spread + commission ). Thanks.ReplyDelete
I don't have a trading related question per se, but can you give us an update on the trader that you were teaching?
dt233, he switched to Live trading a day earlier than planned, and also decided to increase size when I told him to stick to 1-lots. He quickly grasped the concept of trading break-outs, but did not want to learn anything beyond that, even though I told him his current skill set/knowledge base would not be sufficient to generate consistent profits. But he was adamant on NOT learning additional techniques. Another mistake he made was putting too much faith in what he knew about the market. For example, he was very sure price would act in a certain manner based on his trend lines, even though I constantly reminded him that "price can do anything at anytime."ReplyDelete
As a result, he ended up losing a little over $1K during his first couple of weeks, and went back to the Sim. As far as I know, he hasn't switched back to Live trading yet. He realizes that trading profitably is a lot harder than it seems.
Hi Emini -- Do you post your P&L data? If not, could you post these data? I am interested in viewing your contunuously tracked performance.ReplyDelete
Screen shots of P&L are posted on most of my earlier posts. I'm not trading these days due to a full-time job + full-time school, but once I get back to trading, I'll start posting the P&L screen shots. Trying to find a prop firm so I can trade full-time!ReplyDelete
TST, I don't really have one "favorite" pattern, but I like trading break-out pullbacks and bull/bear flags.ReplyDelete
Hi E-Mini, I'm glad you have this post up because I'm a former E-mini Futures Trader(S&P500), and I want to get back into it! I traded the ARB heavily (about 3000 minis per day) and it's been a few years since I've done this. Would you say there are still ARB opportunities between the "BIGS" and the e-minis?ReplyDelete
I don't have any experience in Arbitrage, so can't answer your question. But considering the large volume of program trades in today's financial markets, I think it would be extremely challenging for an individual manually entering orders to keep up with the programs constantly Arbing the S&P 500 futures. It's a lot faster for a computer program to identify arbitrage opportunities and execute the trades than for a human.
So unless you're using an automated system, I think it would be a big challenge. But again, I have no experience in that field so am not the right person to ask.
My question to you would be, what made you stop trading a few years ago?
I have been trading/learning for around 2.5 years,
if trading is business of uncertainty, then i have come up with the following rules.
- watch out the lot size you trade.
in this case, its money management issues i believe that kills most of the newbie account. however assume if you trade conservatively with no more than 2% risk of your total account, the account can survive if the setup go against you and maximum of 50 times consecutively before lose everything.
my question here is, how do you define your edge once market hit your stoploss level?
for eg: you found a setup, and enter the trade with 1:1 risk reward ratio.
assume this particular trade was hit with stoploss, then most of the people would wait another setup, but again with same 1:1 risk reward ratio?
but if calculating from the previous loss, you need at least 1:2 risk reward ratio just to break even the initial capital, and haven't even make any profit yet. if having consecutive row of losses then the next trade would be quite difficult to make any money because need really big ratio just to even out and only then make the profit.
i have been thinking using gambling method which is martingale lot size on the next setup. which is 1,2,4,8..etc etc but i know this is unprofessional, and i couldn't find any edge if using typical 1:1 ratio
whats your advice in this case?
henry_swk at yahoo dot com
Hi e-mini long time without an update. One question i have. How did you learn to trade? on your own, or you did take a course or something you could recommend?ReplyDelete
Thanks a lot man
Daniel From Spain
Hi e-mini thanks for your answers I really appreciatte it. I wanted to ask you here some things but i also want to thank you for running the blog, i also want to thank Ziad and Ym for helping with so helpful posts.ReplyDelete
For the three of you guys, even though i am not sure if Ziad and YM are still reading the blog !!!
Do you really believe that a trader can become profitable enough to live from this, I mean this is my dream BUT i am 25 years old, have spent 1.3 years on the SIM watching the ES, EUR/USD, GBP/USD, CL and YM to finaly settle just on the ES about 6 months ago. i have made mistakes, fine-tuned as much as possible, got mad, cried the hell out like a baby not knowing what to do and how "this" works, got exited thinking i "got" it, etc.
By no mean this is easy, emotions play a key role. But as ZIAD posted once. THis is a business of uncertainty and right now after 1.3 years of trading the ES i have come to the conclusion that i have NO EDGE. I mean. I use trendlines, S/R,previous HLCO, Pivots, 20 EMA, different timeframes, etc and i am aware of the times when markets pullback or simply stay in a range. I have NO script for this. I just try as hard as possible to read the market, TO absorb what it tells me, I dont have set ups, i just see a hammer or a shooting star, and OK i know many candle patterns, BUT. What do i do with them? nothing !!!If i cannot read what the market tells me. Sometimes i think is pulling back when it is just reversing, sometimes i think is reversing when it is pulling back.
So what's is the point of this comment? i don't know really, I just wanted to express how i feel in trading, knowing that each day is different, what works now might not work tomorrow, nontheless, i can say that after this 1.3 years watching the ES. I think i am begining to really see when to buy or sell, little by little something makes "click". then when i feel lost that "ahaa" comes back. Yet i am not making money consitently as much as i wanted, but i least i can say i can control losses and protect the money i get !!
I have read thousands of things, spend more than 4-6 hours a day watching a chart in front of me, rejected job possitions to be able to see the market while i can and yet i still feel i don't have a script. I just try to do what the market tells me. trying to make at least 1 NET point per day, which is 20 on a month. Use 10 contracts and you'll earn more than any high paying job. At least here in Spain.
So to wrap up, i just wanted to ask or comment some things here
So to wrap up, i just wanted to ask or comment some things here
1) 1 point per day NET on avarage, Is a good trader ot not?
2) I have done my BEST to join an I.Bank or prop firm but here is Spain is kind of hard, so i am really frustrated that i might have to put aside trading for some years since i won't have enough time as i have right now.I need money as well as capital and matureness to go on my own. Is not the same dedicating 5 hours a day on a real market than just watching a chart after is "done". I wanted to HAVE and EDGE to be PROTITABLE so that i could go and build capital to trade on my own when i come back.
Join a prop firm to learn and work for them is what would help me the most right now BUT it is simply hard here.
Do you guys believe that this is something one can achieve on your own? without joining a firm and just self-education?
3) i am 25, so i think that as time passes by the chances of getting into a firm are slimmer. So just out of curiosity, how old are you guys? At what age did you "discovered" you could make money consistently here.
4) DO you have an EDGE? or not? How can someone trade mechanically, I mean it is DIFFERENT every day
Daniel, you're welcome - I'm glad you're taking in the content posted on the Blog.ReplyDelete
Your comment has a lot of questions; I'm busy this week and early next week but will try to get to them by end of next week. Btw, I'm 26 y/o.
Do you use TS or Multicharts? They look like mine, but my volume by price ELD was overwritten when I tried another one from a forum. If you had the eld to make the red bars it would be ever so helpful!ReplyDelete
No prob e-mini.ReplyDelete
Thanks a lot
Salsaman, I use TradeStation. The Volume Distribution ELD comes with TradeStation so you should be able to download it from the TradeStation forums. Other option is to install the latest version of TS, and it will automatically get installed on your PC.ReplyDelete
HI e-mini is Daniel here....ReplyDelete
i know i ask a lot of questions but thats the way of learning...hehe
I know you use Infinity futures that runs with transact. How much do they charge you in comissions and for tradestation and for the real time data feed?
Let me know since i was thinking the maybe there is something better that MIRUS futures with zen fire
Hi Daniel, you can find the cost for TradeStation from their website at http://www.tradestation.com Although I don't execute through TradeStation, I funded an account with them to save $149/month on the platform fee. Regarding Infinity, please contact my broker: Anthony Giacomin at firstname.lastname@example.org Let him know I sent you and he will hook you up on the commission rates.ReplyDelete
Hi Emini player,ReplyDelete
I am very impressed to see such wisdom come from a 26 y/o. Thank you so much for your website. You mention on Dec 7,Monday, bolg 'same as always, bounce off of support and pull-back on resistance'
Do you use the bounce to go long or short and what influences this decision?
DO you use the pull-back to go long or short and what influences this decision?
Also, will you please share how you come up with the key levels? I understand if it is a 'family secret'.
Thank you, M.R.
M.R., you're welcome. I'm glad you're liking the content.ReplyDelete
Now to answer your questions:
Do you use the bounce to go long or short and what influences this decision?
If I'm not in a position, I will look to buy support and will scale out of my position on the bounce. At that point, stop-loss gets moved to break-even on the remainder of the position and I watch to see if price can move higher.
Do you use the pull-back to go long or short and what influences this decision?
I look for a short entry around resistance, and if the price action indicates weakness, I will enter short. Again, scale out on the pullback and move stop to break-even.
Now, keep in mind that the areas I outline on the Blog are areas of interest. I don't blindly go Long at Support and Short at Resistance. Price action has to tell me to go Long at support. I may go Long at support based on a positive tick divergence, a double-bottom, volume divergence or waning momentum. The trigger you use to get Long/Short is up to you. The key point to take out of this is to initiate trades at Key Levels. The direction needs to be figured out in real-time. For example, sometimes, price will slice right through the support level and move on to the next support level. Look at how price behaves at Key Levels - that is a key piece of information I take in to figure out the direction. But yes, in general, I anticipate that Support will hold and Resistance will hold. Once price breaks through these, I look to the next level of Support/Resistance.
Also, will you please share how you come up with the key levels? I understand if it is a 'family secret'.
There are no secrets in trading. But that topic requires its own blog post and I will try to get to it in the next week or two.
Hey Emini Player,ReplyDelete
Been following for a while now. It's been great to see how your trading has evolved. I was wondering if you can share your views on scaling in/out, averaging in etc.
Hi Tony, yes it has been a great learning experience, and I believe my trading has shifted towards becoming simpler and more logical over time. No doubt, it's a work in progress and I still have a LOT to learn but I feel I'm at a much better place this year as compared to last year.ReplyDelete
Regarding position sizing, I think it's an extremely important topic and requires its own post. I'm not sure I'm at the point where I can educate others on the topic, so if/when I do write up a post on position sizing, please take it with a grain of salt and feel free to question my findings. The amount of risk I take is probably much less compared to most people and may even be a problem; rather than a strength.
Thank you so very much for your detailed explanation for my last set of questions. I didn't realize you'd posted it until you mentioned it in your blog. My other question isReplyDelete
What do you mean when you say 'fade in on the leg up'?
Thank you !!
I would like to learn how to use Market Profile in my trading?ReplyDelete
Also, I have been following ur blog and ur pretty good at fading the markets. I wanted to know how do u know that the market will bounce off a given support/resistance number? Does it always bounce off support/resistance numbers or is it usually on the first touch?
And, one last question... How do you get your support/resistance numbers?
Sorry, but Im a newbie to trading and trying to read and learn.
Thanks in advance.
Hi e-mini how is it going is Daniel here.....i want to ask you a very important question to you and ZIad if He is reading....ReplyDelete
Do you use just RTH for charting and finding levels or use the 24 hr session...for determining HLCO, S/R, ETC....hope ZIad can answer as well....
another question number 2 would be...Is there any market profile or vlume chart for free... tradestation charges at least 50 $/m also....Using candles How would you determine Value Areas?
ps:e-mini remember some of my previous questions hope u get sometime to answer them hehe...i know i know they are pretty longggg
I have watching your comments for several weeks now and you have a good feel for the market, IMHO. I have a question about the monthly VPOC; I am new to the VPOC and not sure how you got a 1103.50; I read on your how-to-set-up and see you go back 60 days; I have Ensign Windows and my VPOC is not close; shouldn't these numbers be close? Thank you, GaryReplyDelete
Hi Gary, I'm using the continuous @ES contract so the variance could be due to how TradeStation handles contract rollover. Also, TradeStation uses 1-min data to calculate volume profiles, which is an inaccurate method of calculating volume at price, but it's usually close enough.ReplyDelete
A request: would you mind doing an illustrated example some time on how you reach the various levels and numbers? For example: the range extension on today's chart. Thank you, GaryReplyDelete
I don't have a mic/headset, or I would just throw up a quick video. The other idea I had was to do a webinar for the people who follow the Blog, but I haven't been able to make time for that.
Found you on twitter. Watching the market every day. Takes a while to learn. In Brett's book "the Psychology of Trading" He notes it takes 10,000 hours of practice to become a master of a skill. I am at 1,200 hours and 800 hours of research. Really nice charts. Been committed to trading the qqqq or Nasdaq100 (just discovers that index has options and does not spike and get stopped out) But everybody is trading the ES. Using 2k to trade 60k seems very risky, but I don't really understand the ramifications. If you have a drawdown, can you wind up owing more than what you have in like Forex?ReplyDelete
Can you use the same funds more than once in a day?
I've also seen the 10,000 hour number thrown around, and have chosen to disregard it because that number is an "average", and I don't want to restrict my progress by monitoring the number of hours I dedicate to trading. Not all "hours" are created equally - 1 hour of focused and intense study may be better than 4 hours of aimless education.
Regarding the $2K to trade $60K; $55K is the notional value of the S&P e-mini contract, but that doesn't mean you're actually risking $60K per contract -- i.e. the S&P will not go to zero in a matter of seconds/minutes. I generally allocate $5-10K per contract, and my risk on each contract is a max of 2 pts ($100), so I'm risking $100/5000 (2%). Technically, yes, you could lose more than your account but that would be a rare event. There are a few safety mechanisms available to you, such as using stops. In addition to stops, your broker most likely has a risk monitoring system in place that will automatically close out all of your trades if your account balance drops drastically.
At the end, the amount of risk and leverage is completely up to you. You could trade with less or more leverage as you see fit. Just because your broker offers $500 margin per contract doesn't mean you will ever utilize the max margin. Hope that makes sense.
Btw, this only applies to liquid markets such as the S&P E-Mini. In thinly traded markets, such as Natural Gas, your risk will be much greater.ReplyDelete
When selecting a product/instrument to trade, Volume/Liquidity is a KEY requirement for me. I never want to be caught in a situation where I can't exit my position.
How much you charge for subscribed followers only for ES_fReplyDelete
Naveedah, there is no charge. As long as you have a Twitter account, you can follow along for free :)ReplyDelete
I use mdtrader and xstudy charts (my brokerage firm is velocity traders), they have VAP and VWAP but I dont see anything specific for TPO. I'm working on your mind over markets book recommendation, I was wondering if you had any recommendations for charting market profile.
Hi Charlotte, I don't use TPO counts in my trading. XStudy produces pretty nice Volume Profile charts, so I would just stick with those.ReplyDelete
I am new to the website and have lots of reading to do. You definetly have some great information here for traders to read. 1 question for you I use tradestation also and I would like to know how you set up the charts with all the high and lows from the overnight sessions and regular session. I have found your post on the volume distribution charts, thanks for that!
I just found your blog last week,reading all infos and learning, please accept me in your group as I realy like to learn about your trading style,.Just the only question which you did not answer to anybody's question is: How do you come up with key levels daily? Or maybe you answered it somewhere in site which I could not find it?
Hi Hossein, welcome the Blog. I've touched on that topic here and there, but haven't had time to post about it in detail. I'll try to post about it when my schedule frees up.ReplyDelete
It took me a few days to figure this out, but for all your blog followers who are using mdtrader and xstudy, if they need a market profile chart they need to right click the chart and select chart type and then price distribution. Since market profile is trade mark of cbot they use price distribution instead. Especially the newbies like me who are working on your book suggestion and use mdtrader may find this useful.
Thanks for the info Charlotte. It's called Price Distribution and Volume Distribution in TradeStation as well.ReplyDelete
Your key levels and reviews are great. I really appreciate the effort you put into this & for sharing with all of us.
I have been wondering how you determine your entries into the market based upon the levels / midpoints / and other indicators you are using. It seems you are trading from a 5 min chart, but I wasn't sure what actually triggers you to enter the market. Also, I was wondering how you trail your stops once the market is moving in your direction. Just some things I struggle with, so thought I'd get your take on these topics.
Hi Chris, my schedule has been too hectic to write any detailed posts lately, but I will try to address your questions in the near future.ReplyDelete
Thanks for the post on the setups & entries. Your thoughts are truly appreciated. It helps us all see things in a way we may not have before. One thing I've noticed is that a 5 min bar closing against the trend into a support / resistance key level has given pretty valid confirmation of a good move off of that level.
Glad you liked the post, and thanks for sharing your insight here.
Why is the Mar ES futures trading 3 points under the cash index? I thought the futires always traded at a premium to the cash index. Thanks.ReplyDelete
Hi-Thanks for all your great blog posts and tweets. I find your information very helpful. Yesterday you tweeted about the uneven playing field between professional & retail traders and that retail traders can get close to the same setup as the professionals? Can you expand on that topic?ReplyDelete
4seasons, busy with exams and papers this week. I'll try to answer this in a post by next weekend.ReplyDelete
Thanks for your help. I was looking at your Volume Profile and noticed that it does not show the Volume for the Cash Session only but rather combines it with the overnight session as well. Do you post the Volume Profile for the Cash Session only. The reason I ask is because the market seems to react more to the cash session VPOCs more than the the VPOCs with the overnight session combo. Thanks again.
You're absolutely right. I recently began posting the Day Session Volume Profile in the Market Review/Analysis posts. I use the Day Session Profile when coming up with the Key Levels, so I am aware of the day session VPOCs, LVNs, etc. but I use the 24-hr Session to show the nightly Key Levels since I want to be aware of the full 24-hr Price Range.
Before you go pro could you find some time to describe how you come up with the key levels.ReplyDelete
Emini-You changed the perspective and provided the means to have good entry..I also agree that it takes practice and understanding to when to use the key level.ReplyDelete
Thank you very much for suggesting book Mind over market and giving us a respective
Thx GM, glad to help.ReplyDelete
Hi Eminiplayer, I'm currently using tradestation as my broker. Is there any trustworthy and reliable broker to reco. beside RCG?ReplyDelete
I trade through Infinity Futures. Call my broker, Anthony Giacomin.ReplyDelete
I see you are reading about Market Profile; I am reading Mind over Markets and ran across a term I could not figure out the meaning of: Opening Call. I searched various places but without success. Perhaps you could enlighten me. Thank you and regards, GaryReplyDelete
The Opening Call is simply the trading activity leading up to the Cash Open. You could consider the 7:30-8:30 AM (cst) trade activity as the Opening Call, or you could tighten it up and only consider 10 minutes prior to the open (8:20-8:30 AM cst) as the Opening Call. Exactly how much trading activity is considered part of the Opening Call is up to you and I would recommend you play around with this and use what works best for you. Do your own research and get to the core of every term you come across to really understand its "meaning". If the information gives you an edge, use it. Otherwise, don't get caught up in terminology and don't worry about it. Keep it simple :-)
How do major selloffs and up moves develop if the ranges basically limit the downside especially. What would have to change for any move down to not be greeted with buying initially like waht happened before March last year when the market went down every day.ReplyDelete
HI e-mini how is it going? good luck with the firm...ReplyDelete
I was wondering if you could put me in contact with ZIAD (if you both want), i would like to ask him a question but i dont know where i can reach him. Let me know please.
thanks a lot
By the way are you using market profile or just volume profiles?
Daniel, you can post the question here and I'll have Ziad check it out when he has time, or you can email the question to me and I'll forward it to himReplyDelete
Hi emini...this aré the questions for ziad,hope you can forward them to him(u can answer as well if u want )ReplyDelete
1)do you use market profile ann volume profile for finding levels?(if yes which one MP or vol profile)
2) do you trade based more on levels you find from
the big picture(daily chart,etc) or from what is happening right now in the market...what i mean is...that if you trade just waiting for levels to be hit or you find better trades just following market development
3) how far back do you think the market can affect your trading and levels in general terms ...just the precious days levels,5 days,1 week,1 month?
4)do you use the DOM?
5) do you use composite volume profile charts from several days back to find low and high vol areas? Do u consider them to be found just in composite profiles or a candle chart is enough? Tails represent low vol áreas and ranges high vol...thats why i ask
6)do you use value areas?
7) are you using buy/sell preassure (delta indicator)indicator
from market delta?do u consider it essential in you trading
8)which broker and data feed aré you using
9)finally which is you average point Per. Day (if you want to day it otherwise no worry)
a lot of question i hope you can help me with
thanks a lot ziad and e-mini as well
Hi emini, I was wondering what the benefits of joining a prop firm were? Are you an ecm member/leesse with the firm? Do you pay SE tax on your gains? Do you receive a k-1? Is there a profit split (80/20)? How big of an advantage do you have as opposed to before? (Ie commissions/buying power/trading associates/tax benefits?)ReplyDelete