ES trading with 10 contracts or more

[aversano]

A few weeks ago I moved into the territory of a 20 contracts position hence
I would like to discuss your way of building a position.

This is how I do it.

Initiate a position with a direction that you speculate.

Do not go all in, no matter how confident you are.

Start with 2 contracts and build your position as it goes
against or with your direction (pyramiding and averaging in) YES! add to a losing position.

I often find myself in a great position that goes 5 points in my favor but with only 2 contracts.... tough luck....

When adding to a losing position, limit your profit expectations as well unless
a strong confirmation appears. Take it a tick by tick when volume, T&S and the DOM are all in your favor.

Limit your daily loss to a loss that suits your account size and average daily wins.

The key is to speculate on immediate market sentiment by tracking
buyers and sellers. Follow the group you think has more control or has a better chance of moving the market from point A to point B.

LET YOUR PROFITS RUN and DO NOT BE AFRAID TO BE IN a RED ZONE.

my personal opinion is that most information out there doesn't give us the long
term approach for a successful trading career.

After acquiring the right tools, you just got to believe in yourself.

 

[aversano]

I was hoping to start a discussion about building a position....
When doing 10 or more contracts I just couldn't do it the same way I was handling 1,2 or 3 contracts.
All in seemed like too much of a risk for me. Your thoughts....

 

[wackypete2]

I don't think there are many people here who trade 10-20 contracts that would be able to discuss that with any intelligence. It's difficult to get in and out quickly as in scalping with that size so you would need to have an entry "zone" and long(er) term outlook. How long do you estimate you would likely be in a trade? At 2 contracts for each entry you'd have a minimum of 5 entry points. Whether you are averaging or pyramiding, IMO, more than 3 entry points diminishes your chances for success. Exiting the entire lot would prove equally challenging.

Peter

 

[aversano]

I don't estimate the time it would take me to be in a trade. As long as I see that the market is still being pushed in my direction or at least isn't pushed in the other direction. I add to a position as if I am taking individual trades.it all depends on the situation. My favorite setup is volume absorption on a down move (especially with our current bullish market). In this case, if I believe the absorption has been going on for a while, I might go in with 5 and just scale out.

I don't target a zone. I look at the markets + the tape/DOM and then decide if I want to be a buyer or a seller. then just take it from there.... as simple as that.

Position time varies between 3 minutes to a few hours. I have held an open position through the close.

 

[wackypete2]

I don't estimate the time it would take me to be in a trade. As long as I see that the market is still being pushed in my direction or at least isn't pushed in the other direction. I add to a position as if I am taking individual trades.it all depends on the situation. My favorite setup is volume absorption on a down move (especially with our current bullish market). In this case, if I believe the absorption has been going on for a while, I might go in with 5 and just scale out.

I don't target a zone. I look at the markets + the tape/DOM and then decide if I want to be a buyer or a seller. then just take it from there.... as simple as that.

Position time varies between 3 minutes to a few hours. I have held an open position through the close.

The line I bolded is what I was attempting to say, but I was not very clear I guess. We certainly have different styles of trading. Nothing wrong with that of course. I much prefer scaling out than scaling in while trading with the trend. If you attempt to scale out a portion of your position while the trend is still in your favor you can get out quickly. I have found it's better for me that way rather than wait for the trend to stall, or worse, quickly turn and then attempt to exit the entire position.

Peter

 

[joshdance]

aversano, is there something about the order fill that makes 20 contracts more difficult, or is it purely psychological? Perhaps it has something to do with trading style, but if you're using a fixed %R risk for each trade, why would it be different?

 

[aversano]

It all depends. for instance, yesterday I let a 6 contracts position to run to a 5 points profit...

 

[wackypete2]

It all depends. for instance, yesterday I let a 6 contracts position to run to a 5 points profit...

 

[aversano]

but the question is how do others build up positions? is averaging in or pyramiding that bad? I kind of put my R/R ratio a side in addition to most of the calculations that my excel spitted. Currently, trying to focus on trading.
without a plan.... The plan I created 2 years ago helped me polish the skill...
what worked for 2 contracts no longer works for me. don't know why.