simple scalping strategy

[JumpOff]

I've been paper trading with the folks at CMS. When their servers are up, I seem to get filled within seconds and it's on the money. The EUR/USD has a 3 pip spread, so if I let it go even 2 pips against me, that's 5 pips down. If I am able to scalp 2 or 3 pips on a winner, then I have to win 2 out of 3 just to break even - not counting the time I spend sitting in front of a screen.

What kind of win loss ratio are you getting with your method?
Thanks,
JO

 

[randalfrost]

I've been paper trading with the folks at CMS. When their servers are up, I seem to get filled within seconds and it's on the money. The EUR/USD has a 3 pip spread, so if I let it go even 2 pips against me, that's 5 pips down. If I am able to scalp 2 or 3 pips on a winner, then I have to win 2 out of 3 just to break even - not counting the time I spend sitting in front of a screen.

What kind of win loss ratio are you getting with your method?
Thanks,
JO

If you love scalping, do futures.

With FX at 3 pips spread:

+5 pips = 8 pips move.
-5 pips = 2 pips move.

You need 4 times the move of a loser to get a winner.

For futures its usally 1 tick spread. Since its level 2 style, u get to buy at the bid and sell at the ask for 0 tick spread if thats ur style.

For ES, they play in Points. And 1 tick is 1/4 of a point.

You get so much better deal scalping futures.
In fact, I switched over to futures in order to scalp.

 

[Faris]

Are you same Randalfrost who has been posting ay moneytec and Elitetrader?
If so hows the Emini's?
Been cleaned out yet?

Faris..

 

[randalfrost]

Are you same Randalfrost who has been posting ay moneytec and Elitetrader?
If so hows the Emini's?
Been cleaned out yet?

Faris..

Nope, I'm not the same Randalfrost.

But I do trade the ES, i'm raking in about $500k a month.
Waiting to hit $10 mil so I can retire.

 

[FetteredChinos]

just how big a retirement pot do you need??

Wow!!

 

[Faris]

I wonder...
You have the same name, same location and your trading ES.
Keep lying to yourself mate!

Faris..

 

[Faris]

FC.

Its the same guy who has been posting at moneytec and elitetrader
Check this link out http://www.moneytec.com/forums/_showthread/_threadid-9846/_s-

Faris..

 

[FetteredChinos]

super-sleuthing there buddy.

still im sure that RF forgot to insert the <irony> and </irony> tags into his post.....

 

[JJL3142]

"...But I do trade the ES, i'm raking in about $500k a month.
Waiting to hit $10 mil so I can retire..."

What is it with this month and the previous month ? Have the BS been let out of the asylums ??

 

[JonnyT]

$500K per month on ES seems entirely reasonable to me given the massive liquidity.

JonnyT

 

[randalfrost]

Guys relax, just joking. lol.

Faris' post wasn't very encouraging for me to post a serious answer.

 

[trendie]

Hi RandalFrost,

I always find phrases like "I make £xxx per month" very confusing !!
I appreciate you are capable of making that sort of money.

I am more interested in how many PIPS that represents ?

Hope you dont me asking this.

My point is: £1000 per pip = 500 pips = £500K; OR £100 per pip = 5,000 pips = £500K.

The amount you make is not as important as how many pips.
That gives a far more useful idea of what the experts are making from the market.

Thanks

 

[JumpOff]

If you love scalping, do futures.

With FX at 3 pips spread:

+5 pips = 8 pips move.
-5 pips = 2 pips move.

You need 4 times the move of a loser to get a winner.

For futures its usally 1 tick spread. Since its level 2 style, u get to buy at the bid and sell at the ask for 0 tick spread if thats ur style.

For ES, they play in Points. And 1 tick is 1/4 of a point.

You get so much better deal scalping futures.
In fact, I switched over to futures in order to scalp.

Yes,
I've been looking into futures. I'll be starting small (5K account), so I'm guessing by the time I pay commission and spread I'll probably still be at 2.5 pips for my ante. When your a little fish, you have to work with the hand your dealt - I don't perceive myself as having a lot of negotiating power to get a professional deal from a broker. I'll just have to learn how to climb over that bar of inexperience, retail commissions, and the fact that the odds are stacked against us newbies.

I am happy to accept advice about "who is the best futures for a retail account." The criteria are that the account size is no more than 5K, and I don't want to pay more than $100/mo for platform and data feeds.

Thanks in advance,
JO

 

[JonnyT]

Trade EURUSD future with IB and its 1 pips spread $12.5 and $3 round turn.

i.e. equilavent to a 1.5 pip spread with Forex Bucket Shop and this market is fair...

JonnyT

 

[randalfrost]

Hi RandalFrost,

I always find phrases like "I make £xxx per month" very confusing !!
I appreciate you are capable of making that sort of money.

I am more interested in how many PIPS that represents ?

Hope you dont me asking this.

My point is: £1000 per pip = 500 pips = £500K; OR £100 per pip = 5,000 pips = £500K.

The amount you make is not as important as how many pips.
That gives a far more useful idea of what the experts are making from the market.

Thanks

My previous post on how much i make is total bogus, just a joke~

I know a few guys who do make, they make from 100+ pips on bad months to 500-700+ pips on good months.
On most months, they do about 250-350 pips.

 

[trendie]

Thanks for your reply, RandalFrost.

For us beginners, if we can expect half that;
its about 50 pips on bad months, and about 600 on good months.

We can all do the maths for our own comfort level £x per pip.

Your response in terms of pips per month is far more useful than the monetary value.

 

[sidinuk]

JonnyT, I pay $6 for a eurusd roundturn, are you doing big volume to get $3 or am I being 'done'?

 

[JumpOff]

Trade EURUSD future with IB and its 1 pips spread $12.5 and $3 round turn.

i.e. equilavent to a 1.5 pip spread with Forex Bucket Shop and this market is fair...

JonnyT

I have heard you and several others mention accounts with IB, and it is my understanding that they don't take accounts as low as 5K, (or from people without several years of trading experience).

Also, here in the US, if your account is less than 25K there are regulations about pattern day trading (PDT), that would close or lock your account if you had several bad stock trades stopped out the same week. (this makes no sense to me - they'll let you run your account into the ground over 2 days, but if you put in a reasonable stop loss order and get stopped out the same day, then "you must be protected from your self") So I don't think I'll be able to trade the nasdaq either..

Your messages about the bucket shops make complete sense to me and I will go with a regulated U.S. futures broker when I get past the paper trading stage. I am hoping that the PDT rules do not apply to the futures market, so that I might be able to find a broker and platform that will enable me to trade the EUR, JPY, or maybe the mini version of the S&P index with stop loss orders in place to manage my 5K starter account.

RandalFrost wrote:
For futures its usally 1 tick spread. Since its level 2 style, u get to buy at the bid and sell at the ask for 0 tick spread if thats ur style.

I thought LEVEL II was for stocks. Are you talking about the screens where you can see the market depth for futures contracts?

Is the ability to buy at the bid and sell at the ask a function of the platform you use? Why wouldn't that be everyone's style? Can you explain a little more about that?

Thanks,
JO

 

[Hittfeld]

>>Also, here in the US, if your account is less than 25K there are regulations about pattern day trading (PDT), that would close or lock your account if you had several bad stock trades stopped out the same week. (this makes no sense to me - they'll let you run your account into the ground over 2 days, but if you put in a reasonable stop loss order and get stopped out the same day, then "you must be protected from your self") So I don't think I'll be able to trade the nasdaq either..<<

The PDT-rule is to be enforced by any US broker. But it only concerns stock and options, but not futures.

You can look up the margin enable minimum at the IB website. It might be around $ 2k, but thats to remain after deduction of losses and margin requirement for your next trade. So $ 5 k might be a real minimum, many would suggest $ 10 K for the first contract.

Hittfeld

 

[GotGold]

Beating the spread is very hard.