The DAX started the day with a gap up and a sell off. It then found support at below the VAL but within the overlapping Profile's buying tail.
The 90 minutes ended with over $1,000 profit on a 1 lot initial entry using my DoubleDown trade management rules.
Order flow was very clear although some of the level 1 resistance points did not hold. This brought in the DoubleDown rules and resulted in no losing sequences again today so far. This is day 4 for me without a losing sequence.
I'm trying to show that you don't have to trade large size to make reasonable money once you have a good trading plan. Starting with a 1 lot size with DoublingDown is the way to start. Once you are CP on the minimum size, scaling SLOWLY up becomes a lot easier. The trap to avoid is to increase either too quickly or to a size where the outcome of any one trade matters.
Very very interesting your double down strategy, I'm working on something similar for my own trading, coul you please elaborate a little more? At some point in time you were 40+ ticks in draw down with the first position and 20+ ticks with the addon, how do you decide where to put your drop dead stop loss? in this ase at what point would you have accepted a loss if price continued going up?
ReplyDeletethanks a lot!
Alex
Alex, I test where a drop dead stop should be on the original position and double down inside that. Context will override the stop. Price only goes straight in one direction of there is a major Fed like announcement or 9/11 type scenario. Having belief is irreplaceable and that comes from testing and screen time.
DeleteDrawdown is not relevant as long as it meets the rules of my trading plan. Yes, DAX is a big contract but you can do the same in ES, NQ and a lot more.
DeleteThanks EL for all your hints.
DeleteSo let's say for example you make on average $1000 per day with 10 trades per day and you expect to lose 4 days of profit for every 100 trades "on average"....in 20 trading days you expect to lose $4000 of the $18000 you made. And keep the remaining $14000. Very good expectation. What do you think is the min account balance needed for trading Dax in this example you provide??? Just to be safe
Thanks Again
Alex
The first big requirement id to validate that you can achieve your stats in SIM. The second big requirement is to validate that you can do with real money what you did in SIM. This is by no means automatic. Far from it. The account size you need is big enough so that no one trade's outcome makes any difference to you emotionally. Whether that is 1/10 of 1% or 1% or 2 or 3% only you know. I've seen many locals who were down top their last $20k who went on to become really big traders. The past drawdown you have will not necessarily be your lowest.
DeleteHello EL, great work as always. Theres is just one question, what do you do in case the market is still going against you after put on the third contract? Being forced to get out of 3 contracts at some point must result in a relative big loss...do you have made some stats on this event?
ReplyDeleteTIA Peter
Hi Peter, see comments above. Yes, I will get wacked a couple of times out of 100 trades. I expect to lose 2 days profit on each wack. Testing will show you the stats. The important thing is to know where to double down. Testing and context tells me that.
DeleteHI EL, "expect to lose 2 days of profits"...thats a great hint, thx a lot. Peter
ReplyDelete