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This is good advice. I keep information for each futures contract which I
trade along with the current trading plan for that commodity in my PIM.
Commodities are grouped on tabs by type: financial, agricultural, metals &
energy. Information maintained for each commodity includes: trading hours in
my local time, contract months, quote style and tick size, margin, typical
and extreme high 10 day average true range expressed in dollars per
contract, and seasonal data.
The extreme high 10 day ATR, obtained by scanning the ATR graph for worst
case, gives me an idea regarding a possible worst case capital exposure per
contract.
When I prepare to enter a trade, I complete the following standard
information _before_ entering the trade:
a) Entry: Long/Short - quantity, price and type of order which will be used
to enter
b) Confirm: price and derivation of initial price level which will confirm
trade is correct. This is generally the price level at which I will raise
the stop to breakeven or better.
c) Non-confirm: price and derivation of initial price level which will
confirm trade is wrong. This includes how serious the non-confirmation
would be including indication of trend change which would warrant a stop and
reverse
d) Objective: minimum price objective for trade and resulting profit
per contract is indicated in green
e) Stop: price and derivation of initial price level at which I will exit
position, also reverse position if appropriate. The loss per contract is
indicated in red along with the total loss for the number of contracts to be
traded (note this is minimum loss and subject to additional slippage). The
total loss exposure is never more than 2%-2.5% of account size.
For position trades, the stop order is entered immediately upon receipt of
entry fill. When scalping, the stop is held and fired into
the market immediately if the stop level is hit in real-time.
Once I have done my homework and am in a trade, I have objective measures of
how my trade is progressing and the trade itself almost runs on auto-pilot.
Earl
----- Original Message -----
From: Ira <ist@xxxxxx>
To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
Sent: Thursday, May 06, 1999 9:31 AM
Subject: Re: I refere to earl adamy "june bonds " message
> opinion you will soon be broke. I try to trade without any opinion. I
always have
> an entry to the upside and one to the downside. If the numbers are hit and
the other
> parameters concur, I have a trade. Many times you will be in a trade and
something
> doesn't look right. You can't put your finger on what the problem is, then
get out
> of the trade and take another look. It looks different when you are not
trying to
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