bondtrader's Blog

Futures Trading, Musings, and Random Thoughts

Saturday, May 13, 2006


Just got hold of a new blogging platform called Performancing, a Mozilla Firefox extension. Let's see if this works...

Thursday, September 23, 2004

Market Behaviour

Strong trends are followed by trading ranges and vice-versa. A tight trading range is followed by a breakout and a strong move in the direction of the breakout.

Strong trends call for a money-management strategy that allows you to take part in the trend -- larger stops and longer profit targets.

Trading ranges call for more aggressive money-management techniques and even scalp trading, to prevent from being whipsawed too much.

Just something to take note of during the trading day.

Monday, September 20, 2004

Results for the Day

The trading day is just about over, but it doesn't look like there are any more trades to be had. Trades on the mini-Russell tend to thin out in the afternoon.

Since my Stats Manager is still not working, I have to type in the trade manually again. (So much for smart software and technology...)

14 trades, 12 winners, 2 losers. 32 ticks total, NET $185.20.

Here are the trades:

BUY 2 @ 573.3 7:34:36AM ER2264734301
SLD 1 @ 573.8 7:35:10AM +5
SLD 1 @ 574.0 7:36:43AM +7

SELL 2 @ 573.3 7:48:27AM ER2264748272
BOT 1 @ 572.8 7:50:49AM +5
BOT 1 @ 573.2 7:51:20AM +1

SELL 2 @ 571.5 9:58:57AM ER2264958563
BOT 1 @ 571.3 9:59:25AM +2
BOT 1 @ 571.3 10:00:01AM +2

SELL 2 @ 571.3 10:30:47AM ER22641030441
BOT 2 @ 571.2 10:37:20AM +2

BUY 2 @ 571.2 10:46:35AM ER22641046202
SLD 1 @ 571.2 10:50:23AM +0
SLD 1 @ 571.5 10:50:32AM +3

SELL 2 @ 571.4 10:59:18AM ER22641058453
BOT 1 @ 571.3 11:00:42AM +1
BOT 1 @ 571.4 11:02:16AM +0

SELL 2 @ 571.0 11:09:09AM ER2264118474
BOT 1 @ 570.7 11:09:50AM +3
BOT 1 @ 570.0 11:10:21AM +10

BUY 2 @ 570.2 11:14:20AM ER22641114155
SLD 2 @ 569.5 11:15:40AM -14

SELL 2 @ 569.7 11:21:53AM ER2264112096
BOT 1 @ 569.5 11:22:27AM +2
BOT 1 @ 569.7 11:25:06AM +0

SELL 1 @ 570.7 11:55:16AM ER22641154287
BOT 1 @ 570.5 11:57:44AM +2
BOT 1 @ 570.5 11:58:15AM +2

BUY 2 @ 570.8 12:07:35PM ER226412779
SLD 1 @ 571.3 12:08:14PM +5
SLD 1 @ 571.0 12:09:41PM +2

SELL 2 @ 570.6 12:11:49PM ER226412111111
BOT 2 @ 571.2 12:12:59PM -12

BUY 2 @ 571.5 12:26:19PM ER226412261812
SLD 2 @ 571.6 12:26:51PM +2

BUY 2 @ 572.1 12:30:39PM ER226412303113
SLD 1 @ 572.2 12:31:12PM +1
SLD 1 @ 572.2 12:31:39PM +1

Looking at the individual trades, the most bang for the buck is in the morning, where one of my biggest trades was. There was also one big trade in the afternoon. However, it was followed by a big loser. Most of the other trades were small; but that is how it's played. You never try to score a homerun each time; just get it a little at a time. I was looking over the shoulders of a fellow trader last week (via a chat room), and one of his money management styles is to lighten up on his position once he had a few winning trades in a row. He's just playing the probabilities -- once he has a few wins, a loss is bound to happen. I didn't think much of it at first, but after looking at him trade for 2 days, he was quite right.

I was also observing myself today, and found that after a big win, especially my first trade in the morning, my succeeding trades were smaller net wins, partly due to the markets at that particular time, partly due to me lessening the risk by taking the profits as they came to me. I also noted that the big trade in the afternoon came after I took a break from the markets between the morning and the afternoon session. Some of trades prior to the big one in the afternoon were taken after I stepped away from the computer screen for a while (even just 5 minutes). It didn't matter how long it was. The point is it did make a difference. Another trend that I noticed is that the morning really gives the best opportunities. (I talked about this in my previous post "Intraday Trends".)

Anyway, that's a wrap. See you tomorrow.

Friday, September 17, 2004

Intra-Day Trends

There are really only 2 trends during the day for ER2, one within or after the first 15 minutes of trading, the next after the first 30 minutes of trading.

First Morning Trend
3LPB First Trend

Second Morning Trend
3LPB First Trend

After that, the volume dies down, and ER2 moves in a trendless fashion, and this is probably true for all the other e-mini futures.

After the 2 Morning Trends
3LPB First Trend

Possibly, a third trend could happen in the afternoon, within the last 1-1.5 hours of the trading day, but note I said possibly. I have seen it trend in the afternoons, but more recently I've seen afternoons where the market didn't really go in any particular direction. What the afternoon is good for is that it gives you a hint as to the what might happen during the next day's opening.

Thursday, September 16, 2004

Go Fug Yourself

Just saw this website... Good for laughs during the trading day. Whoever they are, the authors are hilarious.

Go Fug Yourself

Wednesday, September 15, 2004

Today's Results

Since there's something wrong with my order entry software's statistics manager, I'll just write down today's tradelog manually:

BOT 2 ER2 @ 567.20 7:34:28AM
SLD 1 ER2 @ 566.60 7:35:21AM +6 ticks
SLD 1 ER2 @ 566.10 7:37:38AM +11 ticks
+17 ticks total, Gross $170.00, NET $160.40

BOT 2 ER2 @ 566.10 7:37:38AM
SLD 1 ER2 @ 566.20 7:37:47AM +1 tick
SLD 1 ER2 @ 566.30 7:37:55AM +2 ticks
+3 ticks total, Gross $30.00, NET $20.40

SLD 2 ER2 @ 566.40 8:05:24AM
BOT 1 ER2 @ 566.50 +2 ticks
BOT 1 ER2 @ 566.30 +1 tick
+3 ticks total, Gross $30.00, NET $20.40

Only 3 trades today. 23 ticks total, $201.20 NET. The second trade was a SAR (Stop-And-Reverse) trade off the first one, on a retracement, and I quickly got out of it just in case the market continued on its trend.

The rest of the day I didn't take any more trades, due to problems with my order entry software. Had to re-start my computer several times, and decided that was it for the day, in case these computer glitches broke my flow for today.

There were obviously more trades to be had when I was not looking at the market, but I'm not going to miss money on a trade I didn't take. I can't afford to indulge in what-ifs like that; it just won't help me. Even with the computer problems, I didn't do too badly today.

Anyway, got to run for now... Maybe I'll post charts later.

Tuesday, September 14, 2004


What a difference size makes, position sizing, that is. For those of you who are thinking something else, it simply means I increased or doubled up on the number of contracts I traded.

And today's results are so much better, from a financial, psychological, and trade management quality standpoint.

Here's today's results:
tradelog 200409014

10 trades, 22 ticks captured, but because of position sizing, grossed $430.00, NET $334.00 for the day.

It's easy to see why it's better from a financial standpoint.

From a psychological and trade management quality standpoint, let's see...
Percentage of win/loss = 77.78%, and expectancy went up because I was more disciplined in waiting and riding out the trends -- which came from knowing I can lock in my profits and still participate in the majority of the moves. It really gets rid of anxiety associated with finding the balance between not wanting to leave money on the table and taking your profits when the markets pull back. It just feels much better knowing that I can scale out of 1/2 of my position on the initial pullback, and let the remaining position ride out the trend.

Result: I wasn't panicky, I wasn't hesitant, I wasn't anxious. I was just trading calmly.

And that is what makes for better trading.

Joe Ross, in one of his chats mentioned that they recommend traders trade with 3 contracts. The first one to exit once the initial costs are covered, the other two to scale out of the position as the market moves in your direction.

Makes sense... It is, after all, a numbers game.