This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com
I went over my scalp winners for today and yesterday, and these are the drawdown amounts after my entry for each trade in SPY cents before I exited for a profit:
7 cents
2 cents
4 cents
5 cents
2 cents
3 cents
1 cent
1 cent
2 cents
I am very happy with these results. These are with market orders, so I am pleased I am hitting the momentum at the right time for the most part. My stop is mentally set at 10 cents, with a 30 cent hard stop in case the shit hits the fan. I am wondering if I should tighten my mental stop to 5 or 6 cents. The smallest winner (2 cents) had the biggest drawdown (7 cents)…..go figure.
This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com
November 21st, 2007 at 7:43 pm
Maybe that says that your winners win right away. If it retraces, it’s not the momentum you’re looking for. Move along…
Glad you’re back, Zoomie. I need to study this new strategy of yours. Scalping the opening hour would sure agree with my work schedule more.
November 21st, 2007 at 8:04 pm
Prospectus,
Thanks. I can’t believe I am back to trading indices, and scalping no less. Blame it on Richard ;).
I found my winners did stall some. Some for 10 minutes…but they kept at or near my entry. So I think I will just not allow for such a deep retracement. Of course this is a small cross section of trades in a unique momo market……time will tell if this method will continue to work. It should as it is based on momo, chart patterns, volume, and trend. I will try to get a (good)screen shot of an entry on Friday.
November 21st, 2007 at 11:30 pm
Zoomie, have you considered adding to the winners after a certain target is met? If your right on the momo why not try to grab some more of it, add a partial or double up and raise the stop on the total. This allows you to increase the dollar win while maintaining the risk. Maybe when you get more comfortable scalping this is something you can consider.
November 22nd, 2007 at 7:13 pm
Andy,
When I read Phantom of the Pits, he suggested scalpers put the full position on in the outset, then reduce as required. So I have stuck to that. Do you scalp and add? I pretty new to scalping, so any comments and ideas are more than welcome.
November 22nd, 2007 at 8:23 pm
I stand corrected after I re-read some of Phantom’s advice. Scalping is different than daytrading. He doesn’t cover scalping in his book. Great read.