by 3rdhdm » Mon Jan 29, 2024 6:57 pm
It crossed my mind while trading today that I have been using the stop-loss as a profitability guarantor rather than a fail-safe, if that makes sense? To hopefully clarify, I've loosely modeled my risk-managment from the casino model of volume + slight statistical edge = profitability. However, the market (the ES/MES in particular since that's what I trade) doesn't seem to work that way. Somewhere along the line I learned to over-expect losses, so I started to try and use losses in the aforementioned fashion.
But, today I started to finally see what Mack has said about how efficient the ES is and how it takes a great deal of directional movement just to get the 6 ticks required for a simple 1 point scalp. That made me aware of my critical trade portals (entry, target(s), stop-loss). When I saw this, I immediately noticed how poor my choices of where those points lie are, and that if I simply followed Mack's admonishions to "buy low and sell high" within the current range of price, there were a LOT of opportunities for profit - based on my current chart-reading ability - that I had never seen before.
I will ruminate on this much more, and test my hypothesis, but I am very curious to any insights/knowledge on this. Thanks to anyone who shares their thoughts on this topic. I hope it was clear.
It crossed my mind while trading today that I have been using the stop-loss as a profitability guarantor rather than a fail-safe, if that makes sense? To hopefully clarify, I've loosely modeled my risk-managment from the casino model of volume + slight statistical edge = profitability. However, the market (the ES/MES in particular since that's what I trade) doesn't seem to work that way. Somewhere along the line I learned to over-expect losses, so I started to try and use losses in the aforementioned fashion.
But, today I started to finally see what Mack has said about how efficient the ES is and how it takes a great deal of directional movement just to get the 6 ticks required for a simple 1 point scalp. That made me aware of my critical trade portals (entry, target(s), stop-loss). When I saw this, I immediately noticed how poor my choices of where those points lie are, and that if I simply followed Mack's admonishions to "buy low and sell high" within the current range of price, there were a LOT of opportunities for profit - based on my current chart-reading ability - that I had never seen before.
I will ruminate on this much more, and test my hypothesis, but I am very curious to any insights/knowledge on this. Thanks to anyone who shares their thoughts on this topic. I hope it was clear.