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My broker (TD Ameritrade) has a trading platform called "Think or Swim" which is geared towards options trading however it also has futures trading. It has a feature called "On demand" that allows user to playback any trading day in the past four years. I have been practicing "day trading" and "scalping" futures over the past few weeks.
I plan on practicing until I achieve consistent results and then go "live" with real money. My plan is to be consistent for at least six months in the "on demand" program and then commit 15,000 dollars to live trading with the limit of one contract. If I can become consistent with one contract in live trading for another six months I will add an additional 15,000 in order to trade two contracts.
My results so far trading one contract in "on demand" have been well over 500 dollars per day. I have used trading days over two months ago and have kept it honest by not knowing what happened on any particular day. I realize there is no slippage in the on demand program and my results will likely not be as good in real life trading. If I can maintain 500 per day in on demand I "hope" it might be at least 350 to 400 a day in live trading. Another issue is my Psychological problems when I go to live trading. I think NOTHING about losing 100 bucks in a demo account but what happens when its real? My hope is that I can develop my Psychology to accept losses while not getting excited about gains. My goal is to make my trading as "robotic" as possible. I will think nothing about losing money nor will I get excited about gains. I need to develop an attitude that trading is boring. It is going to be the hardest part of this process as far as I am concerned.
I thought about trading futures at optionsXpress this month. I practiced with their virtual platform. What I learned is that you really need deep pockets to trade futures. Because futures contracts are so large the only people who have any business trading futures are large institutions (an oil company with crude oil that wants to make delivery to a gasoline company that wants to take delivery of the crude so that they can manufacture gasoline), or a fund, or an individual with deep pockets. I'm neither, so I decided not to go to live trading. I hope I can someday, though. The mini-contracts have no volume, so I decided to give those a pass.
Oh, and one more thing, beware of the leverage. A small price movement can produce a very large contract movement. If you think the stock market is a risky place, just try the futures market.
I thought about trading futures at optionsXpress this month. I practiced with their virtual platform. What I learned is that you really need deep pockets to trade futures. Because futures contracts are so large the only people who have any business trading futures are large institutions (an oil company with crude oil that wants to make delivery to a gasoline company that wants to take delivery of the crude so that they can manufacture gasoline), or a fund, or an individual with deep pockets. I'm neither, so I decided not to go to live trading. I hope I can someday, though. The mini-contracts have no volume, so I decided to give those a pass.
Oh, and one more thing, beware of the leverage. A small price movement can produce a very large contract movement. If you think the stock market is a risky place, just try the futures market.
I have been practicing on the /CL futures (oil)
Leverage is my main concern. What I have been doing so far is placing stops and limit orders below/above and above/below my trades. I have been using .10 cent stops below ( 100 dollars) and limit sell orders 100 dollars above. Once a trade moves in my favor I move my stop up/down to the purchase price as long as it is .10 cents away. Once I move my stop I delete the limit. As the tick changes I adjust my stop out depending on the price action always keeping it .10 cents below/above the average price action. As I see the price action petering out I move my stop closer and closer to the price.
My thought so far is I AT LEAST want to cover my commissions. If I can earn ANYTHING above the cost of commissions I am ahead. I always set my stops at MARKET so if it blows through I will still sell at some price at or below my order.
I am hoping that a few months or years of trading the "on demand" will prepare me for live trading.
Can you clarify what you mean "individual with 'deep pockets'" how much is that?
I think the "Deep pockets" are required if you hold a position overnight/longer term. You can trade one contract for as little as 4,500 dollars initial margin and 1000 maint. margin. I am starting to believe it is a bit safer to allocate 15,000 margin per contract "just in case".
I started the S&P futures in Jan 2012. Its called the /ES
I was at a local website following a guru trader.
I neglected to started paper trading first as the guru recommended I do. I thought I was smart. Boy was I wrong.
Jan started with $3k and lost it all by May. lol
Then I started paper trading the /ES for about 5 months afterwards and did fairly well.
I started in Jan 2013 with real money, lost another $900 off the bat. Stopped, set some strict rules and started again in May 2013 regaining the $1000 I lost. Took a break til September cause I got busy at work.
The past few months my I have become profitable but have not fully developed a strategy.
I honestly feel the best way to trade futures is to learn from a guru.
I follow the price action and limit risk, with 2 pt stop losses.
Trading futures I really enjoy. Its better than trading stocks, because I can control my losses better and less confusion with the valuation of a company.
Leverage is my main concern. What I have been doing so far is placing stops and limit orders below/above and above/below my trades. I have been using .10 cent stops below ( 100 dollars) and limit sell orders 100 dollars above. Once a trade moves in my favor I move my stop up/down to the purchase price as long as it is .10 cents away. Once I move my stop I delete the limit. As the tick changes I adjust my stop out depending on the price action always keeping it .10 cents below/above the average price action. As I see the price action petering out I move my stop closer and closer to the price.
My thought so far is I AT LEAST want to cover my commissions. If I can earn ANYTHING above the cost of commissions I am ahead. I always set my stops at MARKET so if it blows through I will still sell at some price at or below my order.
I am hoping that a few months or years of trading the "on demand" will prepare me for live trading.
What is strategy for trading /CL?
My strategy for trading /ES is support/resistance using a paid subscription to provide support and resistance zones of the day.
I think the "Deep pockets" are required if you hold a position overnight/longer term. You can trade one contract for as little as 4,500 dollars initial margin and 1000 maint. margin. I am starting to believe it is a bit safer to allocate 15,000 margin per contract "just in case".
My goal is to make $3K in profit first before increase my contract size to 2. I am currently trading 1 contract.
Each oi contract is 1000 barrels of crude oil. I suppose you could have 95,000 dollars in your account to trade one contract but it isn't required.
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