Here is an example of a type of trade I take during choppy markets like today. This isn't the only trade I took today, but it is a good case study for how tick charts can be helpful, and all my trades followed this same general idea.
/ES Charts (5m on bottom left, 1000tick is main chart)
As everybody was probably well aware by now, today was a chopfest. Skipping about how we could probably tell it was going to be chopfest (aside from always assuming there will be chop until proven otherwise), I would like to explore how using a tick chart over a minutes based chart can be helpful when scalping for quick hits.
First of all, I want to state that I am a price action & S/R level trader. No indicators or MAs or DOMs or Level II or anything. I used to use volume profile too but have recently even let that go, and the way I have the chart (aside from all the markups) is how my chart looks when I trade. Just horizontal S/R levels and up/downtrend lines all derived from the weekly or daily charts.
As you can see, on the 5m chart, my trade occurred all within one medium sized green candle. But within that 1 candle, I executed a whole entire plan, and captured 3.5 pts on 2 /ES contracts.
The second the bullish hammer finished printing on the on the 5m chart, I went long, considering there would be at least a small bounce off of a minor intraday trend line once I saw the bullish hammer forming. My initial stop would be just below the body of the matching red bullish hammer on the 1000tick chart, and also just below the bottom of the wick on the most previous candle on the tick chart. Keepin' it tight is how I like to operate. Minimal drawbacks are necessary for me since I trade for a prop firm normally.
Almost immediately, the price broke above the downtrend shown in green on the tick chart that had just been recently respected, so I immediately added another contract knowing that there was at least a little more breakthrough to happen. Also, I moved my stop up again to just under the candle previous to one I added the 2nd contract on.
I ignored the first red candle on the tick chart after I added the second contract because it never broke back below the 1/2way point of the bigger green candle that I entered on.
Then I got a couple quick points move in my favor on the next candle on the tick chart. I told my self I'd let that candle play out, since we are breaking out a bit here (but reminded myself that I wasn't expecting a lot of upside here, considering the intraday downtrend line (shown on the 5m chart on the bottom left), so I resigned to take profits at the end of the first red tick candle now. No need to move stops, since I was ready to pull profit trigger.
This trade ended up as a 3.5 point winner (or $350 since I was using 2 contracts of ES). I usually take up to 5 of these a day on a choppy day, and aim to make at least $500 a day. I haven't had a red day in a long time, and only pay attention to the market for maybe 10-20 minutes at a time during each trade, and just casually watching the charts throughout the day while I work my 9-5 job.
I want to note another thing about how I manage my risk when it comes to drawbacks. As you can see, I'm a big fan of using S/R levels to plot my entries, and tick charts to make sure I enter as close as possible to those S/R levels so that I can keep my stops as tight as possible. However, another thing I didn't blatantly mention is that I don't add an additional contract until I am at least 1pt up on my position, and when I do, I immediately tighten my stop to maybe within 1 pt of breakeven so that I'm still only risking the same amount if I were to be stopped out. I notice a lot of people who are straight to full positions immediately when they open positions, and I can't tell you how folly that is, especially if you're trying to mitigate as much drawback as possible on your trades. These are high leverage products, so even 1 mismanaged trade could really knock you down a peg or two, or in cases like mine, totally screw your whole account over.
Not selling anything, just keep seeing a lot of posts about people getting chopped up, so I figured I would try to spark some discussion on helpful ideas people can discuss or try to integrate into their own trading.
Here are the other trades I took today on both the 5m chart and the 1000tick charts.
5m Chart of the whole day.
Opening trade after the large green candle about 1hr into the trading day. You can see I used the tick chart to help visualize the small pullbacks as chances for entry, and chances to keep stops tight (initial stop just under previous red bar).
2nd trade of the day, a couple hours later, after breaking above previous compression range, and doing a small pullback and confirming price continuation of the breakout of the range. Took profits when I saw momentum waning once I was already up a few points.
submitted by Chumbaroony to Daytrading [link] [comments] /ES Charts (5m on bottom left, 1000tick is main chart)
As everybody was probably well aware by now, today was a chopfest. Skipping about how we could probably tell it was going to be chopfest (aside from always assuming there will be chop until proven otherwise), I would like to explore how using a tick chart over a minutes based chart can be helpful when scalping for quick hits.
First of all, I want to state that I am a price action & S/R level trader. No indicators or MAs or DOMs or Level II or anything. I used to use volume profile too but have recently even let that go, and the way I have the chart (aside from all the markups) is how my chart looks when I trade. Just horizontal S/R levels and up/downtrend lines all derived from the weekly or daily charts.
As you can see, on the 5m chart, my trade occurred all within one medium sized green candle. But within that 1 candle, I executed a whole entire plan, and captured 3.5 pts on 2 /ES contracts.
The second the bullish hammer finished printing on the on the 5m chart, I went long, considering there would be at least a small bounce off of a minor intraday trend line once I saw the bullish hammer forming. My initial stop would be just below the body of the matching red bullish hammer on the 1000tick chart, and also just below the bottom of the wick on the most previous candle on the tick chart. Keepin' it tight is how I like to operate. Minimal drawbacks are necessary for me since I trade for a prop firm normally.
Almost immediately, the price broke above the downtrend shown in green on the tick chart that had just been recently respected, so I immediately added another contract knowing that there was at least a little more breakthrough to happen. Also, I moved my stop up again to just under the candle previous to one I added the 2nd contract on.
I ignored the first red candle on the tick chart after I added the second contract because it never broke back below the 1/2way point of the bigger green candle that I entered on.
Then I got a couple quick points move in my favor on the next candle on the tick chart. I told my self I'd let that candle play out, since we are breaking out a bit here (but reminded myself that I wasn't expecting a lot of upside here, considering the intraday downtrend line (shown on the 5m chart on the bottom left), so I resigned to take profits at the end of the first red tick candle now. No need to move stops, since I was ready to pull profit trigger.
This trade ended up as a 3.5 point winner (or $350 since I was using 2 contracts of ES). I usually take up to 5 of these a day on a choppy day, and aim to make at least $500 a day. I haven't had a red day in a long time, and only pay attention to the market for maybe 10-20 minutes at a time during each trade, and just casually watching the charts throughout the day while I work my 9-5 job.
I want to note another thing about how I manage my risk when it comes to drawbacks. As you can see, I'm a big fan of using S/R levels to plot my entries, and tick charts to make sure I enter as close as possible to those S/R levels so that I can keep my stops as tight as possible. However, another thing I didn't blatantly mention is that I don't add an additional contract until I am at least 1pt up on my position, and when I do, I immediately tighten my stop to maybe within 1 pt of breakeven so that I'm still only risking the same amount if I were to be stopped out. I notice a lot of people who are straight to full positions immediately when they open positions, and I can't tell you how folly that is, especially if you're trying to mitigate as much drawback as possible on your trades. These are high leverage products, so even 1 mismanaged trade could really knock you down a peg or two, or in cases like mine, totally screw your whole account over.
Not selling anything, just keep seeing a lot of posts about people getting chopped up, so I figured I would try to spark some discussion on helpful ideas people can discuss or try to integrate into their own trading.
Here are the other trades I took today on both the 5m chart and the 1000tick charts.
5m Chart of the whole day.
Opening trade after the large green candle about 1hr into the trading day. You can see I used the tick chart to help visualize the small pullbacks as chances for entry, and chances to keep stops tight (initial stop just under previous red bar).
2nd trade of the day, a couple hours later, after breaking above previous compression range, and doing a small pullback and confirming price continuation of the breakout of the range. Took profits when I saw momentum waning once I was already up a few points.
