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Sunday, April 13, 2014

Crude Oil Futures Day Trading - Encore! Continued!



Well, I got myself into a bind with my sweet crude oil. I sold a contract which just kept going up, up, up. And it sure didn't look like it would ever come down. (and in fact, it hasn't to this day). I was losing thousands of dollars on ONE contract! So back to the drawing board. (yes, I'm still in paper money, thank you very much.)

It became instantly clear to the big dumb-dumb (that's me) that what I was missing in this little day trading game of futures is a STOP order. I was trading one contract and putting in an order for my profit target. But if the commodity moves against me, I was unprotected. So then I had to figure out how to do the stop order, making it a THREE item trade each time. I'm still studying this, as I need to figure out WHERE to put these stops, so that I don't keep bleeding losses.

Here's my "ladder" from Think or Swim, and I have indicated 1) the contract I bought at $104.02,

then 2) the "Limit" order to sell at $104.12 (which would give me a profit of $100, as each rung of the ladder is $10);

and finally 3) my "Stop" order in case the market goes against me at $103.99.



Since the stop was only 3 rungs of the ladder ($30) away, needless to say, I got stopped out within seconds of making this trade. But that was still better to lose $30 than lose thousands!

So now, the trick becomes how to gauge WHERE to put the stop. This is where your chart comes in, and the "tick" chart is handy because each rung of that ladder represents one tick.

Also, don't forget that on this TOS "ladder" you can put your cursor on those STP (stop) and LMT (target buy) icons and simple SLIDE them up and down as you sit watching the golden price move up and down. If you want to sit at your desk and daytrade, you can try to "outrun" the movement if your stops aren't in the right place, or if your targets are too high or not high enough. It is really fabulous software this "Active Trader" stuff.

I'm re-setting my P & L to represent what I had before $ 6,559.29(on the blog), and then, for today, showing this current small loss: (i.e. I am ignoring the BIG loss that happened between 4/3 and 4/13, which convinced me I needed stop orders,) as I trying to see how long it will take for me to build this fund, doing things properly:

  • Date--------------- # of Trades--Daily Profit---$5K Fund Balance
  • March 25, 2014-----18 trades-----$415.08-------- $5,415.08
  • March 26, 2014------3 trades-----$678.19-------- $6,093.27
  • March 27, 2014------9 trades-----$157.50-------- $6,250.77
  • March 28, 2014------3 trades----($427.76)--------$5,823.01
  • March 31, 2014 ---- 4 trades----$195.71----------$6,018.72
  • April 1, 2014---------6 trades----$377.95----------$6,396.67
  • April 2, 2014--------15 trades---$642.02-----------$7,038.69
  • April 3, 2014--------10 Trades--($379.40)---------$6,659.29
  • April13, 2014--------1 trade--($30.00)------------$6,629.29


  • Yeah, yeah, I know this isn't very sophisticated and certainly OBVIOUS to any real trader that one needs stops, but I'm self educating here! And it's not so easy to find Futures training (FREE) that is readable. A lot of trader talk, but not a lot of straight talk, so I'm trying to put out there in dog-shit-simple language for all the newbies following along with me. Hope it's helpful to at least ONE someone. Let me know!

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