In a previous life, I worked for several proprietary trading firms in Chicago. During my time there, I learned a few things. I also made a lot of money. And I still use.
have i done it.. yes.. but have i done it as a methodology following order flow.. no.. trading for 10 ticks on CL is NOT scalping to me.. I would like to hear from someone who truly does this why do i ask - i want to be able to scalp the few hrs i am watching the screen Why cant i trade then.. i can but i loose more trying to force a trade without right setups (+ indicators lining up) I bought the basic course.. thinking about intermediate , but want to hear from someone who does this day in and out what instrument is best? ZN/ZB? but then will we get stuck behind other big orders timeframe? someone who is success before NY market open Question is not Can i scalp? but Whats the methodology, instrument, stop loss, with charts/without charts thats the right way to do it from someone who does this for a living thanks |
hi jokertrader - I'll give you my 2 cents although I don't really scalp myself. Yet.
Firstly I'm assuming that by 'scalping' we are talking about the activity that people used to do with many lots and attempting to buy at the bid and sell at the ask. That activity which now in electronic form is what, as I see it, many prop shops teach people to do. Of course with the electronic form if you have the right skills you can scalp more than just bid/ask spread.
Within that context, I think the volatility of CL makes it very impractical to scalp. You could be up 3 ticks and in the next 5 seconds could be down 10 ticks, just like that.
My take is that high-liquidity products are much more suited to being scalped. Products such as ZN/ZB or the ES and the Bund/Eurostoxx in Europe.
All the documentation I've read about scalping says to leave the charts alone, and the methodology as I understand it is being able to spot certain 'setups' that may take place at critical junctures of the market. Junctures being prior days' highs/lows; today's highs/lows; Ranges forming around Point of Control, or High Value Areas; significant changes in volume profile, and so on.
![No Bs Day Trading No Bs Day Trading](https://i.ytimg.com/vi/PK2hr4Evz68/maxresdefault.jpg)
Did you read the entirety of the ebook?The more this strategy is automated, the more effective it becomes. This is a simple explanation for 'trends', as people see liquidity consumption and enter on the side to further consume it - more people repeat the pattern. The net result is a 'trend', which is a blunt way of saying 'demand exceeded supply in <x> direction'.
There is no sane way to automate this, since everyone's description of 'enough' volume delta is different. Perhaps I open positions at a CD imbalance of 15%, bank of america waits on 19%, and chase at 25%. My actions at 15% further the delta, causing bank of america's 19% threshold to fire, which in turn increases the delta to 25% causing chase's threshold to fire. Until every day trader 'gets on the same page' so to speak, this will not be automated. And...if they ever do get on the same page, then it only takes 1 person with decent equity to take the other automated strategies to the cleaners.
tldr; This will be automated away when greed no longer exists, i.e. never.