A Little Bit Adds Up

Sometimes we just want to go for the big money, but I learned another valuable lesson today. I didn't want to trade before the gym, which meant I would not be back until the last 2 hrs of the market.

While I was up at 3 am, the market was making some moves, as well as when I went back to sleep and got back up at 7 am. The market for equities is from 6:30 am to 1 pm. The futures market is opened another 15 min. later than the equities market.

I left at 8 am to go do some cardio and hit yoga, and did not make it back until nearly 11 am. I figured that was good, as lunch back east is now over and the markets would move. I started trading not too long afterwards and it was soooo slow moving. Though there were many opportunities to take $50 again and again, I did not take it.

When I got in, it was at 11:21 am MST at 893.75 and out @12:37 at 894.25. That was just 1 contract for $25. My profit stop was actually at 896 and my cost sto was just below the 50 EMA. It came close a few times to tagging the 50 EMA, but it would've taken another 2-3 more ticks for me to be taken out.

So, I sat through over an hour to take on $25. Granted, it's still money and I'm very happy to have money no matter how much and from where. I could've just originally taken $12.50 and reversed my position to the short side.

RECTANGLE: The ES was trading in a rectangle compression pattern from 891.75 to 894.25. That's a 2.5 range. Surely just taking 1.5 points, which includes slippage, at least 6 different times 1.5 pts could've been taken. Heck, let's just say on a 0.75 to 1 point range, more than double the 1.5 pts could've been taken during the same period that I was in my one trade.

Even if I only took 1/2 point, that was totally possible to do take $25 again and again to amount to a few hundred dollars in this same period, but my fear kept me from closing my trade and just reversing. My thoughts were to go for the bigger money.

And you know what? As I got out of the trade and was just going to settle for the $25, that's when it took off. I got impatient. It not only met my 896 target, but exceeded it to have a high of 897.75. Once again, my intuition was right. I had all my stops (profit & cost) placed correctly, but because I sat here the whole time, I micro-managed the trade and felt my emotions through the trade, though, I did some prayer & EFT through it.

Now, it's okay to pray and recommended, so as long as you have your stops in place. If you are praying for something to happen and do not have your stops in place, then that's a different thing and foolish.

Anyway, my point in this post is that if the market isn't going to give you a good run for you to take a number of points, rather, it will only give you a very small, tight trading range, then just take what it will give. There is at least a 1 tick slippage. If the market is moving fast, you could have greater slippage than that.

This evening, as I traded after hours, I wasn't at the computer the whole time, rather just had my stops set. I was taken out of my trades with profits each time, as I did not sit and micro manage.

If you do take smaller, scalp profits, you will be having a greater percentage of your profits go to commissions, but in my case, doing $21.01 (after commissions) 10-20 times would've been totally more acceptable than just 1 time in over an hr. So what if I give 19% of my profits back in commissions. That won't be every time, but mainly for rectangular compression patterns.
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