Last week I started to take a look at the QM or Mini Crude Oil contract as an alternative to trading the CL or full size Crude Oil contract.  I am primarily a scalper/very short term trader and set out to trade the QM on Friday before the news as can be seen by the following trades.

My biggest concern trading the QM was execution speed and overall liquidity. The QM or mini contract represents 500 barrels of versus the 1000 barrels of oil in the full size CL contract. I was a bit more difficult to get fills when I would try to scratch a position. The CL contract although more leveraged still provides more “stopping places” with 100 ticks per point versus 40 in the QM. At the end of the day IMO the QM contract lacks liquidity and is only a more viable instrument for those trading small accounts and need a less leveraged contract in order to trade more contracts. For more information regarding contract specifics see:

Regular CL:

Light Sweet Crude Oil

E mini QM:

E mini Light Sweet Crude Oil

I realize that it has been quite a while since my last post. Many things have changed since that time frame. Even though I have neglected this site, I have not been neglecting my work trading. My hours have gotten longer and since increasing my 6E trading and in the market from 2:00-3:00 AM until 4:00 EST for 2-3 days per week and weekends get consumed quickly with family and rest.

I have continued with the eminiaddict subscription but not always listening to David’s webinar. I am usually in David’s chat room and also in Vlad’s chat room at esecfutures.com. for the most part during the trading day. In addition, I have also subscribed recently to Ben Lichtenstein’s squakbox broadcast of the live S&P pit. I have both going most of the time but slowly trying to use Ben’s service primarily. I trade only futures now and use the futures contracts to trade currencies. My current trading plan as follows, ES and 6E (Euro) trades constitute 8o% of my trades with the other 20% being of 6J (Japanese Yen) and 6B (British Pound).  I have become much more regimented and find myself sticking to my trading plan better. It has also shown in my results as I have had my best 3 weeks of the year in the past 7 weeks, ranging from 6.2% to 7.9% per week. In reality, I only expect to have one week like that every 6 to 8 weeks. I am trading on accounts totaling 60-70k total for now and is sufficient for my risk tolerance and position sizing. I am looking forward to doubling my trading account size in 6-12 months as I become more consistent.

My trading setup has changed a bit. Hardware wise, I am all Mac now and do not use any PCs. I am still using TOS and Tradestation for charting and have not been able to fully convert to Tradestation. I am using IB and Tradestation as brokers but still have accounts with Infinity, TOS, and MB Trading as well. I currently run Tradstation on Windows XP inside of VMware Fusion on the Mac. I am at the same time and on the same machine running TOS, IB, Market Internals spreadsheets, etc. on Mac OSX natively. I like this setup as it is very stable and also mobile on a 17 inch MacBook Pro with a secondary 22 inch Samsung T220 monitor, secondary Mac full keyboard and mouse. I still have a desktop PC with a Samsung T260 and a T220 in my upstairs office that is not currently being used.

I will be starting a one-on-one mentorship with Joe Mertes at Joseph James Consulting next week that should last into the holidays. Joe uses Market Profile data extensively in his trading so I will be learning something new. We will be refining my trading plan over the next few weeks and will post it here once it is refined. Our goals are not to overhaul my trading since I am already profitable and getting more consistent every week but to enhance my trading by working over the basics of planning, execution, tracking etc. inside of my existing plan. I will also post periodic updates of my training and hopefully some examples.

Well that’s enough for now. I am hoping to get back to posting on this site and get some fresh material posted. Thanks!

I finally booked my travel to the International Traders Expo in Las Angeles June 3-6. I am only going for 2 nights arriving on the second day and departing on the last day (Saturday). The intent was to stay through Saturday and take only one “pay” course,  Linda Raschke’s condensed 3 day course, Classic Technical Trading. I have not decided if I will take her course as there are others during that time that are free. This is my first of these events and I am looking forward to learning and meeting some fellow comrades in person.

Here’s a great video, Mind Over Market by Mark Douglas, that I ran across last week. He is the author of Trading in the Zone and Diciplined Trader: Developing Winning Attitudes.

With the exception of walking outside and holding my phone as high as I could to get my email, I enjoyed a wonderful four day weekend without an internet connection. I did have a chance to catch up on some reading. One of my more interesting reads was the 83-page eBook, Read the Greed by Mike Reed and Morrill T. Morehead.

Most of the setups discussed in this eBook are designed to get a trader into a position with an expected immediate turn around or continuation. Almost all of them use TICK extremes to determine when momentum is about to slow/change. The determination of a TICK extreme is made on breakout on a 5 minute TICK chart of a 12 period Bollinger Band with 2 standard deviations of the last 12 bars. Clear examples with easy to read graphics and charts were provided for each setup. Throughout the document he refers to the “RBI Support and Resistance Levels” are the levels that his group determines nightly and publishes as part of their subscription service.

I readily use one of Mike’s key trading rules when trading any of the Emini futures: if the trade is not going my way I exit immediately. Usually I exit in 60 seconds to two minutes if the TICK supported by price action turns against me. I will be taking a closer look at some his techniques reading the TICK. I am also going to take a look at the 60 EMA on 5 minute chart and the 15 EMA on the 2 minute chart and their correlation with extreme TICK readings for scalping the ES. At the end of the day, this document was a good read and a must read for anyone interested in scalping the eminis.

Here is a webinar for those that have not been able to attend a Fair Tax meeting:

Understanding the Fair Tax

I ran across an eBook, Practical Fibonacci for Forex , written by Ken Marshall and Rob Moubray. It totals 30 pages and explains the Fibonacci numbers, what they are, how the ratios are derived and why they apply in the Forex market. It was also explained how to find entry and exit points using candlestick patterns with clear graphic examples These apply in many markets, particularly in E-mini futures and spot Forex markets. I use Fibonacci retracements primarily and sometimes in conjunction with Fibonacci Fans to find other support and resistance levels and found the examples helpful. It also explained in detail how areas of convergence of different retracements apply yielding areas of potential greater support and resistance. The standard ABCD or 1234 pattern was described with detailed examlpes.  Overall, a good resource for those that want to apply Fibonacci Retracements to the Forex market.

I have had several people online and a couple from the local Forex Meetup Group ask for more information on Ambush Trades and how to apply them. They work very well in many markets. Here is a video from David Halsey AKA Eminiaddict for those interested in learning.