Starting From Scratch (Futures)

June 10, 2024

As we’ve talked about, Starting From Scratch is a very helpful and nearly impossible topic.

Starting from the beginning not only has an practically infinite amount of choices but it also is entirely dependent on where you’re starting from.

If a world-class athlete who has played paddle sports is starting out in tennis, they might be able to play a tournament in a week.

If an inexperienced person who’s never held a racquet is starting out in tennis, they might not play a tournament for a couple of years.

So the question, “What would you do to start trading automated systems in Futures?” is way too vague and has no concrete answer.

But, if I were new to Futures trading and had at least heard of the stock market, here’s what I would do.

I would pick a portfolio that did things I understood.

And here’s where I would start.

Here’s a new Buy on Monday system for the E-Mini Dow. It buys on Monday and then reaches its small profit target, stops out, or exits on Wednesday if nothing has happened. It’s simple and takes advantage of the current upward bias in the U.S. stock market.

Buy Monday YM.D 5-Minute System

• Go Long at 13:50 EST on Monday.
• Target is 1.5x the current Average True Range (ATR Length 14).
• Stop is 20x the current ATR.
• Exit Wednesday at same time if neither stop or target are reached.

Here is the Report from 2002-2024 trading 1 contract each time via Portfolio Architect:

It has a nice Profit Factor, low drawdown and a win rate above 90%.

Here’s the curve on a sample $10k account:

Again, it’s simple and can be trading using a robot or even manually.

And I can understand it and not be scared during the small drawdowns.

If it were me, I would like the simplicity and the win percentage. That would help me get started.

In our next Newsletters, we’ll look at some familiar systems that I could possibly add in.

Talk to you soon.

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Disclaimer:
It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results are not necessarily indicative of future results. Examples presented on these sites are for educational purposes only. These set-ups are not solicitations of any order to buy or sell. The authors, the publisher, and all affiliates assume no responsibility for your trading results. There is a high degree of risk in trading.

HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.