In most cases, I present myself to my readers as a medium-term investor. But the majority of my trading practice is devoted to rather tough speculations according to the rules of intraday trading. Over the years and with the growth of the portfolio in absolute terms, the size of its speculative part has decreased. Currently, about 90% of the funds are allocated to investments in Russian and foreign stocks, and the rest to speculations on the Russian derivatives market.
Universal Rules for Intraday Trading
I am often asked why I trade on the derivatives market? At one point, it just became more convenient for me. If I had to decide where to trade speculatively right now, I don’t even know what I would choose, since there are now opportunities to take loans on stocks greater than on some futures, and not worry that expiration will interfere with plans. Sometimes I think, maybe I should shake up the old days on stocks? But for now, I’ll refrain, as I haven’t studied everything on the derivatives market yet, and I don’t want to spread myself thin.
Nevertheless, my strategy based on intraday trading rules on the derivatives market will celebrate its five-year anniversary in November this year. The results are already good now; I don’t like to announce them officially because there were big breaks in trading futures contracts. But nevertheless, if you don’t throw these gaps out of the statistics, the yield will approach 120% per annum with maximum drawdowns up to 40%.
Very often when working on the derivatives market, I do not exit a trade beyond one day. I think even if you don’t appreciate the results of my practice—I understand they are modest for the market I chose—my intraday trading rules on the derivatives market will be useful to you, as they can be adapted to any time interval and any exchange instruments.
So, let’s break it down in order.
When Do I Stay Within One Trading Day?
- In intraday trading, I make trades against the main trend.
- When the profit between support and resistance levels is too small to hold a trade for a week or more (less than 2-2.5%).
What Do I Trade Intraday?
- Futures: Gazprom, Sberbank, RTS, Si.
But as I already said, the intraday trading rules presented below will be universal after some adaptation.
How Do I Trade Intraday?
According to the classics of technical analysis. The advantage of this method is that at any moment when I open the terminal, I can see an idea and not be tied to the monitor.
The disadvantage, especially for beginners, is that it will be difficult to cope with the subjective component of this method. Experience is needed here!
Working Timeframes for Intraday Trading?
Most often it’s 1 hour, sometimes 15 minutes—for the RTS index. And heaven forbid you trade on 5-minute charts if you don’t have a robot or at least a trading advisor that automatically generates signals.
15 Simple Rules for Intraday Trading
- Check the trend on the base asset.
- Check the main trend on the stitched futures.
- Do not trade a week before and after expiration.
- One day for analysis (that’s why I don’t trade speculatively on Fridays). You can take weekends for this day!
- Do not open trades with profitability less than 1%.
- Play all trend signals, Fibonacci, horizontal levels, patterns that I see.
- If the stop is triggered, the next trade after a 1-hour filter.
- If the stop is triggered a second time—2-hour filter.
- After the third losing trade—stop trading until the next session.
- Do not open trades where risk to reward is less than 1 to 2.
- After a losing trade, risk to reward 1 to 3.
- No more than 2 futures names in play at the same time.
- If the base asset (stocks) of Sberbank or Gazprom can give up to 8% net profit potential and there is a similar signal on the futures—the trade is priority. Opened on the day with maximum leverage.
- Indicators are important only when the contract has been traded as the main one for a month. The three great indicator signals can be used for full leverage work. What are the Great ones? That’s my personal secret, which I share only with clients on consulting support.
- Close the trade in the main session before 18:30 MSK. (Clarification! The terminal allows me to close a trade at any time, even if I’m not at the monitor. But I prefer to close the trade myself. So if I fly out of work at 18:00 MSK today, I will close the trade 15 minutes before that). Well, throw stones at me for irresponsibility that I don’t monitor the close of trading? From experience—openings are more important, I try not to miss them.
In general, that’s all I wanted to share with you. This time there are so many I’s in the article :-). Understand correctly—this is not boasting, this is a piece of personal experience and soul, as well as an overflow of feelings from favorite work. Please, if you convert my rules to your strategy, even if not for intraday trading, share it. I’m interested in how it might look! Fair winds and following seas!
