Futures Trading Tips from Mark Oryhon

Came across a chat transcript on Elitetrader where Mark Oryhon from Velocity Futures in August 2003 gave some tips on futures trading (link here).

There are a number of good tips and nuggets that Mark gave. I especially like the tips on plotting your entries / exits using colored lines on a chart, and scratching trades that you are unsure about or trades that don’t work right away. In the last session, I found myself scratching a few trades that went in my favor almost immediately after I got out, so I was thinking whether I have been too aggressive in cutting my trades and not giving it enough time to work. I guess scratching trades quickly is still better than taking a loss, but I’ll have to get used to seeing those wins-that-could-have-been.

Keep Detailed Trading Logs

  1. Log the following for each trade
    • Time you get in
    • Time you get out
    • Reasons for getting into the trade
    • P/L
  2. Plot each trade on a 1-minute chart after the trading day
    • Connect the entry and exit points with a green line if it is a winner, red line if it is a loser
  3. Look at the daily stats
    • # winners
    • # losers
    • Biggest winner
    • Biggest loser
    • Average winner
    • Average loser
    • Average time in winners
    • Average time in losers
    • Time in biggest winner
    • Time in biggest loser
  4. Want
    • Average winner > Average loser
    • Biggest winner > Biggest loser
    • Time in biggest winner > Time in biggest loser
    • Average time in winners > Average time in losers
  5. Check to see if
    • Losses snowball one after another
    • Trades churn in a trading range
    • Caught on the wrong side in a trend day
    • Any particular time of day where they lose money

Four Most Common Problems

  1. Trading just to make the next round number in the P/L.
  2. Trading more size when you are down
  3. Trading without proper preparation.
    • You need to prepare your plan and trade your plan.
    • You need to know the major news expected each day so that you are not caught by surprise.
    • Know the support and resistance levels to watch
    • Know what other sectors to watch that would be leading tells (e.g. bonds, dollar, or some other sector)
  4. Trading when you are emotionally upset / mad

What To Do When Experiencing a Rough Patch

  • Cut back size
  • Trade less
  • Wait for easy trades
  • Get a string of small winning days
  • Then add size


  • Scratch trades that you are unsure about, don’t wait for it to turn into a loser.
  • The best trades work right away. If it doesn’t work out right away, don’t wait for it to go against you
  • Don’t trade your bias, but go with the flow if your bias turns out to be right.
  • Change the P/L from dollars to ticks.
  • Watch the TICK, learn its patterns.
  • Understand higher highs and lower lows.
  • Pay attention to C, IBM, MSFT, SOX index, BKX index (that was in 2003, may not be as relevant today)



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