Wednesday, October 26, 2016

Only Take the Best E-mini Trades

You don't have to take every trade you see. The Trade Scalper produces, on average, eight to twelve E-mini S&P trades from 9:30 a.m. to noon. If you took every trade, you would be subject to more risk. Instead, John Paul from believes traders should only take the best trades. How is this accomplished? One way is to use the ATR (Average True Range) to see how volatile the market is. When the ATR is between one and five points, the market is considered good for trading. For scalping, an ATR of at least two or three ticks is preferred. Because the ATR is less than that, John Paul avoids this trade altogether.

With multiple good short trades prior to this one, you can see why taking this trade is tempting. If all the other signals were right, what are the chance of this one being wrong? That can be dangerous thinking. Instead, it is better to stay objective. Another psychological problem is beating yourself up after not taking a trade that would have been a winner. You may think that the missed trade may have made up for a losing streak or paid a bill. That's also an unhealthy perspective. Remember, if you follow a strategy objectively, the strategy should provide you with more winners than losers in the long run. Don't sweat the small stuff. Let missed trades roll off your back. Continue to monitor your progress and take notes. The live training that's included with the Trade Scalper will teach you other ways to manage risk.

Thursday, September 1, 2016

Not every trade you place is going to be a winner. I probably don't have to tell you that, though. In some cases, it's possible to reduce your losses. Here's a perfect example of that. John Paul from DayTradeToWin is going for a three tick profit. Not much, but this is a scalp trade from the Trade Scalper, a trading system. The stop loss is around six ticks. Obviously, it's better to make profit as quickly as possible. It would then make sense to have a rule in place that limits one's time in the market. The time-based stop is just that. If a specific amount of time passes, you get out at the current price - whatever that may be. In this case, John Paul slides his profit target up to the entry price. Since price is at that level, he exits the trade at breakeven.

With broker fees included, this would be a small loss. Most brokers charge per contract, per trade. That means you would multiple your round-turn cost by the amount of contracts to determine your total cost for placing the trade. NinjaTrader Brokerage is who Day Trade to Win recommends. They offer lower rates if you've purchased a lifetime or lease a NinjaTrader license. A NinjaTrader license is required for placing live trades, so this is why they have an advantage in the broker industry. There's been some talk that they may be looking to now support Canadian clients, so it's worth checking them out. Remember that you can get a free, live data feed for NinjaTrader for practicing. Most traders go through a period of weeks or months of practice before trading live. This is advisable because it's easy to assume you know what the market is doing, when in fact, you're guessing and just happen to be correct. Day Trade to Win can provide you with a full setup for paper trading.

Scalp Trading the E-mini Futures Markets With Limit Orders

This video shows John Paul getting signals from the Trade Scalper. The Trade Scalper is both a course and an indicator for NinjaTrader. The method uses 1-min charts to find multiple trades across many types of markets. Each trade focuses on a small profit with a slightly larger stop. If you're not making profit, you are not always taking the greater stop. You're taught the rules on how to manage each trade. You fully learn how the strategy works, so the indicator is optional.

To prevent slippage normally associated with market orders, John Paul prefers to use Limit Orders. Limit orders are a "goal" for your desired fill price to be reached. Once filled, you can focus on managing the trade. Scalping trades generally go for a couple of ticks each. This one is a short, so he's looking to sell the market. Scalping is a more conservative style of trading because you're looking to get out quickly. The longer you stay in, the greater the chance for loss. News events should be avoided - too much volatility or too little can throw off any system. Also, the first 10 min. and final 20 min. of the E-mini (or your preferred market) should be treated with caution. Often, traders are getting their bearings or settling scores. This leads to greater unpredictability. A small way of confirming trades is to see if they are headed in a direction they've already been. Markets like to test previous levels. That's what happened here.

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