in DayTradeToWin, Uncategorized

Day Trading Strategies for Beginners & New Traders

Webinars are one of the best ways to get a feel for how well a person’s day trading strategies work in live conditions. Occasionally, DayTradeToWin holds live webinars to provide just that, as well as educate attendees on a variety of topics. Just recently, John Paul conducted a live webinar and showed his ATO 2, Trade Scalper, and Atlas Line trades to a room full of traders.

For gauging a market’s tradability, knowledge of the ATR (Average True Range) is essential. Set your trading platform’s ATR setting to 4. When the ATR is between two and four points on the chart, trading conditions are ideal. However, an ATR above 5 points or below 1 point means the market is too fast or too slow, respectively. Slow conditions are also apparent when many dojis or short candlesticks appear on minute-based charts. Keep in mind, the ATR is always looking back at the last 4 bars (using our recommended setting), so it is not an indication of future levels. Once you place a trade, you can continue to monitor the ATR and adapt your profit target and stop loss based on your ATR-based strategy.

Ever look at NinjaTrader’s SuperDOM and wonder what all those buying and selling numbers mean? In the webinar video, you can gain an understanding of this so-called Level II price data. For a historical interpretation, check out NinjaTrader’s Times & Sales window. Note that with most DayTradeToWin strategies, we avoid interpretation of buying and selling numbers. In the old days of trading, these numbers were more useful. High-frequency trading and other changes have made our price action approach different.

One of the great new features of NinjaTrader 8 is the ability to place MIT (Market If Touched) orders. Consider the literal interpretation of “Market If Touched.” One could say that if your order is touched by the current, fluctuating market price, then you enter the trade at market value. MIT orders are useful in preventing slippage, which is when a tick or more of potential profit is lost due to unfortunate market conditions. The webinar video also explains limit orders, stop orders, and other helpful order tips.

More Day Trading Strategies

John Paul also touches on the topic of front-running. If you Google that term, you’ll probably come up with an explanation of dirty tactic employed by unscrupulous brokers. That is not what John Paul refers to. Instead, his meaning refers to getting filled a tick ahead of the desired price. It’s a tick less of profit, but it can be the difference between having your stop loss hit. You probably would not want to front-run scalping trades, because you’re only going for a couple of ticks. It’s probably better to front-run in trades when you’re going for a point or more of profit.

Aside from the other day trading strategies, it’s also important that you stick around for the part where he discusses closing out trades. Of course, not every profit target will get hit. You should know how to manually close out a trade in order to reduce excessive loss. The DOM has two buttons designed for that purpose. Be sure to watch John Paul’s specific approach based on years of looking at the markets.

How to Place Trades in NinjaTrader 8 SuperDOM

Use NinjaTrader? You will have to know how to place trades. The SuperDOM is what we use. In other platforms, it’s called a price ladder or a matrix. Think of it as a remote control for the market. You can place different types of buy and sell orders. Open a SuperDOM window via NinjaTrader’s Control Center > New > SuperDOM (Dynamic). You should then see the SuperDOM. With the SuperDOM window now visible, you must make one very important adjustment: select the instrument you want to trade. Normally, the instrument you select (e.g. ES 12-17) should match the chart you’re looking at.

There are three types of orders that you’re probably going to use. The most common will probably be Market Orders. These orders are placed at the current market price (whatever the market is currently trading at) and can be placed long or short (buy or sell). On the SuperDOM, the current market price has a yellow highlight. Note that the SuperDOM has two columns: a buy column on the left and a sell column on the right. At the bottom of each column, there is a Market button. Click this button to place a corresponding Market Order.

Limit orders are the next order type. Think of this type as saying to the market, “I want this price or better.” There are specific rules for placing limit orders. If you want to place a buy limit order, you can only place the order below where price is currently trading. Left-click the price you want in the buy column of the SuperDOM below the current market price. If prompted, click Yes to accept the order. The same approach works for placing sell limit orders, only you will need to place them above where price is currently trading. After placing a limit order, note how “LMT” appears on the SuperDOM to indicate the type of order in play. If price touches your limit order, there is no guarantee that you will be filled. If price goes through your limit order, then you should be filled.

How to Place Trades Using 2 More Order Types

The next common order type is a stop order. A stop order is almost like the opposite of a limit order. Place a buy stop order above the current price you want to buy at. Similarly, place a sell stop order below the price you want to sell at. To place a stop order, click your middle mouse button on the desired price in either the buy or sell column. A little popup will appear, that lets you specify the limit (effectively making your order a “stop with limit” order), which indicates the amount of slippage you are willing to accept. If you leave the value at 0, then you are not willing to accept any slippage. If you set the value to 1, then you are willing to accept 1 tick of slippage. Stop orders can also be used as a protective measure to get you out at a specific price. Refer to the video for more information. If you hold the Ctrl key on your keyboard and use the middle mouse button click, a regular stop order will be used.

Lastly, the video discussed MIT (Market If Touched). MIT orders help ensure a fill when price touches a desired price, instead of going through. An MIT order is placed as a limit order, which then becomes a market order. To place one of these, use the Ctrl key + the left mouse button.

To learn how to place trades, be sure to watch the video in its entirety because there are a number of important tips at the end. See more trading videos here.

Profit Targets and Stops – January Effect

Do you recall John Paul’s predictions from earlier this year? He said the E-mini S&P would go up by the end of 2017. Look at what’s happened so far. The E-mini S&P has reached all-time highs! This video summarizes the January Effect trading strategy as well as an approach to finding additional opportunities in the next couple of months. You’ll learn enough to know where to place those profit targets and stops.

In short, the January Effect works like this: if the month of January closes higher (usually January 31) than the price when it opened (usually January 2), then you can expect to also close higher in December of the same year. Of course, any trading method is subject to fail with a significant financial loss, so only trade with money you can afford to part with. In most cases, price rises consistently throughout the year, which provides many entry opportunities. If your brokerage account allows, you can ride the price up, hopefully to profit territory.

How Do You Place Your Profit Targets and Stops?

The January Effect entries require a bit of understanding. Firstly, you have to wait for price to drop. This will need to occur for a few days. Then you’ll need to see price begin to head back up for about six or so days. Use the Fibonacii tool and configure it to show three lines: a line at 0%, one at 50%, and the other at 100%. This helps because to can accurately see the halfway point between two price values. Apply the Fibonacci tool to the retracement. Wait for price to pass through the 50% with momentum and you have yourself an entry. To know when to get out, watch the video.

This is just one of the many trading methods John Paul will touch on during the next eight-week Mentorship Program. You will learn all of his trading strategies. By the end of the eight weeks, you’ll have a complete understanding. All courses and software are included with lifetime licenses. It’s one of the best deals for personal coaching (with solid, unique methods) available today.

Trading Systems for 2017: ATO 2 and Atlas Line

Two of the best trading systems for 2017 are the Atlas Line and ATO 2. John Paul’s recent webinar taught traders how to handle slow market activity often seen during summer months. As we head into late summer, we’ve fortunately seen an increase in volatility. The ATR (Average True Range) is used as the indicator of volatility, with a range of 2 to 4 points considered good for trading. We’ve seen a few days lately where it’s reached around 3 points. Faster markets mean more potential, which means larger possible profits (and losses). Take a look at this ATO 2 trade in this video, for example.

This trade was taken at the end of a live webinar. You can hear John Paul answering questions from one of the attendees. The ATO 2 trade can take up to twenty minutes or so. That’s why the video was sped up. If price did not reach the profit target, one of the stop strategies would have been used, such as a 20-minute time-based stop. Let’s say price suddenly dropped away from the profit target. That’s where the catastrophic stop is used. It’s a safety net for sudden and significant loss. This trade was worth +2.25 points, equivalent to $112.50 per contract on the E-mini S&P.

The DayTradeToWin.com website has a free trading downloads section that contains many useful links. You can download the NinjaTrader 8 trading platform, a free news indicator, and time sync software to keep your computer’s clock in check.

What about the Atlas Line? Let’s jump to early in the webinar. The Atlas Line produced a short signal at 2459.25. This signal appeared because of two closing candles below the dashed blue line. If price produces two closing bars above the line, a long signal will appear. Notice how this trade appeared soon after market open. The ATR is above 2.5 points. For the additional Strength and Pullback trades, look to see if the market is overbought or oversold. Look at the 10:05 a.m. Strength signal. Even though it worked out, John Paul believes it was riskier because the market was more oversold.

Trading Systems for 2017:  Atlas Line

The Atlas Line can produce two or more trades per day. When factoring in the Strength and Pullback trades, you have plenty of opportunities. Pick the best. There’s no need to chase the high-risk trades. At about 22:00 into the video, follow along and try your hand at guessing the profit target. If the target is touched, then you may want to close our of the trade. You can close out at market or use an MIT order (market if touched). Because this was 2+ point trade on a Friday, it’s better to be more conservative. Exit the trade. If you lose a tick, it’s not a big deal.

The Mentorship Program is the best way to get the ATO 2 and Atlas Line in one package. In fact, you get over 10 strategies with lifetime licenses. We have new classes that begin all the time. The next one is August 28. Click here to check out the details. Classes are twice a week in a webinar room. You can see John Paul’s charts as he explains how to find trades. The goal is to have you learn, not blindly follow a trading room or an indicator.

Summer Day Trading Defeated Using January Effect

Summer day trading is known to be difficult. People take time off. The markets traditionally lose volatility. You’ve seen what happens during a Friday holiday. In the summer, can we see the ATR (Average True Range) below one point regularly and for larger portions of each day. How do you combat this? Small-time retail traders need to think differently. John Paul from DayTradeToWin has an idea: go long-term.

If your brokerage account can substantiate the extra risk involved in holding large positions for multiple days, it may be worth taking a look at the January Effect strategy. The January Effect can best be described as a predictor for how price may behave for the rest of the year. The prediction is based on how price behaved in January of the same year. If you see that price closed higher than it opened for the month of January, then expect the end of the year to also end on a high note. Of course, there’s no such thing as a true prediction. John Paul believes in this strategy’s accuracy, but you should do your own testing and come to your own conclusions.

How do we know when the January Effect will apply? Early February, of course. From that point forward, you can follow the rules to spot bullish retracement trades. The video demonstration is better, but essentially, you’re looking for price to drop. Once the bottom is reached, wait for the 50% recovery and then look to enter a bullish trade. You can find one of these setups almost every month. There’s no guarantee of profitability. Price may turn around and continue lower. Be sure to test with a practice simulation account first. Also, check with your broker and a financial expert.

Beyond Summer Day Trading

Other than summer day trading, John Paul discusses a number of other tricks to possibly improve performance. He talks about groups of days, trending days, and how to spot cycles. He discusses why 5-min charts are superior to most others, the ATR (Average True Range), and much more. To learn everything he knows about day trading, join the next eight-week trading class, Group Mentorship. All trading courses and software are included with lifetime licenses. It’s a great deal.

Free Trading Strategies: January Effect

One of DayTradeToWin.com’s most popular free trading strategies is the January Effect. Just look at the winning possibilities within the last few months:

  • March 2017: +18 to +40 points
  • May 2017: +18 to +30 points
  • June 2017: +17 to +24 points

Will July 2017 produce similar big winning trades? John Paul provides his prediction in the video below.

What is the January Effect? Firstly, remember there’s no such thing as an accurate trading prediction. The market activity is anyone’s guess, so trade at your own risk. Consult with a licensed broker and financial professional before considering trading, especially when holding high-risk trades for multiple days (as described in the video). John Paul believes the direction of the market for the overall year can be predicted based the market’s behavior during January of the same year. For example, because January 2017 closed higher than it opened, he believes December 2017 will also close higher. From there, it’s a matter of finding additional entry opportunities throughout the year.

How to Find Retracement Opportunities

To find those additional trades throughout the year, John Paul looks for periods of downward movement. When price retraces upward, climbing 50% back up to the previous high, that’s the January Effect entry point. How do you know where the 50% point is? Sure, you can eyeball it. John Paul prefers using NinjaTrader’s Fibonacci tool. However, he’s not using it in a typical way. For the January Effect, only values of 0%, 50%, and 100% are visible. In a previous video, we recovered configuring the tool. Free trading strategies and tools are a primary focus of DayTradeToWin.

To discover more ways to trade the E-mini and other futures and currencies, participate in the next eight-week live trading school, Group Mentorship. John Paul reserves his most powerful strategies for this all-inclusive program. Yes, all courses and software are provided plus eight weeks of live training with a pro. All lessons are recorded, so you can play them back in the future.

Day Trading Video: E-mini S&P 2 Point Winner

Subscribing to the DayTradeToWin YouTube channel will provide you with automatic notifications when a new day trading video is uploaded. It’s really the best way to see every video that gets posted, and we know there’s a lot of them. We know for a fact there’s over 300 videos currently, and recently John Paul is producing a new day trading video every week or two. Many videos focus on free education and show real-time charting conditions.

Remember, subjects your finances to substantial loss. Only trade with money you can afford to lose. Too many traders are eager to jump in and start making money right away. It doesn’t work like that. There are no overnight millionaires. Successful day trading may require, but is not limited to, the following: the ability to properly assess risk, a strategy that has profits that exceed the losses and other costs of day trading, proficiency using the trading software, and stability in terms of computers and a broker.

This video shows an Atlas Line trade. Yes, this trade occurs right after market open. The Atlas Line almost always provides a trade within the first 30 minutes of market open. To provide a signal, the software waits for two candles to close either above or below the plotted line. When the second candle closes, a long or short signal appears on the chart. If price is above the line, it will be a long signal. The opposite is true for a short signal. One way to potentially filter out losing trades is to look for overbought and oversold conditions. This is taught in the included live training.

Signals in the Day Trading Video

When the second candle closes and a signal fires off, that is the point in which you can place a trade. To make trade placement faster and more convenient, you may want to use NinjaTrader’s ATM Strategy feature. Ahead of time, you can define profit target and a stop loss values. When a trade is placed with the desired ATM template selected, you will see the profit target and stop loss applied in the SuperDOM. If you also have NinjaTrader’s Chart Trader enabled, the profit and stop will also be visible there, too. In fact, Chart Trader lets you drag and drop the profit and stop. Be careful in doing so, as you essentially put yourself behind the orders of other traders. DayTradeToWin.com is home to hundreds of other trading videos.

NinjaTrader Entry Signals – ATO 2 & Atlas Line

Yesterday, the E-mini produced great trades for the Atlas Line and ATO 2 proprietary indicators. The first of the NinjaTrader entry signals was generated by the Atlas Line at 2442.75. Soon after, an ATO 2 entry signal appeared at 2443. These signals occurred about 10 minutes from each other. You can count on the Atlas Line generated a generate within the first 30 minutes of market open (and usually one or two more later in the day). Because the Atlas Line can provide an indication of expected market direction so early, the ATO 2 is a perfect accompanying strategy.

All clients who use the Atlas Line and ATO 2 receive the same signals as John Paul. You are taught a total risk/trade management strategy. The ATR (Average True Range) is used to assess risk in the moment. This ensures trading goals are within a reasonable amount. There’s no need to extend your account and take on more risk than is necessary. The Atlas Line and ATO 2 are sold separately. The only time they are included is in the eight-week Mentorship coaching program.

Later, an ATO-C trade appear. This denotes an ATO 2 Trade Chaser setup. These are potential money-making opportunities that occur after the main signals. Watch the full video to see how this trade panned out in real-time. Notice how the Atlas Lines Strength trades (small S letters near the candles) coincide with the ATO signals. Again, another example of synergy between the two strategies.

Beyond NinjaTrader Entry Signals

John Paul was able to place the profit target and stop loss quickly because of predefined values. Configure an ATM Strategy and select it in the SuperDOM. The next time you place a trade, the profit target and stop loss will be placed for you. When using a 5-min chart, timing is very important. Combine an ATM Strategy with the Bar Timer to time each trade perfectly. Yes, ATM and the Bar Timer are included for free as part of NinjaTrader.

If you want to be a professional trader using the ATO 2, Atlas Line, and a whole bunch more methods, sign up for the next Group Mentorship class. The next eight-week class begins Aug. 28, 2017. Classes are Mondays and Wednesdays at 5 p.m. EDT. All courses and software are provided with lifetime licenses. Each training session is recorded, so you can log in and refresh through playing back videos.

ATO 2 Software Signals for Futures & Currencies

On June 13, the ATO 2 software for NinjaTrader 8 generated a signal worth 7 ticks or 1.75 points. The entry price was 2432 and the profit target, based on the ATR (Average True Range) was 2430.25. To compute the profit in dollars, remember that the E-mini is worth $12.50 per tick. This trade is worth seven ticks, so do $12.50 x 7 for a profit of $87.50. If you were trading 10 contracts, the profit would have been $875. Note that the profit here is an estimate and does not include broker costs, slippage, or other potential trading expenses.

Of course, the best time to trade the ATO 2 is when the ATR is at least one point. At market open, certainly on the E-mini S&P, price often exceeds the one-point minimum. On average, the ATO 2 fires off a couple signals per day. You may also see a Trade Chaser trade (notated as ATO-C on the chart). These Chaser trades provide additional opportunities. It’s sort of like the ATO 2’s Pullback or Strength signals, only a much different pattern. The ATO 2 works for markets other than the E-mini. Think of how many markets become volatile when they first open for the day or around the time the big markets open for trading (e.g. 9:30 a.m. US/Eastern).

What Else Is Included With the ATO 2 Software?

In conclusion, with purchase of the ATO 2, you will receive the digital course and live training. The training covers all aspects of finding the patterns manually and using the signal software. In addition, you receive a training video from a previous live training session. Combined with email support for trading questions and optional remote support for installation, it’s a great deal. What else is included? The bonus ABC software and bonus “How to Trail a Stop” video. Yes, you are given an additional signal software that compliments your ATO 2 trades.

Trading Strategies: Atlas Line, ATO 2, and ABC

Don’t you just love it when multiple trading strategies agree on market direction? That’s what we see here on this E-mini chart using the Atlas Line and ATO 2 software on NinjaTrader 8. The Atlas Line’s Strength and Pullback trades are also in the long direction. Later in the day (in section B as John Paul calls it), the Atlas Line produces a Short signal. Two closing trades below the line is what caused the signal. Based on the ATR, the profit target is around two points. Price did reach the profit target. Price action has been slow lately, but because the market tends to operate in cycles, John Paul believes volatility will soon pick up.

You’ve probably seen other videos explaining how the ABC method works. On the June 9 chart from the video, notice the A section of the day (shaded yellow). The market tests this range. Subsequently, short Atlas Line Strength and Pullback signals occurred. In addition, notice how the ATO 2 short signal appeared right outside the range of A. The ABC software seen on the chart produces signals. An ABC signal appears right after the ATO 2 signal. John Paul advances the video, and sure enough, look at that trend. What a great display of three separate strategies confirming market direction.

The ABC generates a signal late in the day around the late-day sell-off time. Volatility is good at around 11 ticks or three points. Remember to have your stops ready. Use NinjaTrader’s ATM Strategy feature to have the platform apply them automatically. Follow what price action tells you – don’t guess!

Multiple Trading Strategies, One Program

What’s the best way to get these three trading strategies at a low price? We have a new Mentorship class that starts June 19, 2017. All of our courses and software are included. You’ll walk away a pro trader with over 10 price action strategies in your arsenal. You’ll be able to spot the same trades John Paul sees on a daily basis. In addition, you’re provided a full practice environment that DayTradeToWin.com can help setup for free via remote support.