Day Trade to Win

3 Free Trading Videos
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Group Mentorship – Learn Exact Entry, Profit, and Stop Loss Strategies

A new Group Private Mentorship class begins February 11, 2014. Eight weeks of live training with John Paul will teach you everything you need to know to successfully trade futures and currencies. All courses and software are included with lifetime licenses. This new session has classes twice each week.

We expect this new session to fill up quickly. It’s a good idea to reserve your seat as soon as possible.

» Register Today «

Remember, group training includes:
• Eight weeks of live training with DTTW founder John Paul
• Each training session is recorded for future playback reference
• All courses and software with lifetime licenses and digital books
• In total, 11 unique methods to trade price action are taught – unlike anything you’ve traded before
• Training goes above and beyond the written material
• Look at each day’s activity and ask questions to improve your understanding with expert insight

Trading Video Lesson 2 – NinjaTrader Order Placement and SuperDOM Use

So you’re now using NinjaTrader and you’re struggling with the concepts of placing trades? Look no further! Watch the video and in 15 minutes, you’ll have a good understanding of different order types, ATM Strategies, and execution.

One of the most important-to-know yet misunderstood aspects of day trading is order placement. The NinjaTrader platform, which we are big advocates of, allows you to place orders using two features. The first of which is Chart Trader, which is quite basic. It lets you trade from the chart itself. The more powerful way to place orders is using NinjaTrader’s SuperDOM. There are two flavors of the SuperDOM: Dynamic and Static. They are very similar as discussed here. Market orders are the most simple of all orders. They tell NinjaTrader to get you in the market at the current price (or as close to it as possible). Limit orders and stop orders are discussed in the video as well as the importance of being in the front of the line. The ATM Strategy information is handy too, because you’ll automatically have a profit target and stop loss defined after your original order gets filled.

Watch the previous video in the series by clicking here.

Atlas Line Calls Out Many Short Trade Opportunities

Click the image for a larger chart

» Get the Atlas Line «

Today’s E-mini at 9:30 a.m. EST was priced at 1811.75. It ended the day at 1780.25. It was a big down day. This opportunity allows us to show you multiple Strength and Pullback Trades when price is severely trending. The Atlas Line was correct in deciding the market would be going short, as it advised sticking to the short side. You can see our recent trades on this page that show the Atlas Line strategy in action from 9:30 a.m. to noon, EST.

After purchase, we email you the Atlas Line software and instructions.  We also provide you with a training video ahead of time to teach you how to use the Atlas Line.  We also invite you to the next live training session, where John Paul shows you and a handful of other new Atlas Line users how to use the software.  We also provide you with a recording of the live training session.  Free support is provided for the duration of your license. Click here to go to the Atlas Line purchase page.

Atlas Line Recent Trades Explained

Click the image for a larger chart

» Get the Atlas Line «

We get a lot of questions from non-customers on how to interpret Atlas Line signals. We figured it would be best to examine a recent day that was full of Atlas Line trades that would best demonstrate multiple scenarios. Take a look at the 5-min ES chart above.

Summary:

9:55 a.m., Entry – Two consecutive closing bars above the plotting Atlas Line generates a Double Bar Long order signal
10:05 a.m., Profit Target (+5 ticks) – Profit target, based on ATR, is hit

10:45 a.m., Entry – Pullback Trade is activated
11:05 a.m., Profit Target (+4 ticks) – Profit target, based on Pullback Trade rules, is hit

11:35 a.m., Entry – Pullback Trade is activated
11:55 a.m., Profit Target (+2 ticks) – Profit target, based on Pullback Trade rules, is hit

11:55 a.m., Entry – Strength Trade is activated
12:05 p.m., Profit Target (+4 ticks) – Profit target, based on Strength Trade rules, is hit

Total profit or loss for the day (excluding slippage, commission, fees, etc.): +15 ticks

Remember that the best time to trade the Atlas Line with the ES is from 9:30 a.m. to 12:00 p.m. EST.  John Paul has updated all of the Atlas Line recent trades through January 17, 2014. Click here to the trade performance. Again, the trades listed on the page occurred during the preferred time frame.

After purchase, we email you the Atlas Line software and instructions.  We also provide you with a training video ahead of time to teach you how to use the Atlas Line.  We also invite you to the next live training session, where John Paul shows you and a handful of other new Atlas Line users how to use the software.  We also provide you with a recording of the live training session.  Free support is provided for the duration of your license. Click here to go to the Atlas Line purchase page.

ABC Software for E-mini Plots Entries

As you may have seen from our previous videos, the free ABC Method for the ES market splits the day into three parts. For each part, your entry will be two consecutive closes that break out of the previous section. The A part of the day (morning) is usually the most volatile. Part B (2.5 hours from the start of Part A) is a leading indicator to determine if the day will trend through Part C. The same entry rules exist for parts B and C. By watching the video on the videos page, you can learn to manually plot the lines to assist your entries. As part of the Mentorship Program or the Power Price Action Course, you are provided access to this ABC software for NinjaTrader.

Live Atlas Line in Action – Today’s Webinar

» See More of the Atlas Line «

In case you weren’t able to make it to the webinar earlier today, here is the recording. Consecutive days, multiple markets, live audience – it’s all here! Check out the performance on the YM, ES, 6E, and ZB. In case you don’t yet know, the Atlas Line is software that plugs into your trading platform (either NinjaTrader, TradeStation, or eSignal). It then plots a line at a specific time and angle every day. Depending on how price moves in relation to the line, order signals are generated. The order signals tell you when and how to enter the market (either Long or Short). It’s quite simple to use and it comes with live training.

Reminder – Monday, January 13, a new session of Group Mentorship starts. Click here to read everything about Mentorship. Yes, the Atlas Line is included with Mentorship, as are all of our other courses and software.

Zen-Fire Data Feed Replacement


Recently, we have been inundated with inquiries from traders who want off the Zen-Fire infrastructure and want to switch brokers. Many of you know that Zen-Fire has relied on the Rithmic infrastructure for a long time, so why not go with the Rithmic data feed directly?

My good friend Matt Z. at Optimus Trading Group, www.optimusfutures.com, has been running the Rithmic network for years, and you can easily plugin your NinjaTrader, our preferred trading platform, directly to Rithmic. The Day Trade to Win customers have given me a really good feedback about Optimus services and the quality of the feed (low latency, unfiltered data with historical capabilities) Although there are a number of brokers who offer Rithmic, Optimus has one of the best familiarities with this software.

Contact my friend Matt:
matt (AT SIGN) optimusfutures.com
(561) 367-8686
Toll-free: (800) 771-6748

Trading Video Lesson 1 – Price Action vs. Indicators

This is the first in an installment of ongoing trading videos where Day Trade to Win founder John Paul explains the basics of day trading.  Since most traders come to us wanting to scrap their indicator setup and use only price action to trade, this Lesson 1 video focuses on the differences between indicators and price action trading.

Before we get too far ahead, indicators are little programs that run inside of a day trading platform.  Indicators are meant to provide a trader with helpful advice in gauging market behavior, and in some cases, telling the trader exactly when and how to place a trade.  Indicators are very appealing for these reasons.  However, traders should be cautious because most indicators lag behind real-time price activity, meaning the advice they give can often be inaccurate.

At Day Trade to Win, we teach traders how to assess marking conditions using price as it plots in real-time.  Using only price and its relation to time, we can estimate how good for trading the market is, where to enter the market, how much profit we should be taking, and where to put a stop loss in case the trade goes against us.

In the video, John Paul points out a common problem with the popular SMA (Simple Moving Average) indicator.  Like most indicators, the SMA depends on a parameter (a configurable variable) to adjust its operation.  If you do not know the correct value to use for real-time market conditions, the indicator becomes worthless.  You end up looking at history to see what value worked best in the past and then adjusting the indicator for expectations of improved future results.

John Paul does not use the SMA, stochastics, bands, waves, or any other type of regular system.  For a five-minute E-mini S&P chart, he typically uses a BarTimer and an Average True Range.  You’ll have to watch the video to see why these tools are important and how to use them to your advantage.  For TradeStation users, we offer a BarTimer for free as a download. 

Yellen to Become Fed Chair on Feb. 1, 2014

We previously created a post mentioning Janet Yellen’s approach to the Federal Reserve Chair seat. Leading up to her final approval, there was much controversy among members of both leading U.S. political parties as to her suitability and how she will impact the financial world.

On January 6, 2014, the U.S. Senate voted 56-26 to confirm Yellen as Bernanke’s replacement. Bernanke, best known for his attempts to lead the U.S. out of the 2008 financial crisis and recession, sees his eight-year term expire January 31, 2014. Yellen will officially take his place on February 1. Since October of 2010, Yellen has been the Fed’s vice chairwoman. Bernanke’s advice to Yellen is to listen to listen to and regard Congress as her boss. As for financial market impact due to the switchover, there is expected to be little reaction because Yellen and Bernanke have been allies.

Yellen is expected to stay the course set by Bernanke as the economy continues to recover. Her biggest obstacle may be the management of the Fed’s quantitative easing. Quantitative easing refers to the Fed’s mass buying of Treasury and mortgage bonds in an effort to keep long-term interest rates low, thus energizing the economy. Economic experts believe this massive collection of assets acquired by the Fed has served its purpose and now must be unwound. Under Yellen, the Fed will be looking to stop the quantitative easing program and tighten up the balance sheet without causing problematic waves in financial markets and the economy.

Republicans and Democrats alike have criticized the central bank for its efforts in restarting the economy and its regulation of Wall Street. Republicans are concerned about Yellen causing an inflation spike due to her “easy-money” policies. They would like to establish an “oversight project” to put the Fed under a microscope for at least a year. From which, they can draw conclusions and pass bills to regulate the Fed’s operations. Democrats argue Yellen is the best suited individual for the position at this time and that Obama made the correct choice.

What do you expect to happen when Yellen officially takes over?

Inside CME Pit Trading

The E-mini S&P 500 (ES) trades on the CME Group’s Globex exchange.  CME Globex is the electronic market that trades nearly 24/7.  At one point in time, open outcry floor trading, where the traders yell orders on behalf of clients in the “pit”, was the dominant form of trading.  Now, anyone with a computer, the proper software, and a funded account can engage the markets.  Traditional open outcry hours of trading still align with market volatility.  Many of our trading methods focus on capitalizing on this volatility that occurs during open outcry hours.  This is why having an understanding of pit trading is important.

Why do people still want to trade in the pit? Because of better liquidity compared to electronic trading. Executing a combination of trades and spread strategies is easier in an open outcry environment.  For example, a broker can easily buy 25k in options in one day at the same price.  If this was accomplished on a screen, you would likely end up moving the market as you buy.

In the CME pit, there are usually up to 200 present on a given day.  While it may seem hectic, checks and balances, etiquette and rules are practiced.  In some ways, the rules of pit trading are more restrictive than electronic trading.

There are two types of people in the pit: brokers and “locals” (also called market makers).  Brokers represent customers who want to place trades.  Locals try to make a small percentage of profit or “edge” off of each trade as frequently as possible.

Here’s an example of how the order process works:

1. A broker gets a call from a customer to get a quote.

2. The broker yells and uses a hand signal asking for the quote.

3. The locals yell back and mention two prices: what they are willing to pay for the quoted  item (bid) and what they are willing to sell the item for (their offer).

4. The broker tells his customer on the phone what the locals are offering.

5. The customer decides what to buy or sell and tells the broker.

6. The broker yells out the customer’s order to the crowd and uses a hand signal.

7. Depending on order acceptance, the locals will either hold their bid, offer a different bid, or a local will yell “sold”.

8. The broker will confirm the order with the locals after handing out or dividing up the contracts.  Once confirmed, he will tell the customer the details of the order.

9. Once all orders are confirmed, the orders are written down and handed to the broker’s clerk.  The broker quotes the trade to the market reporters who release the information to the world.  The trade is displayed on the board, allowing for additional confirmation.  The clerk then confirms with other clerks the details of the trade.

10. The broker waits for his phone to ring again with another order.

Depending on the broker, customers can allow the broker to execute the order at the broker’s discretion (best price or “feel” of the market).  In other cases, the customer has an exact price in mind.  As a broker, the objective is to be as fair as possible to your customer, the other brokers, and the locals.  A positive reputation is extremely valuable in the pit, as this helps in getting your orders recognized.

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CFTC RULE 4.41 – HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT 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 PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
GOVERNMENT REGULATIONS REQUIRE DISCLOSURE OF THE FACT THAT WHILE THESE METHODS MAY HAVE WORKED IN THE PAST, PAST RESULTS ARE NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. WHILE THERE IS A POTENTIAL FOR PROFITS THERE IS ALSO A RISK OF LOSS. A LOSS INCURRED IN CONNECTION WITH TRADING FUTURES CONTRACTS CAN BE SIGNIFICANT. YOU SHOULD THEREFORE CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION SINCE ALL SPECULATIVE TRADING IS INHERENTLY RISKY AND SHOULD ONLY BE UNDERTAKEN BY INDIVIDUALS WITH ADEQUATE RISK CAPITAL.
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