How many times have you had price hit your profit target without anything happening? Probably over and over again on the same trade, right? And to make matters worse, price then runs away from you, so you’ve lost out on the trade entirely. Yes, it happens to everyone. It’s not just bad luck.
Trading is a zero-sum game. Unless price trades through your profit target limit price, you may not get filled. All electronic markets have a “first come, first served” rule. Your profit target is waiting in line with all the others placed before it.
Now, let’s take a look at how we can use NinjaTrader’s automation to achieve better fill results. We’ll accomplish this through the ATM Strategy panel. Update: Note that the below instructions are for NinjaTrader 7. For updated info, please see our NinjaTrader 8 trading tips on this page.
The ATM Strategy area can be access through the lower part of the Dynamic / Static SuperDOM. The SuperDOM is also referred to as the “price ladder.” You probably trade with a SuperDOM already, but if not, you can open one via NinjaTrader’s Control Panel > File > New > Static (or Dynamic) SuperDOM. The ATM Strategy feature’s main purpose is to preconfigure profit targets and stops for your trades. There are quite a few options available to configure, including multiple profit targets, different templates to save and load, even alternate stop strategies. For this blog post, we’ll focus on the basics.
With the “first come, first served” rule, speed is important. The faster we place our limit orders for profit taking, the better positioned we are to be filled once the price is tagged. In a roundabout way, we are cheating a little by beating others to the punch. As an example, I have two methods I use to scalp the markets – Price Action Scalping and The Trade Scalper. Each method risks 6 ticks for a stop and 3 ticks for a profit on average. Once I enter into a trade by hitting the market button or entering on a limit order, I need to place my target and stop immediately. If I spend precious seconds fiddling with placing the stop and profit manually, how many other orders have possible been placed ahead of mine? As you can see, automating this process is vital for timely execution. Templates can be created ahead of time for scalping (3 tick profit target with a 6 tick stop), or for any other strategy. To create a template, right click on the DOM in the bottom right empty grey area. A menu should pop up. Since the E-Mini S&P (ES) has been slow lately, my primary template is 8 ticks profit and 16 ticks stop. I can easily adjust up or down once the order is placed if I need to increase or decrease the ticks. I recommend having multiple templates for different markets and different methods accordingly.
Send me your feedback on using the ATM and I’ll offer my feedback if you have questions.
You can sign up to get started with NinjaTrader here.