Day traders strategies

[Ninja]

We all trade the markets using our own personal strategies...thought it might be interesting if we shared a few of these for other forumites to see and learn from or comment re trying tweaks to the system. One of the systems I use is a modfied version of Simons lazy system which I use for trading short term scalps on EUR/$, GBP/$, AUD/$, Ftse spot, DJI spot...it goes something like this. Trading the 5 min chart using the 15 min chart as anchor: 1) Plot 10, 20, 50 and 200 EMA on the chart. 2) Determine trend using 20 EMA in relation to 50EMA, slope of both EMA's will determine long or short trade. 3) Entry trigger: price closes above 10 & 20 EMA. (Long) 20 MA needs to be above 50 EMA. You can also use the 100EMA for further trend support however this tends to lag to much to be used as an entry trigger and for a short term scalp you tend to miss to much of the move on entry. 4) set entry point 2 pips above close of trigger candle. 5) Conditions: RSI must be favouraby angled. Stochastic as well. Momentum needs to be above or below the 0 level depending on your trade direction. 6) Above conditions need to be supported in the 15 min chart. 7) Stop loss: at 10 pips clear bank 50% profit. I always enter into the trade with a 10 pip trailing loss - this means at 10 pips I bank half my profit and my stop loss is automatically adjusted to break even on the remaining 50% through the the trailing stop loss. I trade this in conjuction with support and resistance points. (Pivot points included)When all above conditions are met you have a very high probability scalp which often delivers in excess of 50 pips and when it moves against you your losses are very small. Even on short scalp trades this helps me take the meat out of every mini / medium trend without the stress of top or bottom picking. I love trading this system as I am trading price and momentum and not using oscilators to pick reversal points which I have found to be very painfull. Thanks to Simon and several traders on the forex factory forum - trading momentum works, even in the short term. The system does not offer many trades on a daily basis but you will bank consistent profits. I hope this has been useful!!

[SimonPB]

oi boet now you in trouble .. you gonna get 5million questions about how it works .. an nobody will ever understand it or trade it correctly ..

[SKALA]

Thanks for that Ninja, I use same charts time frame and EMAs, but only MACD. However I tend to stuff up my stoplevels and get stopped out far too often, only to miss the real run shortly after. Will look at your stoploss.

[john_1]

Nice one Nija.. seems simple enough, and I like the momentum back stop..EMA need some momentum indicator to keep you out when it flatlines..good luck

[Levitt]

I use 21,55,200 EMA's... with 5 and 8 sometimes as well, with true macd(21,55,8) with signal line, macd itself and histogram, stochs(8,3,5),20 bollinger with middle line omitted as it is a 20 SMA and quite similar to the 21 EMA, and rsi...

[Ninja]

Skala, a 10 pip SL is tight and can mean a few trades get stopped out....very frustrating. I find momentum helps to clarify entry and waiting for the high of the trigger candle to be taken out before entry also confirms that the trend is probably intact and eliminates the majority of false entry signals where the trigger candle is reversed by the following candle. Let me know how you find it and if you find a way to further confirm entry post the trigger.

[Levitt]

A 10 pip stop seems extremely tight. Do you mean 10pips on 4 digit or 5 digit broker? On a 5 digit I use about a 65 stop. I also use stop targets, let's say the position moves to +50 then my stop would move to 15... got 3 stop targets which moves the stops to the specified level then after that it uses a trailing SL... Also use take profit targets which closes out 0.1 lots at a time, Also got 3 of them then a trailing take profit.

[john_1]

In my systems most basic format.. take the alsi on a chart..Draw horizontal lines every 200 point (25000 25200 25400 25600 25800 2600 etc)each line now defines a "block" Now wait for the price action to pass through 3 blocks. Now place a trade as the price action breeches the third block in the dirrection of the price action. Now you are in and you will remain in untill you break the system. Your stop is always 3 blocks back (so in this case at 25000 with a reversal tigger trade at the same level)... move your stops up one block each successive block is crossed, That way you are always in the market and you will reverse dirrection if price action exceeds 600 points from the highest block breach...In this format it should make about 10k per contract per month.. you can set all your triggers and stops in advance and you need to check on it about one an hour or so... It does take big losses 600 points and also gives back big amounts. So it requires extreme disipline and patience. But it could not be simpler.

[john_1]

just to clarify you change dirrection if three block are breached from the line of the last breach... ignore the exact high and low just work by blocks..

[john_1]

its not a day trading statergy its a trend following statergy for the alsi.. but it does require about 10 minutes a day.

[#11]

John, please mail me so I can get your address again. Fried the computer again and lost everything. Tnx

[Ninja]

Thanks John, I am learning that simple is probably best as long as it is correctly managed. All the best with it.

[TOPIX]

And here is my system. Nothing original but it works. 1)System - 5 min breakout 2)Indicators - None. I believe that when you trade a 5 min system you are trading in the noise, therefore indicators have little value. 3)Markets - ALSI 4)Entry long - As market move down, you'll see new Lower Low (LL) and Lower High (LH) forming. When the market changes direction and break past the last LH, enter a long position. 5)Entry short - As market move up, you'll see new Higher High (HH) and Higher Low (HL) forming. When the market changes direction and break past the last HL, enter a short position. 6)Exit long - On a break of the last HL 7)Exit short - On a break of the last LH 8)False breakouts - When price turns back against your position just after entry. Protect your entry point. Exit immediately as close to BE as possible. 9)Stop loss - For long positions, trailing stop of 30 points until breakeven. Then keep SL at BE. Give the trade time to develop. Wait for new HH and HL to form. Once the price break above the last HH, move SL to last HL. Vice versa for shorts. 10)Ranging markets - When you had 2 consecutive false breakouts, assume the market is ranging - pack up and wait for the next day. 11)Aim - to minimise losses and ride the trend when it presents itself. 12)Expectations - You can achieve a 60% winning ratio. The non-winners will either be small (max 30 points) or breakeven, whilst the winners can be big.

[john_1]

I have traded this as well and it works, although I find that with the 30 points stops I end up being reverse scalped..giving consistant money vs getting consistant money.. I am interested hear you experience..

[TOPIX]

John, the entry is critical. I defend the entry fiercely and seldomly let it drop to 30 points. At the point of entry, you have a battle between breakout traders and breakout faders. So, any sign of a weak break and I'm out. The system gives you enough trades to wait for the stronger breaks. Problem is, you don't know which break will be the winner, so you have to test them all. I must say this is where I like your entry, because your entry points are not "advertised" to all

[#16]

TOPIX Please clarify the following for me please. When you talk about "break", does it mean that take action after the 5 minutes, when the new bar forms, or do you take action on the "break" within the 5 minute movements as they unfold.

[TOPIX]

This system is not for traders who need a high winning ratio. Sure, at times you can feel as if you are giving away a lot, especially if you have a number of losses in a row. To manage mentally, you have to measure weekly/monthly points gain/lost and nothing else. For example, my trades of yesterday - I had 5 trades. One early winner (+280 points), then one breakeven, then 2 losses (-30 and -8) and then one winner (+34). Result 2 winners out of 5 trades - very low winning ratio of 40% but the points are in the bank. You bank points and not ratio's.

[TOPIX]

I do not wait for the end of the bar. I enter an "order to open" ahead of time and the order is executed as and when it breaks.