Day Trading Methods

I parsed your post within the post in color.

 

Also good are divergence plays intraday: buy strong stocks in a sector, short weak ones etc.

 

Buy stocks...

Buy and Hold, till profitable, when drawdown, buy more, when down more buy more....what you want to live forever !!!

 

Sounds like a plan...but, I've heard averaging down can get you into some trouble.

 

You could check out Woodie's Room. He trades the cci and lays it all for you.

 

I am confused - you say Day Trading and mention 4-15 days at the same time.

I suggest you stay away from day trading until you get a handle on your 4-15 day - or swing trading techniques. By the time you graduate to day trading your execution must be almost instinctive - there is no time for research or testing etc.

As far as the advice you are giving this poor soul - shame on you. Either you are confused or trying to confuse this poor soul. Education - yes, but what, where and when. Maybe we should set up an IQ test for traders so that someone new can test their skills before they jump into the morass and find out if they have what it takes. I suspect that most people would be surprised what it takes to become a good trader.

 

There are many many profitable strategies. As you learn, you can do the more profitable ones. Begin with those that create steady profits. Below are listed the names, trades per day and profit per dayin points for ES as an example.
Simple:

1. Fast trends, 4, 3/trend
2. mechanical swing , 1, 1/2 of H/L
3. pre open gap formation, 1, 1.5 times gap

Moderate:

4. BO trades, 5, 3/BO
5. Reversals, 5, 3/reverse.
6. Slow trends (H/L range trading), 2, 3/4 of H/L pre run.

Advanced:

7. Scalping, 50, 3 ticks average/trade
8. Traverse trading, 25, 1 to 1.5 points/Trade
9. trading market continually, 35, 3 times H/L range/day

Which Tools are most Suited for Day Trading?

The numbers refer to the methods you asked about.

Musts:

a. Channel and traverse trend lines.
b. Volume

For special situations:

c. General Indicator signals 2, 3, 4, 5, 8, 9.
d.Absolute indicator signals (MACD HIST, RSI, etc) 1, 2, 6, 9.

For Peaks, troughs and traverse turns

e. smart money squeese and stretch. 5, 7, 8, 9.

For exacting maximum profits:

e. first derivatives of indicators 5, 7, 8, 9
f. T&S 7, 9
g. DOM 5, 7, 8, 9

Which Strategies for best for short term Trading of 4 - 15 days

Position trading works well for equities but is unleveraged. See 6 above. I go for 10% every halfcycle using a highly selective universe. For commodities simply trade the IT traverses of the quarterly front month. See 8 above; you make 6 to 10 cycles per ninety day. Do about 20 points in ES per turn, for example.

Thanks
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Hi jonnyy40,

I'm going to take a stab at translating this for you...and me.

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Simple methods:

1.) Fast Trends: 4 trades/trends per day, 3 points per trend = 12 points daily = $600. Semi-discretionary. Sit at your monitor.

2.) Mechanical Swings: One trade per day for half of the high/low range on the day. If range = 24 points, then 24/2 = 12 = $600. Strict rules that may be programmed, hence, mechanical.

3.) Pre-open gap = wide range between yesterdays close and todays open. One trade per day for one and a half [1.5] times the gap range. If range = 16 points, then 16x1.5 = 24 = $600.

Moderate methods:

4.) Breakout trades = bracketing around low-range/low-volume bars....buy if break out of bracket long, sell if breakout short. Five [5] breakouts per day at three [3] points per breakout = 15 points per day = $750

5.) Reversals = changing directions when the aformentioned trades reach an end. 5 reversals per day for 3 points each = another 15 points for another $750

6.) Slow trends = trends visible on a longer time frame such as 30 minute, 60 minute, or daily bars. Two [2] trades a day going for 3/4 of total run getting to the high, and 3/4 of total run getting to the low.

Advanced

7.) Scalping = quick in/out based on some rule(s) and/or discretion. 50 trades a day for 3 ticks each. If one tick = $12.50, then $36.50 x 50 = 36 points a day = $1800 per day.

8.) Traverse = range of trend channel. Traverse trading = selling upper/left side of channel, while buying lower/right side of channel. 25 trades a day for 1 to 1.5 points per trade = 1.25 x 25 = 31.25 points = $1550 per day.

9.) Trading market continually = you are always in long or short all day using more than one method. 35 trades a day for three [3] times the days high/low range. If range = 12 points, then 12 x 3 = 36 points = $1800 per day.

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I will attempt to translate the second part in my next post. Hopefully Jack will show up to correct any of my translation errors.

JohnnyK

 

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Sorry if I've mis-understood (that's quite possible) but you get 4 times leverage with stocks via Interactive Brokers.