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I look to the daily to see what is going on over the week/month. That gives me an idea if the day has the opportunity to trend. One of the biggest things with a trend is to figure it out quickly and enter as soon as possible. If you can't, wait for a pullback and the next entry signal and take the trade. If you are correct then price should not come back against you. If it does then you are most likely wrong about the trend (i.e. leg in a trading range).
I think if you understand how the market moves through cycles then the context of what the market has done will give you your answer. (Did not help me today as I kept fighting the trend in the NQ). I find trend days can be harder to trade then a range. The reason why is it just seems to keep going and unless your grab your pair and go it will keep on leaving you behind.
Look for big volumes from larger market participants coming to the table this is usually at strategic times and price levels. Icebergs and large orders can be a precursor to a trend move. Note: It can be but isn't always, as with anything in this business there's no foolproof method in my view.
Market can change from a chop day to a uptrend day, to a downtrend day and back to a chop day and repeat if required.
What you need is a method ( simple 1 ) that says market is in a a) trend or b) range, then you play A or B until it changes it's mind, which is frequent, that is all you can do.
Obviously when it changes you have to most likely take the loss, switch modes and hope you make enough before it changes again, over all, not always.
Forex and Index's are too changeable to news for longer term holding in my book, well if you have a wage in wind from a modest account.
Hey there Budfox!
I agree with some of the earlier posts. Stressing that whatever system you find (or may I suggest a hybrid,) TEST TEST TEST in sim. Once your trades reach the 65-80 percent winners on average a month, and you are CONFIDENT, then start trading live. Its a pain, I know, but will save you from possible great financial pain, and keep you from fretting when you do take losing trades. Because lets face it, you will take losing trades. All traders do. No trading system 100 percent successful. Thats just the down to earth reality of trading.
As for trend trades specifically, they can be tough. Ever since the HFTS were introduced in 2000, it threw the individual traders a huge curve ball. They are specifically used by the big boys to take our money.
I trade trend trades, but use a hybrid of 4 systems to do so. That being said, trend trades only make up of about 30 percent of my trades, because they have to be darn good. The rest of my trades pullbacks and reversals. Those trades just fit my personality better.
Sierra Chart has a Bid / Ask Difference study. I slap a 2 and 3 SD band on that and when the bid or ask penetrate these levels we might have OTF participants. If this happens at key levels and higher time frames confirm these levels are important, you could be in for a trend day. Takes discipline though to stay out of the market.
I see you say you work from a basic platform. I hope that has changed. Sierra gives you the best value for money. Extremely professional and flexible - and no, I am not affiliated. Just a very happy customer
Starting to looking at Bid/Ask Volume ratio - this one in Sierra has a 14 length on the EMA.. so wondering what the best use is (this seems than the Bid/Ask bars)
Would really appreciate if you could provide an example. i mainly use Cum Delta.. but combine this and looks good - thanks