Day Trading Patterns; Easy Ways to Find Trading Opportunities

– Tips and Tricks for Identifying Patterns

o Keep it simple
o Use range charts

 Compare a 3-min to a 13-range

• Minute charts are VERY different, sloppy, sideways, big candles, small candles
• Range charts ALWAYS look the same

o Focus on 1 market at a time and learn that 1 market first

 Each market has a different personality

o Stay away from the faster timeframes

 1min
 89tick
 4-range
 These are way too whippy and false-moves to be consistently watching patterns while you learn.
 Focus on the 13. 21, 34, 55, 89, 144 Range Charts (fibs)

o Limit your distractions

 Only watch for THESE pattern
 Don’t overcomplicate it, keep it simple

o Review your trades every day

 Why did you enter?
 Why didn’t you enter?
 Where did the trade go?

o Study them over and over with consistency

 Flashcards: print out the charts and review them before bed, when you wake up, throughout the day
 Market Replay: record the market and then replay the price action and you can look for patterns
 Beginner’s Course has a video on the 3 patterns, watch this video, and ask questions.
 Don’t be afraid to ask JJ for help identifying them.

– Contract Rollover:

o Blog search for : contract rollover and watch the video

o Crude rolls over each month (20th)
o Gold rolls every other month
o Dollar, Currencies, Emini roll over quarterly

– What are the different colors on the time and sales

o In the download section: ‘time and sales properties’
o Check out the advanced course download section for properties on the Tape

– Ways to sell the lows and buy the highs

o Wave pattern

 Buy the pullback
 Sell the retracement

o 2-step reversal if it fails

– Can a market be weak to the long side and the short side?

o YES. sideways and sloppy, indecisive

– Wave Pattern; different ways to enter the trade

o Aggressive: enter at the test of the trigger line
o Moderate: wait for momentum to confirm and then take the trade
o Conservative: use multiple timeframes to plan the entry using a 2-step pattern

– How do we determine a low volume day?

o Total volume is only used for contract rollover

 Total volume does NOT tell me whats happening NOW
 We may have ALL the volume at 8am, and now its 330pm and its slow.

o Speed of the market

 I need to know what’s happening RIGHT NOW

• Time & Sales = is it moving quickly, and with LARGE ORDERS
• Pace of Tape Indicator (POT) measures the speed of the orders

o Heavy speed = heavy volume
o Low speed = low volume

• Tells me whats happening NOW.

o Red Pace of tape (less than 100) = very slow
o Dollar is narrow trading range = very high risk
o ATR is falling
o If you see these at 8am (or whenever you begin your day) use extra caution.

– My computer keeps jamming

o Stop running programs you do not need

 Remove anti-virus
 Remove the firewall
 Close charts you don’t need
 RAM is the easiest way to improve your computer’s performance.

– What type of entries do we use?

o Limit Orders = Fast Track
o Buy / Sell Stops = Trap Entry / day trading
o Never use market orders (sloppy)

– Divergence Method Example

o DO MORE training in our members-only training next week
o Works on any market, any timeframe

– Setting up Automated Trade Management Strategies

o Adv Course = Setting up your DOM and ATM
o TUTORIAL: SETTING UP YOUR TRADING DOM W/ ATM STRATEGIES

– Open AND close:

o Always use the faster timeframe to see the Open and CLOSe
o If your OPEN/CLOSE does not match mine

 Re-load your data
 My data may need to be reloaded.

– Which markets will give us the most patterns:

o Aussie Dollar
o FDAX
o Crude Oil
o Gold
o Russell

– Which markets will give us fewer patterns?

o Eurostoxx FESX
o E-mini ES
o 30yr Bonds
o T-Notes

– Anything cheaper than $10/tick

o Pound = 6.25
o YM = 5.00
o NQ = 5.00

– Why is lunchtime so risky?

o Less volume
o Fake-out breakouts
o Market manipulation
o No news events to act as catalyst