January 28, 2011
- in Uncategorized by schooloftrade
Stops and Targets Trade Management Day Trading Futures
– Stops and Targets
o What type of trader are you?
o Scalper = always use the same stop and first two targets
o 6-10 tick stop
o Target = +5/+10/Runner
o Day Trader = stops and targets can be the same, but often they are different
o 10-20 tick stop
o I can also use standard 10 tick stop or 20 tick stop, but make sure you use standard targets too.
o I can also use support and resistance in the market im trading.
o Targets = +10/+20/Runner
o Swing Trader = stops and targets will ALWAYS be DIFFERENT.
o Always use different stops and targets. Find support and resistance on the market you’re trading and use that for your stops and targets.
o What’s my risk tolerance?
§ Do I have a problem taking losses?
§ Am I unafraid of small losses?
o What’s your trading experience?
o 10 years of experience or 10 minutes or experience?
o The more experience you have the wider your stops
o The wider you stops the wider your targets can be.
– Why does the profit target NOT get filled sometimes? Liquidity.
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– What is my definition of the perfect pattern?
– My job as a new trader is to find MY PERFECT PATTERN and then practice until you know it more than anyone else.
– JJ’s perfect pattern is a trend reversal 2-step off the HOD/LOD
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– Divergence arrows, how important?
– Use the notes and watch the video in the advanced course to learn more.
– The slower the chart timeframe the more important the arrow signal.
– 4range arrows are NOT as important as the 21range arrows. Slower = more important.
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– Large accounts with low volume markets, how do we trade these?
o Under 20 contracts you have no issues ($50,000)
o Above 20 contracts you now need to worry about slippage and lack of liquidity.
o Entry will not be as good, it will be a little bit different b/c of slippage.
o Need to give my targets room to be filled.
o Multiple timeframes for double confirmation, what do we use and when?
o Two Most popular ways to use multiple timeframes:
o Trend lines: mark your TL on the slow chart and use that trend line as your guide when trading on a faster chart.
o Momentum: im looking for multiple timeframes to have momentum pointing in the same direction.
o Example, looking long: all momentum curling up.
o What are the different market personalities
o Moving stop to breakeven, what are my options?
– Why is it more difficult to trade the Euro breakouts? Its high volume, similar to the ES
– What if my power goes out while you’re in your trade:
– Find a new set of underpants (scared!!)
– Call your broker
– Toll free number, best thing is to have a toll free number directly to the trade desk.
– Stops and targets are still active, they are already on the server, not YOUR computer.
– If you lose power or your internet often (once a month) I would suggest a backup
– Power backup is easy ($300)
– Internet back-up may be tough, so look in your area and get some sort of back up plan in the works.
Different market personalities:
– High volume , lots of moves (good)
– Low volume , no moves (bad)
– Long Bias (dollar was dropping)
– Short bias (dollar was rising)
