Day Trading for Beginners 102 - How to Day Trade Guides

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Day Trading 102 – How-To Guides


How to Get Your Charts in Sync Sync Your Computer Clock & Charts to Official Time Servers When trading, it's extremely important to make sure your Windows computer time is accurate. Discrepancies between Windows time and the timing of incoming live data may result in inaccurate charts, and potentially, missed trades. Right now, you can check how "off" your computer time is from the official time via the handy  website. Over time, your computer clock will eventually become innaccurate . Therefore, on a weekly or bi-weekly basis, we recommend syncing your computer clock to official time servers.


How to sync or fix your Windows computer clock: On your keyboard, hold down the Windows key and press R. In the Run box, type in " timedate.cpl " without the quotes. Click the Internet Time tab > Change settings > Update Now (you may need to do this multiple times until the sync succeeds). Close out of the Windows time settings. Tip: since you should sync your time regularly, for easy access, create a Desktop shortcut that opens timedate.cpl .


Contract Rollover With CME futures contracts, contract rollover day is always the first or second Thursday or Friday of the expiring contract month. These expiration months are March, June, September, and December. Your day trading platform may automatically warn you of the rollover. Why is it important that you roll over the contract? Well, you can't trade an expired contract. Also, follow the volume and liquidity.


NinjaTrader 8 Rollover Instructions: Navigate to NinjaTrader's Control Center > Tools > Database Management You should see expired contracts with the update box checked > click Rollover In your charts, remember to change to the new contract


This applies to CME markets like the ES, 6A, 6E, etc. Read the  official rollover statement  from CME Group In other platforms, understanding market/instrument symbols and contract months can be confusing. Here's an example of how some trading platforms construct the ES symbol: Take the E-mini abbreviation: ES And then add the contract contract month: H=Mar, M=June, U=Sep, Z=Dec And then add the two-digit date for the current year: 20 And put it all together: ESZ20


Holiday Trading Tips On a regular basis, it's a good idea to refer to the  CME Group Holiday Calendar  to be aware of upcoming holidays. Usually, CME Futures do not trade on U.S. bank holidays.


Remember the following for holiday trading: Traders who act as the underlying force behind the big moves are on vacation. Therefore, the remaining traders fight like mice pulling cheese, causing the market to move erratically. This erraticism is further influenced by press releases, quarterly profit statements and expectations. Expect half days and days before holidays to also behave erratically or hardly move. FOMC (Federal Open Market Committee) meeting days and those surrounding the meeting days, the volume becomes thin and price trades in small channels. Use your trading platform's ATR (Average True Range) software to determine your targets and stops for each trade. Trade within what the market can produce at the given moment based on an ATR setting of calculating based on the last four bars. Consider holding back if the ATR is slow at 1 points or chaotic at 5+ points.


Around the big (spending) holidays like Christmas, many traders will get out or get in large positions in anticipation of tax regulation. This creates uneven spikes in the market. Seasonally, expect markets to trend long-term towards the end of the year. Take this into consideration, especially with long-term positions. However, during months at the end of the year, expect daily profits to be less as compared to other months. Therefore, your lower monthly profit target should also be less. Remember that there's more to life than trading! Spend much needed time with your family on Holidays. If the trading day just isn't working in your favor, spend it with those whose company you enjoy.


NinjaTrader's Market Replay (Playback Connection) With NinjaTrader , it's possible to replay market activity from the current day or previous days as though it's occuring live. After downloading a given day's replay data, NinjaTrader uses the data (either minute or tick) to plot price at the exact values at the exact time as recorded. In effect, you can see price plot on your charts and DOMs as though the day (or night) is unfolding in real-time. Orders can be place and success can be tracked using the Replay101 account (similar to Sim101 account). Replay101 is NinjaTrader's designated Market Replay account. NinjaTrader lets users download history for free.


Why should you use Market Replay? Playback Connection Replay the day's price activity To practice placing trade in simulated, real-time conditions To back-test a strategy to see its effectiveness when trading live To bypass the need for a live data feed (although live trading with a free demo account is always recommended) Few other day trading platforms offer such a feature When your schedule doesn't allow for real-time paper trading, this is the next best thing Don't wait until tomorrow to practice under live trading conditions!


NinjaTrader 8 Market Replay Instructions If you are currently connected to a data feed, disconnect from it. Download the latest Replay Data through NinjaTrader's Control Center via:Tools > Historial Data > Load tab (on bottom of screen) > Get Market Replay data Select the desired instrument Select the desired date Click Download Close the Historical Data window Go to Connections > Playback Connection. The Playback window should appear. Playback lets you fast-forward to a specific time and start playback from there, at 1x, 2x, and much faster speeds. You will first probably want to drag the slider to the time when the market you're trading opens. If you're in US/Eastern time and trading the E-mini, this would be 9:30 a.m. After dragging the slider to the desired time, allow NinjaTrader a few seconds to "catch up". Once your chart is positioned at the desired time, you can begin playback and practice trading. You can also change the speed as needed. If you want to "try again", simply drag the slider back to the desired position, wait for NinjaTrader to catch up, and play back again. If you are expericing error messages, be sure the Start and End dates reflect the data you downloaded in the previous step. Once you're done using Market Replay, disconnect from the Playback Connection.


NinjaTrader's ATM Strategy (Feature) How many times have you had price hit your profit target without a fill? Probably over and over again on the same trade, right? And to make matters worse, price then runs away from you, so you've lost out on the trade entirely. Yes, it happens to everyone. It's not just bad luck. Trading is a zero-sum game. Unless price trades through your profit target limit price, you may not get filled. Electronic markets use a "first come, first served" rule. Your profit target is waiting in line with all the others placed before it. Now, let's take a look at how we can use NinjaTrader's automation to achieve better fill results. We'll accomplish this through the ATM Strategy area on the SuperDOM .


The ATM Strategy area can be access through the lower part of the Dynamic / Static SuperDOM . The SuperDOM is also referred to as the "price ladder." You probably trade with a SuperDOM already, but if not, you can open one in NinjaTrader 7 via NinjaTrader's Control Panel > File > New > Static (or Dynamic) SuperDOM . If you're using NinjaTrader 8, go to NinjaTrader's Control Center > New > SuperDOM (Dynamic). The ATM Strategy feature's main purpose is to preconfigure profit targets and stops for your trades. There are quite a few options available to configure, including multiple profit targets, different templates to save and load, even alternate stop strategies. For now, we'll focus on the basics.


With the "first come, first served" rule, speed is important. The faster we place our limit orders for profit taking, the better positioned we are to be filled once the price is tagged. In a roundabout way, we are cheating a little by beating others to the punch. As an example, I have two methods I use to scalp the markets – Price Action Scalping and The Trade Scalper. Each method risks 6 ticks for a stop and 3 ticks for a profit on average. Once I enter into a trade by hitting the market button or entering on a limit order, I need to place my target and stop immediately. If I spend precious seconds fiddling with placing the stop and profit manually, how many other orders have possible been placed ahead of mine? As you can see, automating this process is vital for timely execution. Templates can be created ahead of time for scalping (3 tick profit target with a 6 tick stop), or for any other strategy. To create an ATM Strategy template in NinjaTrader 7, right-click on the DOM in the bottom-right empty grey area. A menu should pop up. Since the E-mini S&P (ES) has been slow lately, my primary template is 8 ticks profit and 16 ticks stop. I can easily adjust up or down once the order is placed if I need to increase or decrease the ticks. I recommend having multiple templates for different markets and different methods accordingly. In NinjaTrader 8, creating a template is easier: under ATM Strategy, there should be a box that says None. Click this and select Custom. The rest is self-explanatory.


Improve Your Fill Rate with Limit Orders As a trader, it is important to understand some advanced tactics that can make or break a trade. One method I advocate using is front running. The way I use this term is a bit different from its standard meaning. You will be surprised at how it can improve your bottom line for both entries and exits in any market. The standard definition of front running describes how brokers and insiders positioned themselves unfairly using information from the traders they represent. Before the regulatory agencies starting cracking down, front running was a widespread "pump and dump" scheme. As individual retail traders, we front run trades by placing the profit target one tick "in front" of our goal. This greatly improves the chance of getting filled. Seems simple? Yes, it is. Surprisingly, many traders never front run trades using this method.


Example of using limit orders: Let's say you are long the market and you have a profit target of 1400 on the E-mini S&P. There may be 5,000 other traders waiting for the same price to enter on limit at 1400. This could create a problem because orders are processed on a first come, first served basis. If you wanted that exact price (1400 limit), yes, you could achieve it, but not unless 1400 was penetrated to 1400.25! This is why trading can be a rough game, but it doesn't have to be. When front running in this example, you would move the target to 1399.75 (effectively in front of 1400). When should you front run trades? Watch how the market reacts when approaching the price you want. In the chart below using the ATO method, 1400.75 was attempted multiple times starting at 10:20. When the market tries (unsuccessfully) to continue a trend or move showing multiple, consecutive failures, that's an indication to move your target back by one tick to ensure a fill. You can use the same scenario for entries, which would have guaranteed an ATO entry in this same example. Always look for bar effect as proof. This tip will allow you to exit or enter a trade when the writing is on the wall. Also, front running is not always necessary – it works great for slow markets.


Time Zone Conversion for Day Trading Ever been in a position where you needed to calculate what your time zone is in another part of the world? At Day Trade To Win, we do this all the time for our customers. Some of our software requires an adjustment to the market open time, depending on where the user is in the world. Knowing how to convert time zone also has countless other benefits. One of the easiest options – your local time is automatically determined. If you need to change it, type in a new time in the correct format. Select a city on the right to display the comparable time. For trading purposes, you may want to switch to the 24-hour (military) format by selecting "24" on the bottom. If you want to perform more advanced conversions, this is the place to go. There are a host of time related applications: a world clock, date to date calculator, stopwatch, and much more.


WolframAlpha If you've never used WolframAlpha , it's use is much like a search engine, only it can perform advanced mathematical calculations. Google around for the many uses of WolframAlpha if you're ever bored. In our case, simply typing in "time difference between Florida and Hong Kong" presents all the information we need. WolframAlpha is very good at interpreting what you're asking.


Using Time Zones in NinjaTrader You can set a specific time zone within NinjaTrader itself via NinjaTrader Control Center > Tools > Options > General > Time Zone. Manual Calculation The easiest way to manually calculate the difference in time between two locations is to find both locations' current UTC or GMT time, subtract the difference, and get the absolute value (non-negative version of the same number). As Wikipedia states, UTC (Coordinated Universal Time) is the primary time standard by which the world regulates clocks and time. GMT values are the same as UTC, so you can use UTC and GMT interchangeably. Here's a quick visual reference: By counting the difference between the two time zones, we can see that Hong Kong is 12 hours ahead of Florida:

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