Countless numbers of day traders spend their time and money searching for that magic indicator that will unlock the secret of trading profits. To be sure, I have seen aspiring traders purchase trading program after trading program in search of the new indicator that will send their trading profits soaring. Unfortunately, no such indicator exist and it is unlikely that a magical indicator will be developed that can revolutionize profits for the e-mini day trader.

On the other hand, thousands of e-mini day traders successfully trade every day without any wondrous and magical indicator. Of course, it would be much more convenient to have an indicator that unlocks the secrets of e-mini trading. To date though, we are far from developing any such trading tool. So that leaves us with the trading tools we have at hand, and there certainly is no shortage of indicators for the e-mini trader to utilize. The question remains, though, which indicators are the best ones to utilize?

While some indicators claim to be leading indicators, that is to say that they have a predictive quality in their results, the evidence suggests that this predictive quality is sketchy, at best. Most indicators are lagging indicators and indicate the status of current trends based upon recent history. As any good trader knows, recent history can be helpful, but the market contains a random element that can easily deviate from past history. We are left with indicators that give us, at best, an educated guess as to the path the market price action will take in the near term future. In short, short-term trading can be a rather inexact science, at best.

One important aspect of trading is often overlooked by traders who depend solely upon indicators and oscillators to time their trades. In my world, price action is the driving force in my trade selection. While I do employ oscillators and indicators, their purpose is primarily to confirm potential trades I spot by observing price action. I pay careful attention to support and resistance, volume, and price movement in choosing my trades. Obviously taking trades into known resistance or support it is risky business, at best. Unfortunately, strict oscillator and indicator traders do not have a handle on where or support and resistance may lie and often blindly take indicator or oscillator indicated trades into these danger zones.

Further, price movement and price analysis can give a trader a unique view in which the market functions. Specifically, I analyze each bar and note whether the bars make higher highs and higher lows. Conversely, I am also interested in the opposite price action, and that is whether the bars are making lower highs and lower lows. Each of these price formations can be indicative of potential market moves in their respective directions. From there, I can have a good look at my oscillators and indicators to determine the strength and velocity of these potential moves and decide whether or not the trade is a high probability or low probability trade.

Price action, along with support and resistance and volume, are often overlooked in trade selection. But learning to actually read price action will give any trader a much better understanding of what is actually happening in the market and provide the trader with insight into high probability trades and conversely, help him or her avoid low probability trades. Very few traders are excited about entering low probability trades and seek to avoid them at all costs. It is my contention that ignoring price action and relying strictly upon oscillators and indicators will often lead traders into low probability trades.

A second common mistake made by oscillator traders is the failure to recognize the trend in the market. Regardless of whether the oscillator or indicator being used indicates a nice trade, if it is against the trend you will often find yourself on the losing side of the trade. From a statistical standpoint, a trend is likely to resume (after a short retracement) 80% of the time. Obviously, trading with the trend is a habit all traders should cultivate. The only way to truly ascertain whether or not the market is trending is by observing the price action and subsequent retracements.

In summary, we have stressed the importance of observing price action and the benefits price action has to offer traders. Trends, retracements, and then market noise can all be identified very easily by observing price action. We have also noted that strict oscillator trading can often lead a trader into low probability trades, which should be avoided. Watch the price action and you’re trading will improve immeasurably.

- About the Author: Learn to trade from a full time trader. All active members may attend FREE daily trading room and receive nightly market recap video (a $495 value). Click here and get your free videos and FREE live trading room. Article Source

Traders all over the globe have been battling over the proper way to day trade. Trading Price action or price action trading as it’s called is taking precedence when compared to following Indicators on a chart. What’s better? What works?  What makes the most profit? Let’s compare the two methods of trading and come to a conclusion to which trading style comes out on top. Let us digest the question that most serious trades come to realize.  Which method works better, price action or indicators.

Price Action as explained and taught by DayTradeToWin is a method of trading where price is used as the primary tool for determining risk and reward in real-time.  In terms of online day trading, price action is the price movement displayed on the chart, and nothing more. The price as displayed and plotted on the chart real time can provide traders everything they need. The 5 minute chart seems to be the most popular.  Inherently, price action is a singular method of trading, requiring no external trading tools (like indicators), plugins, or other third-party software for charting purposes.  All that is required is an understanding of the market, and a set of rules for interacting with price and the ability to identify price behavior. Sounds simple enough, right?  Well not so fast.  The interpretation of the price is what makes or breaks price action trading. Without the proper understanding, education, and specific rules, the chart looks nothing more than random bars.  Having the key to decipher the code is what price action is all about. John Paul, founder of DayTradeToWin has in fact taught traders to decipher this code with outstanding results and testimonials.

Adversely, indicators are third-party extensions that summarize data, advising traders when and how to trade.  Indicators exist for nearly every aspect of day trading for nearly every software platform that supports them.  For example, NinjaTrader’s indicator list includes indicators ranging from Bollinger Bands to oscillators, moving averages, volume averages, stochastics, and everything in between.  Indicators that focus on price action do not exist for the most part, with the exception of those offered at DayTradeToWin.com.  This exception is a stretch, as software like the Atlas Line Indicator is really a price guide; indicating what type of trade to take (long or short) only if price confirms the action. In order for an indicator to be considered compatible with price action, the indicator must:

-          Operate and produce signals in real-time not after the fact.

-          Be compatible with price as it moves on the chart

-          Produce non-conflicting signals that whipsaw a trader

Indicators look pretty and have lots of colors. The question is do they really help, or do they create dependency for traders?  Let’s first understand what an indicator does.

A trading indicator needs price to first to make a move up or down.  Once this move is made the Indicator takes what just occurred and plots a point – line – bar – graph on the chart.  The indicator by definition is already late in providing information to a trader about a move up or down in the market which has already occurred.  Indicators also have another huge issue which John Paul at DayTradeToWin educates his traders on.  Which parameter is right for the market being traded?  What has worked in the past, will most likely not work in the future.  If the indicator in question has been optimized with historical data, then how will history relate to the forward looking performance when traded?  This becomes the issue at hand.

At the moment It seems price action has the advantage with the comparisons made. This is just “Round 1″ and the following articles will provide more info, but for now let’s understand what each contestant stands for and what each brings to the table.

Price action trading:

- Is free – a trader does not need to extra software.  Candles, bars, dots or any other chart price symbol will provide ample information for price action traders.

- Can be used on any market at any time under any circumstances (E-Mini S&P, Forex, stocks, other commodities, futures and currencies).

- Can be used with any trading software (NinjaTrader, TradeStation, MetaStock, etc.).

- Is fast – price lag is irrelevant, old data will not obstruct your trading.

- Is versatile – price action trading methods can be combined for a coherent trading system that is free of conflicting data.

- Must take time to learn, and understand how to trade it.  Education is needed to master the methods and practice is key.  The Cost is not cheap and is compared to a semester in college.

Indicator-based trading:

- Is not free – most indicators are commercial.

- Lags behind price – data based on the past is unlikely to be of assistance in the present and the future in an ever-changing market.  Until data can be transferred instantaneously across any distance, this will be a consistent outcome.

- Often produces conflicting signals and hesitation of when and how to perform trades.

- Compatibility is dependent upon the indicator’s programming; only certain markets and / or trading software may be supported.

- Subject to the law of overuse – the more traders that use an indicator, the more a market will adapt “in retaliation” to its overuse, thus rendering it ineffective.  Price action is free from such boundaries as it is based on watching the resulting changes in price.

- Easy to use, and follow.  A no brainer, nothing to think about and only following the signals is needed.

While Price Action trading may be free, it may take a trader quite a while of practice (and a few losses) to determine what works.  The logical next step in preventing losses is pursuing a form of day trading education.  Indicators are a dime a dozen and most focus on following the heard.  DayTradeToWin.com’s beginner to advanced educational program, also known as “Private Mentorship“, features one-on-one trading from an experienced price action trader.  The Program includes exact instructions on scalping methods, filtering trades, trading the news, and much more.  Six weeks of live tutoring at the student’s own pace is much more effective in creating a self-sufficient day trader than any combination of indicators. Let’s  see what happens in “Round 2″ of Price Action VS Indicators.

- About the Author: John Paul, Educator and founder of www.DayTradeToWin.com and www.TheTradeScalper.com has been trading Price Action and Education Traders on how to Day Trade the markets. Article Source

Did You Begin Day Trading As An Indicator Only Trader?

Did you start day trading after buying a book on technical analysis, and getting a charting program – probably a free one that you found online – in order to save money? While reading your book you learned about trading indicators which could ‘predict’ price movement, and what do you know, the ‘best’ indicators were actually included in your free charting program – let the games begin.

Now that you have all the day trading tools that are necessary, the book for education AND the free charting program with those ‘best’ day trading indicators, you now need a day trading plan so you can decide which ones of those ‘magic’ day trading indicators you are supposed to use. This really is a great book, besides telling you how to day trade using indicators to ‘predict’ price – it also said that you need a trading plan to day trade.

So what should this plan be? The book told you about trend following using an indicator called macd, and it also told you how it was possible to pick the top or bottoms using an indicator called stochastic; my guess is that you picked the stochastic indicator to start your day trading – this must be the ‘best of the best’ since this indicator was going to ensure you of entering your trades with the ‘best’ price. Amazing, simply amazing how easy this day trading stuff really is. In fact, why even bother taking the trades, each time your indicators give a signal – just call up your broker and tell him to stick $100 in your account.

My book was Technical Analysis of the Futures Markets. My charting program was TradeStation with an eSignal fm receiver; that was the one that if you hung the antennae wires just right, and you put enough foil on the tips, you might even get quotes. I had sold a business before I started trading so I did have some capital – isn’t that how everyone gets into trading, you either sell a business or you lose your job? My indicator was the macd as I had decided that I was going to be a ‘trend follower’ instead of a ‘top-bottom picker’. I also decided that I was going to be ‘extra’ clever, if one indicator was good than two indicators must be better, so I added a 20 period moving average. My first trade was a winner, then after many months of extensive therapy, I was finally able to forget the next twelve months – ahhh the memories 

Learning To Day Trading – The Learning Progression

Beginning to day trade, or learning to day trade, as an indicator trader is very typical. This is also logical when you consider – HOW are you supposed to initially learn how to trade? Trading indicators are available to anyone who has a charting program, and simply using line crosses, or histogram color changes, provide ‘easy’ signals to understand. If you will also take the time to learn the arithmetic behind your indicators, as well as learning what each indicator is specifically intended to do, not only is this a logical way to begin, it is also a good ‘step’ in your learning progression – understanding the WHAT you are doing, instead of attempting to create ‘canned’ indicator only trading systems, without any regard as to WHY you are trading this way.

This does become one of the ‘sticking’ points in your learning progression, as you come to find out that you are unable to profitably trade indicators as signals only – now what? Now what – you ‘can’t’ develop your own indicators, so you start doing google searches for day trading indicators and start buying your ‘collection’ – they don’t ‘work’ either. Now what – you buy a mechanical trading system – what does hypothetical results may not be indicative of real trading or future results mean? Now what – you start subscribing to signal services OR you start joining the ‘latest and greatest’ chat room – am I really the only person using the signals who isn’t profitable?

Now what – you never learn how to trade.

I began trading as an indicator trader, and I did try to learn everything that I could about the various indicators, as well as trying to combine indicators that were consistent with how I wanted to trade – I just could never develop a mechanical day trading system from what was available to me. I read a couple more books that didn’t really help me, so I then started looking for someone who could teach me. From what I now know about gurus -vs- teachers, I am very lucky that I got involved with a money manager-trader who taught me a tremendous amount, but I still couldn’t get profitable, in part because there was also ‘pressure’ to learn how to trade using real money. As well, any discussions or thoughts about trading psychology and the issues involved, especially to beginning traders, was non-existent.

Now what – learning but losing – I stopped trading. Learning to trading using real money, and ‘scoffing’ at trading psychology as simply individual weakness, really was something that I now regard as misinformation. I always mention this as I now feel that this cost me as much as a year of time, and was very close to costing me my trading future, as stopped trading was VERY close to quitting trading. How can’t trading psychology be real to a beginner, when you consider that you are risking losing money at a very fast pace as a day trader, and when you further consider that you are also doing this when you really don’t know what you are doing – this is NOT by definition being weak. And if trading psychology is real, how are you going to learn to make ‘good’ trading habits with real money while you are fighting the implications?

Now what – not trading and not ready [quite] to quit – still studying and searching.

Probably the single most important ‘thing’ that got me to a next step in learning how to trade, was the concept of a trading setup, and that a setup and a signal were not the same. This was extremely meaningful to me, as it also led to an understanding of how to better use trading indicators for the information that they can provide, but not to use them as trading signals – in essence I began learning about trading method where discretion could be consistently applied -vs- trading system that was mechanical and arithmetic rules.

Traders who are indicator only traders, are also what I refer to right side only traders, that is they are always looking at the right side of their charts for an indicator signal. BUT what about the left side of the chart, what about price and patterns, what about market conditions – WHAT about the relevant ‘things’ that are ‘moving’ price, instead of indicators only as an arithmetic derivative of price, and thus, one that is dependant on the time frame that you have chosen to trade from? These ‘thoughts’, along with the concept of trade setup, became instrumental in the development of a trading method, and how I came to turning my trading around.

When I think about the steps in my learning progression – I would list them as follows:

2/95 – 6/96indicators onlyteaching service that included signalslearning to trading with real money and trading psychology issuesstop trading

6/96 – 3/97understanding of trading psychology issueslearning about trading setups concepttrading method -vs- trading systemtrade setup – trade trigger are not the samemethod development understand the importance of the left side of the chart and what is happening ‘across’ the chartrelated trading setups and how/when they triggeredindicators + patternindicators + pattern + priceindicators + pattern + price + market conditions

3/97 – 11/97able to paper trade profitablyable to real money trade profitablyable to trade for a living

Indicator Only Day Trader – Setup Including Indicators Method Day Trader

I have attempted to discuss the way I started day trading, and the way I think many-most traders typically begin. Along with this, I have pointed various issues and problems that I had – those regarding how to learn to trade, and then progressing into a profitable trader. My experiences have been both personal, as well as those of many traders that I have worked with over the last 8-9 years through Tactical Trading – that a very large number of these problems are due to day trading only with indicators, the specific indicators used, along with trying to turn these indicators into a mechanical trading system. This is not to say that this can’t be done – I simply couldn’t do it. However, I would strongly suggest that anyone who is in the early stages of day trading, or struggling with their day trading, consider these things that have been discussed.

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The World’s First and Most Profitable Forex Hybrid-Strategy

- 95% Accuracy

- 95% Automatic

- 100% New breed of Strategy

==> Vladimir’s sRs Trend Rider Official Site

Vladimir Ribakov is a professional Forex Trader aiming to change the way we all know the Forex market, and he puts his reputation on the line…

He waited until the beginning of the New Year to mark the beginning of his activity, to symbolize the beginning of a new era in Forex trading.

I have seen many new products and strategies in the last several years but it seems that Vladimir’s new strategy is really something of a different breed.

Let me tell you a little about the system:

The system is what Vladimir has been using for several years to extract impressive profts and support a life of high quality for his family. It is a highly accurate strategy that can be used all day and with almost all currency pairs.

It is set to change the ugly picture of today’s market, where home-based traders lose their accounts each and every day. It’s not just “stupid” people who are losing. 90% of all traders don’t make it because they are armed with promises instead of being armed with the right tools and education.

Since Vladimir is a wizard when it comes to the Forex market he has been using this strategy without any additional tools. However, for us, he has perfected it and created 4 components to ease our use of his system.

Here is a short description of his 4 additional trading tools which come with the system:

1. The sRs Indicator – this is a simple to use but highly potent indicator developed by Vladimir. You don’t actually need to sit all day and watch this indicator, because it is automatically connected to the alert signal that you also get with the package.

2. Customized Template – a special template that eases and simplifies the use of the system.

3. The sRs Alert tool – an alert tells you when to be prepared to enter a trade. This tool is very sophisticated and accurate and relies on Vladimir’s proprietary algorithm.

4. The sRs Money Management and Trade Management Robot – Vladimir uses this system together with his TWO-PHASE smart management system. Instead of relying on users to use it correctly and be negatively affected by emotions, he programmed his money management and trade management rules into a robot (Expert Advisor) to apply after you execute the trade according the system rules.

I think that’s a fair enough description, although this is definitely even more impressive than what I can explain in this email. Suffice it to say the beta-testers have doubled their account in just 1 month of easy casual trading! The rest you can find out on Vladimir’s webpage.

It seems to me that if Vladimir is willing to risk his name and reputation, then we need to give him a chance and see what he has prepared for us.

==> Vladimir’s sRs Trend Rider Official Site

==> Read Full Review

Rob Trader – Forex Expert http://tradingtoollist.co.cc/

Article Source:http://www.articlesbase.com/day-trading-articles/srs-trend-rider-just-went-live-1701090.html