Day Trade or Scalp? Swing trade or Position trade? Which trade should I take?

– Choosing the correct trade for your trading style

o I have the same pattern setting up on 2 different charts, 1 is very slow and the other is very fast
o Which trade do I take?

 Identify the trader first

• New trader
• Lack confidence
• I have small account
• Low risk tolerance

 Identify the market second

• Fast speed
• Good follow-through
• Lots of movement

o I take the SCALP because of the following reasons:

 I have a low risk tolerance so my stop needs to be tight, and I cant afford the 40 tick stop I would need on a 34-range chart

 With lots of speed the scalps will always work well
 Slower speed is much more difficult for the scalpers

• New example

o 13range and 4range setting up together
o I have slow speed, and NO follow through
o I have a small account, and low risk tolerance
o Which do I take?

 Rules of thumb:

• Small account = faster timeframe
• Large Account = anything
• Slow Market = slower timeframe
• Fast Market = both
• Low Risk Tolerance = faster timeframe
• High risk tolerance = both

– 3 Signs of a price reversal:

o Slowing speed
o Momentum pointing against you
o Big money buyers/sellers against your trade

– How do we know when to flatten at entry?

o Use the 3 signs of a price reversal

 Speed slow down
 Momentum curls against me
 Big sellers/buyers against my position.

o Remember, we use the OPPOSITE of this to enter the trade

 I saw good speed to enter the trade
 Momentum confirmed
 Big buyers/sellers to support the trade

o Now once im in the trade, I begin to see something is wrong

 Speed slow down
 Momentum curls against me
 Big sellers/buyers against my position.

o When I see that I have 2 options:

 Move my stop up to my entry and let it run
 You can FLATTEN your trade by clicking the CLOSE button on your DOM or chart trader.
 Keep a close eye on some additional things

• Point of entry

• MACD on your trade management chart

• If this applies before you fill your first target, you still have RISK in the market, so move that stop to entry, or simply flatten.

– What is your stop using your 13-range charts?

o Stops for scalps?

 Always the same, and this is different than day traders’ trade management.

– Drawing channels, wedges, and sideways ranges

– Trading Freefalls and Rises

o Big difference between these two things:

 Market falls on volume
 Market falls on NO volume

• I can see volume with the following:

o Pace of tape indicator increases in speed
o Big money on the time and sales
o Watch a volume counter technical indicator

 High volume = expect the move to continue
 Low Volume = expect the move to reverse and go back up most likely to where it began.

– Scalping Fast Track?

o Yes you can, use the following trade management

 6 tick target, 6 tick stop
 8 tick target, 8 tick stop
 4 and 8-range charts
 Most important things to watch will be speed and momentum

– Entries for our trades

o Do not use market orders, too sloppy
o I use limit order, buy/sell stops, according to our TRAP ENTRY technique.

– Max loss, daily goal? How do we react to these?

o Daily goal = $1000usd for 4 contracts
o Max Loss = 2 full stops in 1 day

 After my max loss, I will move to DEMO/SIM to keep trading
 I want to keep trading so that I can build my confidence back to where it was.

– Compensating Factors:

o Good speed is more important than anything else.