If you’re not yet trading with the trend, No worries, this video lesson will help.

It’s been proven that it doesn’t matter if you’re day, swing, or position trading the key is to trade with the trend. Trend trading has been utilized for many years by professionals, intermediates, and novice traders alike who follow the trend with success. But why do they trade the trend and how do they find the trend?

The hardest part…Finding the Trend! The easiest part…Trading the Trend! Take a few minutes and look at this streaming video lesson titled, “Why to Trade the Trend and How to Find the Trend” at the MarketClub Traders’ blog. If the video is not the first entry then scroll down a bit.

Futures ALERT is a MarketClub related advisory service that made 16 total trades in September. Here are the results:

$16,623.50 profits
$2,666.50 losses

NET: $16,357.00

Oct Results:
$6762.50 profit (Stopped out of Copper for a $6762.50 profit) $0.00 losses

6 Open trades that can STILL be profitable. Agricultural, metals, futures options, currencies, hards, and softs are ALL covered.

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Futures ALERT has helped me understand how to trade and why to trade some markets vs others. After 6 months of following the recommendations I’m up over 35,000 in my futures account…and so far I’m already in the money on the October trades…THANKS!
–Steve R. New Hampshire

Using the service I’ve been able to pin point my entries and exits to stay profitable. I’ve been a member for just over a year with no end in sight.
–Diane P. Alberta CA.

Take a 30 day trial here and track the trades to see if Futures ALERT is all it’s cracked up to be!

Gold, Crude Oil, the Dollar Index … how did MarketClub do in Q3?

Last quarter was by most accounts one of the most volatile on record.

The DOW hit record highs and then plunges 10% in just 21 days. Crude oil soars to over $84.00 a barrel and Gold trades at levels it hasn’t seen in a quarter century.

Inflation, the credit crunch, the sub-prime disaster, record high prices for oil and if that was not enough, the fed cuts 50 basis points!!! All of these amazing events were all part of the trading fabric that made up the third quarter.

Looking back over the quarter one word best describes the markets …volatility!

O.K. so how did the new “Trade Triangle” approach do trading Gold, Crude Oil, and the Dollar Index?

All the buy and sell signals were generated using MarketClub’s “Trade Triangle” technology. The results are all positive for each market and show just how well you can do when you filter your trades using MarketClub’s triangle methodology.

Having a proven approach and a solid game plan to trade with gives MarketClub members a tremendous advantage over other traders and investors.

Here’s the new 10 minute video.

The video shows you step by step, signal by signal and illustrates how well you can do in the most difficult quarter in 12 years.

This video shows EXACTLY how to pick winning Futures Trades using MarketClub.

Click here or on chart to see video

Technorati Tags: winning Futures Trades

Millionaire Traders: How Everyday People Are Beating Wall Street at Its Own Game

List Price: $39.95
Buy New: $21.34
You Save: $18.61 (47%)

Editorial Reviews:

Trading is a battle between you and the market. And while you might not be a financial professional, that doesn’t mean you can’t win this battle.

Through interviews with twelve ordinary individuals who have worked hard to transform themselves into extraordinary traders, Millionaire Traders reveals how you can beat Wall Street at its own game.

Filled with in-depth insights and practical advice, this book introduces you to a dozen successful traders-some who focus on equities, others who deal in futures or foreign exchange-and examines the paths they’ve taken to capture considerable profits.

With this book as your guide, you’ll quickly become familiar with a variety of strategies that can be used to make money in today’s financial markets. Those that will help you achieve this goal include:

Tyrone Ball: trades Nasdaq stocks almost exclusively, and his ability to change with the times has enabled him to prosper during some of the most treacherous market environments in recent history

AShkan Bolour: one of the earliest entrants into the retail forex market, he trades in the direction of the major trend, rather than trying to find reversals

Frank Law: a technician at heart, identifies a trading zone, commits to it, and scales down as long as the zone holds

Paul Willette: has mastered a method that allows him to harvest some profits right away, while ensuring that he can still benefit from an occasional extension run in his favor

Technorati Tags: Millionaire Traders, forex market

When day trading futures, you enter and exit all positions in the same day - never carrying a position overnight. Since the overnight moves of the market are difficult to predict, many traders avoid risk by day trading. Ironically, the public believes that day trading is the riskiest way to trade.

THIS IS A MYTH !

Some traders day trading futures, make 1 to 3 trades per day, trying to catch the major intraday moves. Others trade in-and-out very frequently, trying to “scalp” a small profit on each trade. (My style uses a unique blend of these two strategies.)

For those day trading futures, the Emini Stock Index Futures have become the most popular day trading vehicle because of their liquidity, leverage, and the ease of trading them online. You can go short or long with equal ease - unlike stocks where it’s easier to go long than short due to the “up tick” rule.

The time relationship of the eminis (and the “big contracts”) to the cash indices is important to understand. Let’s start from square one.

The S&P 500 stock index (the cash index, symbol SPX) is central to day trading futures. It has an Exchange Traded Fund (the “Spyders,” symbol SPY) that trades like a stock, but without the “up tick” rule. The price of the S&P 500 cash index moves up and down with the 500 stocks that make up the index. The SPYders follow the S&P 500 cash index very closely. You can trade Exchange Traded Funds such as the SPY (and QQQQ for the Nasdaq 100) online from home. But for day traders, they are not as favorable as day trading futures.

The concept of “futures” is a little confusing, but it boils down to this: the financial industry has turned the S&P 500 cash index into a “contract” that trades like a stock. The contract (or futures contract) has a price that goes up and down from one moment to the next. It has a chart that looks just like stock chart, and you can make money with it by buying low and selling high, or vice versa. That’s a complicated as it needs to be for now.

The “big contracts” or SP Maxis were invented first and they’re still around. With the big contracts, a lot of money changes hands. When the price of the SP Maxis moves one point, $250 per contract moves with it. The SP Maxi contracts trade in a literal “pit” where the traders, called “locals,” shout at each other, buying and selling for everyone who wants a piece of the action.

The locals are not public servants, of course, they make money for their own accounts. They have the advantage of being able to read each other’s body language and the tone of the other trader’s voices. They see what the strongest traders in the pit are doing. They have several other advantages too, their costs per trade are tiny compared to the public’s commissions.

The “locals” aren’t born as professional traders though, they learn to trade like everyone else, except they have a huge advantage in learning as well because they learn to scalp first! Their instant access and low commissions make this possible compared to others, but those day trading futures online can take advantage of scalping trades as well.

Scalping is basically limiting your losses to only one or two ticks while taking any profit you get as you get it. It’s easier than going for several points per trade, I’ve been using this strategy day trading futures with much success.

Locals also use the spread (the difference between the bid and ask price), to grab quick profits from orders that come in on either side of the market. This makes scalping easier for them.

In the past, all these advantages made it impossible for a “retail” day trader to be a successful scalper. It was insane to try. And to this day many traders have the idea that scalping is too difficult for the public because you have to compete against traders with an unfair advantage.

But all that has changed now. If you follow some simple, yet important guidelines then you too can be successful scalping and day trading futures online.

They took the concept of the Maxi futures contracts and came up with smaller contracts (the eminis) that move $50.00 per SP point instead of $250.00. This allows all traders, big and small, to trade the stock index futures.

But even more radically, they set it up so that the smaller contracts (the eminis) are traded only through computers. This was revolutionary, they bypassed the pit, taking away the advantage of the “locals,” and leveling the playing field in a way that has never been done before. And to level the field even more, retail commission costs fell like a rock. Today, any trader day trading futures with a small account can pay $4.80 per round turn (entering and exiting a trade).

This means that scalping is open to the day trading public for the first time in history. But most people who are day trading futures don’t even realize where the new advantage really is.

Scalping is one of the keys to making a living day trading futures as I do, because I follow a simple rule: “Every trade starts out as a scalp until proven otherwise” .

The SP emini futures became more and more popular and more liquid, breaking a lot of records along the way.

The SP Maxis futures and the SP emini futures are both derived from the S&P 500 index (symbol SPX), which, as I said, has an ETF that trades like a stock (symbol SPY).

So the question is - which of these is the leader and which are followers?

Today the emini futures track the Maxi contracts almost tick for tick, with the emini’s beginning to lead the Maxi’s at times, and also “overshooting” the Maxis at emotional extremes, such as the at the top of an intraday rally.

Both the SP eminis and the SP Maxis (the futures) lead the S&P 500 cash index by a variable amount of time, often in the range of a fraction of a second. Some people call this “the tail wagging the dog,” because the futures are derivatives of the stock indices, but call it what you want, the futures are leading the way.

The fact that the futures lead the markets makes their chart patterns more “pure” and reliable for support and resistance trading. This makes a huge difference to me.

I use the stock index futures (the eminis and Maxis) for calculating daily support and resistance areas, which are the basis of my own trading style - a style of trading tat has paid my bills and built my financial security for about 20 years now.

Mike Reed is author of TradeStalker’s RBI Trader’s Updates. He has been trading the Market for 23 years. His support and resistance numbers have been published on the internet since 1996. Mike’s nightly support and resistance zones are specific and incredibly accurate. He offers an unlimited free trial of his nightly TradeStalker RBI Trader’s Updates. “http://www.TradeStalker.com”

Technorati Tags: day trading futures, day trading

Senior Commodities Analyst Jeffrey Kennedy just authored “What’s Next In Wheat?” which is the focus of the Monthly Feature section of the September issue of EWI’s Monthly Futures Junctures (MFJ) – now online. And you’re in luck, because right now, during FreeWeek, you can read it absolutely free – all 12 pages of it, loaded with 34 commodity charts, plus a Trader’s Classroom lesson on how the “3-in-1 Reverse” bar pattern can reveal trading opportunities you may have overlooked.

All you need to read the September MFJ is a free Club EWI membership.

If someone tells you that you can get rich quick day trading…run for the hills! There are no overnight successes, unless you are very lucky!

Day Trading isn’t easy, but with experience, dedication, self- control and hard work, you *can* become a successful day trader.

1. How to Treat Gap Openings.

A gap up or gap down open is an emotional move, and it often will reverse course and turn in to “trap open”. Gaps that are less than 4 points on the SP Future tend to get filled in the same day, especially Tuesday through Thursday. Turns will occur within 20 to 40 minutes after the open. A trader must be on the lookout for a reversal as soon as early momentum is lost.

A gap into a good support /resistance zone is almost always a good “fade” - with stops no more than 1 point on other side of the support /resistance zone. (A “fade” is simply entering a position opposite of the direction of the gap. If the market gapped down, a “fade” would be entering a long position (buying) in to the selloff.)

2. When the Market Moves Against You, When Do You Exit a Trade?

The way I trade, I exit as quickly as possible. There’s no sense in waiting around for your “stop-loss” to get triggered when the perceived edge is gone. I like to stay in control of my trades, and if the market doesnt do as anticipated, I don’t wait for my stop to get hit. When there is no longer a high probability situation, exit and take a second look.

3. When Are The Best Times of the Day to be Trading?

For me, the best times of the day for trading are the first hour and the last 2 hours. Here’s an old rule of thumb (and this used to work like clockwork in the “old days”, and although it has diminished a bit, it still happens):

“The Minor Time of Day”- f the Market opens higher, then there tends to be a pullback within the first 20 to 40 minutes. If the pullback is weak, there will probably be a continuation of rally into the early afternoon. But, if the pullback is sharp, then you’ve likely seen the high for the day and you’ll want to be selling the bounces.

“Major Time of Day”- Around the 2:20pm to 2:40pm time frame, we’ll often see moves reverse or gather steam in that timeframe. People that have been holding positions all day long become a bit “antsy” - they have to do something with them before the Market closes for the day. When people holding losing positions into late into the day see the time until the close is near, that can cause the market to make some sharp turns in the last 90 minutes. The program gang also likes to get active that time of day.

4. How Can Anyone Trade a Choppy Market?

I take a number of scalps in choppy markets. I time entries with Tick extremes, especially when price pops into previous high areas of congestion, or other intraday support and resistance. Moving averages are not good during choppy days.(Scalps : small profit, “hit and run” type of trades)

5. How Do You Measure Pullbacks?

In a trend move, I like to see shallow pullbacks to a steeply sloped moving average on one of the 3 time frames I follow. (more time frames, the better) Pullbacks to symmetry in a persistent trend are useful when present.

Example: Rally, dip 2.00 points Another run up, then a dip of 2.25 points A another push higher, then a dip 1.75 points. Note continued dips of 1.75-2.25 points repeatedly hold. A pattern has developed, and you want to be buying those shallow pullbacks. This works great used in conjunction with a steep slope of the 20 ema on the 5 minutes charts, or slightly bigger picture, the 60 ema on the 5 minute chart.

About the Author

Mike Reed is author of TradeStalker’s RBI Trader’s Updates. He has been trading the Market for 23 years. His support and resistance numbers have been published on the internet since 1996. Mike’s nightly support and resistance zones are specific and incredibly accurate. He offers an unlimited free trial of his nightly TradeStalker RBI Trader’s Updates. http://www.TradeStalker.com

During FreeWeek, you’ll have access to Elliott Wave International’s Daily Futures Junctures and Monthly Futures Junctures. Senior Analyst Jeffrey Kennedy scours the markets to find the best commodity opportunities and serves them up to you on three different time frames.

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• Daily: Clearly labeled price charts and plain-spoken analysis of the commodity market that shows the highest probability for a big move.
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• Monthly: In-depth analysis of the most promising long-term opportunity, plus intermediate- and long-term forecasts of a dozen other commodity markets. Plus a Trader’s Classroom lesson, which offers practical tips and techniques to help sharpen your wave-trading skills. September issue releases Friday!

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Everyone trades a little differently. The trading method outlined below is MY personal approach to trading. This method has worked for me for the last 20 years, and has helped me to avoid big draw downs since the mid 1980’s. My trading strategy has helped me to make a good living trading.

It takes some time to learn my method of trading because it’s based on tape reading and getting a “feel” for the market. This is *not* about a fast,easy formula to “get rich quick” while you sweat out every trade. Instead, this is about developing confidence and trading consistently without fear and without big draw downs.

Here is my 10 Step Approach to Learning My Style of Trading:

1. Practice exiting trades at break-even, using a one-tick target, a two or three tick soft stop (mental stop) and a 1.5 point hard stop. Never *allow* the market hit your hard stop. Exit by moving your target toward your hard stop, not by moving your hard stop towards your target. With time, all of this must become a reflex. You won’t always be able to keep your losses down to 2 ticks, but only on rare occasions should you find yourself letting the market hit your hard stop. (”Rarely” means only about once every 50-100 trades after you get the hang of it.)

Even though your entries won’t be good enough in the beginning to make a profit trading these tight soft stops, your entries will gradually improve until you turn the corner and become profitable.

Learn exits and entries separately. Don’t let the one influence the other.

Taking losses this way takes dedication and discipline, so stick with it. It’s the key to confident trading. If you never take large losses (and rarely medium size ones), the fear of loss pretty much goes away, and your confidence grows. Especially after your entries improve enough to support a “scalping” type exit strategy.

2. Every trade *in all market conditions* begins as a scalp. Let me clarify this: if you’re in a choppy market and you’re looking to get small gains, like a point or so, manage your initial hard and soft stops *exactly* the same way you would in a quick trend or any other type of market. That means keeping losses as close to 2 ticks as possible, taking lots of break even trades and exiting every time the market doesn’t give you *instant gratification* (within a minute or so).

No matter what the market is doing, you must demand that it moves in your favor right after you enter, otherwise you get out as close to break even as possible. This means you’ll be closing a lot of trades near break-even within the first minute. This is the foundation of learning to trade for consistent gains.

3. Don’t worry about the commissions on break-even trades. If you do, you’ll hold on to losing positions, begging them to turn around for you. This is called *hoping.* In this business, this type of *hoping* is the kiss of death. Your money-making trades must move your way in the first minute or less. When trades don’t act right in the first minute, most of them will hit your hard stops.

So don’t get hung up on the fact that your broker loves you. Who cares if he/she makes a living?

Your concern is *limiting losses*. I care more about this than anything else in trading. (Well-timed entries make my tight soft stops possible, so they’re almost as important as the exits.)

4. Practice your entries until your timing is so good that you can *reasonably expect* the market to go your way immediately, before it goes more than 2 ticks against you. This is not easy at first, but if you stick with it, you’ll get it.

5. Practice fading the emotional extremes on your entries. (Fading means entering in the opposite direction of the market’s last move.) When an extreme NYSE-Tick (often above 1000 or below -1000) occurs at the same time the market accelerates into a support or resistance area, look for a price stall or reversal and fade the move. Fade the emotion.

6. Rarely, if ever, *chase* the market on your entries. Wait for a pullback to get onboard a trend.

I favor shorts over longs… I can get out of a short position quicker than I can get out of a long position. I don’t know why. I like to say that I “see gravity better than helium.” In the rare strong-trending markets where I may chase an entry, it’s going to be a down trend, not an uptrend. I don’t trust up trends enough to chase them. Maybe it’s just a personal quirk and maybe not. I honestly don’t know.

But it’s interesting to note that most (not all) professional traders I’ve met are Bears and prefer short positions over longs. You should give it some thought and find out which direction works better for you. Are your losses bigger on shorts or longs? Specialize in one direction and trade the other direction only when things are looking real good.

7. Never let a gain turn into a loss. This will mean getting out of most trades a little (or a lot) too soon. You just have to live with it. Swing for home runs (greed) will ruin your trading. There is no mechanical formula that I know of, (such as, “move your stop to break even after you get 3 ticks gain”) that will work. You have to develop a feel for how the market is acting at the moment, and use your feel to reduce your target or advance your hard stop. This comes with experience.

8. Develop a feel for the big picture movements of the market, not just the intraday action. Use the end-of-day market internals to analyze the market’s mood and develop a daily bias.

9. Practice does *not* make perfect. Only *perfect practice* makes perfect. I learned this in my younger years, pursuing a professional
baseball career. Perfect practice will keep your losses smaller than your gains in the trading business.

There are a lot of things involved in perfect practice. When you get tired, or when the phone rings, or whatnot, *don’t trade*. Always, *always* exit trades exactly the way I’ve outlined above on every trade in every market condition. Always *wait* for your pitch, the well-timed setup for entering. Don’t practice sloppy entries just because you’re bored. Only perfect practice will help you. Anything else just amounts to practicing bad habits.

10. Get a mentor. I traded for 6 years before I learned to keep my losses small. My trading turned around immediately after I met my mentor and talked to him on the phone for one week. Is there any serious profession that you can learn without a mentor? Maybe there is, but I don’t know of any. It’s certainly not trading.

About the Author

Mike Reed is author of TradeStalker’s RBI Trader’s Updates. He has been trading the Market for 23 years. His support and resistance numbers have been published on the internet since 1996. Mike’s nightly support and resistance zones are specific and incredibly accurate. He offers an unlimited free trial of his nightly TradeStalker RBI Trader’s Updates. http://www.TradeStalker.com

Technorati Tags: trading method, tape reading, exiting trades