Why choosing the right day trading strategies for the market conditions is crucial to your trading success. Each of these two basic market conditions (consolidating vs trending) require very different day trading strategies. Hopefully you now understand why we need different strategies for different market conditions. Almost every other technical day trading strategy in existence is a variation on the basic themes outlined below. The success of this day trading strategy relies on the market continuing to rotate sideways within its defined trading range. Gold has had quite the range day overall with smaller ranges in the mix as well really showing its choppiness.
The first target will come off at midline resistance with the final target back up to the channel highs or high of day. Until recently, I’ve avoiding commodity futures day-trading systems because of transaction costs. In order to trade the strategies, you must have an account with one of our preferred brokers and authorize the broker to trade one, or more, of these strategies for your account.
This occurs when the market breaks out from its trading range and moves directionally until the market begins to consolidate sideways again.
However, trying to employ a directional strategy while the market is consolidating in a tight trading range will more often than not get you chopped around and stopped out of trades. That date is the earliest date Tradestation has continuous electronic contract data for the commodity, or five years of data. Two trading evolutions have changed the impact of transaction costs: the electronic markets, and discount brokers. The electronic markets have eliminated the need to cross your fingers and hope for the best when placing a market order.
And competition from discount brokers, like Interactive Brokers, has forced even retail brokers to dramatically lower their commission rate.
These two evolutions now make day-trading viable, and on most liquid commodities, not just the emini S&P. I’ve developed a family of commodity futures day-trading strategies that use the same market principal to try and capture profits on short-term trades. Using a number of time-frames, these strategies try to anticipate, early in the trading day, the trend for the day. Once determined, entry is made in the direction of the anticipated trend and money management is used to try and stay with the trade through the day.
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