I decided to post this simple, yet effective trading method to help those that can't seem to make money consistently get their foot in the door. My hope is that others will do the same to help the whole trading community out. We all want to make money and every single one of us does it differently. It helps to get ideas from others. I am going to show screen shots of a very basic method and then one that incorporates trends to reduce the amount of trades and wade through the chop.
It will likely seem too easy for some, but I find the less complicated the indicator set up, the easier it is to make money. We are so busy loading our screens with indicators, that we miss signals while we are trying to figure out what the data is telling us.
It works just as well for daytrading as it does on longer term weekly or daily charts. I only trade from market open at 9:30 am Eastern and stop around 1:00pm in the afternoon. 90% of the money is made in those hours. I only trade in the afternoon if I have a really strong signal pop up on my screen. It pretty consistently will land you 50 ticks a day. If you want to make more money, add more screens to your desk. I don't increase the amount of money I throw into a stock, I just trade more stocks. If you make 50 ticks per stock and want to make 150 ticks, trade 3 different stocks on 3 different screens and do the same thing. When I started, I never understood why some traders had 2 screens and some had 12. This is the reason. It just depends how you trade. I personally like to trade 3 minute carts.
The first chart is very basic and easy to read, the indicators I use are as follows:
Price Action Swing (15,3)
Stochastics_Color (4,8,1)
RSqueeze (momentum period changed to 9)
Just ride the wave and Short the peaks and Buy the Valleys. You will know when to get in and out by color change of stochastics, but more importantly, watch when the price action swing posts its dots. If the dot posts on the top of the 4th,5th,or6th Rsqeeze colorbar, It has peaked and make the trade. Price action Swing posts dots all the way up or down that are false alarms, you will know if it is the real thing if it corresponds with the top of your Rsqeeze chart. Th reason I stop trading at 1:00 is obvious if you look at the change in the quality of signals. Make money on the good signals in the morning and don't gamble on what they are going to do in the afternoon. To make more money trade several good quality signal stocks in the morning time period instead of trading a weaker quality stock all afternoon.
The second chart is played the same way, I just incorporate a few more signals to tell me which way the trend is going so I dont get caught going against trend.
This is the system I use everyday when I trade. MACD and EMA dots are really the 2 big changes between screen 1 and 2. These are key in knowing not only if your going up and down but how far and how deep. The ema dots, when they appear are really telling. 1 or 2 rows means a quick move with strength. 3 or more rows is a warning that it is a strong trend and don't go against it. I put up a screen 3 to show you what it does. When they appear, take notice.
Hopefully this is helpful in your trading. I modified many of the indicators from original, so if anyone needs a screen shot of the settings I will post it.
Daytrading isn't about a quick 3% gain which are somewhat rare, it is about many small wins which give you a big win at the end of the day.