Albert Einstein once said "Everything should be made as simple as possible, but not simpler."
Many traders are making trading more complicated than it needs to be. They think the more complicated, the better the strategy.
I've been there myself: In the mid 90s, when computers became more powerful and affordable for everybody, indicators were very popular.
And believe it or not - I was an "indicator junkie!"
I thought, the more indicators I plot on my chart, the better my entry signals.
So I bought "The Big Book Of Indicators". This book described 176 indicators in great detail.
And I think I plotted 169 of these indicators on my screen. In fact, there were so many indicators on my screen that I could barely see the prices any more!
But here's what happened...
Instead of giving me more clarity, all these indicators were confusing me! At any given time, half of the indicators on my screen would scream BUY, while the other half would yell SELL!
These days I am using only THREE INDICATORS.
Three indicators is all I need to identify the direction of the market, the beginning and end of a trend and when to enter and exit a trade.
And I like to setup my charts in a very unique way.
Let me show you...
Here's a short 12 minute video explaining the unique chart settings I use, the indicators and the settings of these indicators and the markets that I like to trade.
As you can see, the setup is quite simple. And here's a short video explaining how I use these settings to determine my entry and my exit signals. This is ONE of the FOUR trading strategies that I use in my trading.
The Simple Strategy
Now you know how I set up my charts and what indicators and settings I use. And you know one of my favorite strategies: The Simple Strategy. I've shown you when and where to enter a trade, where to place a stop loss and when to take profits.
So you basically have everything to start trading, don't you?
Why You Must Have Multiple Trading Strategies
Well, here's the "problem" if you are just using ONE trading strategy.
There are three (3) different types of trading strategies:
- TREND-FOLLOWING STRATEGIES which work beautifully in a trend,
- TREND-FADING STRATEGIES that work best in sideways markets and
- SCALPING STRATEGIES that give you a lot of trading opportunities and usually have a high winning percentage.
The "Simple Strategy" that I describe in the video above is a trend-following strategy and works very well in trending markets.
But as you know, the markets are not always trending. Some people say that the markets trend only 20% of the time. The rest of the time they are moving sideways in a choppy way.
So what do you do when the markets are NOT trending?
Well, you could simply stay out of the markets, right?
However, very few traders have the patience to sit on their hands and wait for the really good trading opportunities.
And I personally think, if you don't know how to trade a sideways markets, you are missing out.
Therefore I believe that EVERY TRADER should know AT LEAST TWO trading strategies:
- A trend-following strategy for trending markets - like my "Simple Strategy" and
- A trend-fading strategy for sideways markets.
I personally use FOUR different trading strategies:
- The Simple Strategy (trend-following)
- The Boomerang Strategy (trend-following)
- The Ping Pong Strategy (trend-fading) and
- The Seahawk Strategy (scalping)
If you have have multiple trading strategies, then you get many trading opportunities and can choose the best ones, which lets you run circles around the "one-strategy trader" who sits on his hands.
HOWEVER, there's a catch:
You MUST know when to use which strategy!
And in order to apply the "right" strategy for the current marketing condition, you must learn how to easily identify the direction of the market. Very few traders can precisely determine the direction of the market, and that's why many traders apply the wrong strategy: They use a trend-following strategy in a sideways market and wonder why they got frequently stopped out. Knowing when to apply which strategy can give you an edge and put you way ahead of other traders.
The Ultimate Day Trading System
If you are interested in learning more trading strategies, the check out my "Ultimate Day Trading System."
It's a set of four DVDs. On these DVDs I'll teach you the trading strategies that I use in my own trading. And I show you WHEN to USE which strategy.
PLUS, you will learn how to manage your trades, how to deal with your emotions and the Money Management approach I use. Money Management is extremely important for your trading. It can make or break you as a trader. If you choose the wrong Money Management approach or don't use Money Management at all, you COULD lose money DESPITE having a profitable trading strategy!
Here's what's included in "The Ultimate Day Trading System"
- Day Trading Basics
What you need to know about day trading and trading strategies. You will learn about different types of trading strategies, when to use what kind of strategy and the "best" trading strategy.
- Strategy #1: The Simple Strategy
This strategy is perfect for trending markets. It has a reward/risk ratio of 1 : 1.5 and can be traded on a variety of markets. This is our most popular strategy, and you can learn it in less than 30 minutes. You gonna love it.
- Strategy #2: The Boomerang Strategy
This strategy allows you to enter into an existing trend and take advantage of a quick pullback move. You can trade it in addition to The Simple Strategy or when you missed an entry according to the Simple Strategy. This strategy has been working great lately.
- Strategy #3: The Ping Pong Strategy
This strategy is perfect for a sideways market. And as you know, there are often times when you are waiting for a trend and the market is just trading in a narrow range. Most traders shy away from sideways markets, but with this strategy you will be able to trade while others are sitting on the sidelines, and run circles around other traders. Try it out. I'm sure you'll enjoy it.
- Strategy #4: The Seahawk Strategy
This is a scalping strategy. It's very popular, because you are trade this strategy in trending and in sideways markets. When using this strategy, your goal is to make small, but consistent profits in the markets. It's one of my favorite strategies.
- Money Management
You will learn about different money management techniques and which one you should use in your trading. Apply this strategy in your trading to manage your risk accordingly: Don't risk too much, but don't risk too little either, otherwise you will never grow your account. You won't be able to trade for a living if you only trade 1 contract, so you MUST learn when to increase the number of contracts based on your trading account size.
- Trade Management
Don't let a winning trade turn into a losing trade. Learn how to properly manage a trade and the concept of "the free trade."
- Business Management
Trading is a business, and you have to manage it as such. Learn how to write a sound business plan for your trading business in less than an hours, and get the tools you need to run your business and make sure you're on track. Very few traders treat their trading as a business, but those who do have a significant advantage.
- Trading Mindset
Learn about the mistake that many traders make and how to avoid them. Get tips and tricks on how you can control your emotions so that they don't sabotage your trading. PLUS: We will show you daily routines - what to do before the bell and what to do after you are done trading.
PLUS GET THESE BONUSES
- BONUS 1: How To Develop A Trading Strategy
If you every want to develop your own trading strategy, THIS video is a must. You will learn how to develop and test a strategy. You will learn how to read a performance report so that you know how to tweak a strategy, and I will show you how to improve a strategy without over-optimizing it. I will pull back the curtain and show you EXACTLY how we develop, test and deploy trading strategies here at Rockwell Trading.
- BONUS 2: Intro To Futures
In my trading career I have been trading stocks, options and forex. Then in 1999 I discovered the futures market and their advantages, and since 2002 I have been exclusively trading futures. If you are not trading futures (yet), you are missing out! In this guide you will learn the basics about futures trading and how to switch from a stock, ETF or Forex trader to trading futures. Trust me: Once you start trading futures, you will never want to trade stocks, ETFs or Forex again.
- BONUS 3: Software Support
We programmed our indicators into various charting software packages, and you will get the indicators and templates for the following charting software packages: Trade Navigator, Sierra / AT Charts, TradeStation, NinjaTrader, eSignal and ThinkorSwim.