Shadowtraders

Trading Strategies -- For Day Trading and Night Trading

As a day trader, you develop a good trading system overtime. In that trading system are a group of trading strategies that you hope you can rely on as you trade. Whether you decide to trade during the day or are night trading, you need the best trading strategies you can find. The key is to find a trading system you can stay with. The last thing any day trader wants is to have to trade from the seat of their pants, entering and exiting without trading strategies.

What are trading strategies? Investorpedia defines trading strategies as "a set of objective rules designating the conditions that must be met for trade entries and exits to occur. A trading strategy includes specifications for trade entries, including trade filters and triggers, as well as rules for trade exits, money management, timeframes, order types, etc. A trading strategy, if based on quantifiable specifications, can be analyzed on historical data to project the future performance of the strategy."

Here are the operative words: rules, conditions, entries and exits, triggers. Sounds perfect right? These rules should work no matter if you are currency trading, trading the emini, stocks, options, etc. The entries and exits should give you good triggers for day trading and for night trading.

Well here is what trading strategies are not: Trading strategies are not guarantees, they are not an ATM machine, where you put the money on the trade and guaranteed, more money comes back.

Here's the problem at hand. Trading strategies are dependent on 3 variables: time, price and volume. It doesn't matter if you are using moving averages, stochastics, MACD, RSI, etc, and these are the basic indicators that make up most strategies. But with new technology, high speed computer systems, and co-location of servers inside the exchanges, tried and true strategies are just not keeping up any longer. In fact, we could go so far as to say, in its purest form, technical analysis no longer works.

High frequency trading robots (HFT's) are now trading the Markets. The exchanges admit that over 50% of all trades come from HFT's. HFT's are based upon new algorithms and not dependent on the basic 3 variables. Since they are co-located inside the exchanges, they get filled that much faster than smaller investors. As an example, an individual investor is using technical analysis and his trading strategy, the moving average. Everything looks great, and he enters. No sooner than that, and he gets stopped out. A large volume trade appears as if from no where in the opposite direction, not something that could have been predicted. These type of trades occur regularly in all the exchanges.

How do you handle this kind of trading strategy interference? The answer is, you can no longer rely on the old tried and true indicators. You need to find new mathematics for trading. Don't rely on indicators that provide "high probability guesses" because they are no longer reliable.

Barbara Cohen CIO, Shadowtraders, and professional day trader, specializes in teaching students how they can be trading futures with their own trading system and trading strategies. Ms. Cohen has helped hundreds of traders achieve their goals trading. Find out if trading futures is for you by attending one of Ms. Cohen’s Free Webinars. Check out my Futures Trading Articles. For more information, send an email to shadowsupport@shadowtraders.com or call 866-617-2037 today.

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© 2011 Pure Reason, LLC. All Rights Reserved

Testimonials disclosure. Unique experiences and past performances do not guarantee future results! Testimonials herein are unsolicited and are non-representative of all clients; certain accounts may have worse performance than that indicated. Trading Futures involves substantial risk and there is always the potential for loss. Your trading results may vary. Because the risk factor is high in Futures trading, only genuine "risk" funds should be used in such trading. If you do not have the extra capital that you can afford to lose, you should not trade Futures. No "safe" trading system has ever been devised, and no one can guarantee profits or freedom from loss.

THIS INFORMATION IS PROVIDED FOR EDUCATIONAL/ INFORMATIONAL PURPOSES ONLY. These results are not indicative of, and have no bearing on, any individual results that may be attained by the using these indicators in the future.

PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. The example shown here may or may not be typical of the performance of this system and, ALTHOUGH WE BELIEVE THIS INFORMATION TO BE ACCURATE. Potential traders should carefully investigate, evaluate and compare trading strategies before investing capital. Some or all trading strategies may involve an inappropriate level of risk for potential traders. It is the nature of commodity and securities trading that where there is the opportunity for profit, there is also the risk of loss.

Trading strategies, like any other, may involve an inappropriate level of risk for prospective investors. THE RISK OF LOSS IN TRADING COMMODITY FUTURES AND OPTIONS CAN BE SUBSTANTIAL AND MAY NOT BE SUITABLE FOR ALL INVESTORS. Prior to purchasing or leasing a trading strategies from this or any other system vendor or investing in a trading strategies, investors need to carefully consider whether such trading is suitable for them in light of their own specific financial condition. In some cases, futures accounts are subject to substantial charges for commission, management, incentive or advisory fees. It may be necessary for accounts subject to these charges to make substantial trading profits to avoid depletion or exhaustion of their assets..

All information is offered with the understanding that an investor considering purchasing or leasing a system must carry out his/her own research and due diligence in deciding whether to purchase or lease any trading strategies noted within or without this report. This report does not constitute a solicitation to purchase or invest in any trading strategies which may be mentioned herein. Shadowtraders MAKES NO ENDORSEMENT OF THIS OR ANY OTHER TRADING STRATEGIES NOR WARRANTS ITS PERFORMANCE. THIS IS NOT A SOLICITATION TO PURCHASE OR SUBSCRIBE TO ANY TRADING STRATEGY.