In this week’s
educational letter, we focus on trade preparation.
Professionals are Prepared – Trading is a Professional Business
A) Trading
Time Table
You trading
day opens at 6 p.m. ET (all times mentioned are Eastern Time). Volumes are low
at this time; however, there are days, where the market makes an adjustment
move in the first 30 minutes after 6 p.m. ET. The next time period to check is:
8:30 p.m. to 11 p.m. After this, the markets usually halter, until they move
again around 2:30 a.m. (London Session). All financial markets usually take a
rest at 5:30 a.m. and restart at 7 a.m.; with more heavy trading volume until
noon. At around 1 p.m. the market participants then decide if they want to
confirm the morning direction or not; ending the day at 4:15 p.m., with an extended
our session for specific instruments and restarting their day at 6 p.m.
Your second
trading time table comes from considering economic news events that pertain to
the asset class you are trading: Futures and Forex traders consider an around the
clock time table. Find an example at our news section…click
here: Major news events are highlighter in red (“High Importance”). The
best way to tackle news events as a day trader: Stay out of the market over the
event and to re-enter when the market forces found a new directions, which
usually takes between 10 to 30 minutes. If you are holding stocks over highly
important economic events, stock earnings or news announcements, we recommend protecting
against a potential downside risk by adding options.
Stock and option
traders usually stick to the US-economic-news, where this weekly calendar gives
you a very good overview of the most important events…click here.
B) Prepare for the Assets You want to
Trade
There are assets
that trade with-, independent from-, and others that trade against the overall
market development. This always gives you the opportunity to either go long or
short with favorable instruments.
Why does this
matter?
Markets or
asset prices fall five to eight times faster than they rise and thus short
selling strategies should be an essential part of your way of trading.
Trade where
markets move: Fish, where the Fish are.
Either Build
yourself a scanner, which is in tune with your trade setups or subscribe to a
scanning service that provides you with an overview of assets on the move. Sticking
strictly to one asset or a limited number of assets, reduces your probability
for market participation and compounding interest.
NeverLossTrading
Alerts informs you on multiple levels with assets, which showed institutional
attention:
- Day Trading Alerts: Stocks, Options, ETF's, Futures, Forex
- Stock Trading Alerts: Stocks for Short-Term Trading, Swing Trading, Long-Term Investments
- Long-Term Investor Alerts: Receive a 1-5 week perspective for, Stocks, Options, Futures, Forex
C) Approximate
the Risk and Minimum Movements to Trade
Calculate the expected price move of an instrument per time
unit observed and only trade when the odds are in your favor.
Example: CSCO moves about 11-cents per hour, which is below
the minimum price move expectation, we would recommend to trade a stock or
option on, even so the stock is highly liquid, exchanging a minimum of
3-million shares per hour. On a daily time frame, the price of the CSCO share
moves about $0.33/day and fulfills the minimum requirements for a trade to take.
If you are looking for a high probability trading system …click
here and download an overview (PDF), which will explain how to work with
defined trade entries and exits, knowing meaningful risk and reward levels,
only entering into trades when the odds are in your favor:
Win in the average series of trades, where the individual trade
matters less than the overall performance in executing your trading plan,
striving for continuous improvement with the help of our mentorship programs.
For more details: Call +1 866 455 4520 or contact@NeverLossTrading.com
Be part of our free reports, trading tips and webinars…sing up here.
