Currency Futures Trading

When trading futures, especially when day trading futures, it is my opinion, that a future’s trader has to be aware of two key technical facts. The first is the technical structure of their specific market, which is to say the big picture of the market and the technical significance of key technical areas. The second key technical fact is the strategic importance of the technical structure of the market they trade. Now, what does that mean?

How many times have you been a position that you thought was technically sound with a well placed stop, only to see the market move against you just enough to take out your stop and then move back in the direction you had speculated it would move? By not realizing the strategic perspective of a market, I believe will result in these kinds of trades.

By not fully understanding the strategic perspective of a market and the potential strategic consequences of a move, then it is my opinion that a futures trader day trading futures is at a major disadvantage. Remember, it is my perspective, opinion and or outlook that day trading futures isn’t meant to be easy or a game that everybody can make money at. For every loser there is a winner, therefore the market needs both winners and losers. So, for traders that enter the game without fully realizing the importance of losers or losing to the traders that win, I believe will be limited in their ability not only to assess the market, but also in executing, managing and exiting their trades.

I’ve spent many years talking to traders both professional and amateur and one thing is clear for me. A professional trader sees an objective, identifies risk and executes a trade, or stands pat. If the trade doesn’t work he resets and trades again understanding that a major ingredient of futures trading is trading. An amateur often looks for the Holly Grail to trading; the perfect entry, the perfect stop, the perfect commission, the perfect platform, the dream of millions and so on and so on. Only to be disillusioned when they find out trading is nothing like what they imagined. Just like anything day trading futures is work, it’s constant assessment, reassessment, identifying risk and objectives, not to mention all the pre-trade analysis. You notice all this comes before a single trade.

Bottom line, if you want a no nonsense perspective to trading, as well as a unique strategic perspective you can simply sign up for a private presentation and get a clear idea on the how’s and why’s of how I trade the markets, which is absolutely FREE. If you like the perspective then come to my trading room, access my trading simulator and test my ideas. Once again it’s FREE. I will not solicit you for a subscription and or seminar; you know the one that cost a $1,000 for the initial weekend and the $300 monthly subscription fee. 

So, if you are serious about trading, and can appreciate a no-nonsense approach to the most aggressive markets in the world then come see for yourself if THE TRADING WAR ROOM can give you the edge you have been looking for.

If you have never traded then come discover the potential of day trading futures, specifically currency futures and determine for yourself if it’s worth the risk. Remember, trading isn’t for the meek or garden-variety-investor, but for those individuals who understand that to get profit without risk, experience without danger and reward without work is as impossible as it is to live without being born,’ A.P. Gourthey.

There is significant financial risk in trading futures, therefore you should carefully consider whether trading futures is right for you in light of your financial position.

Day Traders can utilize a multitude of trade triggers to enter and exit a market. Once such DAY TRADING STRATEGY is the use of short-term trading ranges. A futures day trader could fade a rally or buy into a sell-off utilizing a trading range to help determine possible entry points or stop locations. Every market in my opinion has it’s own DNA or particulars in the way it trades. So, when utilizing this kind of day trading strategy in one market, the particulars won’t necessarily transfer over to another market. This day trading strategy is applicable to all futures markets, but the exact particulars should be assessed and modified when appropriate.

What does it mean to fade a rally or buy into a sell-off? When fading a rally a day trader takes a position in the market looking for the market to reverse or sell-off. When buying into a rally a day trader takes a position in the market looking for the market to reverse or go up.

What is a Trading Range? Every market has an average trading range, which typically translates into a percentage. The trading range can vary depending on how much data is calculated. A range with fewer data points will be more volatile, while a trading range with larger amounts of data will have a smoother average of trading ranges. These ranges can then be applied to the market in such a way that it gives a futures day trader a statistical probability or chance of a certain outcome.

Here is an example of how a futures day trader day trading futures might utilize this day trading strategy (trading range) to enter, manage and or exit a market. Let’s imagine a futures market that traded within a 1% range, nearly 75% of time based on the last two years of data. A futures day trader could utilize this trading range to enter a short or long position at .95% of the market’s range. In this example a futures day trader is looking to fade a rally or buy into a sell-off and is speculating that 75 percent of the time the market will not trade outside a 1% range. This same futures day trader could place a stop one tenth of a percent above a 1% range, again utilizing the trading range in this particular example as a way to help manage the position. If the market were to trade outside of the 1% range, a stop would be triggered and the position exited.

Once again, the above illustration is an example of how a futures day trader day trading futures might utilize this type of day trading strategy (trading range) in a particular market to implement intra-day trades. This particular day trading strategy could also be combined with other day trading strategies as a way to enter, manage and exit positions. 

Remember, trading futures is not for the meek or garden-variety-investor, but for those individuals who are looking for aggressive alternatives. There is significant risk of financial loss in trading futures and you should carefully consider whether such an investment is right for you.

To understand this phrase you have to understand my perspective not only on day trading futures, but my perspective on the futures market as a whole. Trading futures is a zero sum game, which for most traders is something you already know. For those of you who don not know what a zero sum game is let me give you a partial definition from Wikipedia.

In game theory and economic theory, zero-sum describes a situation in which a participant’s gain or loss is exactly balanced by the losses or gains of the other participant(s). Zero sum games are also called strictly competitive. 

The idea of the zero sum game has had a major impact on not only on how I look at the markets, but also on how I look at other traders. In day trading futures, utilizing the definition from Wikipedia, helps me understand that trading isn’t only about assessing information about price, but also about assessing the strategies of how day traders can try and outwit other day traders. Remember, one participant’s gain or loss is exactly balanced by the losses or gains of the other participant(s). It’s also my opinion, that this kind of strategic market action is probably more easily seen in day trading futures, then in long term price behavior, which I believe is dominated by the fundamentals of supply and demand.

But for those of us trading the noise, or the day-to-day price action, the futures market becomes a battlefield of day trading soldiers looking to take out other day trading soldiers. What weapons, tactics and analysis techniques day traders utilize are all different, but our objectives are the same. Remember, the zero sum concept? A participant’s gain or loss is exactly balanced by the losses or gains of the other participants.

So, when I first assess a market, I’m not interested in the weapon I’m going to use when it’s time to get into the market. I am more interested in trying to understand the strategic layout of the battlefield first. Think of it like a chessboard, what are the pieces on the board telling me. Is my opponent playing for position, or is my opponent trying to trap me into a bad position. It’s this kind of perspective I bring to the game of Day Trading Futures.

I will take this perspective out a little further. Once I get an idea of where I might want to engage the market based on my analysis, then I begin to assess what kind of tactics will work best in the battle that I’m about to engage in. This means, what kind of short-term trades will I implement when the shooting starts? If I were anticipating an increase of short-term volatility then I would consider utilizing a short-term day trading strategy that implements a higher frequency of trades. If I were not anticipating an increase of short-term volatility, then I would look to implement a short-term day trading strategy that is more specific in regard to price. This is what I would consider a sniper approach to Day Trading Futures.   

Once again, this is just my perspective on Day Trading Futures. It’s not meant to be a Holy Grail of trading. Think of my perspective and analysis as a scouting report in regard to football. The scouting report is about understanding the strengths and weaknesses of your opponent and then creating a game plan that will assist in beating the other team. The scouting report is about what kind of strategy (running more or passing more) might work in scoring touchdowns and what defensive schemes will keep the other team from scoring. The football plays (trade triggers) are what get you into the market.

Trade triggers are the weapons we utilize to get us into the battle. These weapons are the plays that the football team practices day in and day out. Now, I’m going to go out on limb here, but I don’t believe there are any football teams that rely on just one play to beat an opponent. This is why I don’t subscribe to the theory that you only need one definitive trade trigger to get you into the market. Again, this is must my perspective on Day Trading Futures.

If you would like to talk about my analysis in further detail, simply schedule a Private Presentation.

If you are a trader Day Trading Futures then let’s talk and see if my perspective can give you the edge you’ve been looking for. If you are thinking about getting involved in Day Trading Futures then come discover the potential and determine for yourself if it’s worth the risk. 

Opinions expressed are subject to change without notice. I make no promises or guarantees Implied or otherwise that utilizing short-term trading strategies will result in profits or limited losses. You should carefully consider whether trading commodities is right for you in light of your financial condition. Again, there is significant of financial loss in trading futures and trading futures is not suitable for everyone.