price action Archives • Futures Day Trading Strategies

Posts Tagged Under: price action

Using Multi-time Frame Analysis To Improve your Futures Trading Results

 

This article on Multi-time frame analysis is the opinion of Optimus Futures, LLC.

Being able to comprehend how price information printed on different time frames connects to yield a complete picture of the market is a very useful skill for traders.

Most trading strategies – built on popular trading mechanisms like common technical indicators and chart patterns – only emphasize the time frame being watched and analyzed per se, with no regards to higher or lower time frames.

This can be a grave mistake to make. As much as it extends your analysis and requires studying the same price action from different perspectives (which some new traders find daunting), it is a much needed aspect of becoming a long-term futures trader.

Regardless of whether you trade on the higher time frames as a swing trader or a long-term trader, or whether you are a scalper glued to the lower time frames, keeping a hawk

Read More


How to Trade Divergence the Right Way!

 

Spotting and trading divergence is a common practice employed by technical traders, irrespective of the time frame or market. There is a lot of literature around the web sharing the nuances of spotting divergence correctly, including the use of swing points and drawing reference trend lines on the oscillator and price itself for assistance and visual clarity.

But there is clearly more to divergence than just spotting it right. And that truth jumps out at you more than ever when you notice instances where price continues on with the trend while your favorite oscillator indicator continues to print diverging highs or lows, leaving you scratching your head. How exactly do you time your trades to make the most of the divergence?

Let’s take a deeper look to explore how divergence works in the marketplace.

Divergence is an Indication, NOT a Trigger

The first thing we need to understand is that divergence alone is

Read More


Three Ways To Determine High Quality Trend Lines

 

Trend lines are among the most commonly used trading tools used by technical futures traders. Whether you run a trading strategy built entirely upon using and trading off of trend lines, or you use them in a limited capacity to determine your entries (or exits), the need to locate the high-quality ones that aid in trade placement or management is a critical skill for a technical trader to master.

The hunt for quality when it comes to trend lines stems from the fact that they can be drawn to connect essentially any two lows or highs on a chart, but may not always be as useful. Let’s look at three ways you can separate a potentially high-quality trend lines drawn on a chart, versus any random trend line connecting multiple highs or lows.

1) Trend Lines Precision

Precision is a key factor when it comes to the strength of a trend line.

Read More


Stop Trading the P&L! Establishing a Proper Trade Exit Strategy

 

Read the Chart and do not Trade your P & L

The reason many traders fail when it comes to exiting trades is because they focus solely on the money they can potentially lose or win instead of making market-related decisions. This is also called “trading your P&L,” where traders completely detach themselves from their charts and market context and respond only to their account balance and the unrealized profits on their futures trading platform. (P & L stands for Profit and Loss)

Improving Profit Taking & Exiting Trades

Profit-taking or loss, or exiting trades in general, is arguably more important than entry timing because how you exit your trades determines the long-term outcome of your P&L. However, most traders don’t spend much time on developing their trade exit strategies and are often uncertain of even how to exit. This results in emotional trade management driven by impulsive decisions with no clear plan.

Read More


Cutting through the Noise – Analyzing Price Action Correctly

 

Over the past few months, we have looked into the different indicators and charting tools that help us better understand price action. Today, we are going to take a step back and focus on the purest form of price and chart analysis: Trend and Wave analysis.

We will explore how the formation of swing highs and swing lows and trend wave analysis can help traders understand the overall market context. Every good chart analysis should start with an examination of trend and wave analysis, and we will show you how you should approach it using the recent price action of Gold Futures and T-Bonds ( 30-Year-old) Futures.

 

The Basics of Trend Analysis

Before we get into price analysis and chart studies, let’s take a look at the fundamentals. Every chart and trend pattern, including range markets – are made up of individual swing highs and swing lows.

A swing high is where a bullish trend

Read More