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A Simple Day Trading Strategy by Markus Heitkoetter
A Simple Day Trading Strategy by Markus Heitkoetter : " In this video I am presenting a simple day trading strategy using Bollinger Bands and MACD."
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Time flies, doesn't it?
It's hard to believe that just 10 years ago I was still stuck in the corporate rat race, working for IBM. I was working 60-80 hours a week, thinking that I had "job security." - What an illusion!
10 years ago I was still living in Munich, Germany, wondering if I will ever be able to retire comfortably and to enjoy the things that really matter in life.
And now - just 10 short years later - I'm living right at Lake Travis in Austin, TX. As I am writing these lines, I'm sitting on my deck overlooking the pool. It's December, but the temperature are still in the upper 70s, and I'm feeling the warm sun on my face. Behind the pool I see the sail boats gracefully gliding through the lake. The kids are 7 and 9 years old now, and they are playing with Riley, our border collie.
Over the past 10 years I have been able to focus on trading and achieve what many would call "The American Dream." I am my own boss now, and life is good.
But it hasn't been easy to get to this point. Trading is tough, and it took me a while to figure out what it REALLY takes to become a successful trader. Years ago, when I started trading, I thought all I needed was a "profitable trading strategy" - or a "trading system with a proven track record." And I would spend a lot of money, time and effort on buying trading courses, strategies, systems, books - just to realize that they did NOT help growing my trading account.
I wasted a lot of time and money and did not realize, that the missing piece of the puzzle was right in front of me, hiding in plain sight! I was too busy trying to find "the good stuff" by attending webinars, seminars, reading eBooks and wasting countless hours on the Internet.
Do you know the feeling when you finally discover the solution to a problem that you've been battling with for so many years, and then you wonder why you didn't see it earlier? The "Duh" moment when everything finally comes together, the fog is lifted and you can now clearly see what you've done wrong? When you ask yourself "how could I waste so many years?"
On my website eBook "Adventures Of A Trader" I will tell you about the adventures of a trader - MY adventures. I want to share with you why I left the corporate world 10 years ago, moved 5,621 miles from Munich to Austin, TX to become a professional trader, how I struggled and the important lessons learned from these experiences, and how I finally "got it."
On that website you will see the links to several "chapters" of this book, and I invite you to join me on my journey. And no, this is NOT a "look-at-me-I-am-so-awesome" story. In fact, often it's not glamorous at all! I will openly confess the mistakes that I made, how I lost a lot of money and wiped out my account several times, and how stupid I was falling for all the false promises of the "trading gurus", wasting a lot of time and money!
I am convinced that often you might see yourself in this story, and I hope that my story will help you to avoid some of the mistakes that I made - and save you some time and money!
The Complete Guide to Day Trading: A Practical Manual From a Professional Day Trading Coach
http://youtu.be/QQVTP46euZs
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Why Is It Important to Update MetaTrader 4 to the Latest Build by August 1?
From August 1, 2014, MetaTrader 4 desktop terminals older than build 600 will no longer be supported. However, many traders still work with outdated versions and are unaware of the updated platform's features. We have put a lot of effort into development and would like to move on with traders and abandon the older builds. In this article, we will describe the advantages of the new MetaTrader 4.
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How high frequency trading works
High frequency trading has roiled the stock and bond markets. The machines have taken over, and they can do far more business than a human can. But HFT has plenty of risk attached, as this short video explains.
http://youtu.be/f2cbylOElm0
Stay in Strong Trends with the Heikin-Ashi Candlestick
Talking Points:
-Why Mess With a Good Thing?
-The Purpose of Heikin-Ashi
-Trading With New Vision
“You can observe a lot by just watching.”
Yogi Berra
http://youtu.be/AWFbP_n8aRE
Candlesticks are a great tool to help you see sentiment in real-time. However, there is something deeper than what the candlestick is showing you. That something deeper is your fear of being on the cusp of a reversal against your position. Therefore, a false signal of Candlesticks can be costly where as Heikin-Ashi would have likely kept you in the trade as this article will explain. Heikin-Ashi is a free indicator available to be added, like a moving average, to your chart.
Heikin-Ashi (Right) Smooth Out Trends
https://media.dailyfx.com/illustrati..._Picture_1.png
Why Mess With a Good Thing?
The short answer to this question is that there is a lot of noise with candle to candle price action which can make some candlestick signals misleading. How they are misleading is when you get more noise than signals. Even though candlesticks can help you to find & confirm higher-probability entries when a reversal is shown by other tools or techniques, traders need to be aware of a potential false signal.
https://media.dailyfx.com/illustrati..._Picture_2.png
Heikin-Ashi also simplifies the process of visualized trading. If you’re familiar with Candlesticks, you may be aware that there are over a hundred documented Candlestick patterns. This means that not only is it difficult to learn all candlestick patterns, but as you can see above, there not always reliable. The highlighted boxes above are to highlight reversal signals, known as Shooting Stars that did not result in a true market turn and could be seen as noise vs. a true signal.
Bottom Line: Candlestick Trading doesn’t always provide clean signals and can produce noise in a strong trend.
The Purpose of Heikin-Ashi
Heikin-Ashi is a visualized balanced candle so that you can filter price of the current move for the overall trend. Heikin-Ashi is sometimes known as an average candle to replace or confirm candlestick patterns. As you can see from the calculation, Heikin-Ashi averages out the prior candle to build a bias for the overall trend continuation and the current candle.
Heikin-Ashi Formula
Close = (Open+High+Low+Close)/4
Open = [Open (previous bar) + Close (previous bar)]/2
High = Max (High,Open,Close)
Low = Min (Low,Open, Close)
By looking at the calculations, you’ll be able to see that Heikin-Ashi is a technique which looks at the average price of a candle and uses that to plot the next candle’s open. Because the current candle is plotted based on the prior candle’s average, you’ll notice a sequence of same-colored candle bodies to show a clean trend with longer bodies & candlewicks in the direction of the trend showing you strong trends.
Few Red Heikin-Ashi Candles Show a Strong Trend
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Trading With New Vision
Heikin-Ashi doesn’t look for traditional candlestick patterns. Rather, when using Heikin-Ashi, you’re looking for a strong trend to stay in while always managing risk with a trailing stop. When the bodies get weaker / smaller or begin to change color, then a reversal and / or correction is on hand, it’s time to step aside from the trade as the future is increasingly uncertain in respect to the prior trend you were trading.
The strongest trends are displayed with a shaved Heikin-Ashi candle. If you are trading an uptrend with Heikin-Ashi applied to your charts, and the current candle shows no candlewick to the downside, the trend is very strong and it is best to stay in the trend until either a red candle appears which my preference is or a bottom candlewick forms. This form of trade management provides an active and intelligent trailing stop so that you’re only exiting on a likely consolidation that can chew up time or a reversal is on hand.
Trailing Stop Example
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Closing Thoughts
Heikin-Ashi allows you to “trick” your eye to staying in the strong trends that can throw off weak or false reversal signals. This trick is based on averaging the prior candle so that the current price action is only filtered through the prior candle as opposed through the time of the prior candle. If you have trouble jumping out of a trend well before it’s done, Heikin-Ashi could be a helpful indicator for you.
Happy Trading!
---Written by Tyler Yell, Trading Instructor
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