Posted by straighttalktrading in Intraday Trading Secrets. FOUR scenarios have to be considered by intraday traders 15M charts and below on a daily basis. In fact, these scenarios have to be considered by every trader.

Before we look at them though, we must consider our bias — the direction we believe the trend is headed in for the day. On any given day, regardless of bias, you should plan for both moves up and down. Depending on your methodology, you may have different ways for projecting resistance and support.

Nonetheless, the four scenarios should be as follows:. Price moves up and you find a way to sell the rally. This will usually involve a level of resistance higher up, but not so high that it invalidates the bearish assumption. Price moves past a point where the bearish assumption becomes invalidated.

In this case, price is breaking out towards the topside. Breakout traders would buy this, whereas bounce traders would wait for a small pullback to buy it. In this case, you also want to have breakout targets. Price moves down and you look for a way to buy the dip. This involves a level of support lower down, but not so low that it invalidates the bullish assumption.

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Price moves past a point where the bullish assumption becomes invalidated. In this case, price is breaking lower. Breakout traders would sell this, whereas bounce traders would wait for a small rally to sell.

In this case, you also want to have targets to the downside. Most traders never so much as consider these possibilities, but they are the essence of intraday trading.

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First come, first served. Day trading , Foreign exchange market , Forex trading strategy , Price action trading. INTRADAY trading is one of the domains of several types of traders: In order not to fall in the category of the foolish, one would be well-advised to be aware of the levels that other traders take account of.

Here is the logic behind the 2 simplest ones. There are also systems that aim to fade the breakout of these levels. Thus, you expect in general to see plenty of volume around these areas. The result is that they are prime candidates for choppiness on the 5 and 15 minute charts. Knowing this, you know not to take trades too close to these levels, or to suspect the market of catching the unwary with fake setups at these levels.

You also know that when you are in profit, to take some off the table and be more defensive at these key levels. Easy when you know it. Enquire via the Straight Talk Trading website form bottom of page. Daily range trading , Forex trading session times. INTRADAY TRADERS , particularly those that trade the 5M and 15M charts, often miss one simple fact — many days, price will complete its average true range ATR.

The range can be gotten off a simple indicator on the daily charts.

It is true that it is an average number, so some days will have less pips, and others will have more. However, by and large, most days in my experience come pretty close to the ATR.

HOW CAN YOU PROFIT FROM THIS FACT? I do not want to delve into those in detail here, but suffice it to say that the London morning session is for me am in London and the New York morning session is am in New York, whatever the local time is. Daylight savings time can mess things up so it is best to just check the actual time rather than quoting it based on GMT.

I personally like the Forex Timezone Converter. The Asian session occurs well, in the morning of Asia. Most base it off Tokyo, although some consider Australian time. Essentially, a good chunk of the time, the Asian session is quiet for trading. This does not mean that it cannot be traded, incidentally. If you choose to trade this session, use a reversion to the mean system — trades tend not to trend, so betting on a return to the range is usually a good idea.

The London morning is far and away the best session to trade — it moves well, especially Tuesdays to Fridays. Mondays can be choppy or tepid in all sessions. This is a trending session, usually. It may fake you out occasionally, but generally it will behave itself, giving the possibility of many pips. The New York session is the London afternoon. I rank it second best. I have found this session to be generally more choppy than the London session over the years.

I believe this is partly due to London traders winding down their positions in the New York morning as the London day draws to a close. Occasionally, the Asian session range can even go up to 50 pips. However, this range is tricky for trading, as it only truly defines itself towards the end of the session. If you can get a clear range trade, one method to trade is to use false breakouts. Wait for price to break out of a defined range during this period, and then go counter to the breakout direction when it immediately goes back to the range.

Many times, this will head to the other side of the range, so you can adjust your risk-to-reward ratio accordingly. Note that there is usually a month or two in the year when the Asian session trends, but I have not noticed any seasonal pattern to this. The methods of detecting those are beyond the scope of this discussion.

The London session is the turnkey session. We can have a few types of days, but the most common is the fake and turn pattern. On the daily chart, notice that most candles on any currency pair has wicks. This gives a daily candle wicks on both sides. Well, London is often when the first wick of the day is formed. This can happen with price doing a false breakout as described with the Asian session and then turning back into the range to punch through the other side.

This can also happen with a fake breakout move in Asia continuing into a proper breakout trade. Essentially, during London, we know that the high or low which we can hook the ATR on will likely be formed, but we need more price information to tell where that is. Thus, the bias is based on the usual factors — trend, momentum, cycle, time and trigger.

If more has been completed, you could be hopping on the bandwagon too late. Of course, if you think the move is fake, then your advantage increases as the ATR completes. The New York session is when the ATR comes into its own. The market has very often tipped its hand by the time New York opens. London has trended in one way or another. If it has gone in the direction of the major trend, then New York will continue this move before eventually stopping to pull back, usually at the end of the New York morning session.

This type of countertrend pullback is not really worth trading, as it can be very shallow. If the trend was up, a day that has been moving down is likely to meet support.

Thus, once the ATR for the day is fulfilled, it is a logical place to look for a buy. This simple fact alone can be extremely useful. In short, for the NY session, use the ATR as a guide to help you pick when the top or bottom for the day has been put in, and trade in the direction if your trading plan allows you to do so. Day trading , Foreign exchange market , FXCM. Their systems analyse the percentage of retail longs and shorts, and collate that information.

They then use that as a basis for identifying the likely direction of major currency pairs. You get the idea — the crowd is usually wrong. So, by going counter to them, they take the money of uninformed traders. Hopefully, anyone reading this blog is informed or will be by the time they finish with us! Now, you can get this from the DailyFX Plus website. You will, however, need to have a live account no real minimum needed other than the usual requirements for access.

Last time I checked, however, they were giving out passes for limited periods. How to read and analyse that information? They crunch it for you on a daily basis. Follow it for about a week and you will get the hang of it.

Finding a trading strategy , Price action trading , Relative strength index , Technical analysis. When we conduct our live trading sessions, I show clients how to identify the daily trend and momentum in less than 10 seconds. Let me emphasise that it is nothing special. We can do it because we know our systems inside out. We have polished our edges into sharp blades with which we carve profits out of the market.

Whether you are a daily or intraday chart trader, I strongly encourage you to do the same. Before we go any further, pause a moment to ask yourself one question: This is more difficult to explain than it looks. Largely, it depends on your system. In my own terminology, the trend is the larger move. Within this trend, you can determine smaller waves moving up and down.

These waves are the cycles. It is the direction in which price showed the greatest acceleration. It is up if there is bull pressure and it is down if there is bear pressure. Momentum very often aligns with the larger, true trend.

For our purposes here, it is safe enough to assume that the momentum represents the true trend.

Trend here is the smaller wave movement. When it swings in the direction of momentum, it moves further and more coherently. When it swings against momentum, it moves more uncertainly and usually goes less far. There are many ways, but in this context we can use a simple crossover. If that gives us our daily direction, why should we care about momentum? The trend pushes price along in the right direction, and momentum very quickly takes over because that is the line of least resistance.

When momentum and trend are going in opposite directions, expect choppy price action. IN FACT, YOU CAN EXPECT NOVICE TRADERS TO LOSE MONEY IN THIS PHASE OF PRICE ACTION.

Place a simple RSI with default period 14 on a chart. Place the 60 and 40 levels on the RSI. If RSI last closed above 60 in recent history and has not closed below 40, the momentum is up. This momentum continues to be up as long as RSI does not go below It does not have to remain ABOVE If RSI last closed below 40 in recent history and has not closed above 60, the momentum is down. This momentum continues to be down as long as RSI does not go above It does not have to remain BELOW So, if RSI last closed above 60 and the 5 SMA has crossed above the 8 SMA, then the trend and momentum are aligned to the upside.

VERIFY THIS FOR YOURSELF: Put the RSI, 5 EMA and 8 EMA on a chart and look for periods like this. Count the number of days that are up versus the number of days that are down. You should find that the number of UP days are significantly more.

Similarly, if RSI last closed below 40 and the 5 SMA has crossed below the 8 SMA, then the trend and momentum are aligned to the downside.

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You should find that the number of DOWN days are significantly more. When any of the other possibilities occur, momentum and smaller trend are not aligned and thus you should expect more uncertainty. The number of up and down days are usually slightly skewed in favour of the trend the cross , but much less significantly so. Forex trading strategy , Intraday Forex Trading. I remember one particular participant at an training event in SE Asia. He shared that he no longer did intraday trading.

In fact, he only took trades quite profitably on the daily charts. A rather harsh statement, especially since I do trade intraday charts myself! However, he has an important point.

They never realise that intraday movement is determined by the higher timeframes. Essentially, intraday trading is taking part in a a bigger timeframe swing. If you are trading counter to the higher timeframe trend, you are probably playing a losing game. Note that trend, cycle and momentum are all considerations , but for now I will share just one trick that will help you massively in deciding the direction of the day.

Before you take an intraday trade, go to the daily chart. Place two simple moving averages on it: When the 5 crosses above the 8, there will generally be more up days than down days. When the 5 is below the 8, there will generally be more down days than up days.

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Of course, in itself it is not enough to trade on, but if you know your trading bias for the day, you will stop getting lost in the jungle of the lower timeframe charts.

When I learnt to orient myself to the daily chart, my trading improved dramatically. Create a free website or blog at WordPress. Bullish Bias If you have a bullish bias, you will essentially have two strategies: To buy dips in an uptrend, or 2.

To buy breakouts to the topside. Bearish Bias If you have a bearish bias, you will have the corresponding two strategies: To sell rallies in a downtrend, or 2. To sell breakouts to the downside The Four Scenarios On any given day, regardless of bias, you should plan for both moves up and down.

Nonetheless, the four scenarios should be as follows: Tags Day trading , Foreign exchange market , Forex trading strategy , Price action trading. Tags Daily range trading , Forex trading session times.

HOW TO COMBINE ATR AND FOREX TRADING SESSIONS Here are some tips related to the trading sessions: Tags Day trading , Foreign exchange market , FXCM. Tags Finding a trading strategy , Price action trading , Relative strength index , Technical analysis. It all comes down to asking a question: What is the difference between trend and momentum? Great, so what use is this to me?

So give me the secret already! Putting It All Together So, if RSI last closed above 60 and the 5 SMA has crossed above the 8 SMA, then the trend and momentum are aligned to the upside. This valuable piece of information can provide the basis for many a trading system.

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