For the people that I teach daytrading to, I am writing here a summary
how to earn 40 points trading the fdax every day:
1. You have to be certain that price will move in a predefined direction at a specific time.
To archive Step 1 you have to observe the chart of the prior days and how the cycle of up and down movements repeat every day. At the moment the cycle is this: What ever happend
after 10.40 yesterday will happen after 2.45 today and what happend after 3.00 am will happen after 9.30. (There is two exceptions to that rule, it does not work on monday morning and on wednesday the move after 2.45 am will be reversed) What you can do outside these two opening phases is looking for when the market was trending on the current weekdayone or two weeks ago, most days good trends also start at 4.30 to 6 am, so be prepared to enter on those times.
2. You have to be sure that your trade will be profitable (or at least breakeven), no matter if your prediction about future price movement will be correct or not.
To archive this you have to make a low risk entry, do do so enter with a stop order below a red bar short if the distance to the last swing low is at least 3 points (opposite for long trades you would enter above a blue bar) As the initial stop should be placed right above your entry bar, so in average 3 points away you have at the time when the price reached the last swing low a 1:1 risk reward ratio. For short trades place a breakeven stop when price reached a new swing low point and in sideways market after the high of last bar is below your entry price.
3. You have to be not confused or upset if you get stopped out 3-4 times before the actual trend starts. You can use a trendline break confirmation to avoid too many entry attempts.
So dont enter on breakouts, wait for the re-trace or for the retest. A save entry is also on the highor low of the day to enter after a reversal bar in a decision
4. You have to be certain when to exit your trade and because you dont now the volatility will be in advance you have to consider 6 different exit rules: Timed exit, Macro Exit, Reversal Bars, Trend end Exit, Trail Stop exit and New Setup exit.
5. You have to follow the 4 rules mentioned above and dont be concerned about the outcome, only if your mind is in the present you can fully concentrade on placing the trades. The result will be every day above 40 points if you dont try to outsmart the rules how the fdax trades :-)
