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Hi,

 

I want to start to trade soon. But i need some advice on software, brokers, and data feeds. I will be trading just the YM to start. What market internals should i look at, which ones in your experience have helped you the most? I was reading Mastering the Trade by John Carter and he recommends the Trin, Trinq, Tick, Tiki, put/call ratio, and the sector sorter list. Also, how could i use these internals all at once in order to confirm whether i should just focus on long or shorts? Also, what hardware do you recommend i get and how should i setup and distribute my software on the screen(s)? These might seem like some idiotic questions but i need some help from some traders with experience. Thanks.

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I have one suggestion for now - find a good paper trader (simulator) and test your ideas out there. While your post was small, it's loaded with 'how do I do this' questions and you have just barely put your foot in the shallow end of the pool. It's got a tiny, tiny drop of water on it. You can choose to slowly test the water or dive into the deep end and see how it feels.

 

This forum has good info everywhere, so click around and spend some time reading.

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  matinthehat said:
Hi,

 

I want to start to trade soon. But i need some advice on software, brokers, and data feeds. I will be trading just the YM to start. What market internals should i look at, which ones in your experience have helped you the most? I was reading Mastering the Trade by John Carter and he recommends the Trin, Trinq, Tick, Tiki, put/call ratio, and the sector sorter list. Also, how could i use these internals all at once in order to confirm whether i should just focus on long or shorts? Also, what hardware do you recommend i get and how should i setup and distribute my software on the screen(s)? These might seem like some idiotic questions but i need some help from some traders with experience. Thanks.

 

Have a look around the boards first because all answers to your questions can be found here. You need to be careful by applying strategies that you read in a book live. Test them out and make sure you have a profitable strategy. Techniques get outdated... and certain market internal strategies may no longer work. So once again, test it and then apply money management techniques into it.

 

One honest opinion.... your question regarding whether to use internals to confirm a short/long. This tells me right away that you should not be trading live yet. You will just be gambling away your money if you relied on these tools without any structure to your trading. Try them out first.. find what works for you, apply them to a strategy, test it. If profitable, apply it live.

 

Also for hardware, I run a 4gb Vista Core 2 Duo. Works for me.

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Most that books tactics are heavily dated.

 

This volatility we have going on will demolish most newer traders without a sound mind, deep pockets for wide stops and/or great entry skills.

 

Definitely not the best environment to be tinkering with live. I 2nd the sim trading thing heavily!

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  matinthehat said:
Hi,

 

I want to start to trade soon.

 

Here are a few steps you should take, in handy list format, before you trade live:

 

1. Educate yourself: Think about it this way, would you take Muay Thai classes for two weeks and compete in the Ultimate Fighting Championship? No, of course not, you'd get murdered. You need a complete, well rounded skill set to compete with trained professionals who've spent years honing their skills.

 

I recommend you read books that will help you to think about markets, understand how they move and operate, rather than just a system or a book about one small feature of the market. The last thing you should do is take a simple system or methodology and just start trading. You must UNDERSTAND what you are doing and why. You need a good cognitive framework to understand the market.

 

I, personally, recommend you read Mind Over Markets and Markets In Profile, and then come here and discuss them with us. Also, go to http://www.traderfeed.com. Brett Steenbarger has a free e-book on teaching yourself to trade that is awesome.

 

2. SIM, SIM, and then SIIIIIIM: Before you go live, you need to know you have a set methodology that works and that you can execute it in real time. Be strict with your risk/reward parameters and stops. Make it as realistic as you can. KEEP RECORDS. I can give you spreadsheets if you don't know where to start. Keep track of your performance.

 

3. Start with twice as much money as you think you need and half the size: Seriously, this stuff ain't as easy as it seems. SoulTrader and the crew just make it look that way because they'z pimps and stuff. Chances are you'll have your bumps and tuition payments along the way and you don't want to be taken out of the game before you get rolling.

 

4. Don't discount costs. Understand your costs going in. That means your computers, monitors, data costs, charting, exchange fees, commissions, rent, drinking money if you're into that kinda thing, whatever. You never ever want to feel like you HAVE to make money today or you can't pay your rent/child support payments/Mongo the Loan Shark.

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  MC said:
Most that books tactics are heavily dated.

 

This volatility we have going on will demolish most newer traders without a sound mind, deep pockets for wide stops and/or great entry skills.

 

Definitely not the best environment to be tinkering with live. I 2nd the sim trading thing heavily!

 

Great point. With the current volatility, the 1 lot trader is having the hardest time. For instance, my position size is half at the moment but using a wider stop and wider target. The 1 lot trader does not have this luxury to practice sound money management.

 

ES is extremely volatile now... price can easily jump 3pts against you before moving in your favor. If your typical stop is 2pts.... you are likely to get stopped out the moment you enter.

 

And talk about great entries... if you can take less than 1 pt of heat, you are absolutely amazing.

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Don't want to take this thread off topic, but have you guys looked at the Stoxx as a possible market to trade if the ES is too jumpy for you? I've been trading more there recently b/c for me at least, respects levels and so forth a little better. It's incredibly deep and liquid, which is nice too. Commissions also a lot lower than the ES.

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  Soultrader said:

And talk about great entries... if you can take less than 1 pt of heat, you are absolutely amazing.

 

You should come to the chat room more often and check out the traders who use <1pt stops ;)

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  brownsfan019 said:
Don't want to take this thread off topic, but have you guys looked at the Stoxx as a possible market to trade if the ES is too jumpy for you? I've been trading more there recently b/c for me at least, respects levels and so forth a little better. It's incredibly deep and liquid, which is nice too. Commissions also a lot lower than the ES.

 

Great market for trading in these conditions.

Wonder if you traded yesterday, ideal setups via the 20ema/pattern .;)

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  Bearbull said:
Great market for trading in these conditions.

Wonder if you traded yesterday, ideal setups via the 20ema/pattern .;)

 

Again...IF and only if you have proper patience for entry and/or wide stops to accommodate for the shakes and spikes of volatility.

 

Not that I'm debating...I've run the 21sma myself for most the time I've watched futures and if I had the right mindset and entry/exit plan MAN it could be profitable! :cool:

 

Love the thread guys.

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  Soultrader said:
Great point. With the current volatility, the 1 lot trader is having the hardest time. For instance, my position size is half at the moment but using a wider stop and wider target. The 1 lot trader does not have this luxury to practice sound money management.

 

ES is extremely volatile now... price can easily jump 3pts against you before moving in your favor. If your typical stop is 2pts.... you are likely to get stopped out the moment you enter.

 

And talk about great entries... if you can take less than 1 pt of heat, you are absolutely amazing.

 

That's me...1 lot wildman. And I'm gonna just sit cash till this mellows some because the wiggle room needed is sometimes 3 stops away from where I think it should be. LOL Spikes are wild on YM and ES here...too wild for my small account. :( Now if you have $ to let the stops work you are rolling in the $ here...such sharp moves to profit from. I'm sad I'm poor at this stage of my trading career. ;)

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  brownsfan019 said:
No - commissions. Actually at OEC margin is higher on Stoxx than ES.

 

Stoxx are on Eurex, where everybody gets "member" pricing. ES is CME, which means that you pay much higher for retail trades and if you want the cheap rates you have to lease or buy a seat.

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  sdoma said:
Stoxx are on Eurex, where everybody gets "member" pricing. ES is CME, which means that you pay much higher for retail trades and if you want the cheap rates you have to lease or buy a seat.

 

Yep. I understand how it works. Thanks. lol

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What type of internals all depends on upon what style of trading ultimately appeals to you. Like you, Carter's TTM book really got me into futures trading. I started trading YM exclusively January 1, 2008. It's been a great ride. The setups in Carter's book are just starting points - they don't simply just work out-of-the box. I did manage to make the opening gap fade into a mildly profitable system but that was after much testing and refining of the parameters. Check out the TTM web site for free daily videos. You can get a lot of hints from that.

 

TTM Free Daily Videos

 

These are some steps that I started last fall before jumping into trading YM:

 

1. Do not trade live yet until you have developed a trading plan. Pick one or two setups, define your risk and define all possible entry and exit scenarios.

 

2. Trade your plan on a simulator until you are consistent where you do not deviate from your plan.

 

3. Get copy of Trading in the Zone and do the exercise in the book.

 

In the end, I became successful at trading only after discovering consistency, sticking to a plan and removing emotion from trading.

 

You don't need a fancy computer to start trading. I use TradeStation 8.4 on a Mac mini with one 20-inch screen. My fees are $4.26 per contract for a round trip and a $10 monthly data feed fee for CBOT E-mini feed. Oh, TS also has a simulator.

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The highest payback trade you can make right now is to trade going live with gaining screen time.

 

The volatility is incredible right now. The daily VIX is pushing ever higher. And, the bar-by-bar volatility is getting larger and larger.

 

I've just come back to watching real-time data after doing other stuff for several months. What a difference a quarter makes! I'm just paper trading right now to get my execution back up to snuff. By the time I receive my entry confirmation (a couple of seconds), my first target is usually already hit and surpassed.

 

The speed of these moves are lightning fast. Unless you and your trading tools are tuned up and ready to instantly react, don't do yourself the disservice of putting your money on the table. In these conditions, you will not have the luxury of taking the few moments a beginner needs to check off in your head that all your entry requirements are met.

 

Enjoy the ride,

 

Bam-Bam

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