Watch this short video about “trading along with Jeffrey” on the M1 Channel
NOTE: All Traders should do their own due diligence and SIM Trade any new strategy for several days to get a feel for the follow through you will experience from the alert barriers. Every strategy has a different “flavor” and it is important to expose yourself to the trade mechanics in different market conditions without fear or risk before trading a live account. Track your SIM results in a spreadsheet and only attempt to trade live when you able to capture a good PnL over the series.
The M1 Channel tab will automatically appear in the Alert Software on Tuesday-Wednesday-Thursday
(M1-CHANNEL) Desktop Alert Software Instructions – Scenario #1
With this particular type of alert we will be using a slightly modified approach with the desktop alert software. This specific strategy does not use the Dynamic Range Breakout Concept utilized by the other algos – but instead we will be trading off of a single specific barrier as it arises. There will be 3 basic software states, (1) Hunting For The Trade Barrier. (2.) Potential Trade Barrier Found (3.) Confirmed Actionable Trade Barrier Alert, i.e. (Get Ready, Get Set, Locked and Loaded) In alert software scenario one, the software the Dynamic Trigger area will be blank, the Momentum Meter will be in the blue at 20 and the Directional Arrow will be flat. This a neutral hold state while waiting for the system to alert us to the next potential trade barrier. Note: These Alerts will come through the M1 CHANNEL Tab at the bottom left of of your alert software. (The Average Volume is not displayed).
Desktop Alert Software Instructions – Scenario #2
In alert software scenario two, (2.) Potential Trade Barrier Found (Get Set)- the Momentum Meter will shoot into the green at 50 and the Directional Arrow will display a green up arrow or red down arrow designating current trade direction. The software the Dynamic Trigger will display the POTENTIAL trade barrier located by the system. As price continues to shift you may see this level dynamically change. This Alert States to GET READY. It is ONLY A POTENTIAL TRADE BARRIER at this point and subject to change.
VERY IMPORTANT: This is NOT a price entry recommendation at this point but A POTENTIAL BARRIER TO ACTION. Please do not “Jump the Gun” and place – ANY MARKET ORDERS – at this price level UNTIL THE FINAL 1 TICK TRADE TRIGGER OCCURS which will be described further below.
Desktop Alert Software Instructions – Scenario #3
In alert software scenario three (3.) Confirmed Actionable Trade Barrier Alert, i.e. (Locked and Loaded) you will see the final main visual/audio TRADE BARRIER ALERT with your local time stamp above.
VERY IMPORTANT: This is STILL NOT a price entry recommendation at this point but NOW A CONFIRMED BARRIER TO ACTION. Please do not “Jump the Gun” and place – ANY MARKET ORDERS – at this price level UNTIL THE FINAL 1 TICK TRADE TRIGGER OCCURS which will be described further below.
Final Trade Entry Trigger
Once we have a CONFIRMED TRADE PRICE BARRIER you will watch for a minimum of 1 tick (0.25) Trigger Move before considering any entry based off the alert price…. ONLY when price action is able to penetrate the CONFIRMED PRICE BARRIER, is this your systematic -> GO signal.
System Targets and Stops
At the appropriate time, the Alert software will display a Dynamic Target price and Trailing Stop. As a systematic/discretionary trader you always want to rely on your Initial Protective Stop based on your trade configuration and attempt to get to a Delta-State or move your stop to break even based on the 3 bar trigger just described above. WHEN AND IF the alert software issues a trailing stop alert you then have the option of incorporating this price level into your trade management. Likewise if you are shooting for a fixed static price target based on your trade configuration and the alert software issues a Dynamic Target Price, you have the option of incorporating this into your personal trade targeting.
NOTE: The majority of the time, the Dynamic Target and Trailing Stop do NOT appear at the same time of the final trade barrier alert but come in at a later time when appropriate.
Managing The Runner
If the markets are running hot it is many times very easy to catch much bigger moves by placing a 10-point target with the combination of the system trailing stop. Once price action passes the final confirmed trade barrier by a certain point based on the market conditions the system trailing stop will begin to update in the alert software. If you are in a trade you can protect it AT or NEAR the currently posted System Trailing Stop level and you will now be locked into a WIN/WIN trade result. Either your full 10-point Target will be hit or you will be taken out by the system trailing stop. This is an excellent way to combine the statistical benefits of being a Discretionary/Systematic Trader and avoiding over analyzing or micro-managing your trades based on gut feel.
The System Auto Trailing Stop is designed to accelerate at the proper speed based on the aforementioned trade configurations and provide a statistical advantage to the systematic trader over the series. The trailing stop is issued once the system detects there is enough wiggle room between price and the barrier. This will typically be a move of 1.5 point past the barrier. Again, it is recommended you use an INITIAL protective stop based on the specific trade configuration you are using and employ the trailing stop for a secondary part of your trade AFTER you hit your first delta target or have physically moved your stop to Break-Even. Note: If you do not purposely pull profits at one of the designated fixed scalp targets you may be able to stay in trades for much larger point gains should the market throw us a big impulse move to work with utilizing the system trailing stop.
Mechanics For Scratching A Trade
Another important way we can fine tune our statistical probabilities in trading over the series is to attempt to scratch a trade that exhibits signs of failing. The majority of good trades that are most likely to follow-through and become winners tend to take off in our favor relatively quickly. Those that do not can begin to fail quickly. About 50% of the time the market will give us one quick chance to get out of a failing trade if we take the opportunity and attempt to scratch at our entry point. Based on the trade configuration tolerances outlined for this strategy you can consider attempting to scratch a trade on any -1.00 to -1.50 move again your position. In highly erratic markets a few successfully scratched trades can keep you in the game a bit longer until the market smooths out and the energy picks up and we see more decent price follow-through. In choppy/dull, low follow-through conditions, loss prevention is your first concern.
Important Systematic Trading Principle
An finally… an Important Systematic Trading Principle is to limit your losses on a day that is panning out as not conducive to finishing positive. The market throws two personalities at us. Active, Easy going, Friendly with trade follow-through smooth as butter sometimes. It can be like a charmed day and very conducive and easy to scoring big points. Other days the market can be frustratingly erratic, non-directional, non-committal, non-playable.. etc.. and the odds are against you finishing positive. To avoid falling into the trap of REVENGE TRADING (which will the great majority of the time only serve to make an already bad day much worse) – It is highly recommended to NOT take more than 3 net stop outs during one session. The market does not want to be your friend that day.
TAKE THE HINT…