NDi HELP FILES

Strategies

The AutoTrader is preset with default settings for trade management.
However, the markets do change with ebb and flow.
Sometimes prices move around with great volatility and other times are boring and flat.
This is why you need to be examining the daily trades that have taken place, and make small adjustments from time to time.

Keep in mind, there is NO PERFECT trading management method. It simply does not exist. There will be loosing trades and loosing days. Every trader and investor in the world knows this. Think of your goals in terms of a 'week' or a 'month' and try not to focus on any one particular day.

Market Open

• When the markets open, there is 'unusual' volatility and usually no lasting trend is forming
• Therefore, we do not want to trade, at least, the first 5 minutes after the open (6:30 AM PST)
• It is even prudent to wait 10 - 15 minutes to begin taking signals
• AutoTrader start time is adjusted in the Set 2 tab
• Default Start Time: 06:45 AM PST

Market Close

• The stock market closes at 13:00 PM PST
• The futures market continues for another 15 minutes
• As a futures trader, you must be flat (no trade position) after the futures close
• During the last 15 minutes of the futures, the AutoTrader is not accurate
• So, to be safe, we prefer to not take any trade signals after 12:30-12:45 PM PST
• Default End Time: 12:45 PM PST
• Note: AutoTrader also has the EOD Cancel All safety function to make sure your are flat

Economic News - Geopolitical Events - Holidays

• News events occur each and every day
• Some are important and others not so much
• The biggest news is the FOMC interest rate announcement (Wed) and Non-Farm payrolls (Fri)
• It is prudent to not trade these days or put it in simulation live mode
• If a geopolitical event occurs (plane crash, terrorism, ect) the markets can behave irrationally, and if you are around your computer, just turn off the AutoTrader (AT:ON/OFF button)
• The days just before and after a major holiday can be flat and choppy
• View scheduled news events here

Targets and Stoploss Values

• When markets are running flat, you need smaller targets and stoploss values
• When markets are really moving, you can increase the target and stoploss values
• If you note, more often than not, trades getting stopped out by 1 or 2 ticks, then that is a time to increase the stoploss number, and, also increase the target by at least the same amount
• Of course, visa versa, with lower volatility markets
• Default Ticks: Target - 9, Stoploss - 7

Floor Trade Pivot Levels

• These are precalculated from the previous day's price action
• They are constant for the trading day
• The main level is the 'Pivot Point' aka PP
• Price above the PP is considered bullish and if below, bearish
• There are a total of 7 pivot levels (S3, S2, S1, PP, R1, R2, R3)
• These levels often act as price magnets and provide support and resistance to price movements
• Therefore, it is prudent to avoid taking trades near these levels, called 'no trade zones'
• AutoTrader is set (by number of ticks above and below each level) to avoid taking trades in the zones
• You can choose to trade anyway around the pivot levels, by unchecking 'Engage Zones' in Set 1 tab
• You can adjust the size of the zone by changing the Ticks Front and Ticks Behind values
• Explain by example 1:
  
  
  • Price is going up, near but below a pivot and you get a 'Buy' signal
  • Price may be expected to stop going up at the pivot level (resistance)
  • Therefore, you may not have enough room for your proposed trade to get to target price
    
    
• Explain by example 2:
  
  
  • Price is just above a pivot level and you get a 'Buy' signal
  • As pivot levels can act as magnets, price may not be able to get away from the level
  • So, your proposed trade may not go anywhere and get stopped out
    
    
• Study pivots here and here
• Defaults: Engage Zones - checked, Ticks Front - 6, Ticks Behind - 6
• AutoTrader also includes 2 more important levels: Previous Day High (PDH) and Previous Day Low (PDL)

Trailing Stops

• Determining the initial Stoploss is difficult and trailing stop strategies are no different
• There is no right or wrong answer
• Sometimes you are glad your stop was tight and other times - 'if I only had given it 1 more tick room'
• It is prudent to:
  
  
  • Move the stop up some after price has advanced well toward your proposed target price
  • Move the stop tighter (closer to current price) as you get really close to target
  • Initiate a small 'chase' mechanism when you are at the target
    
    
• AutoTrader allows you to utilize all the above and make adjustments as you gain proficiency
• Gain proficiency by the daily study of the trades along with the charts
• All of the AutoTrader values are in 'ticks' or 0.25 points (the minimum price movement)
• Defaults:
  
  
  • ES Single Stop Move: Trigger - 7, Distance (behind) -6
  • ES Step 1 Trail: Trigger - 8, Distance - 3
  • ES Step 2 Trail: unchecked
  • ES Final 1 Tick Bracket (chase): checked

Trading Size

• Initially trade in Simulation Live mode without risking anything
• Always enter trades with protective Stoploss
• How many contracts to trade with is up to you, but here are some guidelines:
  
  
  • Each ES tick movement is worth $12.50 per contract - Assume your initial Stoploss is 6 ticks
  • This translates to a risk of $75 per contract traded
  • Your risk a conservative 4% of account per trade - Assume an account size of $3000
  • So, 4% of $3000 = $120 risk total
  • You can trade 1-2 contracts per trade (again, all up to you)
    
    
• Conservative trade risks are in the 2% to 6% range

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Trading futures and stocks involves substantial risk of loss and is not suitable for all investors. 
Past performance is not indicative of future results.
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