Take the emotion out of trading with Exitpoint's diversified proven trading-systemTrade Instructions
Day Trades:
The day trades enter the market with the "hobo" approach. This is also known as volatility breakout. The stop-entry order is triggered only for those markets that have started the day in the direction of the trade. Then when the price is hit we jump on board. Most orders go unfilled. The standard exit is to have an objective price and a stop loss price. If either of these occurs the trade is over, if not then the position is exited at the end of the day. All entry orders are day orders and expire at the end of the trading session. An additional early-exit strategy is described below to keep your profits from slipping away when market momentum starts to wane.
Short Entries:
If just before the opening of the pit session, the price has not moved enough to exceed the entry price shown in the recommendations table for day trades, then go ahead and place the day order to enter in the electronic market to sell on a stop. If the entry fills, place a stop loss order for the day at the price shown in the recommendations table. For short positions this would be a buy stop order.
If the price has already dropped below the entry price before the opening of pit trading and afterwards the stop-loss price is NOT hit then use the re-entry method described below to enter the market. You will be trading the short side of the market.
On the rare occasion that the price drops below the entry price and afterwards rallies to hit the stop-loss price in the night session all before the orders are placed at the opening of pit trading, then ignore what happened in the night session and place the entry orders as you normally would at the opening of pit trading. If the market hits the published entry price after the opening of pit trading then it means the downward momentum has been restored and we should be short.
If using the normal entry method and the price opens at the start of pit trading below the entry price the protective buy stop price needs to be reduced by the difference between the entry price and the opening price. The stop loss is not adjusted until after the fill occurs. After a fill, place a limit buy order to exit the position at the objective price. The objectives are just in case of large moves.
Long Entries:
If just before the opening of the pit session, the price has not moved enough to exceed the entry price shown in the recommendations table for day trades, then go ahead and place the day order to enter in the electronic market to buy on a stop. If the entry fills, place a stop loss order for the day at the price shown in the recommendations table. For long positions this would be a sell stop order.
If the price has already risen above the entry price before the opening of pit trading and afterwards the stop-loss price is NOT hit then use the re-entry method described below to enter the market. You will be trading the long side of the market.
On the rare occasion that the price rises below the entry price and afterwards declines to hit the published stop-loss price in the night session all before the orders are placed at the opening of pit trading, then ignore what happened in the night session and place the entry orders as you normally would at the opening of pit trading. If the market hits the published entry price after the opening of pit trading then it means the upward momentum has been restored and we should be long.
If using the normal entry method and the price opens at the start of pit trading above the stop entry price the protective sell stop needs to be increased by the difference between the opening price and the stop entry price. The stop loss is not adjusted until after the fill occurs. After a fill, place a limit sell order to exit the position at the objective price. The objectives are just in case of large moves. The estimated risk is the entry price less the initial stop loss price converted to a dollar value.
All Entries:
Exit all open positions at market on close or earlier at the market if the price moves the daily limit. For practical purposes unfilled entry orders for day trades are canceled at 15 minutes before the close.
After an entry occurs, allow the stop loss orders to work all day and either get filled or expire at the end of the session. Not often, but on occasion the order to exit at market on close and the stop loss will both fill in the last few minutes of day trading leaving you with a reversed position at the end of the day. If this rare event occurs, exit the unintended position as soon as trading resumes preferably in the night session if available.
All recommendations are traded electronically.
The entry orders are placed at 8:00 AM ET for all the markets except for the currencies, metals, and the grains. For the currency and metals sectors most of the price movement will begin during the European trading day. Use 2:00 AM ET (New York Time) as the start of the trading day for the currencies and metals. For the grains use the pit opening time to place the entry orders. Use 2:00 PM ET for the close time of cocoa, coffee, and sugar. For cotton, use a close time of 2:30 PM ET. For the other markets use the pit closing time for the close time.
Some brokers require a few hours of sleep each night and do not have a means of entering orders at 2:00 AM ET. For those that need to wait until 8:00 AM ET to enter the currency orders here is what to do. If at 8:20 AM ET the price has not moved enough to exceed the entry price, then go ahead and place the entry order.
If the price has already exceeded the entry price before 8:20 AM ET, then use the re-entry method described below to enter the market.
The e-mini contracts are traded during the hours for the open outcry session in the larger equivalent contract.
The above instructions are for the basic day-trading system. Below are the rules for early exiting the day-trades. This feature greatly reduces the risk for the day trades. Hence greater leverage and smaller account sizes are required. The performance numbers on the website do not include these early exit rules before 6/16/08. You will need the ability to watch the markets once every thirty minutes throughout the trading day to use the following advice. These additional instructions supplement the ones above for the basic system. You will be using a thirty-minute bar chart that includes the night session prices. After a fill the trading signal is in effect until either there is less than 60 minutes before the end of the trading session or the published stop loss price is hit. If either occurs the trading signal is canceled.
For the Early Exit of Long positions there is one rule for moving the stop loss price closer to the market price. Only apply the rule if it moves the stop price closer to the market price. Never loosen stops.
Always adjust the stop after each bar is completed, raise the stop loss price to one tick below the lowest price of the most recently completed 5 bars.
Re-entry of longs:
If you have early-exited the long position and there is one hour of trading before the end of the day session and the published stop loss price has not been hit, then you should re-enter the market long with the following instructions. If the RSI (9) is less than 70 on the most recently completed bar then place a buy stop to enter at one tick above the highest price of the three most recently completed bars. If the price is already above the highest price of the three most recently completed bars plus one tick then enter long with a market order. It should be obvious that you do not enter short if trading the long side.
If the RSI (9) is 70 or more on the most recently completed bar you avoid re-entry because you are likely to be too late.
Place the initial stop loss sell order for re-entries at one tick below the lowest price of the previous 5 bars.
There may be multiple re-entries as long as time remains (60 minutes) during the day session.
For the early exit of Short positions there is one rule for moving the stop loss price closer to the market price. Only apply the rule if it moves the stop price the closer to the market price. Never loosen stops.
Always adjust the stop after each bar is completed, lower the stop loss price to one tick above the highest price of the most recently completed 5 bars.
Re-entry of shorts:
If you have early-exited the short position and there is one hour of trading before the end of the day session and the published stop loss price has not been hit, then you should re-enter the market short with the following instructions. If the RSI (9) is greater than 30 on the most recently completed bar then place a sell stop to enter at one tick below the lowest price of the three most recently completed bars. If the price is already below the lowest price of the three most recently completed bars minus one tick then enter short with a market order. It should be obvious that you do not enter long if trading the short side.If the RSI (9) is 30 or less on the most recently completed bar you avoid re-entry because you are likely to be too late.
Place the initial stop loss buy order for re-entry at one tick above the highest price of the previous 5 bars.
There may be multiple re-entries as long as time remains (60 minutes) during the day session.
The published performance results will include the re-entry for day trades.
Swing Trades
All Entries:
Before the market opens you place the orders as buy and sell stop orders. The system uses volatility breakout also known as the hobo approach. You jump on board the markets that have starting moving in your direction. You enter long if the price reaches your buy stop price for a long entry or you enter short if the price drops to your sell entry price for a short entry. Most of the entry orders will go unfilled as the market price usually never reaches your entry price. All entry orders are day orders and expire at the end of the trading session.
If just before the opening of the pit session, the price has not moved enough to exceed the initial entry price shown in the recommendations table for day trades, then go ahead and place the day order to enter in the electronic market to buy on a stop. If the entry fills, place a stop loss order for the day at the price shown in the recommendations table. For long positions this would be a sell stop order.
If the price has already exceeded the initial entry price before the opening of pit trading then use the re-entry method described below to enter the market.
For those that do fill you will be notified by your trading platform or our broker or maybe you will happen to be watching the quotes. For the open positions you place stop loss orders at the price shown in the recommendations table. If you are long, this would be a sell stop order and if you are short, this will be a buy stop order. Next you place a limit order to exit at the objective price in the recommendations table. If you are long this is a limit order to sell. If you are short this is a limit order to buy. These orders are to remain open until the next morning open of the trading session. Both the stop loss and the limit orders are good until canceled orders.
For open positions that are still working from overnight when the trading session opens in the morning, there will be a new table of recommended stop loss and objective prices for that day. Change the prices for the stop loss order and the limit orders to the new prices in the table of recommendations for the open positions. Continue to repeat this process each morning for open positions until the position is exited. If the exit occurs from the execution of the stop loss order then be sure to cancel the open limit order. If the exit is from execution of the limit order then be sure to cancel the open stop loss order.
The e-mini contracts are traded during the hours for the open outcry session in the larger equivalent contract.
All recommendations are traded electronically.
The entry orders are placed at 8:00 AM ET for all the markets except for the currencies, metals, and the grains. For the currency and metals sectors most of the price movement will begin during the European trading day. Use 2:00 AM ET (New York Time) as the start of the trading day for the currencies and metals. For the grains use the pit opening time to place the entry orders. Use 2:00 PM ET for the close time of cocoa, coffee, and sugar. For cotton, use a close time of 2:30 PM ET. For the other markets use the pit closing time for the close time.
If you cannot enter the currency orders at 2:00 AM ET, you should still swing trade the currencies. Waiting until 8:20 AM ET to enter the orders shows excellent performance results for the swing trades.
Short Entries:
If just before the opening of the pit session, the price has not moved enough to exceed the entry price shown in the recommendations table for swing trades, then go ahead and place the day order to enter in the electronic market to sell on a stop. If the entry fills, place a stop loss order for the day at the price shown in the recommendations table. For short positions this would be a buy stop order.
If the price has already dropped below the entry price before the opening of pit trading and afterwards the stop-loss price is NOT hit then use the re-entry method described below to enter the market. You will be trading the short side of the market.
On the rare occasion that the price drops below the entry price and afterwards rallies to hit the stop-loss price in the night session all before the orders are placed at the opening of pit trading, then ignore what happened in the night session and place the entry orders as you normally would at the opening of pit trading. If the market hits the published entry price after the opening of pit trading then it means the downward momentum has been restored and we should be short.
If using the normal entry method and the price opens at the start of pit trading below the entry price the protective buy stop price needs to be reduced by the difference between the entry price and the opening price. The stop loss is not adjusted until after the fill occurs. After a fill, place a limit buy order to exit the position at the objective price. The objectives are just in case of large moves.
Long Entries:
If just before the opening of the pit session, the price has not moved enough to exceed the entry price shown in the recommendations table for swing trades, then go ahead and place the day order to enter in the electronic market to buy on a stop. If the entry fills, place a stop loss order for the day at the price shown in the recommendations table. For long positions this would be a sell stop order.
If the price has already risen above the entry price before the opening of pit trading and afterwards the stop-loss price has NOT hit then use the re-entry method described below to enter the market. You will be trading the long side of the market.
On the rare occasion that the price drops below the entry price and afterwards rallies to hit the stop-loss price in the night session all before the orders are placed at the opening of pit trading, then ignore what happened in the night session and place the entry orders as you normally would at the opening of pit trading. If the market hits the published entry price after the opening of pit trading then it means the downward momentum has been restored and we should be short.
If using the normal entry method and the price opens at the start of pit trading above the stop entry price the protective sell stop needs to be increased by the difference between the opening price and the stop entry price. The stop loss is not adjusted until after the fill occurs. After a fill, place a limit sell order to exit the position at the objective price. The objectives are just in case of large moves. The estimated risk is the entry price less the initial stop loss price converted to a dollar value.
Early Exit For Swing Trades:
The swing trades are entered using stop-entry orders. The standard way of exiting a swing trade is for the price to either hit the objective or the stop-loss price. The instructions for the early-exit of swing trades are the same as for day trades with one exception. With the day trades you used a thirty-minute chart. With the swing trades you use a 240-minute chart that includes night session prices for all markets. Each bar is 4 hours. Now this means considerable work for the trader. Since you hold swing trades overnight you will need to check on the charts every 4 hours. But the rewards are substantial. Far too often big gains are not taken off the table when conditions change on an hourly basis. At the current time as a practical matter (brokers have to sleep sometime) I am applying the early-exit for swing trades only during the hours of 8:00 AM ET and 4:00 PM ET. This allows for 3 checks per trading day: 8:00 AM, 12:00 PM and 4:00 PM ET. Most of the price action will occur within these day session hours.
Re-entry of swing trades:
Use the same re-entry rules for swing trades as for day-trades as long as the swing trade signal is in effect. That means the price has not hit the objective or the stop loss price published for the swing position. Of course you will be using a 180-minute chart for the swing trade indicators.
Remember you do not re-enter long swing positions if the RSI (9) is equal to or greater than 70. Or for short positions you do not re-enter short if the RSI (9) is equal to or less than 30. This is to prevent you from re-entering too late in the move.
The published performance results will include the optional re-entry for swing trades.