Trading Instructions for Day, Swing, Position and Contra Day Trades
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 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.
Normal 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.
Normal 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 published stop-loss price is NOT hit then use the alternate-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, softs, and the grains. For the currency and metals sectors most of the price movement will begin during the European trading day and often will do so for the softs and grains. Use 2:00 AM ET (New York Time) as the start of the trading day for the currencies, metals, softs, and grains.
Use 1:30 PM ET for the close time of cocoa, coffee, and sugar. For cotton, use a close time of 2:15 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 orders here is what to do. If at 8:00 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 8:00 AM ET, then use the re-entry method described below to enter the market.
The above instructions are for the basic day-trading system. This allows the broker to have someone enter the orders as bracketed orders (contingency orders) at 2:00 AM ET. If the entries are filled the software automatically enters the stop loss and objective prices while the broker sleeps.
Alternate-entry of longs:
If you have not yet entered the long position, your entry price was hit in the night session, 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 enter the market long with the following instructions. If the RSI (9) is less than 70 on the most recently completed thirty minute bar 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 alternate-entry because you are likely to be too late.
Always use the published stop loss sell order for alternate-entries. There is NO need to adjust the stop loss prices during the day.
Once your long position is stopped out that ends the trading in the long direction for the day.
Alternate-entry of shorts:
If you have not entered the short position, and the price hit the entry price in the night session, 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 enter the market short with the following instructions. If the RSI (9) is greater than 30 on the most recently completed thirty minute bar then enter with a market order at the start of a new bar. 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 alternate-entry because you are likely to be too late.
Always use the published stop loss price on the alternate-entry positions. Do not move the stop loss price during the trading day.
Once your short position is stopped out that ends the trading in the short direction for the day.
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 swing trades, then go ahead and place the day order to enter in the electronic market to buy/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 long positions this would be a sell stop order.
If the price has already exceeded the initial entry price in the night session and you are NOT still holding a short position overnight before the opening of pit trading then use the alternate-entry method described below to enter the market. If you are holding a short position from overnight then do NOT use the alternate-entry method. Instead place a day order to enter the electronic market to buy on the published stop price to go long as you normally would.
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.
All recommendations are traded electronically.
The entry orders are placed at 8:00 AM ET for all the markets except for the currencies, metals, softs and the grains. For the currency and metals sectors most of the price movement will begin during the European trading day and often will do so for the softs and grains. Use 2:00 AM ET (New York Time) as the start of the trading day for the currencies, metals, softs, and grains. 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 all other markets use the pit closing time for the close time. This allows the broker to have someone enter the orders as bracketed (contingency orders) at 2:00 AM ET while the broker sleeps. If a bracketed entry order fills the software automatically enters the stop loss and objective orders.
If you cannot enter the currency and metals orders at 2:00 AM ET, you should still swing trade the currencies and metals. Waiting until 8:00 AM ET to enter the orders shows excellent performance results for the swing trades.
Normal 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 and there is not a long position held overnight before the opening of trading then use the alternate-entry method described below to enter the market. You will be trading the short side of the market. If there is a long position held overnight that did not get stopped out then do not use the alternate-entry. Instead place the day order to enter the market short at the published stop price as you normally would.
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.
Normal 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 is NOT hit and there is not a short position held overnight then use the alternate-entry method described below to enter the market. You will be trading the long side of the market. If there is a short position held overnight that did not get stopped out then do not use the alternate-entry. Instead place the day order to enter the market long at the published stop price as you normally would.
On the rare occasion that the price rises below the entry price and afterwards declines 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 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.
Alternate-entry of swing trades:
Use the same alternate-entry rules for swing trades as long as the swing trade signal is in effect with one exception. 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 240-minute chart for the swing trade indicators.
Remember you do not alternate-enter long swing positions if the RSI (9) is equal to or greater than 70. Or for short positions you do not alternate-enter short if the RSI (9) is equal to or less than 30. This is to prevent you from entering too late in the move.
Each morning at the opening of trading the objective price and the stop loss price are adjusted according to the newly published overnight numbers in the trading recommendations. So the published stop loss price is adjusted once per day for each position.
Position 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.
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.
All recommendations are traded electronically.
The entry orders are placed at 8:00 AM ET for all the markets except for the currencies, metals, softs and the grains. For the currency and metals sectors most of the price movement will begin during the European trading day and often will do so for the softs and grains. Use 2:00 AM ET (New York Time) as the start of the trading day for the currencies, metals, softs, and grains. 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 all other markets use the pit closing time for the close time.
If you cannot enter the currency and metals orders at 2:00 AM ET, you should still position trade the currencies and metals. Waiting until 8:00 AM ET to enter the orders shows excellent performance results for the position trades.
Normal 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 and there is not a long signal in effect before the opening of trading then use a market order to enter the market position. 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.
Normal 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 is NOT hit and there is not a short signal in effect then use a market order to enter the market position. 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 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.
Each morning at the opening of trading the objective price and the stop loss price are adjusted according to the newly published overnight numbers in the trading recommendations. So the published stop loss price is adjusted once per day for each position.
Contra Day Trades:
The contra day trades fade the volatility breakout. This system sells rallies and buys dips. The limit-entry order is triggered only for those markets have started the day in the opposite direction of the trade. Then when the price is exceeded we enter expecting reversal in price direction. 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. The trades are selected based on a slew of indicators that foretell that the price breakout will fail.
Short Entries:
If just before the opening of the pit session, the price has not moved enough to exceed the limit entry price shown in the recommendations table for contra day trades, then go ahead and place the day order to enter in the electronic market to sell at the limit price. If the entry fills, place a stop loss order for the day and an objective limit order at the prices shown in the recommendations table. For short positions this would be a buy stop order for the stop-loss.
If the price is already above the limit entry price just before the opening of pit trading and is below the published stop-loss price, then place a market order to enter short. If the price is above the stop-loss just before the opening then do not place the entry order.
The objectives are not targets; they 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 limit entry price shown in the recommendations table for contra day trades, then go ahead and place the day order to enter in the electronic market to buy at the limit price. If the entry fills, place a stop loss order for the day and an objective limit order at the prices shown in the recommendations table. For long positions this would be a sell stop order for the stop-loss.
If the price has already dropped below the limit entry price before the opening of pit trading and is above the published stop-loss price then place a market order to enter long. If the price is below the stop-loss just before the opening then do not place the entry order.
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, softs, and the grains. For the currency and metals sectors most of the price movement will begin during the European trading day and often will do so for the softs and grains. Use 2:00 AM ET (New York Time) as the start of the trading day for the currencies, metals, softs, and grains.
Use 1:30 PM ET for the close time of cocoa, coffee, and sugar. For cotton, use a close time of 2:15 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, use 8:00 AM ET or earlier to enter orders .
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