Day trading is not about indicators. You will not make money because of an indicator or some proprietary gizmo…like the fool who wants $8.5 million. I use Market Profile, which is tool for organizing data, and if you know how to interpret the data, is better than any indicator (proprietary or not).

Let me give you an example using ES futures. I will use today (friday 8/31). Today the ES traded down to 2891.75 and put in the low of the day.

To most people that appears a random price point, but to those of us who use Market Profile, and know how to read the data, that price has meaning as it was the top of the spike from earlier trading day this week. So that price only has meaning if you have the data, know what the data means and the significance.

I had 10 contracts in at 2892, to ensure I got a fill…which I did and got 4 pts, and a quick $2000 profit. There is no way possible for anyone who does not have the tool to know the significance of that price. If price busted through that level, I was prepared with a stop at 2891.50. If I got stopped out, that is what I call the price for information. That tells me something about the buyers in the market and where price is most likely headed from here. However, I knew the market did not have the strength to push lower, so it was a low risk trade. Again, all thing I gleaned from the tools I use and mention below.

I overlay this tool with both the 20, 50 and 200 MA on the 5, 15 and 30 min timeframes, and track the market internals, such at breath, A/D and ticks on the NYSE and NASDAQ, so I know what’s happening real time in the broad market.

If you understand these 3 components you will have a good handle on the market: price, time and volume. Easy to write about, but its the nuances of each component, and how they interact with each other during the day, that paints the picture, and allows you to glean information that others can not see…like the price of 2891.75 as discussed above. Traders that use this kind of data, because they have the tools, are playing at another level, and are able to make decisions about an entry or exit without guessing or speculating, which leads to more confident trading, and more profitable trades.

I always ask myself a few questions each day. What is the market doing, what is market trying to do, and how good of a job is it doing. The answer to these questions tell me how I need to trade, and Market Profile gives the data to formulate decisions on where the market should go and how it should act.

From a productivity trader, I have become a sloth bear.

The last few days have been weird. I don’t feel like trading or writing. These days, I have traveled to many new places and witnessed many exciting situations.

But no impact on my trading!

The reason? I have deployed a few algo systems (based on many indicators and also price action) which take care of the trades even in my absence.

The trouble with indicators is that they behave differently in various market conditions.

The trick is to pick an indicator first, study its variations in different market conditions (uptrend, downtrend, sideways), and then use it in actual trading.

In my opinion, all the indicators are the same. It depends on how a trader uses it.

All the technical indicators available in the market are derived using different variations from the same price information: open, close, high, low, and volume.

All the technical indicators can be broadly classified into 2 categories:

1. Leading Indicators and
2. Lagging Indicators.

Leading indicators are the indicators that lead the price movement. They give a signal before a new trend or reversal occurs.

Lagging indicators are those that follow the price action (little delay). They give a signal after the trend or reversal has started.

All the indicators can be divided into four types, as shown below:

• Trend indicators.
• Momentum indicators.
• Volatility indicators.
• Volume indicators.

For my discretionary trading, I don’t use any indicators. I depend on Market Profile Structure to manage my intraday trades.

But for my algo trading, I use some indicators. I will give a small overview of these indicators.

ADX

Image - ADX Indicator

The ADX indicator has 3 references:

1. ADX line,
2. +DMI and
3. –DMI.

An ADX line above 20-25 is considered a strong trend (either uptrend or downtrend).

If the +DMI line is above the –DMI and ADX is above 20–25, then it is considered that the bulls are in control.

Similarly, if the –DMI is above the +DMI, and ADX is above 20–25, then the bears are in control.

Bollinger Bands

If you are a breakout kind of trader, volatility indicators are the best indicators to manage your trades.

Bollinger Band (BB) is my favorite indicator among all the volatility indicators.

Image - Bollinger Band Indicators

Bollinger Band (BB) squeeze is a popular concept used by most traders to pick good breakout trades.

Basically, when the volatility reduces, the BB also shrinks, and this can be related to a ‘calm before the storm’ concept. A breakout in any direction can result in big moves.

As shown in the above image, a BB squeeze is commonly followed by a breakout. So breakout traders can use Bollinger Bands in their trading system to pick the good moves.

RSI

Relative Strength Index is a famous indicator in the trading world.

It was invented by J. Welles Wilder in 1978 and is most typically used in a 14-period timeframe.

Below are the 2 important concepts of RSI that will be used by many traders to make their trades:

1. Overbought and Oversold conditions (30 and 70 rule).
2. Bullish and Bearish Divergences.

But these traditional fail terribly as they suggest taking the trades in the opposite direction of the trend (I don’t waste much time on these concepts, if you want to know more please visit my website and search for ‘RSI’, you will find a detailed article).

Image - Right way of using RSI

The above image explains the correct way to use RSI.

• When the RSI value is above 60, the price will usually be trending upside.
• When the RSI is below 40, the price will be trending downside.
• When the RSI is in between 40 and 60, the price will be in sideways market.

Image - RSI above 60 indicates uptrend

Image - RSI below 40 indicates downtrend

Above images shows the price trading in north direction when the RSI levels are above 60 and towards downside when the RSI levels are below 40.

I hope this detailed explanation is helpful. If yes, please upvote and share it with your friends.

PS - I am answering one question on the stock market/money/finance topics every day. Follow me if you don’t want to miss my answers.

Disclaimer:

DISCLAIMER

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product.

In view of the above, there can thus be no guarantee or promise given for the success or profitability of investments made. By using this answer, you expressly acknowledge and agree that Indrazith Shantharaj or Profile Traders or Stock Market Courses or any individual cannot be held liable for any and all damage resulting from investments made.

It is very much relating question to me as I personally follow this method in day trading.

Having worked on many trading strategies, especially on intraday trading, I can clearly say that OPENING RANGE BREAKOUT or an ORB is the method that is valid in this technology-driven markets.

Let me answer in detail,

ORB (Opening Range Breakout):

There is a saying that says "amateurs open the market and professionals close the market."

I was not sure about this statement until I worked on the Open range Breakout concept.

ORB is a commonly used strategy among the intraday trading community. TOBY CRABLE is the one who discovered it. It is the most candid yet robust intraday strategy I have seen so far.

ORB trading has numerous modifications, followed by traders all over the globe. Some traders trade close above or below the opening range, while others trade immediately on opening range breakout. The trader's initial time window also varies from 5 minutes to 4 hours.

In this answer, I will compare different variations of ORB strategy with a few simple rules. And I applied these rules on BANKNIFTY, which is highly volatile indices in the Indian market.

(Note: I have used AMIBROKER to develop & Backtesting the strategy.)

Common Parameters used:

Quantities Traded per trade = 50(2 lots)

EOD Square off time = 03:20PM

Initial Capital = 3 Lakhs Rupees.

Backtested Period = 2009 - 2020

Variation - 01:

Entry Rule = Breakout of first 30 min Range with one trade limit for the day.
Stop-loss Rule = 1% from the entry price.
Exit Rule = Either the stop loss trigger or EOD exit.

Equity Curve,

Statistics,

Variation - 02:

Entry Rule = Breakout of first First Hour Range with one trade limit for the day.
Stop-loss Rule = 1% from the entry price.
Exit Rule = Either the stop loss trigger or EOD exit.

Equity Curve,

Statistics,

Variation - 03:

Entry Rule = Breakout of first First Two Hours Range with one trade limit for the day.
Stop-loss Rule = 1% from the entry price.
Exit Rule = Either the stop loss trigger or EOD exit.

Equity Curve,

Statistics,

Variation - 04:

Entry Rule = Breakout of first First Three Hours Range with one trade limit for the day.
Stop-loss Rule = 1% from the entry price.
Exit Rule = Either the stop loss trigger or EOD exit.

Equity Curve,

Statistics,

Final thoughts,

Well, I have shown four combinations here. Like this, many variations can be attempted with the help of the Market Profile & Price Action Concepts. And also, the combination of the trailing stop loss is the added benefit to this strategy. You can also read the book Mastermind of Day Trading to explore many such objective approaches.

There is nothing called as right or wrong here, the only element that differs the Beginner & PRO is the ability of EXECUTION.

"EXECUTION IS THE REAL HOLY GRAIL."

I hope this answer will help you and other readers If you like the content hit the UPVOTE button and share it with your trading friends.

If you have any questions, kindly post them in the comment:)

Happy Trading :)

Nataraj Malavade
Day Trader and trading mentor
Author of Mastermind of Day Trading
Founder of TradeTute

You need to watch-out for any bad news or good news for a specific company which can impact its margin or revenue. This happens typically when a company is about to announce its quarterly / half yearly / yearly results. Depending upon the company perceived performance in the industry, traders take positions. If you are optimistic about the company you can do Buy shares in advance and Sell when the results are announced. The scrip would invariably give a price difference of about 5% to 15% depending upon the quality of results.

Similarly, when there is a sudden breakdown in sensex like August 24th and subsequent days, you should wait and pick-up selective stocks at low prices. After a week or two, the stocks pick-up and again you can make 5% to 15% margin.

At the time of elections which are of national interest, pre-budget time, announcement of any major policy changes like GST etc. the market reacts. You can make use of these events to your advantage..

Good Luck..

Stock Market trading heavily involves analyzing different charts and making decisions based on patterns and indicators. Regardless of whether a trader is experienced, indicators play a vital role in market analysis. The stock market is quite dynamic and concurrent events also heavily influence the market situation. The indicators provide useful information about market trends and help you maximize your returns.

A useful intraday tip is to keep track of the market trend by following intraday indicators. Basically, intraday indicators are overlays on charts that provide crucial information through mathematical calculations. Here is some information regarding intraday indicators:

1.Trend

The particular indicators indicate the trend of the market or the direction in which the market is moving. Typically, the trend indicators are oscillators, they tend to move between high and low values.

2.Momentum

Momentum indicates the strength of the trend and also signal whether there is any likelihood of reversal. Relative Strength Index (RSI) is one momentum indicator, it is used for indicating the price top and bottom.

3.Volume

This indicator shows how the volume changes with time and the number of stocks that are being bought & sold over time. When the price changes, volume indicates how strong the move is.

4.Volatility

Volatility is one of the most important indicators as it indicates how much the price is changing in the given period. High volatility indicates big price moves, lower volatility indicates high big moves.

5.Moving Averages

This provides information about the momentum of the market, trends in the market, the reversal of trends, the stop loss and stop-loss points. Moving average allows the traders to find out the trading opportunities in the direction of the current market trend.

6.Relative Strength Index (RSI)

Relative Strength Index (RSI) is a momentum indicator. It is a single line ranging from 0 to 100 which indicates when the stock is overbought or oversold in the market. If the reading is above 70, it indicates an overbought market and if the reading is below 30, it is an oversold market. RSI is also used to estimate the trend of the market, if RSI is above 50, the market is an uptrend and if the RSI is below 50, the market is a downtrend.

Intraday Indicators

Stock Market trading heavily involves analyzing different charts and making decisions based on patterns and indicators. Regardless of whether a trader is a novice or an experienced, indicators play a pivotal role in market analysis. The stock market is quite dynamic, current affairs and concurrent events also heavily influence the market situation. The indicators provide useful information about market trends and help you maximize your returns. Read this article to know more about the types of indicators and the significance of each indicator.

Key Takeaways

• Fundamental and technical are two types of stock analysis, but the latter may be a better method when it comes to penny stocks.
• Technical analysis doesn't always work when the stock has low trading volume; the more activity a stock has, the more you can trust the pattern.
• Patterns you should look for include bottoming out, price dips, topping out, share consolidation, candlestick, gapping, and going against the trend.

What are Penny Stocks?

"Penny stock" is a term that describes a low priced stock. Penny stocks are stocks that trade under $5 per share. These are common shares of small companies, which is why most of these stocks trade for pennies.

The same like the Forex currencies, most penny stocks trade over the counter, but you can also find some penny stocks listed on major stock exchanges such as the NASDAQ or NY stock exchange.

So, what else you should know about penny stocks?

Some penny stocks have very low volume, which means that it can be very difficult to buy and sell shares of these stocks. Other penny stocks are very volatile and have huge up and down price swings.

You also need to be aware of the pump and dump schemes, and the stock promoters who act as shills to manipulate the penny stock price. The bottom line is that you need to be very careful how you trade penny stocks, and you have to use the best penny stock strategy to survive in these shark-infested waters.

Next, we’re going to highlight our penny stock strategy rules, and how to identify the pump and dump manipulations.

Penny Stock Strategy

Pump and dump trade setups are very vicious. You need to be very fast when trading these penny stocks, so you won’t get caught the wrong foot. Trading the pump and dump setup is like playing with fire. If you really want a safe way to master penny stocks, playing the pump with our best penny stock strategy is the way to go.

We’re going to give you some penny stock tips and a real example of a classic pump and dump setup.

Now, before we go any further, we always recommend taking a piece of paper and a pen and take notes over the rules of this entry method.

For this article, we’re going to look at the buy pump and dump penny stocks.

A useful intraday tip is to keep track of the market trend by following intraday indicators. Basically, intraday indicators are overlays on charts that provide crucial information through mathematical calculations. As the name suggests, the indicators indicate where the price will go next. Here is some information provided by intraday indicators:

1.Trend

The particular indicators indicate the trend of the market or the direction in which the market is moving. Typically, the trend indicators are oscillators, they tend to move between high and low values.

2.Momentum

Momentum indicators indicate the strength of the trend and also signal whether there is any likelihood of reversal. Relative Strength Index (RSI) is one momentum indicator, it is used for indicating the price top and bottom.

3.Volume

Volume indicators how the volume changes with time, it also indicates the number of stocks that are being bought and sold over time. When the price changes, volume indicates how strong the move is. On-Balance Volume is one of the volume indicators.

4.Volatility

Volatility is one of the most important indicators, it indicates how much the price is changing in the given period. Volatility gives an indication of how the price is changing. High volatility indicates big price moves, lower volatility indicates high big moves.

1.Moving Averages

Moving averages is a frequently used intraday trading indicators. It provides information about the momentum of the market, trends in the market, the reversal of trends, and the stop loss and stop-loss points. Moving average allows the traders to find out the trading opportunities in the direction of the current market trend.

2.Bollinger Bands

Bollinger bands indicate the volatility in the market. Bollinger bands are of 3 types: a middle bang which is a 20-day simple moving average, a +2 standard deviation upper bang and a -2 lower deviation lower band. The price of a stock moves between the upper and the lower band. When the market is moving and the volatility is greater, the band widen and when the volatility is less the gap decreases. Bollinger bands help traders to understand the price range of a particular stock.

3.Relative Strength Index (RSI)

Relative Strength Index (RSI) is a momentum indicator. It is a single line ranging from 0 to 100 which indicates when the stock is overbought or oversold in the market. If the reading is above 70, it indicates an overbought market and if the reading is below 30, it is an oversold market. RSI is also used to estimate the trend of the market, if RSI is above 50, the market is an uptrend and if the RSI is below 50, the market is a downtrend.

4.Commodity Channel Index

Commodity Channel Index identifies new trends in the market. It has values of 0, +100, and -100. If the value is positive, it indicates uptrend, if the CCI is negative, it indicates that the market is in the downtrend. CCI is coupled with RSI to obtain information about overbought and oversold stocks.

5.Stochastic Oscillator

The stochastic oscillator is one of the momentum indicators. The oscillator compares the closing price of a stock to a range of prices over a period of time. The momentum of the stock b=changes before the price, hence, momentum is a useful indicator.

There are innumerable signals for trading.

It depends upon your TRADING STYLE, the stock chart price patterns, and other factors as to which to use for trading each stock you intend to trade.

There is no one size fits all with stock trading entry signals.

NEVER use cross over indicator patterns for entries.

ALWAYS use the price candlestick patterns that are actually entry signals and not just reversal or continuation candlesticks. There are specific entry candlestick patterns that are typically several candles not just one.

The best for your trading depends on your trading style, experience level, success rate, risk tolerance, and the current market conditions with the understanding of which market participant group dominated that price and thus created that candlestick pattern. There are plenty of Pro Trader candlestick patterns, which are the best to trade with, as the professional traders of the market are not trading with “scared money” as is common among retail traders and smaller funds managers who actively trade their portfolio.

To learn more about entry and exit signals for the modern stock market of 2022 and beyond, please join my Quora space for Candlestick lessons. I post new lessons regularly.

There are some technical indicators that I use, but I don’t use all at the same time. In fact, I don’t use same combinations in every stock because I try to choose best indicators for that stocks or for forex. Here the list of indicators that I use:

1. RSI: It oftenly takes the 14-day average with criticle lines at 30 and 70. Sometimes, I change its period to 10 and criticle lines to 20 and 80, because RSI can creates very frequent buy and sell signals than normal.
2. Stochastic
3. Aroon: I use it with longer period settings than its main settings since it is a trend indicating indicators.
4. MACD
5. Moving Averages: I use sometimes normal, sometimes exponential or weighted. The periods which I frequently use are MA-5 (One week), MA-20 (One month), MA-100 (Half a year) and MA-200 (One year).
6. Bollinger Bands
7. Ichimoku Cloud
8. TKP: This is custom made indicator that I coded in my app with some help.
9. Fibonacci Bands: This is not fibonacci retracement line! This is the other indicator that I coded in my app with some help.

Hope this helps.

Whether you’re interested in forex trading, commodities trading or share trading, it can be helpful to use technical analysis as part of your strategy – and this includes studying various trading indicators. Trading indicators are mathematical calculations, which are plotted as lines on a price chart and can help traders identify certain signals and trends within the market.

There are different types of trading indicators, including leading indicators and lagging indicators. A leading indicator is a forecast signal that predicts future price movements, while a lagging indicator looks at past trends and indicates momentum.

What is Technical Analysis?

To understand what technical indicators are, you should first know what technical analysis is – and who the people who practice it are.

Traditional financial analysis is related to the basic study of economics: supply and demand.

Fundamental Analysts look at various pieces of data and reports to determine what factors will contribute to an instrument’s future price.

Technical Analysts don’t care about all of the factors – they care about the market’s moves. Price action is the king as a technical analyst.

An undervalued stock has a lower market value than its intrinsic value, which makes it a great investment. Intrinsic value includes many factors about the stock, such as its cash flow, assets, and liabilities. While it can be tricky to pin down the exact intrinsic value of a stock, the simplest method is to use stock ratios to determine if the stock is a good buy. Look for stocks that are both cheap and stable for the best deal. If you keep an eye on the market, you can make a big profit from these undervalued stocks.

Undervalued Stock Indicators.

Low price-earnings ratio.

Lagging relative price performance.

Low price-earnings growth ratio.

High dividend yield.

Low market-to-book ratio.

Free cash flow.

Finding Undervalued Stocks

Study one sector of the market to learn which stocks are undervalued.

Buy stocks during market crashes and corrections.

Check a stock's value after a disappointing quarter.

Use an online stock screener to locate undervalued stock.

Here Are Seven Sigh A Stock Could Be Undervalued.

The Current Ration

Watch The Debt

Positive Earnings

Technical Price Factor

The Price-Earnings To Growth Ration

Price To Book Ratio

Dividend Yield

The Bottom Line

Intrinsic value, and the ratios that attempt to measure it, should only be viewed in the context of a company's whole story. It is also important to consider an investor's financial goals and risk tolerance, as well as the risk-reward potential indicated by other types of analysis.

Thank you for your time.
Happy Trading!
Rashmi Jaiswal :)

In making intraday trading decisions, my approach is heavily influenced by my background in pure mathematics. I gravitate towards quantitative models that can analyze market geometry and dynamics at a granular level. By applying principles of differential geometry, I can model the curvature and shape of price movements to predict future trends with a high degree of precision. This framework allows for a deeper understanding of market structure and liquidity flows, which are critical for timing trades effectively. Furthermore, I leverage deep learning algorithms to parse through vast amounts of market data in real-time, identifying complex patterns and correlations that would be invisible to the human eye. These algorithms are trained on historical data, incorporating a variety of market indicators, including volume, price action, and volatility, to generate predictive models that guide my intraday trading decisions. This allows me informed and strategic trading choices.

All I use is price action and volume slightly.

If the price action is right I trade it, as long as it meets the volume threshold for the time of day (I just use the volume part to estimate liquidity so I dont get killed on slippage when I exit).

I do have the 50 and 200 SMAs as well as VWAP on my charts, just to see if the price bounces off them, but I dont really use them. These seem to be the most helpful indicators, from what I see personally, but my strategy just doesn't employ them.

I look at and have done many back tests with candlesticks (hammers etc), bollinger bands, RSI, standard deviation etc…. Through thousands of back tests I can't find any consistent patterns with these for a standard long strategy. I have found combinations that give amazing results through back testing, but the reason is always either that I over optimized it or it only fit specific market conditions.

I did this last summer. I found a great strategy that gave amazing returns. Then I realized 1/4 of all the trades and 1/2 of the total profit came from a single day. It was the day that the market turned around from covid in march. I dont think we're going to have another day like that any time soon. Through optimization of the back tests I just figured out how the indicators were running that day. I kept trying and ran in to the same problem about 20 times before I quit.

On a more general note, a lot of the strategies that depend heavily on indicators and seem to work well, correlate almost perfectly with the sp500 and NASDAQ during the same time period. This makes them virtually useless because they are just trending with the market as a whole and no one can truly time the market.

What we need are strategies that work in both bear and bull markets.

What is day trading?

Day trading is the act of buying and selling a financial instrument, like a stock or currency, within the same day. The strategy is simply short term and does not look to try and rest on future stock movement. Day trading can be very lucrative for those who know what they are doing but is very risky if you have no idea what to do.

Day trading isn't just a part time thing!

Day trading requires most of the time in your day. Don't start day trading because you have some extra spare time after work and want to make a little extra cash. The process requires a trader to track the markets and spot opportunities, which can arise any time during trading hours. In order to make real money an immediate reaction is required to fully capitalize on any trading opportunity. When you are trading you are competing against others in the market, so in order to get a competitive edge you need to put in a significant amount of effort, more than is required for a part time “hobby”.

There are literally hundreds of indicators that can help you trade. I've looked at several and I use two.

There is a very big danger of having too much information, if you have too much generally you will have conflicting indicators because each one is based or has been designed by an individual or a computer system with its own beliefs.

I prefer to keep it simple, my strategies are based on what has worked for me and my actual trades.

You don't have to fully understand how the indicators work you can read up on them if you like - they're interesting. But you do need to understand how to read them.

I use the RSI which is the Relative Strength Index and the CCI which is the Commodity Channel Index both are indicators and without getting too technical they both do very similar jobs, they tell me the trends and the activity in the market they tell me if a market is oversold (If it's been sold by too many people and is low) or overbought (it's been bought by too many people and is too high) when a stock is at this extreme it will generally bounce back the opposite way. The skill is knowing when to go in.

All you need to really understand is that these two indicators tell you when to put in a trade and when to exit.

Along with these two indicators I use a third guide called the Moving Average. It is a 100 day moving average and it does what it says on the tin. The purpose of it is to act as a guide for when to buy, but much more crucially went to hold and then ultimately went to sell.

My indicator – candlestick chart only.

I didn’t trade penny stocks, but I had experience with stocks, trade it before. I don’t really think that indicators can help in trading penny stocks, I used Technical analysis only based on candlestick chart, high and lows, and some information about company.

I know some Stock traders, and most of them use Fundamental analysis, and company information, rather than indicators.

But, maybe indicators help in trading stocks and penny stocks, I don’t know…

I am Forex trader and for me, every instrument where is candlestick chart, is it Forex or Stocks – are same, difference is only volatility, market movement, speed… Indicators don’t help me in trading, so I don’t use them.

I recommend you to trade from level to level, as market makers do so.

Good luck!

Dorrow Green

I don't engage in day trading or any other financial activities, as I am a text-based AI developed by OpenAI and do not have the ability to trade or invest. However, I can provide information on some common indicators and strategies used by day traders:

Indicators:

1. Moving Averages: Day traders often use moving averages, such as the Simple Moving Average (SMA) and the Exponential Moving Average (EMA), to identify trends and potential entry or exit points.
2. Relative Strength Index (RSI): RSI is a momentum oscillator that measures the speed and change of price movements. Traders use it to identify overbought and oversold conditions in a market.
3. Stochastic Oscillator: Similar to RSI, the stochastic oscillator helps traders identify potential reversal points by comparing a security's closing price to its price range over a specific period.
4. MACD (Moving Average Convergence Divergence): MACD is a trend-following momentum indicator that shows the relationship between two moving averages of a security's price.
5. Volume: Analyzing trading volume can help traders gauge the strength of a trend or identify potential reversals. Higher volume often indicates stronger price movements.
6. Bollinger Bands: Bollinger Bands consist of a middle band (SMA) and two outer bands that are standard deviations away from the middle band. They help traders identify volatility and potential entry or exit points.

Strategies:

1. Trend Following: This strategy involves identifying and trading in the direction of an established trend. Traders use moving averages and trend indicators to confirm the trend's strength and potential entry points.
2. Scalping: Scalpers aim to profit from small price movements by making numerous quick trades throughout the day. They focus on short timeframes and often execute multiple trades in a single session.
3. Day Range Trading: This strategy involves identifying price ranges within a trading day and executing trades when the price reaches the support or resistance levels of the range.
4. Breakout Trading: Breakout traders look for significant price movements beyond established support or resistance levels. They enter positions when the price breaks out of a consolidation phase.
5. Mean Reversion: Mean reversion traders believe that prices tend to revert to their historical averages. They identify overextended price moves and look for opportunities to trade in the opposite direction.
6. Scanning News and Events: Day traders often monitor news releases, economic events, and earnings reports that can impact the markets. They may execute trades based on news-driven price movements.
7. Risk Management: Effective risk management is crucial for day traders. They use stop-loss orders to limit potential losses and set profit targets to secure gains.

It's important to note that day trading carries a high level of risk and requires substantial knowledge, experience, and discipline. Traders should develop a trading plan, use proper risk management techniques, and continuously educate themselves to improve their skills. Additionally, past performance is not indicative of future results, and there are no guarantees of profitability in day trading.

Trading signals may appear to be only used by Wall Street professionals, however, they can be used by regular traders as well. Trading signals are similar to having a friend who is knowledgeable about the stock market, alerting them to potential trading opportunities. It is important to remember that even friends can have bad days, so when receiving a signal, it is important to do some research to determine if it is suitable for you. Additionally, signals often provide clear instructions on when to buy and sell, as well as instructions on when to cash in. Despite the fact that signals can be accurate, the market can still be unpredictable, so it is important to only invest what is within one's ability to lose.

Oh and speaking of insider tips, You should check out this telegram channel “SwiftStock Alerts”. They are like the secret sauce of my trading success. They provide highly accurate signals with clear instructions on when to enter and exit. Trust I’ve been there, done that and got the profits to prove it🚀 Here’s the link to the channel:

I personally don’t use signals but the idea of them is that the signal provider will send you a trade idea that they think is profitable.

They will send it in a group chat or alert system and you would need to copy and paste the information and enter the market.

The problem I see very often is that a signal is called and you miss it or you are busy and you don’t end up taking the trade, and some signal providers do 20 trades a day so it’s just an awful user experience!

This is why I’ve personally opted to use an artificial intelligence expert advisory software the executes trades for me with good accuracy, and doesn’t need me too copy and paste the trade orders at random times throughout my busy day.

If you want to know more info about that A.I software just DM me on instagram @ entrepreneurmatt

• Cheers!

I don't think that signals are a good choice for those who don't know how to trade. This is not instant copying. In forex, the market can move enough in some seconds so your trade won't make enough profit or the losing trades will close with more profit. In the end, your result can be a lot worse than the traders.

I suggest using a free and profitable copy-trading service. These will set the trades instantly on your account. For example, F1M copy-trading had a 600% profitability in the last 3 months and they have a 45% monthly profitability in a 3-year average.

I am sure there are many good copy-trading services for free which can make you more profit and you don't have to worry about setting trades or anything else.

Day trading signals are alerts or indicators that suggest potential trading opportunities in the short-term market. They are used by traders to help identify when to buy or sell a particular asset, based on technical analysis or other factors such as news events or market sentiment. Day trading signals can be generated by software programs or provided by experienced traders, and they are designed to help traders make informed decisions quickly and efficiently.

Do trading signals work?

Mildly, and forget about 80-90% accuracy promises, the only thing sure are the $ 9.99 bucks fee you are going to be wiring every month.

The cost-fee for receiving these signals is irrelevant, but the risk you assume on your money on each trade is not; in the same way the time you waste bogged down within the volatility region inherent of the short-term trading, not being able to obtain sustained profits.

Nature of the Trading Market

The big question is whether the market behavior is purely statistical or purely causal, you can guess the answer of course.

One thing is sure, the market can hardly be modeled as a stochastic process only since a) time invariance in transition probabilities is not guaranteed and b) events (model excitations) are certainly correlated with each other.

So, let's forget about Markov chains for a while.

The only thing I know is that the shorter the trading term is, the more statistical it becomes because the trade is carried out within the volatile region, called noise of the random variable (the stock price)

Short Term

If we talk about intraday trading and binary trading, signals become more meaningful but not due to their fancy algorithms, but because in the end, the people end up joining a coordinated trading effort.

Millions of David’s against one Goliath, yeah! but so far only a social network like for example Reddit (and not a trading signal provider) has the critical mass and the global reach to push through such action to a successfully end.

Look at this marvel $ 14.75 to $ 150 with peaks of $ 350 / share (no signal there, just plain brute force, a coordinated trading effort)

Long Term

Long term trading in the other hand requires a truly monastic dedication to analyze financial statements and so on, in short, getting to know the companies and the market you are investing in.

In this case, it makes sense to hire professional advise far beyond just receiving "trading signals."

Because again, you want to minimize the risk while pursuing time efficiency on profits.

There are Signals and Signals

With that said, let me address something that makes my eyes roll, people self-promoting their own "algorithms".

Gosh, things all these signals have in common,

1. Fancy strange names (Fibonacci infused moving average oscillator bla bla bla pim pam pum)
2. The python coding (honestly, coding, seriously?)
3. A laconic explanation about why averaging the previous day close price and the weight of the sandwich the chap ate that morning would produce a signal that transmutes manure into gold.

In Closing

There are mathematical frameworks that address statistical filtering and associated prediction problems.

These models seek,

1. To predict the most probable values a random signal will reach (volatility)
2. To separate the random noise from the true signals hidden inside (trends)
3. To detect signals of known form (super-cycles, their periodicity, etc.)

The field of application is vast, including Econometrics (per the question), because bottom line, the goal is to predict something of semi-random nature (human behavior + global scale events, including news)

Human mood spreads at wire speed across the globe (we had an example today, May 13, 2021, regarding the ecological cost of mining BTC, the price plummeted)

Just to picture the degree of complexity that it would take to obtain quality trading signals, let me cite the famous paper by Rudolf E. Kálmán that describes a recursive solution to the problem of linear filtering of discrete data.

Kálmán, R.. “A new approach to linear filtering and prediction problems" transaction of the asme~journal of basic.” (1960).

[2]

Other approaches pursue to achieve linear prediction by combining z-transforms and autoregression techniques.

The goal is the same, to get a decent probability distribution of the predicted values on something (symbol quotes) that is semi-statistical in nature.

Bottom line, if I am going to bet my money on an algorithm, it better be very good and complex, one developed by mathematicians, lot of them, working very hard.

And that doesn't cost $ 9.99 a month.

Again, the above is my opinion,

Thanks!

What the Kalman filter formulation looks like, compare it to the "Python Studies" flooding the media nowadays (there must be some substance delivered along with the Python coding)

Footnotes