Futures Trading Across Higher Time Frames

You've decided that futures trading is how you want to participate in the financial markets and the emini contract is your chosen trading instrument. Great! Index futures are a top notch way to make a good living in the markets but you must first decide on a strategy.


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Part of your strategy will be choosing a time frame in which to trade. Large profits are the goal of every trader and this can surely be accomplished if the trader exercises commitment and discipline.

When deciding upon a time frame, the common approach is to choose one that is best suited to the trader's risk tolerance and trading goals. However, regardless of what time frame you choose to focus on, by analyzing the futures market across numerous time frames you can enhance your winning percentages.

A frequent error common to new traders is executing a trade while watching market action in a single time frame. All traders in every financial market, no matter if they are trading futures, stocks, options or currencies have an ideal time frame they favor.

Assesing The Market With Differing Time Frames

Scalping enthusiast could benefit by assessing market conditions with the 5 minute chart in tandem with the one minute chart. Higher chart levels can enhance your view and provide information you may not be seeing at lower level time frames.

A day trader that favors the 15 minute chart should check out the 30 minute and hourly charts as well to improve his view of market internals.

By analyzing the market across at least two higher time frames we can better check for confirmation of the move we are anticipating. Essentially, the higher time frames acting as confirmation is a signal we can use before executing a trade which shows the strength of the set up in both your favored and higher time frames.

If you are a day trader that generally holds a position for extended periods throughout the daily session riding trend for the day using a hourly chart, it is wise to check the daily and weekly time periods as well.

The same goes for the scalper. If you are using a 3 minute chart, you should be using the five and ten minute charts also. With futures trading, some people have three different time frames open all at the same time as well as the NYSE TICK and TRIN charts.

However, trading systems which are based on simplicity typically are the best systems. Over analyzing can create information overload where too much information can cause hesitation and bad judgment resulting in bad execution.

Utilizing more than three higher time frames is more often than not, overkill. Over thinking the set-up presented by the market can make you second guess and miss an opportunity to enter and exit with a profitable trade.

If you are in the habit of trading with one time frame, odds are favorable you're struggling or you would not be reading an article about trading across multiple time frames. Once you start utilizing higher time frames, it will take some trial and error to become comfortable using a different method.

However, the results may well be surprising. You can only trade with the information you have and with a single time frame you do not have all the information you need to increase your winning percentages.

You are more then likely not seeing many opportunities when they present themselves through a one-dimensional view. A three dimensional view is far superior since it provides a wider scope of the market, helping you to react when opportunity is present. Emini future trading using higher time frames in conjunction with the time you favor can only enhance your trading.

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The Best Trading System - Selecting One

A trading system can be as simple or as complex as you wish, however, simple systems tend to do better since they eliminate information overload. If we take in too much information, the decision process becomes difficult which results in bad execution or hesitation, causing losses.

So it is best to exercise some degree of caution when choosing a trading methodology. Simplicity is ideal when we are searching for the best emini trading system to meet our needs.

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If simplicity is the goal, system design is the criteria we should look to first. Is the design of the system built with user-friendliness in mind? Nothing is more frustrating than watching the market and dealing with a difficult system.

It should flow easily between the different modules that make up a system. Your futures broker should provide fast execution when your system reveals a trade set-up and work well with your charting software or time and sales feeds.

Data feeds should be in real-time which require dependable Internet connections from a reputable Internet Service Provider. A back-up Internet connection is recommended should your ISP fail.

If you've ever been in a trade and lose your connection, frantic can best describe the feeling a trader experiences when his ISP goes down. A back up connection is a must since major losses can be the result.

The best emini trading system, as you can see, is not just a single module or one size fits all. Interaction between various tools is a requirement as outlined above.

Trading methodology is the heart of the system. Choosing a time frame to trade will be part of your system. Traditionally, day trading is the method most often associated with index futures trading, with many traders choosing scalping as their approach to the futures market.

Choosing to take small profits many times throughout the day while the daily cash market is open. Others will open positions and trade the overnight sessions when trading is much slower. Some use a combination of both scalp trading and classic day trading throughout the day.

The use of traditional Japanese candlestick charts are used by most index futures traders, while some experienced traders will use only a time and sales screen. Others use a combination of charts, indicators and oscillators to determine when to enter and exit the futures market.

Pivot points around areas of strong/minor support and resistance is another often used methodology and is very productive. As you can see, the choices are varied and trading is available to just about any methodology favored by the individual trader.

Having the best trading system that fits your personality and trading style is what we are after as futures traders. The market is complex no doubt. It is fickle and ruled entirely by the emotions of greed and fear which creates a paradox.

While we see the evidence of emotion every day in the market, we seek out a trading method which eliminates the emotional aspect of trading. Our ideal is to react only to the conditions presented by the market in technical terms, not through fear or greed.

Your system should be of such design that you automatically submit trades based only on technical analysis, without hesitation. Hesitation is the result of emotion which more often than not translates into bad execution and loss.

A good trading system will assist you in determining when to place trades based on market dynamics and technical conditions, not financial news reports, crowd mentality or geopolitical events.

Is there a perfect index futures trading system? No. Is there a trading system that will help you become a proficient? Absolutely! Odds are if you are reading this, you have some experience in the financial markets, most likely as a stock day trader, swing trader or just a long term investor.

Although if you're a long term investor, it is recommended you first read up on technical analysis since you are more likely coming from a fundamental background rather than a technical analysis background.

Short term traders live and die by technical analysis and some education in this area is important before venturing into index futures trading.

As a trader, you can build your own system or you can choose to adopt one of the better trading systems available. However you choose to proceed, finding the best emini trading system will boil down to personal choice and what best suits your trading needs and goals.

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Trading Eminis - How To Win When You Are A New Index Futures Trader

Trading eminis is a vocation which has been proven time and again that just about anyone can learn to be profitable. However, there is one underlying fact that new traders fail to acknowledge when they first begin.

Almost all will lose money initially. Why? Because most will jump into the index futures markets without the necessary knowledge to trade successfully.

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Most will have some background and possibly some varying degree of success in trading stocks. Index futures have the liquidity and movement each day which entice these new traders since stocks may be stagnant and range bound for days on end.

Futures have the ability to generate profits everyday making them the ideal day trading instrument and the number one reason novice traders jump in unprepared.

Which Contract To Trade?

Most realize in order to be successful, they will need to quickly get up to speed and seek out basic information about the futures markets. For example they may acquire information to determine which  contract they prefer to trade such as the DOW YM or the S&P 500 ES contract.

Or they may search the Internet for a live trading room and trade alongside as the moderator calls out trades. Of course most of these live trading rooms charge hundreds of dollars in monthly subscription fees, placing a strain on the new trader's funding sources with most blowing out their brokerage account within the first month or two, quickly leaving the futures markets in frustration.

Trading profitably takes work on the part of the new trader. Being impatient is probably the largest factor attributed to why most new traders fail, never to return to the index futures markets. Sure, they know huge gains can be made on a daily basis, but won't take the necessary time to understand and learn the dynamics of this fascinating market.

Knowledge is key to becoming successful at mini index futures trading!

Keep It Simple

Even more importantly, simple strategies are usually the ones that work the best far more than a tedious and complex system. The good news is, a simple trading system can be learned and traded successfully in a matter of a few weeks, providing the new traders approaches with the right frame of mind.

Most new traders are not unlike small children when Christmas is approaching. Visions of presents under the tree on Christmas morning is what dominates the minds of small children at Christmas time each year. New emini traders have visions of huge gains and piles of money which distract them from what they should be focusing on...learning to trade well.

Trading well has been covered many times here on this website for one very important reason - profits are a by-product of trading well!

Trading Well Begins With The Trader

However, trading well does not begin with adopting a system or strategy, it begins within the mind of the futures trader. The novice trader must first adopt a plan for approaching the market and it begins first with trading discipline.

What do we mean when we talk about discipline where trading is concerned? It's very easy when we first start out as index future traders to easily be swayed by a moving market.

For example, say you are using pivot points or levels of major and minor support or resistance. During the afternoon session when the New York lunch comes to an end as all of the major players return the market starts to show some life after the lunchtime blues.

The market at times can take off quickly and blow through a pivot point or level and the new trader hesitates, not entering the market as planned.

An undisciplined trader will many times force a trade out of frustration and enter the market right when the NYSE TICK is at an extreme and the move is reaching exhaustion, finding himself holding a position at the high of the day as the market recedes as sellers begin shorting the pullback.

The novice trader will then either exit quickly as excitement turns to fear or further increase his loss by holding the position hoping the market will return to the high of the day before the market closes.

The point here is, the undisciplined trader forced a trade because he failed to enter the market based on his trading plan, let emotion take over when he saw the market going up and couldn't restrain himself thinking of the cash he could be making.

The disciplined trader would have stuck to his trading plan and stayed on the sidelines if he missed his planned entry point. He understands the market will always be there and another opportunity is always right around the corner, especially with the amount of liquidity provided in the futures market.

The point is,,,,trade as a disciplined trader and trading eminis can be as profitable as you need it to be.

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How To Choose A Emini Trading Platform

Trading online is much easier now than when the mini sized contracts were first introduced a decade ago due to the advancement of trading technology available over the Internet.

With so much technology available to index future traders it is understandable people experience difficulty when choosing a emini trading platform.

With so many to choose from, as futures traders, we must first determine what are the characteristics that make up a good, usable trading platform.

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When we purchase a new automobile, most people usually take the car for a test drive. The same goes for a trading platform.

The vendor should provide a demo for you to use for a brief period of time to decide if the software is right for you, your trading plan and your personality.

Not all platforms are created equal and a demo can provide invaluable information to make your choice.
So first on our check list is does the developer of the platform provide a demo for you "test drive"?

Make sure the demo provides the data to track the S&P, Dow YM and Nasdaq NQ futures.

Several other factors should be considered when determining which trading platform is best suited for your trading purposes.

Choosing the wrong platform can increase the odds of hindering trading style and failing to profit which translate into bad money management, in this case, capital preservation.

By building your checklist of attributes needed to fit your trading goals and style, you can further enhance your chances of selecting a platform which helps you to be successful.

Although there are several platforms available to future traders, one underlying attribute required is ease of use.

Traders want to trade the markets and spend their time becoming a proficient student of the futures markets, not spending a their time learning how to manage a complicated trading platform.

User friendliness without confusing add on features which require a background in programming is desirable.

There are two types of trading platforms available. One is the stand alone module which resides on the trader's hard drive and the other is a web based online platform.

Accessibility is the strong suit of the web-based online platform. Wherever the trader can connect to the Internet, he can be up an running, trading the market.

A stand alone module based platform requires the trader to be in front of the computer in which the software based program resides on the hard drive.

In this situation, it depends mainly on the lifestyle of the individual emini trader. For those which will be trading from the same location everyday, a stand alone platform is more than adequate.

For those traders that are on the go and travel, an online platform is ideal. Also, online based programs eliminate the worry of computer crashes since the trader can easily access the market through another computer.

One very important aspect of a trading platform is data feeds.

It does not matter if you purchase the best platform on the market, it will be useless without reliable real-time market feeds.

Real-time data is a crucial component of any trading platform and reliable vendors providing data feeds are a must.

It cannot be stressed enough the importance of accurate real-time market information.

If a trader does not have confidence in the information he is receiving, it will result in poorly executed trades which translates into losses.

Very often when traders are going through the selection process of determining which trading platform to use, they fail to consider customer service, including technical support.

Unlike the cash markets which open with the morning bell and close with the sounding of the closing bell, the index futures markets continue to trade after a brief break.

With a market which trades almost entirely around the clock, it is essential that the trader have access to customer support should a problem occur with the trading platform.

If customer support is not available after normal business hours, although the futures market is open, the possibility of losing money is very real if the problem cannot be resolved quickly.

Failing to consider the importance of customer and technical support when choosing a trading platform is a recipe for disaster.

In conclusion, we have discussed some of the most important components which should be considered when choosing a emini trading platform.

Use the demo provided by vendors and spend enough time learning how they work and determine of they are a fit with your trading style.

Become familiar with the different modules and their ease of use and understanding, or lack there of. A trading system is so important to the success of a trader that sufficient time should be spent making sure the system chosen is right for you.

There are many  trading systems available and with enough research, you will find the one that best provides for your trading needs.

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Emini Trading Alerts Software

About Trading Alerts

As a new trader learns how to use trading signals, he will put himself in a place to execute more profitable trades without the need to sift through tons of financial information every market session. First, it is important to understand what is meant by a trading alert or trading signal. Rather than manually reading through trading charts, daily economic reports and a myriad of other financial data, trading systems are available which analyze data for the trader. The system analyze the data turning it into relevant information the trader can use to execute high percentage trades by issuing signals which alert the trader when possible trade set-ups are on the horizon.

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What makes a mechanical trading system great is they provide information both for possible trade entry and elimination of irrelevant information thrown at a trader each day. To be sure, one of the first mistakes a new emini trader makes is failing to spend some time learning the dynamics of the index futures market. Many traders new to the market begin trading impulsively, focused on making a ton of money rather than learning to trade proficiently. Profits are a by-product of learning to trade well and proficiently. This also applies to the use of signals and alerts. New traders fail to take the necessary time to learn a mechanical trading system and don't realize until it is too late that all signals are not created equal. With the usually happening after the rookie has executed a few bad trades and lost money. However, by understanding and employing index futures trading alerts, you can greatly enhance chances of executing winning trades far more than broken, losing trades. This is the power of this kind of system.

Why Emini Trading Using Eimni Trading Alerts

Trading is, without doubt, one of the top money making ventures available to just about anyone with a drive to succeed. Every year, more and more people come to the futures markets hoping to make it big and profit trading the S&P 500 emini, Dow YM emini and Nasdaq NQ futures. Unfortunately, too many think  trading is simplistic and easy when in fact, it is complicated and difficult, especially for those without any market experience. Because of this reason, the Internet has seen an explosion of trading alert services, charting programs and without a doubt, the proliferation of questionable and expensive trading rooms, all preying on those new to the index futures trading market. That being said, there are exceptional services available to inexperienced traders which can quickly get them up to speed, teaching them the skills necessary to become profitable using alerts and signals.

Traditionally, traders have utilized a wide variety of charts and indicators to participate in the index future markets. These traditional tools and their use are still relevant and applied daily by experienced traders. But they require an extended learning curve coupled with many trading losses before becoming useful profitably. The implementation of trading alerts can greatly reduce the amount of losses associated with a learning curve, common to new traders. By relying on these systems designed by experienced index futures traders, accurate buy and sell signals will be issued by the system depending on the condition of the market. By using algorithms, trading software designed students of the markets can produce better results rather than dependence on archaic traditional methods.

 Moreover, new futures traders can, depending on the provider, utilize a demo or pay for a trial period to determine if the alert system fits in within their trading style and personality. Furthermore, by choosing a reputable trading system with built in alerts is a exceptional way to protect trading capital, the life blood of futures trading, until such time the new trader gains a better understanding of the futures markets. Using a reputable system allows the new trader to gain confidence while also allowing him to trade in a real-time market situation.

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